#530: Q and A

In this special episode, Pomp answers questions taken from Twitter. He talks about balancing ambition and happiness, whether or not you should time markets, the likelihood of a bitcoin ban, and much more.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Anthony Pompliano?

  What's up guys, bang bang. Today's a special episode. I've taken questions from you, the listeners on Twitter, and I'm going to do my best to answer as many of them as I can. Polina, my wife, is here to read them out because I can't read very well, and we are going to do our best, so bear with us. But before we get into the episode, I'm really excited to answer these questions. I want to talk about our sponsors. First up is Circle. Circle is a new sponsor, so pay attention here. They're a global financial technology firm that enables businesses of all sizes to harness the power of stablecoins and public blockchains. Jesus, public blockchains for payments, commerce, and financial applications worldwide. Circle is also a principal developer of USD Coin, USDC, it's a stablecoin,

• 0:43Anthony Pompliano?

  which is the fastest-growing, regulated, fully-reserved dollar-stablecoin in the world. It's now standing at more than $11 billion market cap and is adding nearly $300 million in net new digital dollars in circulation every week. Simply, Circle is exploding with that USDC. So, the free Circle account and suite of platform API services bridges the gap between traditional payments and crypto for trading, DeFi, and NFT marketplaces. Go to circle.com right now. Go to circle.com and check them out. They are really, really pushing the pace of innovation. I'm a huge, huge fan of Jeremy and the rest of the team, so go to circle.com, the fastest-growing stablecoin in the market. Circle.com. Next up is Exodus.

• 1:28Anthony Pompliano?

  They're leading the world out of the traditional financial system by building beautiful and user-friendly blockchain products. With their focus on design and user experience, Exodus has become one of the most popular and loved cryptocurrency apps. It's supported on both desktop and mobile, allowing you to sync your wallet across multiple devices so you can have access to your funds anywhere. You can instantly exchange around 100 different cryptocurrencies straight from your wallet. Interactive charts let you view an asset's price history and your portfolio's performance over time. And maybe the best part, Exodus is integrated with the Treasure Hardware Wallet, making advanced security easy for everyone. Visit exodus.com for your free download or search Exodus on the App Store or the Play Store. Again, exodus.com for your free download or search Exodus on the App Store or the Play Store, exodus.com.

• 2:14Anthony Pompliano?

  Last up is crypto.com. With over 10 million users, they are the easiest way to buy and sell over 100 cryptocurrencies. You can download the app at crypto.com and get $25 with my code POMP. If you want to get all sorts of cash back, you can get 8% back instantly with that crypto.com Visa card. And it also comes with all kinds of amazing perks at Netflix, Spotify, Amazon Prime subscriptions. And you also get airport lounge access for you and a guest at hundreds of airports around the world. Of course, the crypto.com Visa card gives you all this with no annual or monthly fees to worry about. Go to crypto.com app today, use the code POMP and you will get $25. Two, five, go do it.

• 2:56Anthony Pompliano?

  All right, let's get into this episode. We're going to do our absolute best here. No judgment. Paulina is going to read the questions. I'm going to do my best to answer them and let's see how it goes. First question.

• 3:08Speaker 01

  First question comes from at Brent underscore KT. Do you and Paulina find time to unplug or is it full throttle all day, every day? It's inspirational, but I hope you guys find some time away from the screens.

• 3:23Anthony Pompliano?

  I find lots of time to unplug. I actually think a lot about the balance between ambition and happiness right now. And the more that I spend being happy, I actually get better and better results. So it's more of a work smarter, not necessarily harder. That doesn't mean that I don't work hard or not a lot of hours, but it just means that I'm much more intentional about the work that I do. And also more intentional about getting my eight hours of sleep, shout out eight sleep. Or I am much more intentional about spending time with Paulina, going on walks, eating dinner together, et cetera, et cetera. So definitely intentional about all of that, but I think the balance between ambition and happiness is the way that I kind of use the mental framework today.

• 4:07Speaker 01

  This one is related and it comes from at altcoins, sorry, altcoin beats. Who really is POMP? Let's erase all of this crypto and financial stuff. At your core, so where would you be working and what truly makes you happy in life? Yes, besides the lovely Paulina.

• 4:26Anthony Pompliano?

  I'm just a dude. That's it. Literally, I'm just a dude.

• 4:32Anthony Pompliano?

  Whether it is going to a bar, hanging with my brothers, hanging with my wife, I'm just a guy. And I enjoy doing what I enjoy doing. And so who you see is pretty much it. I say and act the same way in person as I do in business meetings or in private. And I think that that's part of the beauty of it is I'm just me and I try to be as authentic as I possibly can, because that's when I'm happiest. And so I don't think there's really any kind of secret or any curtain necessarily to kind of reveal behind. It's just me having a blast and hopefully other people are along for the ride.

• 5:12Speaker 01

  At Rob Joe 66, you often get faced with the accusation that you are smart. You nearly always deny or claim that the guy next to you is smarter. Why? Why don't you just take it when it's obviously true in your area slash field?

• 5:27Anthony Pompliano?

  I think that the idea of being quote unquote, smart is a finite position to end up in. There's a saying that the more you know about something, the more you realize you don't understand. And I think that that constant pursuit of intellectual curiosity and information ends up teaching you that you're not nearly as smart as the next person. You're not nearly as smart as you will be in the future. And so if you're constantly trying to compare yourself to a past version of yourself, sure, you're smarter today, hopefully than you were yesterday. But I think of smart as a very static position. And so I constantly just think about if I'm still learning, how could I possibly be smart? If there's still, still more to go.

• 6:12Speaker 01

  Jose Silva, in the past, you've talked about the Bitcoin market cycles and even said that 2022 will most likely be a down year for the asset. Do you plan on selling some at the top of this year and then re accumulating in 2022 to 2033?

• 6:29Anthony Pompliano?

  I think that it's nearly impossible to time markets, especially with any level of super granular accuracy. And so I think that what we've seen is if you held Bitcoin over the last 10 years, lots of volatility, hundreds of percent up and you know, 70, 80% downside in some years. But what was true along the way was Bitcoin continued to grow at a 200% compound annual growth rate for a decade. And so just holding ended up doing all right. And I think that that's a really great way for people to kind of look at this. And you know, I don't think I can time markets. I don't think most people can. So if you can't do it, then don't try.

• 7:09Speaker 01

  Greg asks, what company that you invested in this past year are you most excited about? And what is one company that you shouldn't have passed on?

• 7:19Anthony Pompliano?

  I don't know if there's necessarily just one company. I can talk about maybe two companies that I've written the largest check to in the last 12 months. Might be a good way to kind of, you know, just talk about one or two of them. Obviously BlockFi, I'm a huge fan of, have invested a lot of money, sit on the board there. I believe that BlockFi's pursuit of deposits and payments over a simple brokerage model will end up proving to be very, very valuable. Obviously, the last round was raised at $3 billion valuation. I think that they'll continue to perform very well through the rest of this year and into the future. And so that business is led by Flori and Zach. They're doing a fantastic job, got over 500 employees around the world.

• 8:03Anthony Pompliano?

  And I think that kind of this idea of building actual crypto products for crypto investors or financial products for crypto investors is, you know, just getting started and it'll be cool to kind of see what else they roll out over the years. The other company is Strike. I think that this is probably one of the most underrated companies in the space or products. Strike allows you to send any currency across the Lightning Network and have it instantaneously settled for free. And so Jack Mahlers is by far, in my opinion, one of the smartest people in the Bitcoin space. He continues to be incredibly principled in his view of the company and product he wants to build and his outlook on Bitcoin. So just super excited to kind of continue to invest in Jack and his vision of the future.

• 8:48Anthony Pompliano?

  So those two companies, I think, are pretty simple to kind of point out just because they were the two largest checks that I wrote recently. And then when it comes to a company that I should have passed on, or I should not have passed on, I'll go way, way back. I had a chance to write a very small check in DoorDash when I was working at Facebook. A friend of mine, angel investor, invested in the seed round. I met who was, I believe, he was the head of growth at the time, and they were kind of closing up around. I had no clue what angel investing was. I had no interest in doing that. Really dumb on my part. Ended up being a multi-billion dollar company. So you kind of just want to go back in hindsight and get the ones that you knew would have

• 9:31Anthony Pompliano?

  worked. But again, you know, it put me in a position that I am today. So you can't really regret it or worry too much about it. Just keep trucking.

• 9:39Speaker 01

  Alexander Lores. The COVID-19 pandemic disproportionately hurt small businesses while larger corporations adjusted, thrived, and took more market share. Bezos embraces Biden admin's higher corporate taxes. How will this affect small businesses and large corporations differently?

• 9:58Anthony Pompliano?

  I think that large corporations are very intelligent about ensuring that they show little to no profit because of all of their R and D and kind of their reinvestment into their own business. And so when you do that, you end up paying, you know, near zero taxes. That's not any sort of verdict on bad behavior by the corporations. They're simply operating within the rules. And actually, we should encourage people to pay nothing in taxes if what they're doing is they're taking any free cash flow and they're reinvesting it into kind of progress, innovation, entrepreneurial type activities, and making their business better, employing more people, etc. So it's a weird thing because I think a lot of people like to yell and scream about the fact that large corporations aren't paying taxes. But what that means is that they're reinvesting anything that would have been profits, which

• 10:43Anthony Pompliano?

  actually ends up making it a bigger and bigger company over time, which means that it can employ more people, it can make more progress, serve more customers, all that. At the same time, most small businesses, one, are not sophisticated. They actually end up booking a profit, so they pay taxes. But also, two, is it's just smaller numbers. And so it's one of these things where the big companies are going to be absolutely fine. Uh, but when you raise taxes, you actually hurt the smaller companies, right? Uh, because they're the ones who are operating on the smallest margins. They're the ones who literally the difference between 21 and 28% corporate tax rate could be the difference between hiring two more people or firing two people. And so when you start to look at uh kind of the impact, I think that a lot of these policies, although they're targeted at trying to affect

• 11:28Anthony Pompliano?

  uh and impact the largest companies in the country. Remember, they've got lots of lawyers, lots of accountants, they're very sophisticated, and they find ways to operate within the rules, uh but continue to build progress and build their companies. The small businesses are the ones that don't have those resources and end up getting hurt. And so I generally think that we should encourage more free markets and worry less about government intervention.

• 11:49Speaker 01

  Sergio Stef- Stefay. Do you think that current market cap of crypto is too big to face a threat of being banned in the future? If yes, what do you think that the governments will do in regards to crypto and the blockchain technology as a whole? Will they see these as a threat or on the contrary?

• 12:08Anthony Pompliano?

  I think that we're past the point where governments are going to be able to ban the entire industry. Like that seems pretty uh far fetched at this point. Uh, with that said, they may try to ban individual assets. They may try to attack specific companies or regulate them. Uh, with all of that, I think that we're likely to see uh continued growth regardless. So we've seen in certain countries like Nigeria, Pakistan, China, talk of it in places like India uh and elsewhere where they actually banned something like Bitcoin or other types of assets and actually adoption has gone up. Um, and so I think that really what we're starting to kind of look at here is less about like, is it a binary? Do they ban it? Do they not? Instead, I think the way that is much more likely for them to kind of attack or

• 12:49Anthony Pompliano?

  or uh kind of be adversarial is just tax it more, uh regulate it more, uh regulate the companies, make it super difficult to operate businesses in the industry, right? Now, the outright ban is a pretty aggressive move and hard to to see. But I think that uh the continued pressure on the corporations and individuals in the space, that's likely to see where they're going to get a lot of traction. Uh, so hopefully that doesn't happen, but to me, that's kind of the more likely outcome if uh if there's continued government pressure.

• 13:15Speaker 01

  Okay, Ariel, how can people who make less than a hundred K a year make an exit from fiat efficiently? And what things should they stockpile before fiat dramatically declines in value?

• 13:26Anthony Pompliano?

  I don't think anyone has to worry about like hyperinflation in the United States. I think that's a kind of a false narrative and one that people should be careful about spreading. I think instead what we need to understand is that there's a continued devaluation of the dollar. And so it's not like if you have a hundred dollars in the bank, all of a sudden you're not going to be able to buy a loaf of bread. Right? Like that, that's not kind of what you need to worry about. What you do need to worry about is maybe that rather than your dollar being devalued at a 2% rate, maybe it's four or five or six or 7%. So it's not, again, quite as binary. I think it's a little more of the kind of the gray area. With that said, I don't worry about aggregate dollar amounts. So whether you're making $10 million a year, 100K a year, or literally $10,000 a year, a lot of it is on a percentage basis.

• 14:10Anthony Pompliano?

  Now, I say that, obviously, if you make more dollars, it's easier to kind of adhere to certain percentages. Because if you, you know, only make 20, $30,000 a year, then you still have bills. And so things like food or gas end up being a much, much higher percentage of your income than, let's say, somebody who makes 100K or a million or $10 million a year. And so I think that you just got to think of it in percentages, right? If somebody who makes 100K a year can put, let's say, $1,000 into Bitcoin as kind of a savings slash investment, then maybe you can't do $1,000, but what you can do is you can do $100 or $10. The percentages, I think, is what's much, much more important.

• 14:51Anthony Pompliano?

  And what you have to remember is that the key financial kind of principle here is spend less than you make. And so if you can spend less than you make, you can get out of debt, you can get into investable assets, and you can be patient. I think you got a shot at building real long-term wealth.

• 15:04Speaker 01

  At Sam's stick 33, who are the people that when they release some content, you stop everything you're doing to read or listen?

• 15:12Anthony Pompliano?

  Other than my wife, who is the smartest person that I know, nobody. And I think that that's actually a really important thing is I long ago gave up on having any heroes or believing that, you know, somebody was 100% right all the time, or somebody had accurate views all the time, or was even interesting all of the time. I think it's less About who the individual is and it's much more about the content itself. And so that's a little bit of a nuanced way of looking at it, but there's some people who I think are incredibly intelligent, who just might write something that's bad, vice versa. I actually think there's some people who I don't think are quite that intelligent.

• 15:52Anthony Pompliano?

  But then they write something that's super interesting and thought provoking. And so I think of it less in terms of like, who is that individual or that group of people? And they get much more about the quality of the content. Now, how do I determine that? A lot of times it is literally, I've got a whole host of people that I follow specifically for the content that they share. And I almost use that social graph as somewhat of a filtering mechanism. Got to be careful. It doesn't become an echo chamber. You only read what everybody else is reading. But at the same time, if you see two or three people that you like and that you converse with on a regular basis, all sharing the same article, it's probably worth the time investment to go ahead and read it. And so I think that's kind of the way that I look at a lot of it.

• 16:29Speaker 01

  I like this name beep beep, I'm a Jeep. I currently have a mechanical engineering background. How would someone like me transition to the cryptocurrency job field? What skills would you recommend to acquire? Where would I even start?

• 16:43Anthony Pompliano?

  So I think there's a couple of different things you can do. You can use the skills you have, or you can try and fill a role that doesn't need those skills. As a mechanical engineer, I'm sure there's tons of mining companies and people who create hardware that have, you know, needs for mechanical engineering or other types of, you know, kind of more engineering type degrees. And so I think that you can absolutely go find roles that align with the skill set you have. At the same time, you may say, look, I don't want to do engineering. Maybe I want to do something else. And so I think that what you should do in that situation is just start from first principles and really try to boil down. What do you enjoy doing? What do you want to do? And then really go out and look for those types of roles.

• 17:22Anthony Pompliano?

  And so it's kind of a bad answer, if you will, but I think that there's directly applicable jobs for mechanical engineering. But I also think that a lot of people feel tied to or pot committed to a degree or to experience. They say, oh, well, I went and got a degree in mechanical engineering. I've done this for the last five years. I feel like that's the only thing that I can offer somebody. That's not necessarily true, but you got to ask yourself, what do you want to do? And I think that's usually the best place to start because it'll lead you kind of to the place where you'll be the happiest.

• 17:53Speaker 01

  John Arch BTC. What is the best slash most memorable question you've ever been asked?

• 18:01Anthony Pompliano?

  One time, Paulina asked me if. I felt fat.

• 18:05Speaker 01

  What? I did not do that.

• 18:08Anthony Pompliano?

  And I had just eaten about sixteen Domino's pizza slices and I looked at her and I said, "P H or F A T?" So that was probably the most memorable questions anyone's ever asked me.

• 18:21Speaker 01

  Oh my god. Okay.

• 18:24Anthony Pompliano?

  What was I supposed to say?

• 18:26Speaker 01

  One time I asked Anthony, the first time I met him, I asked him if he thought that two ambitious people could be together.

• 18:33Anthony Pompliano?

  I don't remember my answer.

• 18:35Speaker 01

  You said yes. Okay. Dave, what sort of impact is Bitcoin gonna have short and long term on the banking system? In terms of damage to them, overtaking them and changing the way people bank? It almost feels like banks are making it hard to put money in crypto and I get the feeling it's out of here.

• 18:53Anthony Pompliano?

  The best companies in any industry navigate every technology shift. So the reason why Goldman Sachs has been around for a hundred gazillion years is because Goldman Sachs has navigated, literally, uh, it seems like the printing press, which probably is not true, but uh, everything from the internet to mobile phones to beepers, uh, to, you know, SaaS software, uh, cloud computing, uh, and now cryptocurrency. And so I think that you've got to remember that, uh, some of these institutions have been around for so long because they understand those technology shifts. They're willing to adapt and change when they feel like the information changes. So we're seeing some of that today. Uh, there's plenty of other large institutions or incumbents who are absolutely screwed. They're completely antiquated and archaic and they're thinking and they are gonna get smacked.

• 19:38Anthony Pompliano?

  Literally could go bankrupt or have to be bought in terms of, uh, protecting that shareholder equity. And so it's hard to predict kind of who's gonna end up where, uh, but I think that you can use history as a guide. If you've seen a firm kind of over and over and over again, navigate those technology shifts, uh, and be able to kind of incorporate new technology into their business and not only survive, but actually thrive over many decades, they probably have the DNA and the, and the higher probability of being successful. Doesn't guarantee success, but at least it gives them a shot.

• 20:07Speaker 01

  Ben Wareman, you frequently voice your conviction that BlockFi will become one of the most important companies in the world. As a new user and instant fan of the platform, this gets me hyped. But could you elaborate on how you see the future unfolding for them as adoption explodes?

• 20:22Anthony Pompliano?

  Yeah, so the reason why I say that they're going to be one of the most important companies really just stems from they're going after payments and deposits. That to me is the most scalable model when building a financial institution. And so compared to the brokerage businesses, which are the crypto exchanges, I think BlockFi is in a much better position from a scalability and a profitability standpoint. I could be wrong, we'll see, but that's my personal opinion. With that said, I think that BlockFi and also the other infrastructure companies all benefit when adoption goes up, right? When you look at, let's say Bitcoin going from 10K kind of at Q4 last year to the now $60,000, tons of new users came into the market. And also the existing users started to use the products more often.

• 21:04Anthony Pompliano?

  And so just like Coinbase came out and showed these magnificent growth numbers going from 1.3 billion in revenue in Q or in 2020 to 1.8 billion in revenue just in Q1, you're seeing that across the board. Kraken, BlockFi, all these companies, just metrics are up and to the right. And the reason is because the tailwind of price movement and new user adoption ends up driving revenue, profitability, etc. And so I tend to think that it's less a BlockFi story around adoption and it's more so just the overall industry. But because of BlockFi's specific business strategy, I think that they will have an outsized benefit accrue to them going after that deposits and payments rather than solely going after brokerage.

• 21:46Speaker 01

  Nick Clemott, there is a greater than 0% chance that Bitcoin could go to zero and become worthless. If this would happen, what do you think would be the cause?

• 21:55Anthony Pompliano?

  I think the most likely thing is a self-induced error, meaning that during the development process, somebody introduces an error. I think it's highly, highly, highly unlikely. And that's why there's such a methodical intentional development process. But to me, that would be the most likely scenario. And I actually don't think that Bitcoin can go to zero. I actually could promise you it won't go exactly to zero. It may go really close to zero in that situation, but I'll buy them all up at the end. And so maybe I can keep it at a dollar, but I don't know if it'd go actually to zero just because whenever you have kind of bid and asks on a marketplace, unlikely that it goes exactly to zero.

• 22:35Speaker 01

  All right, this is a good question to end on. Rahul Zoda, advice to young people, what do you wish someone told you at age 20? Make it actionable.

• 22:46Anthony Pompliano?

  Go bigger, be more ambitious, and have no fucking fear. And the reason why I say that is because what you realize is whether you're 20, 30, 50, or on your deathbed, we're all gonna die. And if you know that we all end up in the same place, you have a finite amount of time on earth, and so you use it to your advantage. Try to do the most epic shit you possibly can while you're here, rather than simply trying to always play it safe. Go bigger, be more ambitious, and have no fucking fear. That's the way to live your life, in my opinion.

• 23:23Speaker 01

  Woohoo!

• 23:24Anthony Pompliano?

  Alright guys, that is it. Make sure that you go check out the sponsors. Click on the link in the description. I appreciate all of you. Thank you so much for sending all the questions, and we will have to do this again in the future.