WBD431 Audio Transcription

Bitcoin is Digital Energy with Michael Saylor

Interview date: Thursday 2nd December

Note: the following is a transcription of my interview with Michael Saylor. I have reviewed the transcription but if you find any mistakes, please feel free to email me. You can listen to the original recording here.

In this interview, I talk to Michael Saylor, the CEO of MicroStrategy. We discuss the evolution of their Bitcoin strategy, technological disintermediation, and Bitcoin as a foundational societal technology.

“People joke like, ‘are you going to be 5% exposed, or 100% exposed,’ I’m 500% exposed. I’m not 5%, 50%, we started with $250 million of capital, we bought $3.5 billion of bitcoin.”

— Michael Saylor

Interview Transcription

Peter McCormack: Good to see you again, Michael.

Michael Saylor: Thanks for having me.

Peter McCormack: Well, thanks for having me.  We're in your place here.

Michael Saylor: I guess I am.

Peter McCormack: The host.  So, the last time we did an interview was about a year ago; it was just over a year ago, October last year.  We did two, covered a lot of stuff, a lot of stuff's happened since, so I want to cover a lot of that with you.  But I'm quite interested to find out just from your perspective what it's been like for you this last 12 months, because there's been a lot of changes for you personally.

Michael Saylor: It's been an educational 12 months.  I think that the first stage of my interaction with Bitcoin was defensive.  I was investing in Bitcoin to defend my treasury.  So, first we had a problem and the focus on the problem was the focus upon a currency war and the debasement of currency and the fact the treasury strategies weren't working.  So, with that kind of stress, we found Bitcoin.

I think the next stage was opportunistic.  It's like, the stock was $120 a share and we thought, "If we buy back the stock at $140 a share, we'll be able to buy some Bitcoin".  So, that was the defensive, very careful rotation of our shareholder base.  The second stage, which started about this time last year, opportunistic, our stock doubled and we realised, "We can actually go and raise money".  And then we thought, "If we're going to raise money, maybe we can buy some Bitcoin with the money we're going to raise".  What better use of proceeds is there?

I think the first convertible debt offering, we came to the market, we wanted to raise $400 million, and we got oversubscribed and we raised $650 million, and that deal was December.  So, we're at the end of November right now, so about a year ago in December, we raised $650 million at 75 basis points, and we bought Bitcoin with it, so that was opportunistic.  I think at that point, people still weren't sure what to think.  I think first they thought we were taking an obscene risk, then they thought, they weren't sure what to think. 

But by February, that deal we'd done in December was the best performing bond issue of the year in the world, for anybody.  So, our stock had gone up by a factor of 10 almost, and the bond tripled, and by February we thought, "This is more than opportunistic, and this isn't defensive anymore, it's not opportunistic anymore, this is a strategy; this is strategic".  So, if you look at our filings, when we filed our 10-K, which is the first quarter, a company that's public has to state, "What's your business strategy?" and our business was selling enterprise software at the beginning of 2020, with a bunch of money on the treasury.

By the beginning of 2021, our business at MicroStrategy was, "Let's sell enterprise software", and a MacroStrategy, "We're going to acquire and hold Bitcoin, and we're going to do that with equity or debt, or any other kind of rational financing".  So, I would say we went through these three stages.  And of course, as you find us today, it's strategic.  Our strategy is to acquire and hold Bitcoin.  The core MicroStrategy business is growing better.  We were not growing when we started this endeavour, and now we're growing 5% to 10% a year, so I feel like it revitalised and infused a lot of vitality and a lot of energy into the core business. 

It certainly infused a lot of vitality into the brand.  The MicroStrategy brand is much better known, the MicroStrategy company is much better known, so it's good for the employees, good for the shareholders, good for the customers.  If you sell enterprise software, then you're selling to CFOs and CEOs and CIOs, and our competitors, Microsoft, SAP, Oracle, IBM, all much bigger, all much better known, and so your number one challenge is, you walk into a place and knock on the door and they say, "Who are you?"  So, a year ago, nobody really knew who MicroStrategy was, but today --

Peter McCormack: They know now.

Michael Saylor: -- a lot of people know who we are.  In fact, the CEO of Microsoft might go on CNBC and talk about Microsoft and get 15,000 views on Twitter.  And I would go on CNBC and get 400,000 views, you know.  So, it's a very interesting thing.  We leapfrogged from being the 100th smallest, or 100th largest enterprise software company, to all of a sudden being more well-known than all these software companies we're competing against.

So, I thought it was a really good year for MicroStrategy; I thought it was a really good year for Bitcoin.  If we look at Bitcoin, I think the same is true.  If you look at Black Thursday, back in March, people were afraid, "Is Bitcoin an inflation hedge?  Is it a safe haven or is it a risk asset?  What's going to happen?"  I would say by June, July, August of last year, it was a defensive strategy, "I have some money, I've got to do something with it and maybe I'll do this Bitcoin thing with it".

Then, I would say by the fourth quarter, it started being opportunistic, right, when Square announced they bought Bitcoin, when PayPal started moving Bitcoin, when people saw institutional adoption, they thought, "Well, maybe it's not just an idealistic strategy for a small segment of true believers.  Maybe this is also a tech investment, maybe this is a risk or Big Tech-type idea with some momentum behind it", and I would say that when we hit Elon Musk Day, I think Tuesday in February, whenever they announced, we crossed the chasm to the mainstream adoption.

I think that the first year of mainstream adoption, you kind of look at it from March 2020 to February 2021, and the second year of mainstream adoption starts in February 2021, and we just have this litany of positive shoes dropping.  The election of Biden was good for Bitcoin, the new Administration and all the regulators, including Gensler and the entire crew, even Janet Yellen and even Jerome Powell, good for Bitcoin, right.  And then, Cynthia Lummis arriving in the Senate, good for Bitcoin.  It turns out six other senators, good for Bitcoin.  Then it turns out a Congressional Caucus, good for Bitcoin.

Then, this parade of activities, the approval of the ETF, the parade of public offerings of Bitcoin miners.  You know, by my count, there'll be 16 at least, I count off the top of my head 16 public companies that are Bitcoin miners by the end of this year, and I'm guessing if I can count 16, there must be 20 or more.  In August of last year before we announced, I don't think you could find a single public company that held $5 million dollars of Bitcoin on their balance sheet, in August 2020. 

Then, all of a sudden, we'll end the year, and every Bitcoin miner by definition is holding some amount of Bitcoin, many of them, like Marathon, buying Bitcoin in the open market.  And I would say, if you look at MicroStrategy's journey from discovery to defensive to opportunistic to strategic, I feel like Bitcoin had the same journey of, it was discovering itself, then it was an opportunity, and now it's becoming a strategy. 

The things that we did, okay we did a $650 million convertible offering, and then we did the $1 billion convert offering, but Marathon did a $650 million convertible debt offering at 1% interest a week ago.  Riot just sold $600 million of equity between 1 October and 15 November.  So, you're starting to see flows of capital into Bitcoin, and you're starting to see a whole array, a cohort of publicly traded companies entering the space, and they're building a bridge between traditional investors and institutional investors, and the 20th century economy and the crypto ecosystem of the 21st century economy and Bitcoin.  So, I would say all in all, a good year.

Peter McCormack: But what has it been like for you personally, because I remember when we spoke previously, you had to talk about the idea to your board and explain to your company what you were doing.  I'm imagining some people thought, "What are you up to?" and you've been vindicated.  But also, your roles, the things you do now, you're spending a lot of time promoting Bitcoin, doing interviews like this on TV.  How has your year personally been, because your role's changed a lot?

Michael Saylor: I would say it went from scary to frenetic to fun!  March of last year was scary and then, if you have to agree to buy back $250 million of stock in order to buy $250 million of Bitcoin, that's a pretty expensive insurance policy.  I'm going to buy out all of my shareholders, or all of my minority shareholders, so that I can pursue this strategy; so, that was challenging and we didn't know what would happen, nobody would know, because no company had ever done it before.  So, uncertain.

Then, stuff started moving at a fast pace, and still lots of uncertainty between September and -- well, I mean if you go from September all the way through this September, what do you have?  You have the entry of Square and PayPal, which is interesting; you have Thanksgiving last year, which was a rollercoaster; you have the end-of-the-year runup, Bitcoin's $25,000 on Christmas Day and then it's $30,000 by New Year's Day, so you've got that; then, you've got Tesla's entry into the market; then you've got the China crackdown and Tesla's rollover and the energy crisis stuff.  And Bitcoin trades from $65,000 down to $30,000 down to $29,000.

Peter McCormack: $64,000 to $29,000.

Michael Saylor: $29,000; that was pleasant.

Peter McCormack: Did you feel any pressure at that point?

Michael Saylor: Just the external pressure.  You have all the external people that are gloating, thinking Bitcoin's going to zero.  But we were constructed -- I've lived through worse.  I've lived through a 99% drawdown in my stock.  So, people are like, "You don't know what it's like in a bear market"; I do know what it's like to be in a bear market.  If you've lived through a 99% drawdown and stayed in business, then you've felt this pressure.  This is nothing compared to that.

Our capital structure is such that we're mostly equity, then the $1.7 billion of convertible debt was unsecured.  So, there's no margin laws, there's no mark-to-market, there's no collateral coverage, so it was primarily just Twitter trolling volatility.  There's always somebody on Twitter that wants to make fun of me.  Bitcoin's $30,000, I bought it at $36,000, and they want to make fun of me for buying it at the top.  They're making fun of me today for buying at the top, "Saylor's buying at the top".  Well, I'm going to be buying at the top forever, because it's going to keep going up.

Peter McCormack: Going up forever.

Michael Saylor: I remember when Bitcoin hit the all-time high at $19,000 and I went and raised $1 billion to buy at the all-time high of $19,000, right, and that makes you $2 billion in less than 12 months, if you buy at the all-time high with 0% money.  So, yeah, I bought the top.  So, I think it's a little bit colourful on Twitter, but it's useful to have lived the life!  I'm not 26, I'm 56, so I've lived through stuff.  This is not the first chapter of my life; I've seen a lot of stuff.

Peter McCormack: But this is a whole new chapter for you, right?

Michael Saylor: That is true, it is definitely a new chapter, and it's new twists and new turns.

Peter McCormack: Is it a whole new thing just to bury yourself into?  Because, one of the things I was going to ask you about, there's a lot of times where you're doing interviews and I'm seeing some of your ideas, and sometimes you're approaching things in a way that people haven't thought about before.  And, I'm wondering, do you just spend a lot of time deep in the weeds thinking about this, strategising?

Michael Saylor: I think a lot, yeah, but I also just think I have the benefit of having 30 years in the software business.  I've launched a dozen different businesses, more than a dozen businesses, maybe two dozen, so I've gone through innumerable product cycles, dozens of product cycles, I've gone through all sorts of different business situations, so I've a lot to draw on. 

Also, I'm an engineer, but my engineering background is aerospace engineering.  So, if you were to say to me, "Mike, what's the best engineering discipline?" I would say, "You want to be an aerospace engineer, because they're truly systems engineers".  If you want to make an aeroplane fly, you have to master all the disciplines of mechanical engineering, and you have to master all sorts of physics, and you have to know elements of civil engineering and elements of ocean engineering and elements of avionics and electrical engineering, computer science.  Every discipline of engineering pops up if you want to make something fly through the air.

So, in systems engineering, you learn all about controls, adaptive control systems.  Every aeroplane is designed to be stable which means that if the plane tips, lift builds up on the wing that's lower, and lift falls on the wing that's higher, so the aeroplane comes back to stable.  That's a first-order feedback loop.  In Bitcoin, that's a difficulty adjustment.

So, people in Bitcoin are like, "Oh, the difficulty adjustment, this is the best thing ever, this is genius".  Well, not really.  I mean, Satoshi was a systems engineer.  If you read Satoshi's papers and you think about how Bitcoin was engineered, it was built by someone that knew engineering very well, because it's an adaptive control system, and they had a target and they had a first-order feedback loop, and the difficulty adjustment is just a first-order feedback mechanism. 

How long have those been in existence?  Every machine ever constructed properly, like every mechanism, had a first-order feedback loop in it.  Early steam engines, the automobiles, thermostats, all the control systems, ballistic missile systems, every electrical engineering system.  So, I think I'm lucky enough just to be able to draw upon basic systems engineering background and a decent practical education.

At MIT, you learn thermodynamics, you learn fluid dynamics.  If I was to describe the motion of water in a swimming pool if you drop a rock in it, you can't describe that with arithmetic.  If I want to describe the motion of air around a body like this, or around a fuselage, you can't describe it with arithmetic, which means you can't describe an economy with one number called "velocity of money" and another number called "inflation". 

It is obvious upon inspection in the first hundred milliseconds that you can't describe a bathtub with inflation, you can't describe an aerofoil with inflation, you can't design a ship or a plane or a car, you can't model an engine, you can't describe the way that heat builds up on a Bitcoin mining rig with arithmetic.  You can't build an HVAC system, you can't even cool a house.  A most basic workman building a house and wiring your bathroom with heating and cooling wouldn't use arithmetic, and they would know that you need to think more sophisticated.

The maths that you would use in describing fluid dynamics or aerodynamics or thermodynamics is vector calculus of differential equations and the like, calculus of variations.  And you're a freshman, 18-year-old at a decent school and they're like, "No, you can't solve a problem with arithmetic".  What is the significance of Isaac Newton?  Well, Isaac Newton gave us engineering-grade maths.  Before Isaac Newton, we didn't have calculus, calculus of variations. 

Why does that matter?  If you build a bridge and you don't want the bridge to collapse, it matters; if you build an aeroplane and you don't want it to fall out of the sky, it matters.  And, if you want to build an electric motor or an internal combustion engine, it matters.  So, Isaac Newton gave us this more sophisticated maths, and Andrew Carnegie gave us steel.  What is that?  It's an engineering-grade metal.  Does it matter?  If you want to build a skyscraper 100 stories high, it matters. 

What did Satoshi give us?  Engineering-grade money, engineering-grade property.  What's the significance?  It's just properly engineered.  With arithmetic?  No, not with arithmetic.  All these things that we think of as modern innovations, aeroplanes, cars, railroads, radio, it just had advanced engineering metals and materials in it, or advanced engineering maths in it.  So, if you have that background, if you're an engineer, that's helpful.  If you have a background in the history of science, that's helpful.

So, one of my degrees at MIT, Peter, was aeronautical engineering and spaceship design.  But the other degree was history of science.  So, starting age 18, I was studying radiation, history of cancer cures, what happens when you introduce a railroad into a culture, what happens to the horse and buggy when the railroad comes along?  Impact of steel, impact of manufacturing, impact of oil, impact of Maxwell's equations.

So, I think that's useful and I was always very fascinated by that, and I wrote the book, The Mobile Wave, in 2012, which is really a history of science, but applied to where I look back a few thousand years and we look at all sorts of interesting things, like why did the English language and the Roman alphabet rise to dominance over the Chinese alphabet and pictographic languages?  Why did the United States take control of the computer science era versus the Chinese and the Japanese?  Why did we dominate digital and why did they dominate analogue?

Those are all things on my mind.  What's the impact of software when it goes from a solid state to a liquid state to a vapour state?  So, thinking about that, what's solid state software; I see you ask, what is that?  That's when you run your software on a mainframe in the back office.  That was the first generation.  What's liquid state software?  That's when you can put it on a laptop, that laptop and carry it around with you.  You brought it to your meeting. 

Peter McCormack: Right.

Michael Saylor: What's vapour state?  Vapour state is when it's run on your watch or on your phone and it's in your pocket.  What's the difference?  Well, you're sleeping with the phone, you're not sleeping with the mainframe.  Therefore, a piece of software can ring you and wake you up in the morning when you're sleeping with it, but mainframe software couldn't.

Therefore, when software went to vapour state, you morphed into things that were magical, like communications techniques.  Now you can have a camera on your phone, a camera in your pocket, a software camera; you can have magic maps in your hand and your phone can talk to you and you can talk to other people.  The world changes when you start thinking about that.  So, what happens when you start thinking about the digital transformation of things that weren't digitally transformed during the first mobile wave?  The mobile wave was digital transformation of photos and music and relationships and communications and maps and books and movies and storefronts.  So, that gives you Google, Apple, Amazon, Facebook. 

If you figure that out in the year 2010, the conclusion is buy Google, Apple, Amazon, Facebook.  Why?  Because they're the digital transformation of the 20th century photos and entertainment and storefronts and communications, and they're just going to be better and they're going to move at the speed of light and you're going to be able to ship a product to a billion people on the weekend for a nickel.  And if Apple can ship a product, a better camera, to a billion people on the weekend for a nickel, Apple's probably going to make a lot of money.  And if Google can upgrade maps so that they're magical, so that the map talks to you and tells you how to drive your car, it tells you, "Don't go to that restaurant", Google's probably going to make a lot of money.

What you conclude is, digital maps are worth a lot more than analogue maps.  Rand McNally was never worth more than $50 million or $100 million.  Look, I've got a library of books here.  What happens if I snap my fingers and I dematerialise the entire library and I print a billion copies of it and I send it to everywhere on earth, and the library speaks to you?  What are the prospects for the company that owns that library?  They're good, really good. 

So, I was thinking with The Mobile Wave that, if you can digitally transform all that stuff, you're going to create a trillion-dollar company, so that's what I did.  You find me in 2020 and I bought Facebook stock, I bought Apple stock, I bought Amazon stock, I bought Google stock.  I rode that wave.  What's the trick?  You buy the dominant digital network while everybody tells you you're stupid.  You hold it and you wait. 

Now, how many people are going to tell you you're stupid, that Google, Amazon, Facebook and Apple will never work?  Nobody, right.  18-year-olds, 6-year-olds, are going to tell you that obviously, Amazon, Facebook, Google and Apple work, but if you go back to 2010, you know what people would have said?  The smartest hedge fund guys on Wall Street would have said, "If Apple stock doubles, we're going to sell your Apple stock and diversify your portfolio, because we're going to do good risk management, because it's too risky to hold Apple if it doubles".  "So, what are you going to do?"  "We're going to buy other computer companies".  They used to say that to me. 

I said, "Well you know, guys, the problem with your strategy is, if Apple is able to dematerialise all these other computers, then Apple's going to eat every other computer company and you won't need any of the other companies.  So, you're going to be selling the winner to buy the losers.  And every time you diversify, you're basically converting the winner into the loser". 

We got to a point, Peter, where Apple made 150% of all the profit in the mobile phone business, which means that collectively, every competitor lost half as much as Apple made so that they could compete against them.  So, you see the fallacy of diversification.  The same has happened in retail.  Amazon won, Walmart kind of kept up, and the next 2,500 retailers lost.  And if you had sold Amazon to diversify, the world's richest man, or Jeff Bezos, is rich because he didn't sell. 

So, we saw that play out, and now let's talk about Bitcoin.  What is Bitcoin?  Well, Bitcoin is digital transformation of gold, maybe; maybe Bitcoin is digital transformation of property, more interesting; Bitcoin is digital transformation of money, very politically charged, ideologically charged term, people fight over what money is; and Bitcoin is digital transformation of energy, no one's got their head around that yet.  But all these things are things that Google, Apple, Amazon and Facebook did not figure out how to digitally transform.  And they're so profound that the people staring at them, the traditional Wall Streeters are like the Kodaks starting at digital photos, and they still haven't quite got their heads around the implications.

Ultimately, you want to make a lot of money on digital photos, you'll probably do it via Facebook and Instagram, more likely even than you'll do it by creating a digital camera.  So, I just think we're at the next decade.  It's just a continuation of the digital transformation of everything in the 20th century.  Marc Andreessen had this phrase, "Software's eating the world".  Smart people have said, "Bitcoin is just software eating money".  But I think the problem with the phrase, "Software is eating money", is it makes it so politically ideologically charged and controversial and confrontational that people's brain kind of cuts off and they either decide they're against or they're for, and you don't really get any further.

I think it's a lot more constructive to think of it in terms of digital transformation of property, or digital transformation of energy, because those are less politically charged terms; they're not so ideological, they're more technical.  It's just a technology.

Peter McCormack: And you're fighting different battles.

Michael Saylor: Yeah, it's very different.  Like, Peter, you have $100,000, you want to save it for the rest of your life, what are your choices?  I could buy $100,000 worth of gold.  Gold's been going up 0% a year for the past ten years; and can I rent my gold?  No, can't rent my gold.  Can I put a mortgage on gold?  Not easy to get a mortgage on gold.  The United States Government's not loaning you money against gold.  Can I put a lien on gold?  What does that even mean?  Why would you ever put a lien on gold?  Can I build an application with gold?  Yeah, you can build jewellery with it, but by the time you build jewellery and sell the jewellery, you'll probably make less money than if you just held the gold, because there's so much expense to fabricating the jewellery and marketing the jewellery and distributing the jewellery.  So, gold is a tricky thing.  $100,000 of gold, I'm not sure of.

A better idea, I buy a rental property, $100,000 condo and then I Airbnb it.  A lot of people have that idea.

Peter McCormack: It's not the worst idea.

Michael Saylor: Yeah, not a bad idea.  Got to be a better idea with Airbnb.  It used to be a rental -- I had a guy that worked for me.  He used to be a house manager.  He quits, because he's got four rental properties and he's operating them.  Okay, well you're an entrepreneur, congratulations to you, but I guess my loss.  But his retirement plan was, "I'm going to buy property, I'm going to fix it up, I'm going to rent it".  A lot of people do that.  I buy a condo or I buy an apartment in a college town, I fix it up and I rent it to the college students and it gives me an income for life.  It's not a bad idea; it's a 20th century idea, and Airbnb is a 21st century twist on the idea to get a higher utilisation on it and maybe a higher yield on it.  So, that's a second idea.

The third idea is I can just buy $100,000 worth of the S&P Index of Big Tech.  S&P's up 14% a year for a decade, Big Tech's up 19% a year for a decade.  Nice thing about it is it's lower headache than owning the property.  On the other hand, you don't really have property rights if you own a security.  The problem with securities versus property, and it's more a deep, philosophical issue, but if I own a building, I have the option, as the property owner, to mortgage it, to sell it, to put a lien on it and to rent it.  When I say put a lien on it, maybe you sell the air rights above your parking lot for $20 million in New York City and you keep the parking lot.

If I own the parking lot and you own a share in my REIT and you have one one-thousandth and you're a limited partner, you don't have the right to force me to sell the air rights.  And you can't force me to sell it, right, so you don't really have any governance.  You can't sell it, you can't put a lien on it, you can't take a mortgage against that, because you're not the property owner, you're the security owner.  So, when you own securities, you're a limited partner with limited rights, and you have impaired rights.  Property rights are better.

Now, if you're a rich person, you can buy a building.  Buying a building, if you're a middle-class person, and if you want to work on the weekends, you can buy an apartment and you fix it up yourself, but it's a lot of work.  So, securities were created to give people the ability to own something, to own an asset that was low maintenance, but you suffer from dilution of the securities, because your property rights are impaired; or, the general partner might issue more securities and you have no control over that.

So, why is Bitcoin special?  Because Bitcoin allows you to buy $387 worth of property.  You can't buy one one-thousandth of a building, but you can buy one one-thousandth of a Bitcoin.  So, this idea that I want to save money for 30 years and I want something better than gold, property is better than gold, because property you can rent and you can mortgage and you can lien.  And I want better than a security.

Property is illiquid, but high quality.  A security is liquid, but lower quality.  Gold is this kind of dumpy dead metal thing, which has maybe got all the liabilities of both.  But it was the best idea we had going, a bearer asset, right, a bearer monetary asset.  So, I guess it's got that going for it.  I can carry a bar of gold around if I could somehow get through an airport with a bar of gold.  Hypothetically, theoretically, it's a bearer asset.  Practically speaking, it's only a bearer asset as long as you don't have that much of it.  When you have a lot of it, it ceases to become a bearer asset anymore and it becomes a pile of rocks. 

So, that's why I think Bitcoin is special, or digital property in general is special.  If we come back to this digital transformation, I think the thing that most people miss is, they keep getting trapped in this debate over, it's currency and the government's going to shut down the currency, and it's opposite to the US dollar, and it becomes a political, patriotic debate.  I don't think that's very constructive, and also it's not a very helpful model or metaphor to think about it.

It would be much better if you said, Rand McNally sold this 500-page atlas and that's here, that's an analogue map.  And, Google sold a digital map.  And, when Google took that analogue map and scanned it, they took the weight out of it, and then they realised they could just go ahead and scan all the satellite images and pretty soon, instead of 500 pages of maps, you had 500 million pages of maps.  Then they took the weight around and pretty soon, instead of 1 million copies of the atlas, you had 1 billion copies.  So, you had 100 million pages and 1 billion copies, and it doesn't take a rocket scientist to figure out that that's a lot more map.

The next thing is, they gave you the ability to expand and contract it.  And if your eyes aren't that good, it's pretty obviously a benefit to be able to zoom in and zoom out, so that got better.  Then the next thing, they started telemetering their Android phones, and they put the traffic on the map, and you could see how fast the traffic is moving on the road.  That's a trick you could never do with an analogue map. 

Then they made the phone start talking to you and pretty soon, the phone can tell you which way to drive, and then they marked all the restaurants, and then they told you when the restaurant was open, and they give you the photos.  Pretty soon, you can get the menu and the photos of the food and the reviews and the traffic and you could see where we're headed here, which is eventually you get in the car and you say, "Take me to a cool place that's open now that I'm going to enjoy", and the car does the rest of the work for you. 

That was a possibility of a digital map, but an analogue map was never going to get there.  What you ended up with was a smarter, faster, stronger map.  And when you went from analogue to digital, you went from something worth a few hundred million dollars to something worth a few hundred billion dollars.  There's no politics in this.  This is not ideology, right, this is just technology.  That's the old way, this is the new way.

If I take digital gold versus analogue gold, it's the same thing.  It's like, okay, that's $1 million worth of gold, that's $1 million worth of digital gold.  That has weight, that has no weight.  That you can't subdivide, that you can subdivide.  You ever try to recombine gold?  You've got to put it into a forge and a fire and it's hot and it's dirty and it's dangerous.  This is clean and quick and easy and free.  That's money that moves at the speed of light that you can programme 1 million times a second that you can give to 8 billion people and fetch back, that is just gold. 

That is worth $5 trillion or $10 trillion, and you can debate whether it's 5 or 10.  Let's say it's $5 trillion is the monetary premium on gold.  I'd kind of rather think that it might be $8 trillion dollars is the monetary premium on gold.  If that's that and this moves at the speed of light, smarter, faster, stronger, it's already 10X better.  Google Maps is more than 10X better than Rand McNally maps.  Apple Music is more than 10X better than the DVD or the CD or the vinyl record or the whatever. 

There's just one last point that I think is really important, which is Einstein said, "Matter is energy and energy is matter".  What is property?  Property is economic matter.  What is money?  Money is economic energy.  Can you convert money into property?  Sure you can.  Can you convert property into money?  Sure you can.  In the 20th century, it takes six months to sell a building, there's a 6% commission, it becomes money, the money loses 1% of its value a month.  Okay, that's the system.

21st century, Bitcoin, you can convert the property into money in a few minutes, the commission is 0.1%, it's liquid, you can move it anywhere in the world and it doesn't lose its energy, right, it lasts forever.  So, is Bitcoin digital money?  Yeah.  Is it digital property?  Yeah.  Is it digital energy?  Yeah.  People are like, "How can it be digital energy?"  "Well, how can that be digital music?  But does digital music exist?  I have a piano, you sit down and you play the piano, I record, I put it in a little file, I send it".  They're like, "But it's not the piano".  "I know, but I sent it around the earth and if you have a speaker and you have a power source and you have a decoder, the music comes out the other end".

"Well, it's not perfectly the same as a piano".  Well, if you actually put a Steinway Spirio Piano on this end and a Steinway Spirio Piano on this end and the file moves between them, then it really is exactly the same.  We pretty much decode it back the way it was.  What's going on here?  Symphony orchestra plays Beethoven's 9th symphony.  The old way was, you have to hire 100 musicians that have spent 15 years of their life mastering a skill and you can listen to Beethoven's 9th. 

The next way is they put it on a vinyl record and it doesn't sound quite as good.  The next way is, I make it digital and I run it out of speakers and it sounds better and then eventually, I run it out of super high-quality speakers and I give it to 8 billion people and they run it 1 million times a year and it's free and it's digital music and it's pretty damn good.  "Can you make money?"  Yeah, a lot of money, a lot of money through the digital transformation of music. 

What I see here is, with digital energy, it's the same exact thing.  I have a megawatt of power.  If I sell the megawatt of power at 12 cents a kilowatt-hour, it's about $1 million.  If I hold energy as a megawatt of electricity, I put it in a battery, I lose 2% of the power every month, I lose 24% of the power a year, a 24% inflation rate on a battery.  If I send it down electricity lines, 6% transaction cost.  Move the electricity ten times, lose 60% of the money.  Hold it for three years, cut the amount in half.  Half-life of electricity in a battery is three years if you have the perfect battery.

It's pretty obvious that's analogue energy.  That's electromagnetic energy.  That's the only way to store it.  I guess I could store it as metallic energy, convert it to steel or convert it to aluminium; energy in metallic form.  Or, I could store it in digital form, convert it to Bitcoin.  You run 1 megawatt of power through a SHA-256 S19 miner, you'll end up with about $5 million or $6 million, $5.5 million worth of Bitcoin right now.  Once you've generated the Bitcoin and your cost is the capital cost of the SHA-256 miner and the engineering to run the centre and the likes, you've got a cost there.  But now you've got digital energy; now your inflation rate's zero; now you can hold it for 1,000 years; you can send it 1,000 times, transaction fee is next to nothing.  It's effectively nothing on the Lightning Network, and you know what it is on the Bitcoin Network.

"But how is it digital energy; how do you get it back to being energy?"  The answer is, I send a billion-dollar block of it to Tokyo, I run it through an exchange.  "Heat exchanger?  Decoder?"  No, I run it through a Bitcoin exchange and I convert it back into yen and I take the yen and I buy electricity from the Tokyo Power Company.  And when do I do that?  Whenever I want to do that.  "Well, what if there is no electricity?"  Well, yeah, if the world comes to an end and there is no Tokyo Power Company, then I guess we can't call it digital energy for Tokyo. 

But that's like, what if there's no speakers and I give you a music file.  If I obliterate all of the speakers and all the computers in the world, then your digital music isn't really digital music either.  And if I obliterate all the iPads, your digital book isn't really a digital book.  I suppose if I obliterate the human race, then all this digital stuff doesn't matter.  But as long as there's a civilisation that can produce electrical energy, I can exchange the digital energy for fiat energy.  Currency is political energy, you can think of it as that, political energy.  Japanese political energy, Russian rouble political energy, Turkish political energy, dollar political energy, Chinese political energy.

So, what do I do?  I swap the digital energy for political energy, I swap the political energy, ie currency, for electromagnetic energy.  You want, you can have steel, mineral energy, or metallic energy.  You want mineral energy, you buy a block of granite.  Granite is mineral energy.  You want liquid energy, buy a bunch of oil.  Maybe you don't want energy, maybe you want matter.  So, I send $1 billion to Tokyo, I buy a building.  Maybe you want to do some work with it.  I send $1 billion to Tokyo and I hire 10,000 people to play Sgt Pepper's Lonely Hearts Club Band or Beethoven's 9th, or whatever, or just do stuff, build me stuff.

What you have is you have the exchange of energy for matter and matter for energy.  And, what's clear is that civilisation is built on top of energy systems, and John D Rockefeller, what did he do that made him the richest man in the world?  He came up with a way to distil crude oil into standard oil.  They called the company Standard Oil.  People don't think about the world "Standard Oil".  Standard oil meant he had one uniform quality of liquid energy that worked, that didn't gum up your engine, that wouldn't blow up in your face, so it was a pretty big deal.  If you can standardise oil, you can standardise energy. 

He basically developed and refined and distributed liquid energy to the world, and it was powerful enough to allow the United States to win both World Wars.  I mean, it tilted the course of western civilisation, because Rockefeller provided liquid energy to the West, and we used that energy to defeat the Axis.  And you can trace the wins in World War I and World War II and many other struggles to the superior energy system.

Peter McCormack: So, is that happening with Bitcoin; are we twisting civilisation again?

Michael Saylor: I think it is.  I think if you look at civilisation and you say, what did we build the 20th century civilisation on, it's like, a layer of liquid energy followed by what?  A layer of metallic energy.  Carnegie gave us steel.  Steel is the apex metallic energy.  Ask any civil engineer, "What's the best material to build anything with?"  The answer is steel.  Ask any aerospace engineer, "What's the best material to build anything with?"  The answer is aluminium.  Andrew Mellon became a very wealthy person, a Patron of the Arts, because of the Aluminum Company of America.

Aluminium, steel, oil, these are all just forms of energy.  One is a metallic form of energy, the other is electromagnetic form of energy.  I mean, Tesla gave us electricity; the other is a liquid form of energy.  You could even argue water, liquid organic energy.  Every city on Earth, where was it built?  The base of a river.  No river, no city.  The water of life?

Peter McCormack: Well, it's energy for us.

Michael Saylor: Yes.  Human civilisation is all about harnessing energy and the obvious networks are a river, a port, a seaport, an airport, a railroad; techniques like electricity, oil, steel, aluminium.  And, radio networks, communications networks and the like eventually giving way to the digital information network, which we call the internet.  And now we have Bitcoin, and what is Bitcoin?  Bitcoin is digital energy.

What makes it energy as opposed to property?  Well, if I create a $1 billion digital hotel and I can move it at the speed of light, it's digital property, it's indestructible.  But the thing that makes it energy is the fact that I can rent the hotel out by the room in it.  I can decompose the hotel into a million pieces, send it to the four corners of the Earth, morph it and then reconstruct it again with no friction and no entropic loss.  So, I know that a digital hotel is better than a bricks and mortar hotel.  Steel and glass is better than bricks and mortar, and digital is better than steel and glass.  But a digital hotel, where I can move it at the speed of light, and I can rent it out by the room, it starts to feel not like matter at all; it feels like energy.

Peter McCormack: Okay, you need to explain this one to me, digital hotel?  How is that?  How am I using that?  Digital money makes sense over physical money.

Michael Saylor: Okay, let's backtrack here.  The Fontainebleau is behind you.  The Fontainebleau has got 1,000 rooms in it, let's say.  A room night in Miami Beach, $400, $500 a night, pick a number.  They can expect 70% occupancy rate.  Okay, you bought the property, you've got the occupancy rate, you've got a lot of fixed cost.  What do you do with the other 30% of the rooms that are empty?  Nothing.  You're going to run 70% occupancy effectively at $500 a room night.

So, what if I make it digital?  Well, my first advantage is, I don't have to repaint it.  I mean, the maintenance costs deteriorate, it's not going to sink into the sand, you're not going to have a hurricane hit it, it's digital, it's evanescent.  So, the maintenance cost on digital property is much lower than physical property, but now it's still 1,000 rooms.  I want to rent out the rooms; what's the equivalent to renting out a room?  It's like if I have $1 million and I loan it to you, that's like renting the room to you.

Peter McCormack: Hold on, are we in the metaverse here?  How am I staying in a digital hotel?

Michael Saylor: We're not in the metaverse, this is real.  This is only metaverse if I do this in Second Life or Fortnite.

Peter McCormack: How do I stay in a digital hotel?

Michael Saylor: You're not staying in a digital hotel, it's a metaphor.  You've got $1 billion and you can buy a hotel with 1,000 rooms and that's a hotel, or you can buy $1 billion of Bitcoin, okay.

Peter McCormack: Yeah.

Michael Saylor: If you have a hotel with 1,000 rooms, if it was a magic hotel, if it was hypothetically digital, the thing that I'd be able to do with it that you can't do with a physical hotel, is I would be able to take the 300 rooms that are empty and send them to Tokyo and Paris and London, where I can rent them.  So you see, if the hotel could be decomposed and moved at the speed of light, I would go from 70% occupancy to 100% occupancy.  Just bear with me and I'll explain.

So, the other thing that you would realise is, if it was -- let's call it a magic hotel to make it easier.  If it's a magic hotel, I could send the extra rooms anywhere on Earth where there was demand for the rooms with the blink of an eye.  And, if you thought about it, you'd realise that half the time, the room is not occupied when someone is renting it.  If you're staying at it, you're not in your hotel.  You've probably got a hotel room here in Miami, but you're not in it.

So, if the hotel proprietor could actually rent that room out by the hour, instead of by the day, then they could double the occupancy of it, because most hotels aren't occupied more than 12 hours a day.  You can't do it in the real world, because you have real-world constraints.  It's too complicated, it takes too long to clean the room up, etc.  But imagine if you had computer programmes that moved instantly, they could just turn the room over and they could not just rent out 1,000 room nights, they could rent out 2,000 room nights, because they would do it twice a day.  Now you're up from 70% occupancy to 200% occupancy.

But then you start to do an optimisation and say, "Well, why would I just constrain the hotel to Miami Beach?  Why don't I move the hotel to Tokyo where the room rate's double if I can sell them out?"  So, now you go from 200% occupancy to 400% occupancy.  And you start to think a little bit faster and you're like, "Why am I renting out the room by the hour?  Why don't I rent out the room by the minute?"  So, instead of 1,000 room nights, or 24,000 room hours, now I'm 60 times 24,000 room minutes.

Then you start thinking, "Well, people will only pay a certain amount of money for a room, but if it was a double suite, they'd pay more.  But if it was a conference room, they might pay more".  So, what if I could just morph the real estate into the highest value use real estate by the minute, and what you see is I'm getting a higher rent on the digital property, because I can change it or reconfigure it every minute to the highest best use, and I can move it to wherever in the world there's demand for it.

Now, what I just described is DeFi, decentralised finance.  Let's apply it to Bitcoin.  Instead of a $1 billion hotel, it's $1 billion of Bitcoin.  And instead of renting the room to sleep in, I'm borrowing the asset, because I need the financial asset, maybe to short it, maybe as collateral, maybe to do something with it; but I'm renting it nonetheless, so I'm paying a fee, 4%, 5%, 10%, something.  But I only need it for a certain amount of time.

So, when your property becomes digital, your maintenance costs collapse, but your yield explodes, your yield triples.  If you have that hotel in Austin, Texas; let's say even worse, you have a hotel in New Zealand and New Zealand locks down, and now no tourists are going to New Zealand, and your occupancy rate goes from 70% to 15%, you're stuck.  The problem in the real world is fixed cost and fixed assets.  Your staff is fixed and the asset is fixed.

The beauty in the digital world is you have no fixed assets and you have no fixed cost.  So, on one side, your risk collapses; on the other side though, your yield, your rental opportunity explodes.  So, if you ask the question, "What's more valuable, physical property or digital property?" the obvious answer is digital property, because you can sell it to anybody on Earth, you can rent it to anybody on Earth, you can rent it at any frequency, at any timescale and in any form, and you can do it faster.

In a hotel, you have to hire human beings to work on the hotel, right.  What if I hypothetically created a robot that moved a million times faster than a human being that worked for free on a fusion reaction and you put that in the hotel?  Would your hotel not be easier to run and more valuable?  You're running a hotel, your costs go to zero.  If all your labour is infinitely productive and free, your costs go to zero.  You can't do it in the real world, because you have to use real people and real mass.  But in what you call the metaverse, right, in your cyberworld, all your work can be done by software, it doesn't need to be done by people.

So, when you digitally transform something from the analogue version to the digital version, you can upgrade it with software, and we see this.  For example, digital maps, it's not people doing the work for Google, it's software doing the work for Google.  Digital music, it's not people playing the music, it's software playing the music; I can upgrade the music.

Peter McCormack: There's still a people input and a maintenance.

Michael Saylor: The people put the stuff in, but you scale it up with software, you don't scale it up with people.  You scale it up with software running on computer chips, and both of them are getting faster and faster and the marginal cost is the cost of the electricity, it's not the cost of the energy.

For example, look at the library around you.  If you want to give this library to a billion people, you have to manufacture a lot of books and chop down a lot of trees.  If Google wants to give this library to a billion people, it costs them marginally nothing.  I mean, a billion times less?  At least a million times less, because it's a digital library, not a physical library.

So, I think my point here is digital property is pretty obviously more valuable than physical property, because you can develop digital property with computer chips and software, and you can develop physical property with bulldozers and steel and glass and people.

Peter McCormack: But the point you're getting at is that all investment now in physical property is an opportunity cost of buying Bitcoin?

Michael Saylor: Yeah.

Peter McCormack: We're still going to need someone to do that though, we're going to need some hotels!

Michael Saylor: Yeah, but maybe now we're getting back to the theoretical issue which is, we're going to demonetise all the physical property in the same way we're going to demonetise the gold.  You still need gold to wear, I have a gold ring on; you still need property to live in; but the value of the property should collapse to the utility value and not carry the monetary premium.

What you see in this world is that we have monetised metals and we have monetised commodities and we have monetised securities and we have monetised property, especially the definition of investment property.  How many people buy a second home because they need it?

Peter McCormack: Very few, it might be a holiday home.

Michael Saylor: Let me state it more precisely.  How many people buy an investment property to rent out to someone else because they needed to do that?

Peter McCormack: I mean, plenty do it because they want the extra income, they want the retirement income, they see it as an investment.

Michael Saylor: Yeah, so they do it to -- they're monetising, or they're converting their fiat currency.  I give you $100,000, you put it in a bank, you know you're not going to get --

Peter McCormack: They want yield.

Michael Saylor: So you have to invest.  So, their choice was, buy stocks, become a limited partner in someone else's company; or, buy a small property where they're a general partner in their own company; or, go into some kind of mixed partnership with two or three other people, where they're a partial partner; or, go buy something like gold that they think will hold value.  These are all being monetised and as Bitcoin grows, Bitcoin is the ideal money.

So, if I decide I'm going to sell my second or third investment property and buy Bitcoin with it, presumably the demand for investment properties and the demand for gold, both of those should decrease.  So, as the demand for those decreases, the price will come down, and so that means that if you wish to buy a first home, it will be cheaper for you.  The price of the property for its utility value will become less, it will approach the utility value.  And, on the other hand, it's a lot better for a person to buy Bitcoin and collect yield forever, without dealing with the issue of, the renter trashed the property and defaulted on the rent and didn't pay you and then a tsunami hit it and the roof collapsed.

Peter McCormack: So, is this why you keep buying Bitcoin?  What was it you said to Squawk, "Stack forever"?  Another 7,000 announced today?

Michael Saylor: The reason we buy Bitcoin is because it's our strategy.  We have a financial strategy, which is to acquire and hold Bitcoin.  We're a public company, we've disclosed it to our public investors.  The real key in the marketplace is you should have a strategy, be transparent about it, and pursue it with integrity.  LVMH has a strategy to acquire luxury brands, and if they buy Hermes tomorrow, no one's going to bat an eyelash.  But, if Bernard Arnault went and he got into a totally different business, if he were to buy Square Cash or Twitter, people would look askance and think, "You're getting outside of your lane, and this is not your expertise".

So, I think the key with a public company is, you need to keep faith with your investors.  They bought my stock expecting me to do this.  They didn't buy my stock expecting me to trade other dogcoins. 

Peter McCormack: Well, they do now; maybe not 18 months ago.

Michael Saylor: Well, we've been very transparent actually.  I mean, you could write a book on this, but the whole point is, before we bought a single Bitcoin, we put out a press release saying, "We're considering buying Bitcoin".  And when we bought the Bitcoin, we put out another press release saying, "We'll also buy you out if you don't like the strategy, and you have 20 days to tender your shares at a premium if you don't want to be invested in a company that owns Bitcoin".  So, we've been very progressive and transparent about what we did.

I guess the deeper question is, why did we adopt that strategy?

Peter McCormack: I think I know.

Michael Saylor: I kind of answered that.  First, we adopted it defensively, then we adopted it opportunistically, then we adopted it strategically, because we've come to the conclusion that Bitcoin is the apex property of the human race and it's digital energy.  If you said, what's the best investment idea 150 years ago, I would have said, "How about liquid energy?  Liquid energy that allows you to power the world and power a ship".  Have you ever tried rowing a boat across the ocean?  Then try sailing a boat across the ocean.

Then imagine, Rockefeller shows up and says, "I have this drum of diesel and you can just put it in and the thing will go three times as fast and you don't need sails anymore and you don't have to worry about the wind, and you probably won't die".  It wouldn't have been a hard sell!  It's pretty miraculous what Standard Oil did.

Peter McCormack: But I think what you were telling me earlier when you started talking about back in 2000-whatever, buying Amazon, Google, Facebook, this is what you're doing with Bitcoin; you're at that point?

Michael Saylor: Something bigger than that, because Amazon, Google and Facebook are securities.  They're securities and they're quasi-digital monopolies, but they're companies that operate a dominant digital network.  And, Bitcoin's bigger than that, because it's not a security, it's property.  That makes it somewhere between 10 and 100 times bigger, because it's property; common property, not a security.  And it's a protocol, it's not a company and it's a deflationary asset.  Those are all inflationary securities.  There's more Amazon stock today than there was five years ago.

So, it's a similar strategy.  Bitcoin is like owning digital gold on a Big Tech network, but it's better than any of the Big Tech companies and it's better than gold.  And so, in that way, it's more powerful, and what I did personally as a personal investor was I invested and took big positions in Apple and Amazon and the Big Tech networks, but it was a personal portfolio investment.  But I would say, what we're doing here is an intent business strategy to commercialise digital energy.

Peter McCormack: So, you're in the energy business now?

Michael Saylor: Yeah.  Come back to Rockefeller.  How did Rockefeller build Standard Oil?  They commercialised liquid energy.  What does that mean?  He basically raised as much money as he could and he bought everything.  He bought everything, cleaned up everything, standardised everything.  He was bullish consistently 40 years running, so bullish on an industry that his great-great-grandchildren were still owning shares of those companies 80 years after he'd dead.  So, it wasn't just an investment strategy, it was something a bit deeper; it's a business development.

Peter McCormack: Did you know you were doing this at the start, or is this something you'd recognised?

Michael Saylor: No, it's like as I said, we started defensive, then it became opportunistic, then it became strategic.

Peter McCormack: And the strategic part's this epiphany?

Michael Saylor: It's the epiphany this is digital energy.  I want to make one more point.  With gold, gold is not digital energy, gold is not metallic energy, not really.  It's a much weaker form, because gold is losing 2% to 3% of its energy value every year, and because you can't really develop gold on a Big Tech network.  And control of gold as an asset rests with the gold bankers.  It's a much weaker thing.

So, because it's weaker, there is no gold company, there is no goldminer, that could pursue the strategy that we're pursuing.  For example, if gold was really money, goldminers would never sell gold, they would mine less gold, they would hoard the gold and they would borrow money to buy more gold.  But you see the opposite with goldminers.  Goldminers overmine the gold, they dump gold on the market, they mine so much gold that they pay a huge 30% corporate income tax, then they still have extra cash, so then they go buy back their debt.  They could borrow money at 2%, Peter, but instead they loan money to banks at 2%.

So, they're mining gold, tearing up the rain forest to mine the gold, to dump the gold, to drive the price of the gold down, to pay the tax so they can loan money, so that they can buy dollars to get a 2% yield.  And then, when they've finished with that, they've still got extra money left.  So, instead of buying gold with it, they dividend that out to you, the shareholder, and then you pay tax on it.  So, goldminers are revving the engine to get US dollars and get rid of the gold.  That's obviously more of a commodity strategy.  If you believed that the price was going to go down, you would sell as much as you could as soon as you could.

But with Bitcoin, you have something different.  With Bitcoin, I think the unique thing here is that it's appreciating, statistically, 170% a year for the last decade, up 225% in a year, and because it's appreciating, you have a different strategy.  Not only can you buy it, like people joke, "Are you going to be 5% exposed or 100% exposed?"  I'm 500% exposed.  5%?  50%?  We started with $250 million of capital.  We bought $3.5 billion of Bitcoin.

Peter McCormack: Hold my beer!

Michael Saylor: We really literally had $250 million in capital, because the other $250 million, I had to give back to the shareholders in the Dutch auction.  So, we had $250 million in capital.  100% exposed would be, buy $250 million of Bitcoin, in a way.  What we did was something different than that.  What we did is we issued equity and we issued debt to buy more, so we expanded the capital structure.  Why would you do that?  Well, you would do that if the cost of the capital is less than the expected return on the asset.  So, what's the expected return on digital property?  170% for the last decade.  Scale it down: 20%, 30%?  

Peter McCormack: It's still worth it.

Michael Saylor: It's a property development strategy, like the related companies or anybody else.  I borrow $10 billion, I build a building, I think I'm going to pay 4% interest, I think I'm going to get an 8% return.  That means I scrape a 4% arbitrage on $10 billion.  But what's more valuable than property?  Digital property.  What's more value than digital property?  Digital energy.  In theory, what is the most valuable thing in the universe?  The answer is digital energy.  Digital energy is the theoretical, most valuable, most highly appreciating asset in the universe.  And, what's the likely yield?  We talked about that before. 

I think the price appreciates with the inflation rate in the fiat frame of reference you're in.  If you're in Turkey or Argentina, it's going up very fast.  If you're in the US, it's just going up.  It appreciates with a technical utility.  When I build it into Coinbase and Binance and Square and PayPal and Apple, whatever, it goes up.  It appreciates with the adoption, as people adopt it as a useful asset.  MicroStrategy adopted it.  Bitcoin didn't go up because of the inflation and it didn't go up because of the technical utility.  The MicroStrategy effect is MicroStrategy adopted it as a treasury asset, then a primary treasury asset, then a financial strategy, and that created $3.5 billion of demand for Bitcoin, one company.

Then, the last reason it goes up is because of productivity of the civilisation, or the productivity of the network of the people that adopt the asset.  If hypothetically everybody in the world uses Bitcoin, 100% Bitcoin, and every other currency disappears, there's no inflation, then Bitcoin will appreciate in value with the productivity of the civilisation, and maybe with the differential utility, if there's any other asset that people might be using.  But if Bitcoin's the only asset and it's the only currency, then it will appreciate in value every year based upon the true productivity growth of the human race, 4%, 3%.

So, what you're looking at long term is, long term it's going to go up 3%, 4% a year, but that might be 30, 40, 50 years out.

Peter McCormack: Well, at that point, you might be looking for other assets to diversify to get better than 4%.  Maybe build a hotel.

Michael Saylor: I guess the distinction I make on that is, there's a macroeconomic strategy and the macroeconomic strategy is I swap a weak asset for a strong asset.  Then, there's an investment strategy, and that's I buy an asset that I think is undervalued or underappreciated by everybody else, and I basically accumulate a portfolio of risk.  You see, I don't think I'm taking risk when I'm a macroeconomic investor.

For example, if you were to say, "Mike, would you rather own pesos or gold?"  I'd say gold.  If you said, "Would you rather own gold than the S&P Index?"  I'd rather own the S&P Index.  "Would you rather own the S&P Index than Bitcoin?"  I'd rather own Bitcoin.  I'm just swapping an asset class for a different one.  I'm not really taking this corporate execution risk.

I think when you're an investor, when you buy Apple or Amazon stock, you're taking execution risk, right.  Amazon might get unionised, Apple has a supply chain, Google can get fined by the EU.  You've got political risk, you've got execution risk.  I mean, Twitter has a new CEO today; what will happen?  That's the risk.  There's no CEO of Bitcoin, there's no CEO of gold, there's no CEO of S&P 500 asset class, there's no CEO of land in Texas.  Those are properties.  These other things are securities.  When you get into securities, you take a heightened degree of risk. 

So, if you're in the business of investing in securities, okay, you're running a hedge fund.  People said to me, "Are you running a hedge fund?"  No, I'm not running a hedge fund, I'm simply making a macroeconomic election.  I don't view it as any riskier than if you lived in Argentina converting pesos to dollars.  You're not a hedge fund to convert pesos to dollars, right, you're saving your money as opposed to investing your money.  I think, will we ever get in those businesses?  I don't know.  That would be an election to take on new types of risk, and that's a long way out, so I don't really much worry about it, because the opportunity for digital energy is just so extreme.

Peter McCormack: Well, it's so early, I think that's the point you're making.  Once everyone has Bitcoin, if it's based on true productivity, it's 4% gain; whereas right now, if you're going to be earning 170% a year, you might as well buy as much of this as you can to protect your wealth and increase your wealth.  But you're buying a lot.  MicroStrategy controls a lot now, but there's no limit to how much you would buy?

Michael Saylor: If you have a publicly traded company that's an operating company, you can hold up to 40% of your assets in a security on your balance sheet.  So, if you're Berkshire Hathaway and you're buying Apple stock, at some point there's a limit to how much Apple stock or how much other securities they buy, because they bump up against this 40% limit.  That's why Berkshire Hathaway will buy a railroad; that's why they own entire businesses, because otherwise they become an investment company, per the SEC 40 Act.  If you're an investment company, well then you can own an entire portfolio of securities, but you lose all the other rights that an operating company has. 

So, MicroStrategy is an operating company and Bitcoin is property.  If we started buying securities, like ETFs of Bitcoin, it would become a security and it wouldn't be property, and then we would start to bump up against all sets of limits.  But you can think of us as maybe the world's first digital property development company.  If I said to you, "I'm going to have a public company and we're going to build on Vegas, or we're going to build skyscrapers in New York City.  Is there a limit to how much of New York City you want to build?"  The answer is, "I want to build it all".

But here's the limit.  The limit is, the natural appreciation in property values is more like 10% a year, if the money supply's expanding at 10%.

Peter McCormack: But there are implications of owning, or controlling, that much Bitcoin, if Bitcoin does demonetise large aspects of property and other assets and currencies as you say, entities that you control could end up controlling, or having a strong financial position.  You could have more Bitcoin than the US Government at some point, if they end take their time to end up buying some.  Do you think about the implications of that?

Michael Saylor: No.

Peter McCormack: You just buy it!

Michael Saylor: Look, if Bitcoin doubles every year for the rest of the decade, it might get to $100 trillion, and I suspect that the money supply expands at 15% in a year, then it's going to double twice, or one-and-a-half times, which means we'd have $1,500 trillion of stuff.  So, if the money supply keeps expanding, and Bitcoin keeps doubling, Bitcoin's going to be 7%.  Well, big deal.  So, at that point, it will be as noticeable as the S&P Index.  And what will we be?  We'll be a small part of it.

But it gets exponentially harder to buy Bitcoin, you might have noticed, right?

Peter McCormack: Yeah.

Michael Saylor: It's gets harder.  We all know that, right.  It's a lot harder to stack at $60,000 than it is at $10,000.  But the people who were stacking at $10,000 are remembering back when they could have stacked at $1,000 regretting that.  Then you get the Max Keisers reminding us how he was stacking at $12, or whatever it was.

Peter McCormack: I know!

Michael Saylor: So, I think everybody just executes their strategy.  We happen to be the first public company out of the gate that established the ability to issue securities to buy Bitcoin.  We established a Bitcoin strategy.  How did we do it?  Well, you know the story, the Dutch auction plus all the various steps.

Peter McCormack: And you shared that publicly, right?  You made it publicly available for other companies.

Michael Saylor: And some people go, "Why aren't more people doing it?"  The answer is, they are.  It's all just a matter of perspective.  As I said, 16 publicly traded Bitcoin miners that I can count off the top of my head, and Riot and Marathon.  There are lots of companies that are coming public that are adopting Bitcoin strategies that are issuing stock, that are issuing debt.  Marathon signed a credit line with Silvergate bank to borrow money against their Bitcoin holdings.

So, you've got banking coming into the space, you've got public companies, you've got FDIC insured institutions coming into the space.  I don't know, I guess there's 30, 35 companies that are getting into the business now.

Peter McCormack: But these are all Bitcoin companies.  Did you think there'd be more companies following your strategy who aren't Bitcoin companies, who saw what you've managed to achieve with this?

Michael Saylor: No, I think it's hard.  I think that they're coming at the rate that they can arrive.  I've said before, when I think of the impediments, one of them is the accounting is prejudicial.  It's difficult accounting, and it's indefinite intangible.  If you have a cash rich, well capitalised company that works really well, that's growing, like an Apple or a Google or a Facebook, then if you were to buy large quantities of Bitcoin, then the accounting converts the volatility into a liability, and you end up taking massive write-downs against your balance sheet, and you also end up with massive gap operating losses.  Then you have to explain that to your shareholders and that takes some courage.  And you have to have a reason.

For example, if you had more money than God, do you really have a reason to do something new?  No.  By definition, you have so much money, you don't have to.  So, the companies that are going to go through this are the ones that need to, not the ones that have infinite money that are growing 20% a year that have digital monopolies.  They're the ones that are run by probably a charismatic, decisive CEO, that either is the founder.  Then, I would bet the people that have -- if you find a value stock run by the founder, who has a controlling interest in the value stock, that's low growth, that has a lot of cash, that's got a low multiple, those are the ones that would have the most to gain, the least to lose.

Whereas, the high-growth stocks; if your company's valued at 20 times revenue, because you're a story stock and whatever you're doing, and then you adopt this Bitcoin strategy, you're thinking, "Maybe my shareholders will blanch, or there'll be some issue, so I have something to lose".  And yeah, you have something to gain, but with digital transformations, generally you have to hit that sweet spot where you don't have that much to lose, you have more to gain, but you have the resources to execute and that's the attacker's advantage. 

That, in a nutshell, describes why most incumbents don't make the digital transformation.  Why did IBM and Nokia and Kodak and Polaroid get hollowed out, and why is Rand McNally not here, etc?  What happened to Xerox?  All of these guys, they have a harder time being really decisive.

Now, who has nothing to lose?  Privately traded Bitcoin miners.  If you're a Bitcoin miner and you're private, you're like, "Well, I should go public".  It's hard, it's harder to go public, but if I go public, my revenue multiple triples.  And if my revenue multiple triples and I keep the Bitcoin, that's good.  And if I can buy more Bitcoin, that's even better. 

The real key to the institutional adoption of Bitcoin in the public markets is a healthy capital market and a window that allows new companies to come public.  And this is why generally, it's the new companies in a capitalist system that bring new ideas, because they have everything to gain, nothing to lose.  It's much harder for an incumbent to transform themself.  It does happen, it's just rarer.  It's a little bit harder, because they tend to be caught by institutional inertia.  The accounting is inertia, the fear of a new thing is inertia. 

We talked about this before.  How many people are critical of Bitcoin that spend 100 hours studying Bitcoin?  Can you name one?  I can't name one.

Peter McCormack: I mean, I'm sure there are, probably because they've had a bad time trading alts, or they've timed the market wrong, or they've overleveraged, but not really.

Michael Saylor: Yeah, so there's a lot of people, a lot of money, a lot of power, but they don't have the motive.  And then what you've got is a lot of people with the motive and they don't have the money.  But when you start to have people with the motive that get into the capital markets, Marathon has $650 million more this month than they had last month, and they had the motive.  So, we're just seeing that.

I said before, sometimes we want it to go faster, but would you really feel comfortable if the asset was growing 500% a year, year-over-year, or would you not think that maybe that's a bit too much tempting karma?

Peter McCormack: We talk about this a lot.  I actually like a more stable growth in the price, I would like the four-year cycle to break so we don't think every four years, it's going to do the same thing, because I think it's not good for everyone.  So, yeah, I don't think it would be great.

Michael Saylor: So, if I said to you, "Bitcoin's going to track at 170% a year for the next two to three years, then 150%, then 120%, then 100%, then 80%, then 60%, then 40%, then 30%", that's not bad, right?

Peter McCormack: I'm happy.  That's good.

Michael Saylor: I used the metaphor before, but the shockwave, we designed one aeroplane that can go faster than the speed of sound, in 1965, the Concorde, and you know the story of the Concorde.  We flew it for a while and it was a struggle and it was never profitable and then it eventually crashed and burned and then we didn't do it again.  So, the Concorde was difficult.  Just about every commercial aircraft, and even all the military aircraft, they fly less than the speed of sound. 

The reason why is the speed of sound if the rate at which air communicates to itself.  The aerofoil is moving through the air and if it's moving faster than the speed of sound, the fluid can't get out of the way, which means you create a shockwave, which creates massive turbulence, which is massive dissipation of energy, massive friction.  This is like breaking the speed limit that nature gave you, like the speed of light, a very important speed limit.  Nature's got these speed limits.

In a hydrodynamic situation, we call it the hull speed, and it's the rate at which a ship can move through the water, and it's determined by Reynolds number, and it's the aspect ratio of the hull.  So, if you have a long hull with a narrow point, it goes fast; and if you have a very wide hull, it moves slower.  When you try to break nature's speed limits, you get shockwaves, you get friction, things explode.  The cost of going faster than the hull speed of a ship is the cube of the velocity.  You want to go twice as fast?  It's eight times as expensive.

So, there's a certain speed with which an asset can monetise.  There's a speed at which Bitcoin can grow; there's a speed at which we can create ETFs and a speed at which we can give banks guidance to hold the asset and a speed at which we can fix the accounting and a speed at which we can educate all the senators and all the congresspeople and all the regulators and all the mainstream media.  And there's a speed at which people with billions of dollars can figure out the new thing.

When you try to go faster than that speed, you delaminate, and that's when you get those sparks.  And we see those sparks, because we're going faster than that speed.  I think it's very healthy if it backs down to whatever that speed is.  And it seems to me that north of 100% a year is about as fast as you want to go.  And if you have something which is really utterly compelling, then you just hook onto it and hold on and let that evolve.  I think we've got a decade of that evolution.  It just takes that long for a signal to move through the civilisation.

Peter McCormack: There is someone who has followed the MicroStrategy strategy, in some ways, which wasn't a company, which surprised a lot of people, which is El Salvador.  I kind of referred to them very early on as the MicroStrategy of countries because actually, you were the first to do this.  There can only be one first company to go and do it like this, and they're going to take the biggest risk in some ways, but see the most benefits.  As other companies start to adopt the same strategy, you get the compound benefits.  

I kind of feel the same for El Salvador.  I feel like as the first country to do it, they've taken the biggest risk.  In some ways, I would say Bukele has taken a bigger risk than you, but we could argue about that separately.  But again, as other countries come on, they'll see the compound benefits of other countries coming onboard.  What have you made of the El Salvador story?

Michael Saylor: We haven't really taken that much of a risk, because if you read the bright-line rules that govern publicly traded companies, it's very clear that a publicly traded company can hold property.

Peter McCormack: I didn't mean that kind of risk.

Michael Saylor: So, our primary risk is our shareholder relations and just communicating to our employees, our customers, our shareholders, our vendors what we're doing, that's our primary risk.  I guess their risk is the same in a way, right, they're communicating to their citizens, they've just got more; their citizens, the businesses and the country and then all the other nations that they integrate with, so they've got a massive communications effort as well.  Our primary focus was balance sheet and their primary focus seems to be more like currency, the P&L side. 

For example, if you're a country, the easiest thing to do would be just to buy billions of dollars of Bitcoin, just buy it.  But they didn't have their own currency.  So, if you have a currency, like your Turkey, and you bought billions of dollars of Bitcoin, then you would be converting your currency into a Bitcoin derivative.  And then, by inference, everybody with the currency owns a Bitcoin derivative, and maybe the currency strengthens.  That's easy to execute.

It's much harder to execute the introduction of a new currency.  And so, I think what they wanted was, they wanted the Lightning Network as a remittance network, and they wanted to put a bank in everybody's pocket, they wanted to give everybody a mobile application that serves as a bank.  So, what do you get with Chivo wallet?  You get a store of value via the Bitcoin asset.  You also have the ability to move dollars around, so you've got the stablecoin, or the stable currency, in the form of dollars.  You've got the Bitcoin as the store of value asset, and then you've got the Lightning Network as the remittance network. 

So, they're sidestepping Western Union, they're sidestepping Visa, Mastercard, they're sidestepping the need to roll out branches of banks, and they're introducing a new ideology, a discipline of Bitcoin as store of value, or introducing digital property into their country.  And then of course, they paired it with some favourable tax laws, that would cause a Bitcoin or crypto entrepreneur to be attracted to El Salvador, and those I get.  And then, they've got the added twist of the volcano mining, which is a separate thing; let's monetise a volcano.

What I think, Peter, is I think the world wants two things in a big way.  The world wants digital property in lieu of gold, in lieu of analogue property and investment property, and in lieu of holding securities.  So, they want digital property at any scale, at the speed of light, friction-free, to 8 billion mobile devices, and that is Bitcoin.  And they want trillions of dollars of it, $10 trillion, $20 trillion, $100 trillion, $200 trillion; they want that.  A lot of people don't know they want that, but I guess I would say 5% or 10% of the people know that they want that.  The other 90% don't know, but they'll figure it out.

Saylor, the engineer, thinks what they really need is digital energy, and most people definitely don't get that.  I think the entire 21st century economy needs digital energy, which means $500 trillion worth of digital energy moving at the speed of light, friction-free, from 8 billion devices across 100 million companies, no power loss, super conducting network; that's what I think.  I don't think most people know they want that.  I think a lot of people know they want digital property, but I think even more people want digital currency.  And by digital currency, I mean they want the US dollar.  They want the US dollar stablecoin on a crypto rail, let's say the Lightning Network, but it could be any network, they don't really give a crap.  What they want is they want…

I'm in Turkey -- you follow the news?  I'm in Turkey, I have lira, I want to convert my lira to dollars.  Okay, my lira's dollars, it's not going to debase, but it's in a Turkish bank.  How long before an edict comes out freezing the bank accounts and converting your money from dollars back into lira and devaluing it for you?  I mean, that's the Argentine playbook, right; that happened to me, that happened to Lebanon, that happened in Cyprus, it happened in Russia, it happens in every currency collapse.  It happened in Afghanistan. 

So, if you're in Turkey or Argentina, or wherever, what you want is dollars, but you can't get the dollars, because there's no bank.  If there was a bank, you don't trust the bank.  So, if I were to go to the street, if I were to take a poll of 100 people in Africa or South America or Asia and I would say, "How many of you would like to convert all your local currency into dollars?"  Name one currency in the world that's stronger or more desirable than the dollar, and don't say Bitcoin, but say a fiat currency.

Peter McCormack: Swiss franc?

Michael Saylor: Maybe, maybe debatable, maybe.  Not Chinese, not CNY.  We could have a little debate, but the Chinese currency would collapse if their capital controls came down.  The reason they have capital controls and the Chinese wall is because literally, they printed too much CNY, the currency would collapse and they've hyperinflated the economy.  Their multiples on the Shanghai Stock Exchange are 3X and the US stock multiples two years ago. 

So, if you think about it really hard, you realise the Chinese have an inflated currency, we know the Brazilians do, we know the Venezuelans do, we know the Argentines do, fill in the point.  We can debate, are the Europeans better custodians?  Not clear.  But the bottom line is, everybody in the world, they either want the dollar, or they want a currency pegged to the dollar.  What you would say about a euro or a Swiss franc if you liked it is, I like it because their bankers make sure that their currency stays stronger than the dollar.

Peter McCormack: Well, one of the things that's been really interesting about travelling a lot over the last two years is the amount of places where the dollar is accepted, which is incredible.  It's not like that with the pound.  I mean, the pound is fairly stable, but I can only spend the pound in the UK, that's it.  But I've been to a number of countries around the world which will just accept the dollar. 

They had it in Cambodia.  The interesting thing in Cambodia, they didn't want any creases in.  Most of South America, people want dollars.  It's liquid in a lot of countries.

Michael Saylor: Something I observed, and I travelled in Europe before the euro, and I'm sure you did too.  Before the European Union, I travelled around, many are all using different languages.  Different currencies, different languages, money changers, the signs are all different languages.  After the euro, one thing I noticed is all the menus switched to English, which is very interesting to me.  It was always English and Italian, English and French, English and Greek, at least in the wealthier part of the EU. 

What I saw was the European Union crushed every local culture, and also crushed every local currency.  If you look at currency exchange, everything collapsed to the US dollar after the EU formed.  It used to be the dollar was 30% of currency exchanges, then 40%, then 50%, and eventually it got to be 90%.

Peter McCormack: I'm not sure local cultures have been that crushed.  I've travelled a lot round Europe, spent a lot of time there.

Michael Saylor: I think my point is the English language spread rapidly with the rise of the European Union, and you know why; because the Europeans needed English to communicate with each, and the dollar spread.  And so, what we've seen for the last 21 years is a trend of the spread of the dollar and the spread of the English language.

Let's come back to the dollar.  The big idea is 180 currencies, 60 of them are pegged to the dollar, 66.  There's 130 floating currencies.  How many do we need?  How many really can compete?  Not more than a dozen.  So, I really think what you're going to see is, if the citizens had their choice, you would see the collapse of 100 currencies overnight and everybody would switch.  There's not a single South American currency that would survive, not a single African currency that would survive.  The euro, the yen maybe; the won is weak; the CNY is weak; the rouble, no. 

The question then is, why haven't they already?  The answer is because there's no digital dollar.  There's Tether, which is an entrepreneurial digital dollar, Tether and Circle.

Peter McCormack: Actually, if you speak to Alex Gladstein, he's a huge support of the Tether, because it's absolutely essential for people in places like Palestine.

Michael Saylor: Who is?

Peter McCormack: Alex Gladstein, Human Rights Foundation.

Michael Saylor: Yeah, yeah.

Peter McCormack: Places like Palestine or Lebanon, places where the currencies are collapsing and people talk about them needing Bitcoin, but Bitcoin is still volatile.  Bitcoin isn't the stable currency they need for day-to-day, and he talks about Tether being super important.

Michael Saylor: Yeah, and it is.  Tether is the first entrepreneurial example of a digital dollar, but it's a security.  There's a company behind it, there's people working in it, it is not a property and it is not an FDIC bank and it is not a public company and there are no auditors and people are not quite sure what backs it.  So therefore, we have seen stablecoins go from nothing to $130 billion.  I guess, what, $30 billion to $130 billion in 12 months or so, a massive explosion, but the world wants $10 trillion worth of this; it doesn't want $130 billion.

It's one of those things where the use case right now is the grey market and offshore crypto exchange settlement and crypto trading and hobbyists and crypto specialists.  The use case that would drive it to $10 trillion would be everybody on the planet using it to send money around, like Apple Pay, to everybody; or, global remittance of multinational corporations.  When Apple and Amazon and Facebook and Google and Exxon Mobile and governments move money via stablecoin, right, it won't be $100 billion, it won't be $1 trillion, it might not be $10 trillion, it might be $20 trillion, $30 trillion, $50,000.

So, the real opportunity is digital currency, you just have to trust it.  I think if you look at the regulatory actions in the past three months, the President's working committee on stablecoins published their report and the message is clear, which is, "We want FDIC chartered institutions to issue stablecoins and if you're not FDIC insured, you need to stand up to the same standards as an FDIC approved bank".  I read it as, it's a transition from the first decade, where the industry was entrepreneurial, and Circle and Tether are entrepreneurial, and Gemini and Binance, they're entrepreneurial and good for them; they made it work.

But the next phase is institutional, which is we really want JP Morgan to issue $1 trillion of stablecoin.  But if you're Tether, maybe that's not so good for you, or maybe it is.  If you're Silvergate, you're kind of here, Silvergate doesn't want JP Morgan to do it; Silvergate wants to do it.  And then, Tether is here.  And what you have is you have the early movers that deliver the products, and then you have the institutional late adopters that are staring, and then you have the ones in the middle.  Silvergate is just as progressive as MicroStrategy. 

Silvergate, MicroStrategy, Coinbase, we're all crossing-the-chasm companies.  All three are publicly traded, and so we have one foot in the Bitcoin world of decentralisation, in the crypto world, and another foot in the institutional regulated world.  And we have an opportunity to grow.  I think that, if we come back to this point that I was making, it is undisputed that the world wants trillions of dollars of stablecoin, we know they want it, and it's pretty clear the world needs trillions of dollars of digital property.  A lot of people know it, not everybody knows it.  Those two things are clear, everything else is murky; the rest is unclear.

Coming back to El Salvador, they've got a currency.  The real currency is the dollar, the property is the Bitcoin.  The entire system would work much smoother if you had US dollar stablecoins moving on Lightning rails.  I think the reason they had to make Bitcoin legal tender was because they couldn't move the US dollars back and forth through the Lightning wallet properly using Bitcoin, because Bitcoin's a transport protocol, to move the money across borders, or something like that.

Peter McCormack: I'm not sure on that one.

Michael Saylor: You might have some other insight, but feel free to share.

Peter McCormack: I think it was for a number of reasons.  I think actually, one of the reasons they wanted to do it was to get more Bitcoins in the country, owned by individuals, the state, companies, because they wanted to mitigate the effects of dollar debasement.

Michael Saylor: Yeah, I suppose it encourages that, and I'm all in favour of that.  But I guess my view on all this is it doesn't really make sense for Bitcoin to be spent on anything.  We come back to the fundamental issue.  The rational construct is an inflationary currency and a deflationary property.  If you think about this really deeply, you don't really want to buy a Tesla with a Bitcoin, because Bitcoin's going to $1 million and the Tesla's going to zero.  What you want to do is borrow $50,000 in dollars at 4% interest to buy the Tesla, and then in ten years you'll have the $1 million and you'll be able to buy another Tesla, and then you'll have $10 million.

If what you want is to construct a system that makes you wealthy and keeps you wealthy and keeps all the gears of commerce spinning, the system that works best is everybody holds a digital currency and they hold a digital property, or a digital asset; they're both technically assets, which is why I distinguish one as property and one as currency.  And then the strategy long term is you keep financing the property to the currency.  And it's actually of benefit to you.

For example, if you live in Argentina and you can own Bitcoin, you don't want to pay for things with Bitcoin in Argentina, you want to borrow pesos against the Bitcoin and pay for things in pesos, because the peso is worth 1% of what it was ten years ago.  So, if you borrowed 1 million pesos, it's going to zero and the Bitcoin is going to the moon.  So, you really want both.  You want to discourage people from ever selling or trading the Bitcoin, and what you really want to do is accelerate the development of a Bitcoin banking sector, where you can own the Bitcoin and borrow against it and securitise it.

So, I think El Salvador's a complicated case because they don't have a currency, so if you had a currency, it would be different.  They don't have a currency, they have to have the US dollar.  I think it's pretty clear in the rest of the world though.  If we come back to this issue of currency, Peter, there are 100 million companies and every company has accounting systems that are wired for paying their employees and paying their vendors and signing their products in the fiat currency in the country in question.  So, the accounting system is the nervous system of all those companies. 

The nervous system of the companies is set up, so Oracle and SAP are the only two companies that compete really favourably against Microsoft.  They own the accounting systems of every big company in the world and they're almost impregnable.  If you wanted to rip out the accounting system of Coca Cola and you spent a decade and you had $10 billion, you probably couldn't do it, in a decade for $10 billion.  If I held a gun to your head and I said, "I'm going to kill you and shoot everybody in your finance staff if you don't rip out the accounting system", they'd all be dead.  The accounting system isn't changing, it's that inertia.  It's literally like trying to rip out all of the veins and all of the nerves in your arm and keep the arm. 

Peter McCormack: It's a brain transplant.

Michael Saylor: It's too integrated.  So, the economy of the world is wired to run on those currencies, and the only way that you get rid of the currencies is you arm-wave away every government and every corporation.  So, if you can imagine a future where you don't need companies and you don't need governments, then you can probably not have the fiat currency, but it's definitely not going to happen in this decade, that's for sure.

Peter McCormack: Well, that's an interesting segue, because we can talk about the revolution versus evolution, because there's a certain cohort within Bitcoin of people who consider themselves sovereign individuals, or who seek the sovereign lifestyle, who are maybe more hardcore bitcoiners, anarcho-capitalists, who definitely would be in the cohort that would challenge you, who maybe would consider your strategy is defending the dollar; whereas, they want to replace the Fed and they want to bring down government and they want to end sovereign currencies.  They want everything to be on Bitcoin and on a Bitcoin standard.

Now, I'm in the place where I'm not an anarcho-capitalist, I believe in democracy, I don't believe in the big red button of a libertarian ideal, even though I think libertarians have great ideas.  But there are people that are saying that to you.  And I think the problem, even with the revolution is, if you burn down the government, the state, what we have now, it will just be replaced with the same.  Whereas, to your point, the evolution allows you to incrementally make things better.

Michael Saylor: Yeah, I think there's an evolutionary view and there's a revolutionary view.  The revolutionary argument is the currencies are bad, taxes are bad, governments are bad, big corporations are bad, the banks are bad, and we don't want to support any of them and we're revolutionaries.  The evolutionary view is, "I invented oil and steel and electricity and Isaac Newton invented engineering maths.  Is the world a better place with calculus, oil, steel and electricity, and should we introduce it?"  The evolutionary view is apolitical.  It's constructive and it's also cooperative. 

Every country can benefit from calculus, steel, oil and electricity and computers, every country, every ideology and the human race is better.  If you look at the evolutionary view for Bitcoin, the evolutionary view would be, Bitcoin is digital energy, it's a technology, therefore it's good for every country.  Bitcoin is digital property and it's a better balance sheet asset than cash or credit, so therefore every company can and should buy Bitcoin.  And because it's digital property, every country can use it as a treasury asset and they can back their currency with it.

So, I'm not asking for Turkey to abandon their currency, or the United States or Europe or Korea or Japan or Singapore or Malaysia to abandon their currency, instead of telling them they have to abandon their sovereignty, and there's an irony here.  People that are in favour of sovereignty want someone else to abandon their sovereignty.  Instead of telling the Prime Minister of Malaysia that I disagree with their currency and they should disband their police force and stop taxing people and disband their army, I could just say, "This Bitcoin will make your country richer and better".

So, it's a lot easier, just like I'm more likely to be able to introduce oil and steel and electricity into another nation than I am to be able to introduce my political system or my ideology.  If you interpret Bitcoin as technology instead of ideology, then instead of taking the position that we don't want to have money in the bank, our position would be, "We don't mind money in the bank as long as that money is Bitcoin and not gold [or] as long as it's Bitcoin and not S&P [or] as long as it's Bitcoin and not dollars".  Change the money, keep the bank. 

Maybe you don't trust the bank; but on the other hand, if your brother-in-law is the chairman of the bank and you have Thanksgiving dinner and you say to your brother-in-law, "You know, if your bank starts custodying Bitcoin, your stock price will triple and all your employees would be delighted and you'll be successful in your job and your family will live happily ever after", that might work.  And if you start the conversation with, "You know, Bitcoin's going to destroy your bank, you're a 20th century relic and we don't like banks or bankers and we think you should just go ahead and quit your job.  But before you quit your job, you should convince the Board of Directors to disband and liquidate the bank", it's not likely to happen.

No one's going to liquidate their country or liquidate their bank or liquidate their company or liquidate their family or liquidate their livelihood because of your ideology, and why should they have to.  So, the evolutionary approach is, "Look, Bitcoin is technology.  You're Apple; this is beneficial to you, build in the iPhone".  You’re the United States; if I'm meeting with Jerome Powell, "Bitcoin is not the currency to replace the dollar, Bitcoin is an asset that people can hold in lieu of gold or S&P Indexes or property and it will make the country work better and it's good for the United States".  It has the benefit of being true.

I guess the real issue here is, if there's $100 trillion worth of property in the form of gold and silver and rental income properties and S&P Indexes and bonds that are overvalued, and Bitcoin can simply replace them all, and every bank is more successful and every investor's more successful and every country is more successful, and we all live happily ever after, is that such a bad thing?  It's like, what's wrong with living happily ever after?

We have the phrase, "Bitcoin fixes this".  Well, I think Bitcoin also fixes every company and every governmental institution.  So it's better, when you're thinking this through, I think it's better if you ask the question, "Is Bitcoin a solution to that institution?" and the answer is yes.  You get the sense sometimes, there are some people in the community that, if Jerome Powell were to make a press release tomorrow saying, "We've seen the light and the United States is going to buy $100 billion of Bitcoin", they would be unhappy about that.

Peter McCormack: I think they would be conflicted.

Michael Saylor: They don't want other people to get the secret, but the point is, if Bitcoin is money for enemies, isn't the bigger idea, Bitcoin is technology to make the world a better place and if everybody adopted Bitcoin, then maybe we wouldn't be enemies.  At the point that a company, let's say JP Morgan, do I mind if JP Morgan starts custodying $100 billion of Bitcoin?  They'll pick up the phone, call their clients, all their clients will start buying Bitcoin and the price of Bitcoin will go to the roof and it will demonetise $100 trillion of other assets, and that means that the cost of food and housing and clothing and gold jewellery will go down, and it means that society will get more rational, and it means that the effective ability to pay deficits with inflation will be deteriorated.

Over the long term, when you look at the long-term meaning, when Bitcoin is $500 trillion of the economy, then the marginal ability of political systems to inflate the currency is going to deteriorate.

Peter McCormack: Because it's a check and balance.

Michael Saylor: Let me take a different tack at this.  I do think Bitcoin is going to collapse currencies, but it won't be the US dollar, it's going to be the 100 weak currencies.  I'd even probably take that back and say it a different way.  I really feel like the next step in the economic evolution of the world is the United States dollar is going to collapse all 100 weak currencies if it gets on a crypto rail.  If we have stablecoin US dollars, I think that every currency, other than the top dozen, is going to collapse, and all those countries are going to dollarise.  And I think Bitcoin is going to collapse all the weak assets.

We know enemy number one: gold.  Gold is just an awful monetary asset, but it's not the only one.  Investment properties and timber land and buying up natural gas rights, all the things people do to avoid putting money in a savings account that generates 0% yield, they're all choices.

Peter McCormack: They're a bigger leap though.  I mean, the leap for a better currency is an immediate obvious problem for people day-to-day.  Someone in Turkey, I was reading just the common, everyday problems people are having now with the collapsing currency, they're skipping meals now because they can't afford food.  There was a guy who put on, my brother pointed out to me, somebody had put on Twitter the other day, "Just been to Turkey.  It's amazing, everything's cheap", and a guy replied to him and said, "Not for us".  So, there's that immediate pain point, "I need that right now".

Owning Bitcoin instead of owning property, like a rental property, isn't an immediate pain point for somebody, so that leap's harder for people to make.

Michael Saylor: Yeah, there's two transformations: there's digital transformation of currency and there's digital transformation of property.  The digital transformation of currency is something that will run very fast and very hard, and the Chinese clearly are concerned about it.  The way you know a country's concerned about it is they're going to put in place capital controls and they're going to be regulating the currency. 

It happens that Bitcoin has a role, because Bitcoin and the Lightning Network is a way to move digital currency.  Even when Jack Mallers talks, when he's talking, he's saying, "What people want to do is send $25 from Chicago to El Salvador.  So, we convert it to Bitcoin, we wire it, and we flip it back again on the other end".  What they're trying to do is they're trying to move the medium of exchange at the speed of light, and that's fine.  The path of least resistance is the strategy of most likely success. 

If you want to be successful, then you step back and say, "What am I trying to do?  I'm trying to give 8 billion people the strongest currency I can with the least amount of effort".  And the strongest currency is the dollar, and the least amount of effort would be to put it on some kind of Lightning rail, or even a centralised finance system.  Put it on Facebook, or put it on Apple.  The problem is, they don't go to 8 billion people.  But everybody in the world wants that.

Then, the second thing to do is to give them a property asset that they can hold as a long-term store of value.  If we focus on those two things, what won't we focus on?  I don't think we need to topple every government in the world, nor do I think we need to rewire the accounting systems.  Here's the problem with the accounting system.  I've already pointed out that it is physically impossible to rewire them.  For trillions of dollars, you couldn't do it.

But let's say it was possible.  It's still illegal, which means you have to topple the government, because the distinction between currency and property is a bright-line distinction in the tax code of every nation.  And the IRS determined in 2014 that Bitcoin is property and the US dollar is currency.  In El Salvador, they made it possible to transfer Bitcoin without paying a tax, but in every other nation on earth, the bright-line establishment is, when you transfer property, you owe a tax.  That means that no rational investor would ever pay for anything with a property, and no company would be able to pay for anything with a property, because you're accelerating a taxable event.  So, unless you're willing to default on your taxes to your nation state, you can't use property as currency, you just can't. 

So, now you've got a simple observation.  Do you simply want to give $100 trillion of dollars to everybody in the world and fix that problem, and do you want to give $100 trillion of property to everybody in the world and improve the world; or, do you literally want to deconstruct every country and every nation state?  I think the answer is, when you have the ability to make $100 trillion peacefully to the benefit of everybody, which is go left, that's the evolutionary strategy, and the enemy is gold.

But if we just declared war on gold, it could be a $100 trillion asset.  I'm telling you, Bitcoin goes to $6 million a coin, and I don't know, the nation of gold puts out an arrest warrant for us; what's going to happen if we declare war on the nation of gold and we stop paying our taxes to the nation of gold?  Nothing, and Bitcoin goes to $6 million.  Or, we can be in a dispute with every mayor, the FBI, the CIA, Interpol, the United States Military, the EU, everybody that's a patriot, everyone that's a nationalist, every political party, every politician, every corporation including Apple, Amazon, Facebook, Google, every piece of technology, every institutional structure.  You could do that, and is it better?  No, you're not getting any more. 

It's literally, this is the path of least resistance.  We have a technology, it's digital gold, it's worth $100 trillion.  And the other approach is a digital currency, we want to replace nation state currencies and we wish everybody would do that.  And I guess it's kind of a philosophical issue, but if you think about it enough, if you were a public company CEO, go interview 500 public company CEOs and ask them if they could physically rip out their accounting systems and if they could do business with a property, and every one of them is going to say, "I can't do business with a property.  It's not practical, it's not legal, I'd be fired by my board for doing it".

Here's the last point.  Three people can buy $3.5 billion worth of Bitcoin and drive up MicroStrategy stock by a factor of 10 and make $10 billion for the shareholders, three people.  Or, I can have everybody quit, rip the bottom out of the company, destroy the company, lose everything and not make the money.  One of them is the revolutionary approach; the other one is the evolutionary approach.  So, I think it's kind of a moot point.

What's going to happen is, the industry is maturing and it's going to move from the entrepreneurial phase which was, "Go fast, break things, we don't have a licence, this is really cool technology, look what we can do".  It's going to move to the next phase, which is the institutional phase which is, "Oh, man, Silvergate Bank is issuing stablecoins and I have to get an FDIC charter [or] I have to become public [or] I have to file this".  I think, if your goal is to make the world a better place, I think the world would be better if, instead of comparing Bitcoin to the dollar, compare the dollar to the peso.

Peter McCormack: I get it.

Michael Saylor: I think the false equivalence that happens all the time is people go, "Why do you side with the dollar over Bitcoin?"  The answer is, "I'm not, I'm siding with the dollar over the peso, and I'm siding with Bitcoin over gold".  It just happens to be a bipolar, like a dual model.  You might say -- I guess this is my theory.

In an environment where you have nation states and fiat currencies, the money decomposes into currency and property, and one is an appreciating asset and one is a depreciating asset and it always happens.  The only question is, what is the property and what is the currency?  100 years ago, maybe the currency was whatever and gold was the property.  Then, for a while, the property was sovereign debt.  Then lately, before Bitcoin, the property was S&P Index funds or real estate.  Right now, the property is Bitcoin and as long as there are governments on this earth that have the will to create their own currency, you're going to have this issue.

Maybe you'll get some idealistic governments that maybe get the El Salvador model, but El Salvador's not even an idealist -- if El Salvador's completely idealistic, they would have adopted Bitcoin and abolished the dollar.  And you could make the other argument which is, if they simply said, "Bitcoin's property and the dollar is the currency", and then they gave everybody the Chivo wallet with the Bitcoin, it would have been less disruptive to all the businesses that have to take Bitcoin; they just take stablecoin on the Lightning rail.

I think that at the point that we start to see Lightning wallets, the only Lightning wallet you want, in my opinion, is a Lightning wallet that has dollars and has Bitcoin.  You want to be able to move the dollars at the speed of light and the Bitcoin at the speed of light.  At the point that you have that, I think that's the killer application for the world.  Then, every company operates with its existing accounting systems, then you don't have to change the tax law.  In El Salvador, they changed the tax law.  But what's the likelihood that in Europe or Japan or the US, they're going to change the tax law and let you transfer property without capital gains tax; not at all.

Peter McCormack: It's not going to happen.

Michael Saylor: But here's my last point.  It's not even a good idea.  Be careful what you wish for.  If you can transfer Bitcoin without a capital gains tax, you're more likely to do so, but you shouldn't.  So, it's like the people that moved to Puerto Rico, "I moved to Puerto Rico so that I could sell my Bitcoin without paying tax", and my answer is, "Why didn't you just stay in the US and not sell the Bitcoin, because if you had sold Apple, Amazon, Facebook, Google or Microsoft stock at any time in their history at no capital gains tax, you made a mistake". 

I would say, "If you really were a Bitcoin believer, then the only thing you ought to be doing is buying as much Bitcoin as possible, and you want to find a bank that will loan you money against your Bitcoin at the best, most favourable terms".  Your plan ought to be, "I'm never going to pay a capital gains tax the rest of my life, and to the extent that I can construct an asset-rich portfolio of a lot of Bitcoin, then I can just live off of borrowing the Bitcoin, and I'll never pay income tax the rest of my life".

Peter McCormack: Nice.

Michael Saylor: And if you can leverage up, no income tax, no capital gains tax.  The fallacy is thinking it's a currency in the real world.  It's not a currency, it's a property, it's going up in value, you should not ever want to depart with it.  And in theory, the smartest thing you could do is go to a country with a collapsing currency, borrow that currency, buy Bitcoin and then incur a bunch of expenses in that currency that is collapsing.  That's wise.  And as long as the US dollar is losing 15% of its value a year, every single person in the United States can borrow money at less than 15% interest.  If you're borrowing money at 2%, 3%, 4%, 5% interest, everybody has a positive 10% arbitrage just off of the currency weakening, which means that if you don't have debt in the weakening currency, then your portfolio is half as big as it would otherwise be.

MicroStrategy, we've got $2.2 billion of debt at 1% interest.  But that only works as long as there's a dollar, so we're basically paying 1% on $2.2 billion, and then we're lending it out to the Bitcoin Network at 170% theoretical yield.  So, we're scraping 169% theoretical yield.  If you wave your magic wand and make the currency go away, where does my 169% yield go to?  When we get to Nirvana, and this is practical; when we get to Nirvana, I'm going to eliminate all nation states, we're going to create the one true, great company, I'm going to convert everybody's accounting system to Bitcoin and everybody's going to use Bitcoin and satoshis to buy everything and Bitcoin's going to go up in value 3% a year, and it's going to cost 3% to borrow it!  So, it doesn't work anymore. 

You have an opportunity right now to be an early adopter, and your theoretical payback is 150% a year now, because of the existence of currencies.  That works for about the next decade, then it works slower for about another maybe 10 to 20 years, and then digital property demonetises all the other properties, all those other prices come in, and 15 to 20 years out, the government's ability to print infinite money is dramatically decreased.  And if the government can't print infinite money in the year 2037, then there'll be a lot more debates in the Senate and Congress about tax, and at some point there'll be some tax and they'll tax people.  When people realise they've got to pay a tax, they'll go back and say, "Cut the budget", and we will introduce fiscal discipline with some political process.  But that's 15, 20 years out, that's a while out.

Peter, here's one of my primary frustrations when I watch Twitter and Bitcoin Twitter.  There's only one useful thing that any of us can do every day when we get up, one thing that matters above all.  That one thing is to convince someone to convert some other form of property into Bitcoin.  Evangelise Bitcoin, educate Bitcoin.  If you get up and you talk to 100 people and one of them takes $100 million and they sell $100 million of stock and they buy Bitcoin, or they sell $100 million of gold and buy Bitcoin --

Peter McCormack: You've done your job.

Michael Saylor: And this is why I'm frustrated when people say, "We believe in sound money.  Half of it's gold, half of it's Bitcoin".  Well, no, it means you invested millions of dollars in the enemy of Bitcoin.  Sell your gold, buy Bitcoin.  Sell your bond, buy Bitcoin.  Sell whatever your property or whatever your asset is and buy Bitcoin.  That's the one thing.  We don't need to make any other enemies.  We're not going to fix -- fill in the blank, "How do you feel about this government's policy and that government's policy and this city and that tax edict?"  We're not going to fix that.  The one thing we can do --

Peter McCormack: Fix the money.

Michael Saylor: -- fix the money.  What you want to do is you want to find everybody with money and you want them to buy Bitcoin.  You don't need to change their political convictions, you don't need to change their religion, you don't need to change the food they eat, you don't need to change their views on medicine; those are other battles.  And there are other people that are signed up for those battles, but that's their conviction.  But I feel like every one of those battles we get into is deluded.

Peter McCormack: I see what you're saying.

Michael Saylor: It's a deluded distraction.  I have hundreds of opinions, thousands of opinions, but the only opinion I really think is worth uttering in public is, "Bitcoin is good.  Bitcoin is good technology".  I don't care who you are, where you're from, if you sell the other stuff and buy Bitcoin, you'll be better off, your country will be better off, your religion will be better off, your ideology is better off, your family is better off, your company is better off.

I think when we get drawn into these other debates, they suck up bandwidth, they're all just kind of religious fights over stuff.  Let's take custody.  Is multisig soft custody better than single sig, better than having money in cold storage at Coinbase, better than having it on the exchange, better than having an ETF?  Is it better to do this or that?  They're second-order issues, because owning $1 trillion is in the Bitcoin system and $500 trillion is in the other system.

Peter McCormack: Let's go get it.

Michael Saylor: Instead of us fighting amongst ourselves is all we really want to do is, when we're 500 times bigger, then we'll deal with that.  Everybody should be able to have their views, and don't judge people.  An 83-year-old dude wants to buy the Bitcoin futures ETF and he's going to do it in five seconds with a phone call.  If it's Warren Buffet and Warren Buffet wants to buy $50 billion worth of the BITO ETF, on the margin it's better than if he bought gold, it's better than if he bought land, it's better than if he bought Apple stock. 

So, we ought to just welcome everybody into the ecosystem by whichever route they take, and we should just be trying to channel everything constructively towards a laser-like focus upon Bitcoin.  I don't agree with your country, but I wish the treasury was run Bitcoin standard.

Peter McCormack: I see what you're saying.

Michael Saylor: Here's the other fundamental point.  We can fix half the world, but not the other half.  I've said I think digital energy is worth half of everything.  If the world's $1,000 trillion, I think that digital energy is $500 trillion.  We can call that money, the money is $500 trillion, however you want to deal with it.  We have a solution to half of everything, but we don't have a solution to the other half.

When the United States went into Afghanistan and toppled the Taliban, what did we replace it with?  Did we have that solution, or Iraq, or Lebanon?  What do I think about Turkey?  I don't have the solution to govern Turkey and replace the lira; I don't know how to do that.  All I know is that more Bitcoin, better.  You're not going to always agree with politicians, but the more Bitcoin in the political system, then the better it is.

We're back to Isaac Newton; rewind to Isaac Newton.  Isaac Newton was probably one of the most monumental contributors to truth and integrity and humanity and civilisation in the history of the world.  You can trace so much to that one guy.  He gave us maths.  We had arithmetic, but the mathematics necessary to build the civilisation to make that light work, to make this work, to make electricity work, to fly, to make his headphones work, to make this work, this is all Isaac Newton.  But he only fixed half, and the communist regime's got it, the dictatorship's got it, the people you disagree with have got it; it's maths for enemies. 

Even so, the world is better when we spread this, and every time we spread Bitcoin to one more organisation, we can say they get corrupted, but what's the opposite of corrupted?  They get corrected, they get virtualised.  We're spreading virtue bit by bit, and it's certain.  If I go to Jamie Dimon and I say, "Jamie, the bitcoiners' hope and vision is for JP Morgan to go to zero and we're going to replace you with a Bitcoin mining rig and a multisig wallet", I don't think we're going to get his cooperation.

Peter McCormack: I agree.

Michael Saylor: Nor are we going to get the cooperation of anybody that works at JP Morgan.  And if we go to JP Morgan and say, "Bitcoin is a superior property to gold, or another investment choice for all of your clients, and your bank can triple its market cap and all your clients can double their net worth, and your career will be enhanced, and the world will be a better place and you can handle it safely, because it's just digital property technology", "I guess we should be in that business", and they'll get in that business.  They won't do the multisig cold storage hardware device, that's fine. 

But the people that do do this will be owning $10 million Bitcoin, and they bought it when it was $100.  And when you have $10 million Bitcoin and you are as rich as Jeff Bezos, you can go ahead and create your own anti-bank or your own thing, and you can change the world.  But the fundamental thing is, before you change the world, get the money.  Maybe first fix the money, to your point.  If we fix the money, we fix half the world, you will be able to go work on the other half.  The other half is highly controversial.  Nobody can agree with anybody on anything else; it's highly controversial.

Peter McCormack: It kind of makes sense now, thinking about your Twitter and what you talk about, because you basically only talk about Bitcoin and you see other people comment on Bitcoin who aren't maybe within the Bitcoin community [phone ringing] is that Jamie Dimon?!  Then what you do is you come in and you leave a comment underneath where you just explain it to them.  You don't get in any fights, you don't deviate from that.

Michael Saylor: Yeah, my view on Twitter is you should be cheerful, you should be constructive.  You can't browbeat anybody.  No one's going to change their mind if you embarrass them or insult them.  And there are some cases where there are people that clearly don't understand or appreciate Bitcoin the way we do.  In their case, I might post underneath their comment.  I don't expect to change their mind.  What I expect is perhaps I can educate their followers.

If you have 2 million followers and you say, "Bitcoin is boiling the ocean", I'm not going to change your mind, but I'm going to say, "Well, you know, it really isn't boiling the ocean, and if you want more about it, you can click here, there's a lot of work on it".  I might get their attention, so if I get the attention of someone that is either ignorant or opposite in their point of view, then maybe I can open up a dialogue with them, and probably you're going to change their mind in private more than in public, or maybe you'll just register with them that you exist.

But really, Twitter is not really a battle to change the minds of the blue checks that have carved out their position.  It's actually a battle to capture the hearts and the minds of people who have not yet made up their mind or don't know.  And so, when 57,000 people look and you say something constructive and cheerful, then maybe they're drawn to do some research and discover.

Now, if someone famous, let's say a rock star, says, "Bitcoin is boiling the ocean", I'm not going to go to their Twitter feed and say, "Well actually, you're stupid, and have fun staying poor", because all of the people that like their music will say, "You just insulted…"  They don't know what Bitcoin is, all they know is that you just insulted their favourite musician, which means that they just clicked negative.  So, there's no point in me either venting or injecting any toxicity.  All I think is there are people that might read that, and I have a chance to offer a constructive point of view, and maybe I can be cheerful or maybe I can bin them.

Joe Biden posted the other day, "It's small business day".  So, I go and I troll Joe Biden and I say, "Well, small businesses should consider converting to a Bitcoin standard.  It can help them to compete and it will be good for their business, and Bitcoin is hope here".  If you happen to like Joe Biden and you happen to be a small business, you might discover Bitcoin is the solution for small businesses.

Peter McCormack: And if you did, you converted that person that day.

Michael Saylor: I'm not going to make an enemy of Joe Biden, I don't want to make any enemies.  If I make an enemy of someone with millions of followers, they're not going to click "Like" when I post anything, they're not going to support anything I say; they may actually push back harder and I'm not going to accomplish anything. 

I have one simple agenda, Peter.  I want everyone that doesn't know about Bitcoin to discover Bitcoin, and I want people that know about Bitcoin to understand it better, and I want people that invested none of their portfolio to invest 5%, and I want those who invested 5% to invest 50%, and I want those to think that gold is good to realise that gold is not good and sell their gold and buy Bitcoin and I want people that like gold to stop evangelising gold to anybody, because that undermines the cause of sound money.  And if you're 100% invested, I want you to understand it well enough to say, "Well, maybe I really can take out a 3% 15-year loan and be 200% invested".  Why not?

Peter McCormack: Why not?

Michael Saylor: Ultimately, do I want to opine on Facebook versus Apple versus Twitter versus crypto this versus…?  No.  Stay in your lane.  If we come back to the marketing theory, right, basic marketing theory is, "Stay on brand.  Don't tarnish the brand, stay on brand".  What's basic politically theory, "Stay on message".

Peter McCormack: We had this exact same conversation yesterday; interesting you should say that.

Michael Saylor: Stay on brand, stay on message.  Okay, you want to utter an opinion?  I'm not an expert on the history of New Hampshire property taxes, I'm not going to meddle in that.  I'm going to focus on very tight things: how do the regulators view Bitcoin; how do they view crypto assets; how does Bitcoin stand versus other crypto tokens; what is the definition of digital property?  I'm going to focus on Bitcoin and institutional adoption and individual adoption and the technology and the education.  And if anybody gives me a venue on the left or the right or the middle or in cyberspace to communicate something positive and cheerful and constructive, then I'm going to take that opportunity.

Peter McCormack: Well, that speaks to me a lot; I'm going to be processing that, especially on the brand stuff.  I mean, look, we've basically hardly touched any of my questions here, by the way, I've printed a completely different interview!  I'm just going to have to pester you for another one at some point.  I'm conscious I've taken up a lot of your time here, this was brilliant.  There's a lot to think about here.  I don't often listen back to my interviews.  There's a few bits I need to ponder on this one.

Michael Saylor: Yeah, if you want to come back and do a round two, I'm fine with it.  We only covered a small portion of it.

Peter McCormack: A small portion, yeah!  It was brilliant though, and I appreciate your time, I appreciate your hospitality here to do it, and of course I'd come back; I'd come back all the time and do this, because there are a lot more questions I want to ask.  But thank you for everything again and keep doing your thing, and there's a couple of things that spoke to me, and I think Danny's going to have a chat with me on text on the way back and say, "I told you".

Michael Saylor: It's really an extraordinary time in the history of the business.  If you really start to embrace the idea that this is digital energy, this is the greatest digital transformation of all the digital transformations of the last 100 years.  And you're doing a great job, incredibly hard-working making the rounds to create all the content and put on the record all of the people and all the expertise you have, and I appreciate it.  It's really just testament to how much reporting there is to be done here, and everybody will benefit from it.  I think you've got good focus, so keep up the good work.

Peter McCormack: Thanks, man, appreciate it.

Michael Saylor: Thanks for making me part of the journey.

Peter McCormack: Yeah, thanks.