Trump vs Powell, Solving the Debt Crisis, The $10T AGI Prize, GENIUS Act Becomes Law

(0:00) The Besties welcome Gavin Baker! (1:51) Markets: Pricing in tariffs, Trump vs. Powell, solving the debt crisis (19:24) The $10 trillion AGI prize, what artificial general intelligence and superintelligence looks like in the economy (38:33) Sacks and Bo Hines join to discuss the GENIUS Act and the CLARITY Act passing the House this week, and what it means for crypto in the US (52:42) AI Infrastructure: $90B in new investments announced, Nvidia H20 export restrictions lifted (1:06:06) Sacks interviews Senator Bill Hagerty on the passing of the GENIUS Act Follow Gavin Baker: https://x.com/GavinSBaker Follow Bo Hines: https://x.com/bohines Follow Senator Bill Hagerty: https://x.com/SenatorHagerty Get The Besties All-In Tequila: https://tequila.allin.com Join us at the All-In Summit: https://allin.com/summit Summit scholarship application: http://bit.ly/4kyZqFJ Follow the besties: https://x.com/chamath https://x.com/Jason https://x.com/DavidSacks https://x.com/friedberg Follow on X: https://x.com/theallinpod Follow on Instagram: https://www.instagram.com/theallinpod Follow on TikTok: https://www.tiktok.com/@theallinpod Follow on LinkedIn: https://www.linkedin.com/company/allinpod Intro Music Credit: https://rb.gy/tppkzl https://x.com/yung_spielburg Intro Video Credit: https://x.com/TheZachEffect Referenced in the show: https://www.bloomberg.com/news/articles/2025-07-16/trump-likely-to-fire-powell-soon-white-house-official-says https://www.nytimes.com/2025/07/16/us/politics/trump-powell-firing-letter.html https://polymarket.com/event/fed-decision-in-september?tid=1752872350388 https://www.cnbc.com/2025/07/15/cpi-inflation-report-june-2025.html https://www.cnbc.com/quotes/US30Y https://polymarket.com/event/will-trump-remove-jerome-powell https://polymarket.com/event/who-will-trump-announce-as-next-fed-chair?tid=1752854752131 https://www.politico.com/live-updates/2025/07/15/congress/house-gop-crypto-bills-trump-00455645 https://www.nytimes.com/2025/07/15/us/politics/trump-ai-pittsburgh-speech.html

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

• 0:00Jason Calacanis?

  So Gavin, were you at the Coldplay concert in Boston last night?

• 0:05Gavin Baker?

  Sadly, I missed that.

• 0:08Jason Calacanis?

  Who are you with?

• 0:09Gavin Baker?

  Exactly. I was at home with my wife, but yeah, wow. How insane.

• 0:13Jason Calacanis?

  There's just so many layers to that story. It's impossible to get away from. It'll be 72 hours of memes. Dave, um, were you at the Coldplay concert in Boston last night? And if so, were you with Woody, your astronaut friend? Did you take Woody to the concert?

• 0:32David Friedberg?

  No counselor. I was here in Santa Cruz last night.

• 0:36Jason Calacanis?

  Oh, you were in Santa Cruz on a business trip?

• 0:39Gavin Baker?

  The funny thing is, if they had not reacted the way they did, the camera would have just panned away.

• 0:44David Friedberg?

  Yeah.

• 0:45Gavin Baker?

  Nothing.

• 0:46David Friedberg?

  No one would have ever known.

• 0:47Jason Calacanis?

  There is some great irony to the head of people and human resources being in an affair with the CEO, apparently.

• 0:55Gavin Baker?

  Allegedly.

• 0:56David Friedberg?

  Don't jump to conclusions, Jason.

• 0:57Jason Calacanis?

  No, it could have, I.

• 0:58David Friedberg?

  He could have been cracking her back, you know, like when you get your back tight.

• 1:01Jason Calacanis?

  Yes, it could have been a chiropractic.

• 1:03David Friedberg?

  Yeah, chiropractic move.

• 1:04Jason Calacanis?

  Oh, my God.

• 1:23Jason Calacanis?

  All right, let's get to work. It is the slow, slow news weeks of summer and we are delighted, delighted. Have fan favorite, super intelligent bestie Gavin Baker with us from Atreides. How are you, sir? How's your summer shaping up?

• 1:39Gavin Baker?

  Fantastic. It's been awesome.

• 1:42Jason Calacanis?

  Stock market is back. That's good for you because you invest in both public and private companies, yeah?

• 1:49Gavin Baker?

  My firm does, yes. Yeah.

• 1:51David Friedberg?

  Gavin, let me ask you a question. How do you price tariffs today? So where do you think this ends up? Obviously, there's a lot of back and forth and, you know, everyone's trying to make a read on what the end game is. What's your market take as you're making investments right now and where we end up on the tariff front?

• 2:07Gavin Baker?

  It is a good question. It's, it's open. We're going to see what happens with sectoral tariffs. I think it's, it's hard. You're doing the winning AI summit. It's going to be hard to win in AI if we put tariffs on semiconductors. But for a lot of what I do for now. Tariffs are not super relevant, but you know, for, for the market, for the economy, they are relevant, but for AI, they're maybe a little less relevant because I think everyone is, is maybe a little more sophisticated about the downsides of tariffs for constructing data centers here in the United States.

• 2:43Jason Calacanis?

  And ultimately, don't we look at the tariff situation and say, despite the shock and awe of the opening salvo, it's quite a boring position now. It just seems to be reciprocity and reasonable reciprocity at that. Yeah, that's how we would sort of categorize the end game here.

• 3:05Gavin Baker?

  I would say for everyone but China, you know, it is, and you know, we're, we've clearly reached some sort of deal with China, you know, rare earths for H20s and MI308Xs. But it's interesting. And one of the, the trade deals that has been finalized is Vietnam, and there's a special carve out for goods that were trans shipped from China through Vietnam. So they are clearly focused on China more than almost, you know, any other country, rightly or wrongly. But yeah, and I do think there is, you know, there was maybe three months where, where Trump said he did not care about the stock market, but now he's back to quoting the market at all time highs.

• 3:48Jason Calacanis?

  Yes.

• 3:49Gavin Baker?

  He clearly cares and is clearly very sensitive to market feedback. So I think that that will be a dampening mechanism on tariff volatility. But, you know, they passed the bill and he immediately went back to tariffs. And, you know, we'll see where we land in August. But I just think the most important thing in the market by far is AI kind of overwhelms everything else.

• 4:14Jason Calacanis?

  Absolutely. And I guess the other big story with the market, and we'll get into the H20s, David Sacks will be joining us in a moment. So he'll be jumping in halfway through it. But let's start with. Maybe this soft launch of the firing of Jerome Powell. On Wednesday morning, Bloomberg reported that Trump was likely to fire Powell soon. After talking with Republican lawmakers shortly after that, The New York Times reported that Trump had actually drafted Powell's termination letter. Market instantly reacted negatively, dropped 1%. Bony old rose about 10 basis points. You can see the blips here on these charts starting around 11:30 a.m. when the article was published.

• 4:56Jason Calacanis?

  Polly Market reported Jerome Powell out as Fed Chair in 2025 spiked up to 30% on Wednesday before dropping back down to 20%. Trump quickly squashed these rumors. Markets rebounded and Trump said, "We're not planning on doing anything regarding Powell." Some people speculating, maybe this was Trump testing the market reaction. As you talked about earlier, Gavin, he does seem to care about the market as most presidents do. If you remember, Trump nominated Powell as Fed Chair, November 2nd, 2017, and he has gone on a tirade the last couple of months, calling Powell stupid, numbskull, stubborn, low IQ, a knucklehead, mentally average. It's a long list of descriptors of the person he placed. Powell's term ends May of next year.

• 5:41Jason Calacanis?

  White House officials have confirmed Trump is in the process of selecting his successor. Polly Market says that could be Kevin Warsh, 22%. Kevin Hassett, 19%. Scott Besson, 15%. This hasn't actually ever happened, right? We've never had a Fed Chair fired, but we have inflation coming back a bit. If you all remember, there's a dual mandate for the Fed, keep unemployment low, check, that's pretty good, and keeping inflation under control. That's been going very well since our massive inflation spike over the past couple of years. And here we go. CPI ticked up 10% from 2.4% to 2.7%, 30 basis point increase over May.

• 6:24Jason Calacanis?

  So, any thoughts Gavin on these macro issues around inflation coming back a bit, the stock market at an all-time high, and unemployment? If you believe the unemployment data, and we've had a bunch of debates here about that, you know, how correct is it being at close to an all time low in our lifetimes? Let's go macro.

• 6:46Gavin Baker?

  Yeah, I wouldn't read too much into the CPI bouncing up a little bit. There's base rate effects, I think, on a month over month basis. And if you looked at, you know, what economists call core, super core, different, you know, ways to maybe smooth out CPI, I think inflation is still relatively contained. As far has, but I mean, a lot of very smart people are convinced that tariffs will lead to inflation. We'll see. There's certainly sound theoretical arguments for why they will, but it does look like maybe the overseas exporters are eating a little bit more of the tariffs than than

• 7:29Gavin Baker?

  people thought that they would, which is which is good for US inflation. But, you know, the combination of a very weak dollar and tariffs theoretically should lead to a little more inflation. Firing Powell, I worry that the market only went down 1%. I do think the market would go down quite a bit more if Trump did fire Powell. I think it would be a mistake. I hope he doesn't do it. And, you know, there are very sound reasons for the Federal Reserve to be independent. And I hope he does not read from that trial balloon down 1% that that's all that would happen. Look, the world would continue spinning, America would go on, but it would be a mistake.

• 8:14Jason Calacanis?

  Friedberg, we have this idea that there would be a couple of rate cuts and maybe we get monetary velocity going again, people will be able to take more loans out, invest more in business. But with the stock market tearing it up, there's a lot of wealth being put into the system with the big, beautiful bill. There's a lot of spending in there, as we've talked about here. Putting that aside, it feels like the economy's in really great shape. Chances of a rate cut has now flipped. No change is now the favorite option for September, whereas a week ago, the favorite option was 25 bips. So this idea that we're going to cut, or the Fed's going to cut, that seems to be changing as well. So your thoughts on the? The macro picture here.

• 8:57David Friedberg?

  So I'm not sure like the firing of Jerome Powell necessarily solves the US fiscal challenge, which is rising interest rates on the long end of the treasury curve. So if you look at the 30-year treasury yield over time, and Nick, maybe you could pull this up while I'm talking, but as of today, we're at exactly 5% on the 30-year. And you can see that this 5% yield, which is what the market is demanding the United States government pay in order to be loaned the money to make the bill payments that the US government has to make every year, is the highest it's been, the borrowing cost

• 9:40David Friedberg?

  is the highest it's been since going all the way back to 2007 as of today. And I think this is the real story for the United States. We have $36 trillion of debt. The average interest rate we're paying on that debt today is 3.3%. That's the average of all the treasuries that the federal government has issued, the Treasury Department has issued, to borrow the money that it is using and has used to pay all its bills. And if you look at the 5% number, that's a 1.7% hike. At 3.3%, which is the current average rate we're paying across $36 trillion, we're, we have a run rate interest expense, so just the money we're paying each year and the interest of the outstanding debt is $1.2 trillion a year.

• 10:24David Friedberg?

  And if this spikes up to 5% from 3.3%, we're talking about nearly $2 trillion a year in interest expense. And that number is only going to get bigger as we borrow more money each year and the loan balance goes up, the outstanding debt goes up, because we are still running a deficit. The government is spending more than it's making every year. So the crisis that America faces is a more profound fiscal crisis where the rates that we're having to pay are a function of what the market is telling us. The market does not want to loan the United States money over a 30-year period for less than 5% as of today. And so making adjustments to the short end of the treasury curve, making overnight loans

• 11:05David Friedberg?

  cheaper, which is what the Fed can do, will stimulate the economy and make more money flow easily because now you'll be able to borrow money overnight to do stuff like build a building and then sell the building next week or next month, or take out a car loan and pay it down and use your car to go drive for Uber and grow the economy and other things. So the theory is that if we can, you know, drive rates down on the short end of the curve, we'll grow the economy such that we'll be able to make those payments on the long end of the curve. But there comes a point where, again, you're only going to be able to move the market so much until the more important fiscal situations are going to be addressed, which is spending, taxation, and some of the other key policy issues. So I think what the market is saying is it's not as much about Jerome Powell and frankly,

• 11:50David Friedberg?

  getting rid of a prudent individual may be more challenging than it is beneficial when the real challenges facing the United States need to be more heartily addressed. So I think that's my kind of take on this whole point.

• 12:01Gavin Baker?

  Yeah, go ahead, Gavin. Build on it. So point number one, the 30-year has gone up since Powell started cutting rates. So that is just empirical proof that what David is saying, I think, is right. And second, the deficit has been a feature of American politics dating back to Ross Perot's, you know, 1992 presidential run. His independent third-party run. His independent third-party run. Here we go. But, yes, but it, the deficit never really mattered because interest rates kept going down such that even as our debt grew, interest expense has kind of a percentage of the government's

• 12:44Gavin Baker?

  budget stayed relatively low. Now that rates have gone up and don't seem like they're, you know, going down anytime soon, the deficit does matter, and it really matters. And you can kind of run a couple of scenarios, but like, pick your, pick your metric. If the deficit kind of continues at current levels and we were to refinance the debt at the prices that, you know, David was talking about. You know, it's only a few years before spending on interest is significantly larger than spending on Medicare and Medicaid or Social Security or the military. So pick something you care about.

• 13:27Gavin Baker?

  But, you know, our current course and speed, it's in the not-too-distant future where interest expense is the biggest line item for the government. And that is not healthy. And that's why the deficit finally matters, it's just that rates are higher. But the great thing is, is there is a virtuous cycle here. As you close the deficit, rates should theoretically come down. And then those both feed on each other to kind of help the problem. And it is possible, there's no silver bullet here, but some combination of slowing government spending, extra revenue, and, you know, tariffs are effectively, we've never had a consumption

• 14:09Gavin Baker?

  tax here in America, which I think is a good thing because consumption taxes are very regressive. But the reality is, like, even when Obama controlled the House, the Senate, and was the most popular Democratic president of our lifetime, I don't think federal government tax receipts has a percentage of GDP got above 18, 19%. So that's kind of the ceiling. And it, for income taxes alone, and tariffs are really just a consumption tax that kind of incents domestic manufacturing. I mean, there's all sorts of reasons they're bad ideas, you know? David Ricardo, the theory of comparative advantage, 100% correct, free trade is a good thing.

• 14:52Gavin Baker?

  But introducing some sort of a consumption tax, growing the economy a little bit faster through deregulation, and slowing government spending, I think there is a way out of this for America.

• 15:03Jason Calacanis?

  Yeah.

• 15:04Gavin Baker?

  But it's important to find the way because the deficit finally does matter, after really never mattering in my political lifetime.

• 15:11Jason Calacanis?

  It is interesting. We've never had to worry about our debt. It was always manageable. Because it wasn't that large, and even when it got large, it wasn't compared to GDP because the country was doing so well. We had the PC revolution, we had the internet boom. I mean, we've had boom after boom after boom in efficiency that we've led the world. And these companies like Google or Apple take over the world and all those tax receipts and income comes into our country, that does sort of make you not look at it. I guess, you know, I haven't talked to you, Gavin, and not to make this super political, but both parties have proven that they have no interest historically and in the current one with cutting spending. It's just the nature of it. So we can sit here, whether you're a Biden fan, Trump fan, put it all aside, both parties love spending and they're

• 15:56Jason Calacanis?

  not stopping. One of our friends has proposed, hey, maybe in the midterms, we have a couple of these House positions, a couple senators, maybe we try to flip them and create a new party that cares about this issue. What are your thoughts broadly on that? If a couple of more Joe Manchin types were in the House, the Senate, could this country maybe start to make this the deciding issue? And maybe could we see some movement on the other two parties, some pressure on them by a third party, an America party perhaps?

• 16:28Gavin Baker?

  Yeah, well, I think a few things. I do think there is room for a much more centrist party in America. You know, the way the primaries work, it, you know, leads to more maybe extreme candidates than anyone would actually want, you know, being each party's candidate. So I think a third party would be helpful, you know, and, you know, I think there's plenty of room for a party that is, you know, kind of a, you know, fiscally conservative, you know, reasonably socially liberal, pro-American energy production, all kinds of energy production, including solar, importantly.

• 17:16Gavin Baker?

  So I think there is room for that. And I think it is right that if you just target a few races, you can have a big impact. But I would just say, humbly, I think the American Party is a great idea. I just don't know that it is the highest and best use of Elon's talents at this moment in time with what's happening with AI. And just, you know, to the extent Elon is a friend of the pod, I just think staying focused, AI, Mars, that might be the highest and best use of his particular talents.

• 17:49David Friedberg?

  Hundred, hundred percent. Hasn't that been the case for, for some time, Gavin? And anytime there's something, whether it's Neuralink, or Boring Company, or some other new project, that there's these claims that this is a distraction away from the highest priority work that should be done? I mean, is the political stuff unique? And then his point of view on the political stuff, just like it was with Twitter, is that it's existential to society and civilization and our ability to function and to do, you know, to achieve the progress that he aims to achieve in his core function.

• 18:22Gavin Baker?

  So obviously, he is succeeding being the CEO of many different companies. But, you know, I think a big part of what makes him kind of exceptional as a CEO is the perfectionism, the drive. And, you know, politics is not a game of perfection. It's a game of compromise. So I am sure if he sets his mind to the America Party, that he will succeed. But I think there are other things for him to focus on. And, you know, the Boring Company, Neuralink, these are games of perfection. These are, you know, this is about engineering. This is about solving a problem. It's not, you know, compromise and the art of the possible. So I think he would succeed. I just think that there are

• 19:07Gavin Baker?

  other things that may be a higher calling for him.

• 19:12Jason Calacanis?

  Yeah, I mean, and the the cost of being away from his businesses this last time around, as he said very publicly, was severe. It was intense, and he's had to really regroup. But we got this incredible news when Grok 4 came out, and I think we should maybe talk a little bit here about what that big prize is. The big prize, I think, is most, well, it's actually going to be an open question, Friedberg. I think the big prize is whoever wins general intelligence, superintelligence, or the biggest cluster, or the most power to power the biggest cluster that powers general, superintelligence. So where do we sit on the language models today, Gavin, and Elon's recent, let's just call it what

• 19:56Jason Calacanis?

  it is, I mean, incredibly dominant release of Grok 4? I don't think people expected that. They didn't expect him to be able to leapfrog everybody. And let's be honest, people are leapfrogging each other every four to six months. So I fully expect Gemini will leapfrog Grok and OpenAI will have their time in the sun again as well. But this was pretty impressive, right?

• 20:18Gavin Baker?

  I'd say this is the biggest leapfrog we've seen in quite some time. And I think the benchmarks that matter are R-KGI 2 and Humanities' last exam, where it did, in the case of R-KGI 2, it's called semi-private, which is important, because it means that some of the questions were held back, because the criticism of these models is they memorize the answer. And so R-KGI 2, it has not seen the questions before, and it did roughly twice as good as, you know, the state of the art Google OpenAI and Anthropic models. And then on Humanities' last exam, you know, we can call it 50 to 75% better, you know, and exceptional humans score 5% on that. It scores in the 40s. So this is incredible

• 21:03Gavin Baker?

  progress. And I think it's worth mentioning, this model was trained on Hopper. So this this model is probably about as far as you can take the last generation of Nvidia GPUs. The next models we see, you know, Grok 5, you know, 05 from OpenAI, whatever they're going to call Jim, the next Gemini. They will be trained on Blackwell, and I think that will be a really big step function. But I do think the ultimate prize here is artificial superintelligence. Like, I think artificial general intelligence will create a lot of economic value. But, you know, and, you know, maybe we will be able to work less as humans. But I think ASI, artificial superintelligence, is what is really exciting.

• 21:45Gavin Baker?

  You know, in terms of maybe, you know, being able to live longer, you know, really kind of fundamentally kind of change the fabric of our lives.

• 21:51Jason Calacanis?

  Can you take a stab at explaining that difference in definition to the audience who they hear these terms and we kind of bundle them into either a transcendent intelligence that we haven't seen before, that we as humans can't comprehend, it goes beyond human intelligence, or this is the smartest human on the planet and where we are right now in this journey? Because I think these terms are all getting muddled together, and I think we have an interesting conversation here if we parse them.

• 22:18Gavin Baker?

  I think artificial general intelligence, I would define it, has an AI that can take economically useful actions in a variety of domains and be better than the average human in most domains, all domains. But that's very different than superintelligence.

• 22:36Jason Calacanis?

  Okay.

• 22:36Gavin Baker?

  You know, being, you know, being able to draft a contract, that's not superintelligence, but it is useful. Being able to do a medical diagnosis is not superintelligence, but it is useful. You know, being able to book my travel, so on and so forth. Superintelligence means exactly what you said, that it is smarter than any human. It has, you know, access to all of human knowledge. And I think one of the most interesting questions is what will the economic returns to superintelligence be? And they're definitely unknowable because we have never seen superintelligence before. If as humans, we have kind of pushed the limits of physics, biology, chemistry, the laws of the universe, then maybe the economic returns to superintelligence won't be that high.

• 23:21Gavin Baker?

  But if superintelligence is curing cancer and inventing warp drives, then the returns are going to be really, really high, and it's fundamentally unknowable.

• 23:30Jason Calacanis?

  Okay, so we're at general intelligence. Hey, you're a lawyer, you're a tax, you're an accountant, it's going to go much faster. They'll have a co-pilot. This is all going to be great for a business. Every business gets 10% more efficient a month. Seems like a reasonable bogey, which means every seven, eight, nine months, every business is going to get twice as efficient at these kind of chores, yeah?

• 23:52Gavin Baker?

  I think that I wouldn't say that's a reasonable bogey. I think that might be a little aggressive. It's, you know, the world, the world always, it's, you know, I think it's a Bill Gates quote, you know, the, the world always changes less than you expect over the next one, two, three years, but way more than you expect over 10 years. Just takes time for technologies to diffuse. You know, maybe really nimble startups will see some of the gains, you know, that you were talking about. But I mean, if we doubled productivity, I mean, that would be like an economic revolution.

• 24:23Jason Calacanis?

  I mean, we're seeing it in programming. I, I, I

• 24:26Gavin Baker?

  For sure.

• 24:27Jason Calacanis?

  If you talk to the average developer, they I think would say they're getting five to 10% better a month, better being defined as faster shipping, more code. Rule of 72, hey, you know, every year at least you're going, you're going to be twice as good. I think that actually seems to be happening with developers.

• 24:43Gavin Baker?

  I think it is happening with software. I think software is the first area where you've seen a real, true kind of economic productivity impact.

• 24:52Gavin Baker?

  Generalized, a lot of companies are having incredible success with AI for customers, you know, support for sales. I think you see it more in startups than big companies. But it, the impact it has had on coding is undeniable.

• 25:04Jason Calacanis?

  Friedberg, let me swing this around to you. We've got the super intelligence out there. We've got AGI out there.

• 25:11Jason Calacanis?

  One of the things Gavin said was by definition, you can't quantify the gains of super intelligence. That is the big prize here. That's why people are putting this much money into these kinds of data centers. Yeah, in your mind, it's not just the general intelligence. That would be the silver medal. People are going for the gold here, not general intelligence, super intelligence breakthroughs that we can't imagine. Am I, would you say that's a fair way to sum up the massive interest in investing in these projects?

• 25:43David Friedberg?

  Yeah, I mean, I think there's something

• 25:48David Friedberg?

  where everyone has identified this asymptotic return moment where if you get to that moment, you're limitless in terms of the upside. Is there one winner? I don't know, I don't think so. But I would also kind of reframe this as being some binary condition that I think we're talking about it as being quote, "general intelligence, superintelligence," as being on a spectrum of leverage towards complexity. Complexity meaning like, I can do a simple task, like instead of writing a letter and putting it in an envelope and having some guy carry it to my mom, you know, and she

• 26:31David Friedberg?

  gets it the next day, I can digitally get her that message instantly over email. That creates an incredible amount of leverage and solves a lot of the complexity of getting her that communication from me. So if I as a human said, "I would like to harness fusion power, similar to what the sun uses to make energy, and I want to do that on Earth." Today, we're in, call it year forty or fifty of a research cycle of humans trying to solve that particularly complex problem. It's a scientific problem, it's a discovery problem, it's an engineering problem. And this idea of superintelligence is that it could give us immense leverage in solving that complex problem that we otherwise may be challenged to solve over decades or hundreds

• 27:14David Friedberg?

  of years, or think about one day solving a problem that would take humans thousands of years to solve. I don't think that humans are limited in our ability to solve problems. I think we're limited in terms of time and what intelligence, what digital intelligence gives us is leverage on time so that we can now tackle ever more complex tasks that as you think about these tasks, the amount of time isn't just an incremental one year or two years, but it becomes a hundred years or maybe a thousand years. So this relates to, I think, projects around physics, around chemistry, around transportation, around biology, where we're probably fundamentally scratching the surface

• 27:54David Friedberg?

  today, and where the superintelligence is an enormous leverage creator for us. And so I don't view it as some like species or race that independently persists in its own intentions, but it is a tool that provides leverage in a way that is orders of magnitude greater than the leverage we got from yesteryear's digital tools and probably today's AI tools and probably tomorrow's general intelligence tools, is kind of how I would, I would think about it. And, you know, maybe it's because one model does so much stuff better than any human, you can call it superintelligence. But I think functionally, leverage into complexity is where this becomes super compelling for humans. And it's why I think we can and should

• 28:36David Friedberg?

  be highly optimistic about living very long lives and traveling anywhere we want and having abundance in food and having abundance in resources and having abundance in recouping our time to do the things we want to do instead of the things that we have to do today because we don't have access to this incredible leverage. So that's where I get kind of

• 28:55Jason Calacanis?

  I love it, Freiburg. I think it's a great way to look at it. But I want to go back to the silver medal here in this sort of competition. Gold being superintelligence, we start solving fusion and really big problems on deep research cycles and the velocity of that goes up. But just going back to the silver, you know, everybody in the economy becomes, I don't know, single digit, it's more efficient every month and, you know, some amount every year. I've been trying to back of the envelope what I think the value is for a human being in the West, in the modern world, and what they should spend on AI per month. I've come up with a number of about 75, 150 bucks, somewhere in that

• 29:37Jason Calacanis?

  range, is a no brainer to spend on your AI per month as an individual working in the world. If that's the premise, right, I think there's a billion people in the developed world who could spend, let's call it a hundred a month, twelve hundred a year. It doesn't take a genius to figure out this is a trillion dollars in revenue. Based on market cap, that's probably ten trillion dollars in market cap. And then we just have to back into the spending of what it costs to build this. You're doing these kind of calculations, I'm sure, at a treaties, yeah? And where this general back of the envelope that I've come up with in my mind for a mental model that there's a ten trillion dollar prize, a trillion dollars in revenue, just in the silver

• 30:20Jason Calacanis?

  medal, does that jive with the spending we're seeing today? I think people are putting in ten billion dollars worth of equipment a year across five different companies, right?

• 30:30Gavin Baker?

  Well, I think they're putting in quite a bit more than ten billion per year.

• 30:34Jason Calacanis?

  Um, each.

• 30:36Gavin Baker?

  No, no.

• 30:36David Friedberg?

  Google alone is doing seventy billion this year. Each is twenty seventy.

• 30:41Jason Calacanis?

  But is that, is that seventy billion they're putting in this year going to be repeated for the next five years? So it'll be three hundred fifty billion?

• 30:47Gavin Baker?

  If you look at, if you, well, yeah, TBD, the future is always uncertain. But, um, you know, if there are economic returns to that, they will keep doing it for sure. Something interesting is, AI is, you know, as we've discussed in previous all-ins, extremely compute intensive. And it's just, at no point in my career as a tech investor, except the very beginning, which was kind of the end of the PC wars, which Dell won by being a low-cost producer, going direct, cutting out the working capital, you know, the components in a PC depreciate. So if you have to go through a store where it sits on the shelves, you're at a big disadvantage from, you know, either a, you know, call it a cost or quality perspective. But at no point in the twenty-five years I've been a tech investor is being the low-cost producer mattered.

• 31:32Gavin Baker?

  Being the low-cost producer is really going to matter in AI. Because at some level, the amount of tokens you produce is intelligence because of test time compute, you know, post-training reinforcement learning. And so if you can produce those tokens at a lower cost, you'll have a big advantage. You know, if for that seventy-five billion, or thirty billion, or fifty billion that you're spending per year in CapEx, you can produce more tokens. That is a profound advantage. I don't like your your calculations like just has a back of the envelope, you know, kind of scratch. They seem reasonable to me.

• 32:11Jason Calacanis?

  The trillion dollars a year in revenue because of AI seems quite reasonable when you frame it as a thousand dollars for a person to be whatever thirty, forty, fifty percent more efficient at work every year.

• 32:25Gavin Baker?

  Yeah, and it's just you. We could probably go back and look at kind of like the early days of, you know, cell phones and what were people willing to pay relative to disposable income?

• 32:33Jason Calacanis?

  Your PC analogy would actually be the perfect one. A PC at back in the era that era was what three, four thousand dollars per person. They lasted for three years. So it was exactly a thousand a year.

• 32:42David Friedberg?

  But this is why this is why creating such delineated distinction between different types of AI, I think, is is also like the equivalent of trying to create distinctions between other types of technology. So the the automobile, the airplane, the telephone, the computer, all of these technologies are tools that created leverage leverage on things that were otherwise complexity and reduce them down to simplicity from a human perspective. Pick up the phone, make a call instead of getting up on your horse and going across the country to deliver a message or using a computer to do a spreadsheet that calculated

• 33:25David Friedberg?

  everything for you rather than calculated by hand and so on and so forth. Like all of these tools reduce complexity to simple tasks for humans. And the ever increasing complexity of what we can accomplish with digital tools is, you know, continuing in this kind of era now. But that's why I think it's very similar, Jason. Like we this is not some new concept. It's it's the continuation of human productivity. It's the continuation of the improvement of what humans can do, what we can produce, what we can. And and yes, there's a concept now that intelligence has become such a like it's caught up to everything. And Gavin, I don't know if you think that there is this concept of some moment of singularity, but it does feel to me like there's just extraordinary leverage that's being created that feels similar to. Yeah.

• 34:09Gavin Baker?

  For sure, that's true. I hope that's true. I hope your vision of it being a productivity enhancer for humans is correct. You know, I do think, you know, people deep in AI.

• 34:21Gavin Baker?

  Do you think there's some probability that it goes sideways? But I hope, I hope that you're right. But coming back to, to J Cal's, you know, $10 trillion prize and, you know, relative to, you know, the market caps of the companies involved, it, it, it needs to be at least $10 trillion. Something that I think is, is interesting and, and, and relevant, particularly to Grok four being the best product, is the best product doesn't always win in technology.

• 34:46Jason Calacanis?

  No.

• 34:46Gavin Baker?

  And

• 34:47Jason Calacanis?

  Beta max, yeah.

• 34:48Gavin Baker?

  Yeah. In sports, you know, they say, uh, defense wins championships. And on the internet, distribution wins championships. And Grok four has formidable competitors with lots of distribution and Google. And

• 35:02Jason Calacanis?

  Meta.

• 35:03Gavin Baker?

  Meta, if they get their act together. Microsoft. And so from an industrial logic perspective, something that I think makes a lot of sense, particularly since OpenAI bought Johnny Ives hardware startup, which will place them into competition with Apple at some point, is XAI and Apple are natural partners. There's been a lot of news about Apple thinking about buying perplexity or Mcstraw. But that's just a Band-Aid. Those companies don't get Apple what they need. And Apple's had an incredible partnership for many years now with Google. That's generating tens of billions of dollars for both companies. And I think there is solid industrial logic for partnership. You could have Apple, Grok, Safe Grok, whatever you want to call it, you know, so that Apple feels comfortable.

• 35:49Gavin Baker?

  And that probably also helps Grok in the enterprise. And then it also helps both Apple and Google with this DOJ trial. And so I think in this, you know, incredibly high elo chess match that is being played between the leading labs. Like that is, that partnership makes a lot of sense.

• 36:10Jason Calacanis?

  Fascinating. It's the first time I've heard anybody sort of make that natural connection. But you're right. Eric Schmidt and Steve Jobs at one point had this discussion, which was, hey, we've got search and you've got a browser now because the iPhone didn't have a browser, you know, uh, uh, you know, and they could have built their own search engine. They could have partnered with Yahoo, but they decided to make this long-term partnership with Google. And man, that dropped, what, 20, 30 billion to the bottom line at Apple and. Cemented Google's search franchise.

• 36:40Gavin Baker?

  Absolutely. And right now that deal is being litigated by the DOJ and the DOJ is considering remedies. And so if you bring on a really kind of effective credible AI provider,

• 36:55Gavin Baker?

  I think it could help both Google and Apple with their antitrust issues. And at the end of the day, you know, Google, they have Android and their Pixel phones. OpenAI is making hardware. Anthropic is kind of a captive of Amazon. Meta is kind of a, um, you know, they're, they're in a death match with Apple. So I think there is really sound logic for that partnership. I think it'd be good for both companies. Love to see it happen.

• 37:22Jason Calacanis?

  It feels to me like the interface is going to be the browser. I know this sounds crazy, but I've been playing with the comment browser from perplexity. Did you play with it yet, Gavin, or look at some of the demos?

• 37:32Gavin Baker?

  Yeah.

• 37:34Jason Calacanis?

  What are your thoughts here? Because it's really, and then ChatGPT just launched a virtual desktop that pops up to go do your, you know, little web-based scrapes, agents, assignments, whatever. I'm going to call it assignments, you know, homework chores, go do your chores. What, what are your thoughts on this modality?

• 37:57Gavin Baker?

  Yeah, the browser is part of distribution, winning championships. Apple has Safari, Google has Chrome. And if you're not going to strike a partnership with one of those distribution channels, you will eventually need to do your own browser. And you can extend that logic, you know, all the way, you know, that's why they Google, they did a browser, they did a phone. But I also do think the, um, you know, the companions from Grok have been interesting to play with. And they certainly make it more engaging.

• 38:26Jason Calacanis?

  That becomes the agent. It's a kind of incredible, mind-blowing concept for that to be the interface. All right, listen, here we go. Calling in live. Got a breaking bestie coming on board here. David Sacks calling in live. I see the pale yellow paint in an ancient building. You must be in some sort of wing of the Great White House. Is that correct, David?

• 38:55David Sacks?

  I am. Well, I'm actually not in the White House per se. I guess I'm on the White House grounds. We're in the Eisenhower Executive Office Building. That's where my office is.

• 39:03Jason Calacanis?

  I can tell from that molding.

• 39:05David Sacks?

  I've been here.

• 39:06Jason Calacanis?

  Yeah, no, they said great things. And I checked my calendar.

• 39:10David Friedberg?

  I'll send you some photos. It's great.

• 39:12Jason Calacanis?

  Well, no, but the calendar's wide open between now and the All In Summit, allin.com/ yada, yada, yada. So the window's there, Sacks. The window's wide open. And I'll see you in the cafeteria, I guess.

• 39:22David Friedberg?

  Play your cards right on stage next week, Jake. You might get invited after the AI Summit we're doing. Yeah, absolutely. We got the AI event in DC next Wednesday, which has been publicly announced. So it's going to be exciting.

• 39:33Jason Calacanis?

  David, you brought a friend today. Maybe introduce your friend and tell us what you got done. What have you gotten done in the last week for the American people? They want to know. Because you weren't here last week doing the pod. So you must have gotten something done for the American people. Let's hear it.

• 39:47David Sacks?

  Well, first of all, this is the czar behind the czar, Bo Heim. He's the executive director of the President's Working Group on Digital Assets. So that's the working group that I chair, but he actually does all the work. He's the executive director and he's here every day. And he's been working on crypto pretty much nonstop since we started the administration. And he's kind of the unsung hero within our operation here on these two bills that just passed the House, which are historic and quite momentous.

• 40:25Jason Calacanis?

  So Bo, welcome to the program. And maybe you could tell us a little bit about these bills and what they do for the American people.

• 40:35Speaker 04

  Yeah, well, first of all, David, you're too kind. We've had a blast working together. I mean, we connected back in transition, I think, in late November, and we started mapping out a plan for this. And to see it come to fruition this week is really like, it's unbelievable. The fact that we had the bipartisan votes we did today in the House is remarkable. It's unprecedented. And it shows you that, you know, leaders on both sides of the aisle understand that our country has to be at the forefront of this technological But let's start with Genius because I think Genius is really the foundation for everything else we can build upon in this space. A lot of industry cares about market structure, as do we, and we want to see it done on the President's desk as well. But Genius

• 41:17Speaker 04

  is unique because it really updates the payment rails inside of our current financial system. I mean, the payment rails have been archaic, and I've likened it to the fact of the ways in which we've communicated have changed quite dramatically over the course of the last several decades. The ways in which we move money really haven't. And we have the technology there in blockchain technology. So what we're doing here is we're fixing the plumbing of our financial system. We're securing US dollar dominance for decades to come. If you want to access our capital markets, you're going to have to use a dollar backed stable. You're also providing a pathway for tokenization of public securities in 24/7 markets and the things that people have dreamed about for quite some time. This is a revolutionary piece of legislation, and the fact that it had this much bipartisan

• 42:00Speaker 04

  support is incredible. It's a testament to President Trump's leadership. It's a testament to our fantastic AI and crypto czar, David's leadership. I mean, he's truly been the guiding star behind the ideology and what we're pushing here. And he has a phenomenal team as well. I mean, I'd be remiss not to thank Tracy, who's David's chief of staff. I mean, in the midst of all of the chaos to get this done, and like, there were so many steps to this, we had to beat the banking lobby to get it passed the Senate. Then it moved over to the House, in which we had to basically fight some members that really misinterpreted or misunderstood what this bill actually did. And the President stepped up, David stepped up in an enormous way. It wouldn't have happened without either of them. And so now we have this bill heading to his desk tomorrow. And to pivot to market structure really briefly,

• 42:45Speaker 04

  this provides like the rules of the road for the exchanges, the brokers, everyone in this space. They desperately need it so that we can break down the wall between traditional financial institutions and these digital asset players. I think that's well underway. Obviously, you know, getting a vote as strong as they did in the House is indicative of what can happen in the Senate. If we deliver on these two pieces of legislation, I mean, that's about 90% of what needs to be done for crypto to make the US crypto a capital of the world. And, you know, it's just remarkable. I mean, we're over the moon.

• 43:17Jason Calacanis?

  Okay, Sacks, you got these two things over the finish line. Congratulations on that. Lots of compromises you had to make. So I want to get into what were the compromises to get this done?

• 43:27David Sacks?

  Just to clarify one thing, when you say finish line, so like Bo was saying, there's two bills. There's the Genius Act, which is the stablecoin legislation. And then there's a Clarity Act, which is market structure. It's basically all the other tokens besides stablecoins. Where we are is that both passed the House today, but Genius has already passed the Senate. So it is going to the President's desk tomorrow, and it will become law. We're doing a bill signing with the President. By the time this pod is released, it will probably be law. I think we will have the signing. Clarity started in the House, and so it has passed the House, and now it's going to the Senate. And they still have to do their hearings and markup on it. And we expect that will happen over the next couple of

• 44:10David Sacks?

  months. In fact, the Chairman of the Senate Banking Committee, Tim Scott, has said that he wants to finish with the market structure legislation by the end of September. So if all goes well, then we could be looking at a second bill signing in, say, October. And like Bo said, that would be pretty much the crypto industry's wish list for having a clear legal framework in the United States for both stablecoins and other crypto tokens. So it's really pretty amazing. I mean, when I started this job, I'll just tell you, one of my friends in Silicon Valley said that

• 44:49David Sacks?

  You know, you may be able to get some AI things done, but you'll never get anything done on crypto. And the reason is because the entrenched interests are too powerful and they'll stop it. The banking lobby will stop it, or Elizabeth Warren will stop it, or just all the status quo players who could get disrupted by blockchain-based technology will somehow find a way to stop it. And that didn't happen. Like, we've actually now moved forward. Genius is about to become law. And I think clarity is looking like it's gonna have the votes in the Senate as well to become law. So it's really pretty amazing how much progress we've made in just six months. And like Beau said, this really comes down to President Trump's leadership. He made the promises during the campaign to prioritize crypto, to make the United States the crypto capital of the planet.

• 45:34David Sacks?

  And it was his negotiating skills and deal-making that made this all happen. I mean, this past week has been a little bit of a roller coaster. There were reports over the last couple of days that the whole thing was falling apart and wouldn't happen. There was a moment, I think this has been publicly reported, but I'll give you some color on it, is there were 12 members of the House whose votes were necessary to advance the bill to this vote today. And at a certain point, President Trump brought them into his office, the Oval Office, and worked out all the differences personally. And that's what put this bill over the top. If it wasn't for the President's direct involvement and action and understanding of the issues,

• 46:15David Sacks?

  he listened to all the concerns and he paid attention to the ones that were real and then rebutted the ones that weren't. If it wasn't for his direct involvement, we would not be here today.

• 46:24Jason Calacanis?

  And he understands crypto. He's involved in it, is, uh, seems to have an understanding of the value of stable coins for the US dollar. That seems to be a key motivator for this being bipartisan. You got twice as many Democrats as you thought you would get. Is that because people want to make sure that dollar supremacy gets locked in and stable coins is a way to do that? Because you can't have a stable coin unless it's backed by a dollar.

• 46:51David Sacks?

  Yeah, I mean, like I've talked about on this show before, it shouldn't be that hard to sell regulation to Democrats. I mean, what we're doing here is providing a regulatory framework for the industry. They didn't have one before, and that's why the number one stablecoin player in the world right now is an offshore entity. They will have to come onshore as part of this bill in the next three years. So what we're doing here is creating regulatory framework. But the reason why it's substantially bipartisan is because the industry wants this regulation because they want the stability it gives them in terms of having that legal authorization. They want to make sure that if, you know, four years, eight years from now, 12 years from now, whatever, there's not some new Gary Gensler who comes in and turns the whole industry upside down because he doesn't

• 47:35David Sacks?

  like some aspect of what they're doing, and he just starts prosecuting them, which is what the industry experienced over the past four years with Biden's war on crypto. So we, meaning that the Trump administration could fix the Gensler issues just with agency rulemaking, and we're certainly on that path to do that. But if you want long-term stability that goes beyond just this administration, you have to get legislation, you have to canonize it into law. And that's why the industry was so interested in getting these bills passed. So I think that's why you're seeing some bipartisanship here. Like Beau said, I do think that there's a substantial number of Democrats who understand that this technology is the future, and it's a positive thing for the US. What can be bad about allowing

• 48:17David Sacks?

  digital dollars, which extends the dollar's dominance online, so that it basically bolsters the dollar's status as the world's reserve currency? Over time, as we get challengers from BRICS, for example, this is going to make the US dollar stronger. And every time a dollar token trades somewhere in the world on a crypto wallet, there has to be a physical dollar in a US bank account invested in a US treasury. And that creates demand for our debt, which is another positive thing. And there have been studies done that show that The results of this bill could be trillions of dollars of new demand for our debt, which is only a positive thing.

• 48:55Jason Calacanis?

  And if you don't allow a legal way to do this, and you don't have a proper framework, you've been dancing around this person who has three years to get their act together. That's Tether, I'll say it. You can do a search for Tether controversies or shenanigans, and you'll find plenty of them.

• 49:11David Sacks?

  I don't think it's fair to say they don't have their act together. I think they have their act together. It's just that they did not know how they'd be treated operating onshore in the US under Gary Gensler and the Biden administration. And so they operated offshore. And what was happening under the last administration is that the last administration, by creating all this uncertainty and doubt, was driving all the innovation offshore.

• 49:37Jason Calacanis?

  Okay, fine. They have a sordid past. That's my statement, not yours. But now they have to clean up whatever messy stuff they have in their past. That's me saying it, not you. You can have your opinion, I'll take mine. But we're in agreement that if you don't have a framework, they would be doing even more things that were maybe off the reservation of my mind. Gavin, any thoughts here on crypto? I'm not sure you've participated in it particularly because it didn't have a framework, yes?

• 50:02Gavin Baker?

  I would just say, one, David, congratulations. Seems like an incredible achievement. Two, I try to invest in areas where I feel like I at least believe I have some sort of competitive advantage, and it's not clear to me that I have any sort of competitive advantage in crypto. But three, David, I am curious, for the stable coins, does the genius act limit them to dollar-backed stable coins? So it's not like you can create the stable coin and then swap in something other than a dollar. Is that true?

• 50:34David Sacks?

  Well, I mean, anybody can create a stable coin that's backed by anything. And in fact, I think there are Euro-backed stable coins out there, for example, but nobody uses them. I think if you look at the stable coin market share, it's like 98% US dollars, 2% euros, because there's a flight to quality. Everyone wants to use the best one, right? And this is why it's in the interest of the United States to basically enable this technology to continue flourishing, is because as the best fiat currency, we're the one that's going to get used the most. There's no reason to have multiple fiat stable coins, not really. So this is going to accrue to the benefit of the United States. Jake, let me go back to something you said.

• 51:16David Sacks?

  So I don't necessarily agree with your criticisms of that particular company, but where I will agree is that this bill will provide additional comfort for consumers and additional protection for consumers because now all the stablecoin companies will have to operate in the United States, they'll be subjected to quarterly audits, and we will know that every stablecoin that's been issued is fully reserved or backed up by a dollar in a US bank account. And so therefore, when a stablecoin holder eventually wants to cash out and they go to basically an off-ramp, the money will actually be there. Now, I'm not saying that the money isn't there with any of the current providers. In fact, I

• 51:58David Sacks?

  think it is, but now consumers will have the additional protection and confidence to know that all these entities have been audited, they've passed these audits, and they're regulated entities under US law. And that creates confidence for the market, and it's good for everybody, and it will spread the adoption of this stablecoin product.

• 52:19Jason Calacanis?

  And if they don't, they can't participate in our market, right? So that's the good news here is, you know, if you choose to not go through those audits and you do attestations or other fugazi, fugazi stuff offshore, you're not saying anybody's doing that, but people have, you know, then you just don't get to participate. And this is the great thing about having some basic rules of the road. We should talk a little bit here about infrastructure sacks. You were in Pittsburgh this week. There were some announcements. This was another bipartisan win. I think Shapiro was there, a bunch of investment going on there. Maybe tell us a little bit about the progress made in Pittsburgh with regards to AI and infrastructure.

• 53:00David Sacks?

  This was an energy and innovation summit that was organized by the Pennsylvania Senator Dave McCormick and his wife, Dina Powell McCormick, and they did an amazing job bringing together all of these different companies and interests that have a stake in energy in Pennsylvania and the development of AI. And Pennsylvania is, I think it's the number two energy producing state in the US. It has tremendous amounts of natural gas. They feel like they can expand that. I think there's been a lot of fracking in the past there. For example, they even have nuclear Westinghouses there. And it makes sense to have the data centers near the power source, right? And so we know that these big AI data centers can be powered by either natural gas or nuclear.

• 53:41David Sacks?

  And so Pennsylvania just makes a lot of sense as a place to build this AI infrastructure. So this was a summit to announce new investment in Pennsylvania, something like $90 billion. President Trump was there to keynote the summit and talk about these investments. It's his policies towards energy that he started describing long ago. I mean, remember, he made the campaign promise of Drill Baby Drill. He's been talking about the need for energy expansion in America for many years. And I think he was very far sighted in seeing that energy is the basis for everything. It's a basis for AI. It's a basis for all other kinds of growth. So by promoting energy dominance, we also get AI dominance.

• 54:26David Sacks?

  So we've talked on this show before about how we're going to need that energy to power the electricity of all these new AI data centers. So this summit brought together all these different groups. And the thing I thought was really interesting, the thing I learned from it was just how diverse the business interests are that are going to participate in this whole AI boom. It wasn't just big tech. Yes, Ruth Porat from Google was there. It's also small tech. There was hardware companies, there were robotics companies, but there were also these energy companies. There was nuclear, there was gas. The trade associations were there. It's construction, it's electricians, it's carpenters. And so there was a huge diverse array of different parts of the economy that are going to experience growth from this AI boom that's taking place.

• 55:11David Sacks?

  It's not just a Silicon Valley thing. So that was what I took away from Pittsburgh. And it was a really cool experience being there.

• 55:18Jason Calacanis?

  I thought there were two interesting notes as well. Hydro, I saw Google was investing in hydro and upgrading some dams there. This is, I think Gavin, one of the great. Upshots of the AI boom is that the AI companies, whether it's Meta or Google, they're so motivated that they'll actually go and upgrade the infrastructure. They'll invest in the, you know, small modular nuclear reactors that are coming. And even gas turbines, obviously natural gas is a major part of this as well. And you saw that up close and personal with the build out of Colossus, yeah, Gavin?

• 55:55Gavin Baker?

  Yeah, absolutely. I mean, electrical production is fundamental to AI. If we do not significantly increase kind of domestic energy production and electricity generation, you know, we are already at a disadvantage to China. And I do think we want to close that kind of electrical generation gap as quickly as we can. You know, and natural gas is great, nuclear is great, solar is great, batteries are great. We need it all.

• 56:22Jason Calacanis?

  Yeah.

• 56:22Gavin Baker?

  All of it.

• 56:23Jason Calacanis?

  And Sacks, I saw your favorite governor, Josh Shapiro, was there. And he was being very positive about finding common ground on energy, economic development, and saying, hey, this is like a great example of bipartisan efforts to collaborate. So maybe you can talk a little bit about that because you had two great moments of collaboration between the Trump administration and the Democrats. This is, uh, this is good for the American people, yeah? Both on the crypto project and on AI in Pennsylvania.

• 56:53David Sacks?

  I've never met Shapiro. I did see him there at the event, but I didn't see him on the stage. I don't know if he was part of the roundtable, so I don't know exactly what his status was. But what's interesting about Pennsylvania right now is that it's a state that's turning red. And so you see that Fetterman, who's probably the most right wing member of the Democrat Party in the Senate, and Josh Shapiro obviously is tacking towards the center because they see the direction of travel in Pennsylvania. So yeah, I think you've got some centrist Democrats in that state.

• 57:24Jason Calacanis?

  Yeah, working out pretty well.

• 57:26Gavin Baker?

  Josh Shapiro, every two days tweets something about how he's deregulated something. He's made it easier to do business, like he is, he's on the program. Seems like a sensible man.

• 57:39Jason Calacanis?

  Yeah, 100%.

• 57:40David Sacks?

  I'll just give a final shout out to Bo here for all the work that he did on Genius. I mean, he's kind of the unsung hero.

• 57:46Jason Calacanis?

  And Bo, how are you, uh, how are you doing all this while finishing up your degree? When do you, when do you graduate from college?

• 57:53Jason Calacanis?

  The kid looks like he's 20 years old. How old are you, Bo?

• 57:55Speaker 04

  I have the baby face. I'm 29, turning 30 next month.

• 57:59Jason Calacanis?

  Look at you, 29 in the White House, lead and working with David Sacks. This is a dream come true for you, huh?

• 58:05Speaker 04

  It is. I mean, David's been incredible. I've learned so much from him, just the way that he negotiates and the way that his, his brain works. It's been, it's, it's been a blast just to be a part of it. But I have a 10 month old now, so I should have bags under my eyes, uh, from lack of sleep. But Jason, I'll make one more point before I jump off on, on the tether topic. Like the one thing that I think your viewers should know is this year, they'll be the fourth largest purchaser of US treasuries. And I think that's something that, you know, we should really contemplate. You know, I, I agree with David's sentiment on this. I'm excited to see what they do here in the US. I'm glad that you're going to be a part of our system under the regulatory regime. But so will everyone else. And I think that's a great thing for our country. It allows us to have control.

• 58:45Jason Calacanis?

  That's great that you guys are backing them up because they've been banned so many times by other governments. I'm glad you got their act together. I'm going to, I'm going to keep on those tether guys until they get their act together. So.

• 58:55David Sacks?

  Keep qualifying that you speak only for yourself.

• 58:58Jason Calacanis?

  I only speak for myself. I've been following that tether story for a long time and I think it's great.

• 59:04David Sacks?

  I want to make this point. I always know that our critics have never actually watched the pod. When they start talking about the all in point of view on something, right? As if there's a singular point of view uh, from the all in pod, like, you know, it's like the all in pros wherever think something, when anyone who's watched the show knows that we've been fighting like cats and dogs for years. And there's four distinct points of view. And sometimes we agree, but there's almost always some disagreement. So.

• 59:34Jason Calacanis?

  We, we've disagreed about this issue. We also, uh, Trump and I, as you know, are relentless supporters of Ukraine. We believe we should be giving them weapons and support. And David, you happen to disagree with me and our president on that. You've had a different position historically. So here we are.

• 59:52David Sacks?

  I'm going to stay in my lane on that one.

• 59:56Gavin Baker?

  David, can we talk about the H20s or would you rather not? Because I feel like you have been like so dead right about this. And I am, you know, I, it seems like the export, they're going to get the licenses. And that is 100% the right decision for America. And I do give you credit for championing that. I'm happy to talk about why I think it's great, but we're just, you know.

• 1:00:19Jason Calacanis?

  Can you frame it for a second for the audience, Gavin? What we're talking about here, Nvidia obviously was banned from selling their latest and greatest to China. And even the last generation, the H20s. And obviously that creates an opening for Huawei and other players to create competitive products as opposed to using the standards built here in America.

• 1:00:40Gavin Baker?

  Yeah, well, I think, I mean, I think you said it well, but first of all, it's not the latest and greatest. The H20 is not the latest and greatest. We're not gonna, I don't think we're gonna let the latest.

• 1:00:49David Sacks?

  It's not even the last gen. It's a deprecated version of the last generation.

• 1:00:53Gavin Baker?

  Right, yeah.

• 1:00:55Jason Calacanis?

  So remnants.

• 1:00:56David Sacks?

  It's a less powerful version of the Hopper chip. And now they're on to Blackwell. So it's, anyway, Gavin can explain.

• 1:01:03Gavin Baker?

  Yeah, it is, it's many, many years behind. But while it's many years behind the kind of state of the art here in America, it is, I think, kind of devilishly clever because it's called two years ahead of kind of the chips from Huawei. And so it kind of gives America an advantage while preventing China from developing kind of a domestic Nvidia alternative. And the real threat is because China, they do have more electricity. They can do things that we cannot do here in America. You know, Blackwell racks are exquisitely designed to be as power efficient as possible. If you don't care about power, you can make very different kind of design decisions. Huawei has something called the Cloud Matrix 384, which uses fiber optics instead of copper to link the chips together.

• 1:01:48Gavin Baker?

  And while it's not nearly as power efficient as the Blackwell NVL 72, they have all the power they need. And so I think it's very, it's, it's, it's a smart decision for America to sell this chip that gives America an advantage in AI and keeps China from developing kind of their own domestic alternatives, which could eventually kind of challenge, you know, Nvidia, AMD, you know, other kind of American AI accelerator champions globally.

• 1:02:21Gavin Baker?

  We don't want that to happen. So I thought it was a mistake when they banned the chips. And I'm really happy and think it's really good for America if that is being reversed. And kudos to you, David.

• 1:02:32David Sacks?

  Gowney said so well, I don't think I have anything to add.

• 1:02:35Gavin Baker?

  Can I just say one thing on crypto? You guys can put it in or not, but it was just so interesting, David. I was always worried about stable coins, the risk to the dollar. But I think you make a very good point that when you are the dominant currency, they entrench the dominance. And I just should not have thought of them that way.

• 1:02:53David Sacks?

  I think what's going to happen with these dollar-based stable coins is they'll start being used all over the world. Let's say that you're in a country, maybe it's a developing world country, where the fiat currency is not trusted. And now all of a sudden you can transact in dollars using a wallet on a phone. You know, and the merchant also has a wallet on a phone. And now you can just transact in dollars. You could see a large portion of these economies dollarizing from the bottom up. Because again, once you have your choice of fiat currencies or stable coin, why wouldn't you just use the best one? And that's what I think is really interesting. So I do think it extends the dollar's dominance internationally into the online realm.

• 1:03:35Jason Calacanis?

  Yeah. And previously, people were basing their stable coins on a basket of assets. Some treasuries, some real estate investments, because they were seeking yield, Gavin. So they would buy real estate or, you know, short-term, long-term treasuries. They might put equities into it, they might keep some in cash. And none of that was known. And so that's where this big fear came. Hey, these things are getting pretty big. There's obviously a demand to use this concept of a stable coin. But what if there's a run on the stable coins? And that was always the big fear with various players. Was what if everybody wants to withdraw their stable coins? Are there enough dollars or liquid assets in there? And that's where I think certain players have maybe, you know, moved the asset allocation.

• 1:04:20Jason Calacanis?

  And in order to be in the US market, Tether is going to have to be 100% in treasuries, right? They're not going to be allowed to be, say, in real estate. There was a, you know, concept that maybe they were buying Chinese paper for real estate back in the day. And people were concerned about that. So this cleans all that up and they have an easy path. But you can't make... Interest on it. That's actually a very interesting portion of this. So that will have to come at a later time. So the banks don't lose anything here, right?

• 1:04:47David Sacks?

  Well, just to clarify one point on that. One of the concessions that was made to community banks is not to have an interest feature because the community banks were worried that this new stablecoin industry would put them out of business. I think that that fear was wildly overblown on their part. I don't think that's what's going to happen remotely. But when you have a new technology like this and a very established industry, you can see why maybe they'd be afraid. But the bill allows for all sorts of marketing promotions, rebates, that kind of stuff. So maybe it's not called interest, but there are mechanisms to create, let's say, rewards for stablecoin holders. So it's not as like black and white as just,

• 1:05:29David Sacks?

  oh, there's like nothing a stablecoin issuer can do to attract or incentivize or award one of their holders. It is a dimension they could compete on.

• 1:05:38Jason Calacanis?

  So maybe if I were to buy $10,000 worth of a stablecoin, I could get mileage-like points or maybe a load-in gift card or something like that?

• 1:05:48David Sacks?

  Yeah, we have to interpret the language, but the mechanism is there.

• 1:05:52Jason Calacanis?

  Okay. Well, there you have it, folks. All right. Reporting from our Capitol, David Sacks, our czar of AI and cryptocurrency. I'll see you next Wednesday in DC for a very important summit.

• 1:06:07David Sacks?

  All right, besties. I'm here at the White House with Senator Bill Hagerty from Tennessee, the principal author of The Genius Act. He, I would say, along with the leadership of President Trump, are the reason why this bill happened. And then we have stablecoin legislation just signed into law by President Trump. Bill, you did a phenomenal job. I got to observe this whole process, and you really played the critical role. You're a very skillful legislator, crafting delicate compromises. You were kind of the glue that held the whole thing together. Congratulations on getting this done. Is this your first bill that you've gotten done as a senator?

• 1:06:37Speaker 05

  It is. I've served in the Senate for over four years, but we were in the minority for the past four years. So this is the first opportunity since the Senate was taken by the Republicans to actually drive legislation. Through and the fact that we had the House of Representatives in the Senate and the White House made this possible. It was just a threshold concern. We worked so hard, as you know, to retake the Senate in 2024, to retake the White House in 2024 and hold on to the House of Representatives. It worked and that's the only thing that's enabled us to deliver this type of meaningful legislation. And I say this too, it's been a great team that has done this. I may be the author of the legislation, but the leadership that you've brought to bear from the White House coming in, donating your time from the private sector, working as a volunteer here,

• 1:07:18Speaker 05

  but making certain that the leadership and the vision is present here at the executive branch. You've been absolutely great. And that vision, I think, is carried forward into the Senate, the House. More and more people are understanding this and catching on. And I think what we've done today is launch the catalyst for what's going to make America the crypto capital of the world.

• 1:07:37David Sacks?

  Yeah, it's been, it's been really amazing and interesting for me to watch this whole process. They say that you shouldn't watch legislation or sausages being made. But, you know, earlier in the week, the media was reporting that this bill was dead because there were a dozen holdouts and President Trump made calls late into the night. He gathered people at the Oval Office. He cajoled, he twisted arms and, and he also persuaded. And he, he got us over the finish line. It was pretty incredible.

• 1:08:04Speaker 05

  Well, I think the founding fathers made it actually quite difficult to legislate for a reason. But it is difficult. It's taken months upon months to get to this point. And legislation, the, the Genius Act has been killed a couple of times in the media. Elizabeth Warren declared victory early on that she killed the bill. That didn't happen. She didn't have the juice to do it. But there've been many, many attacks.

• 1:08:24David Sacks?

  That's a big deal because until now, the crypto community's been living under Elizabeth Warren's reign of terror. I mean, she basically was calling the shots during the Biden administration on crypto. And I was there when the Genius Act passed the Senate. I was up in the bleachers or whatever. And she was not happy. I mean, there were photos of her and she, she, she did not like losing.

• 1:08:44Speaker 05

  There's, there's a fundamental reason for this, David, because Elizabeth Warren and her crowd want to see a central bank digital currency. What they want is control of our transactions. They want the ability, they're the ones that wanted to get to a $600 threshold for your Venmo transactions, reporting everything. They want the ability to do choke point 3.0.

• 1:09:02David Sacks?

  Right.

• 1:09:03Speaker 05

  And if you think about it, they had visibility in our transactions, the ability to centralize and control them. They could control our lives. It may be okay for the Chinese Communist Party, but that's not going to work here in America. And this legislation put the final nail in the coffin to that.

• 1:09:16David Sacks?

  It's really amazing that you got it through. And to get this passed, the Senate, you had to have 60 votes, right?

• 1:09:21Speaker 05

  Correct.

• 1:09:21David Sacks?

  Because reconciliation, you only need 50 plus one. But for a regular order, I guess, to get past the potential for a filibuster, you need 60.

• 1:09:30Speaker 05

  That's exactly right.

• 1:09:31David Sacks?

  So what demands did that put on you in terms of getting Democrat votes? Because the Republicans have, what, 53?

• 1:09:37Speaker 05

  Yes.

• 1:09:38David Sacks?

  So we didn't have all the Republicans.

• 1:09:39Speaker 05

  We lost to Republicans. But what enabled me to get the other nine Democrats to come on board was really an education process. Because at its core, this shouldn't be a partisan issue. This is about taking America's payment system in the 21st century. This is about making our nation more competitive. This is about, you know, expanding demand for the US Treasury securities that we issue. This is about the dominance of the US dollar. It's hard not to like it. But I think there's a partisan bent here in Washington that's so strong that their objective is just to keep Republicans, or Donald Trump, or David Sacks, from getting a win here. And through education and through listening, and frankly, I don't think it's my legislative skills. I think it's the business skills that I brought to the legislative branch.

• 1:10:21Speaker 05

  I think it's through the business skills and the ability to negotiate that we've actually gotten to this point today.

• 1:10:26David Sacks?

  And so tell us about that. So before this, you were a businessman, then you became ambassador of Japan.

• 1:10:30Speaker 05

  Mm-hmm.

• 1:10:31David Sacks?

  You met President Trump, you told him you wanted to run for Senator. He told the story up in his speech. He said that you had learned Japanese in like six months as ambassador of Japan.

• 1:10:40Speaker 05

  It was a little longer than that.

• 1:10:43David Sacks?

  Okay.

• 1:10:44Speaker 05

  There's a piece of the story missing because I started my career at a place called The Boston Consulting Group. And they sent me to Tokyo for three years, back in the late 80s, early 90s. That's when I learned the language. And to go back as US ambassador to Japan under President Trump in 2017, the honor of a lifetime. I can tell you, representing the greatest nation in the world, any place in the world is an honor. But particularly in a region like that, that has so much strategic, you know, so many strategic initiatives that are underway right now. You think about this. Japan has more US military stationed there than anyplace else in the world. Japan is one of the toughest environments in the world. If you think about the neighborhood that they're in, North Korea, Russia, China, right at your doorstep. The time that I spent as ambassador really helped me dig in deeply in terms of the national

• 1:11:29Speaker 05

  security issues that our nation confronts and those that our allies confront. At the same time, we did two trade deals with Japan. Nobody thought it could be done. And we were able to navigate that with Jameson Greer working right beside Bob Lighthizer. I loved working with those guys and we got two great trade deals done. Jameson is back now as the US Trade Representative and I'm very optimistic that we're going to see more trade flourish. President Trump knows how to do this. I've been with him in the trade negotiations. He knows exactly how to navigate this. And I'm looking forward to great results from our trade negotiations as well.

• 1:11:58David Sacks?

  Excellent. And so we're only six months into this administration. It feels like so much has happened. So much has been done. I mean, we just had one beautiful bill. Now we have this legislation. What's next in your view? What do you think is going to happen?

• 1:12:13Speaker 05

  What's happening right now in the United States Senate, we just put through a rescission package for a little bit over $9 billion. That's a small amount. It's a large amount of money, of course, but it's a small amount relative to the entire budget. And the Democrats have had, they've just gone apoplectic over this. Any effort to cut back on spending, somehow they've got to be against that. They're only for spending and we're trying to bring physical sanity back to America. So the focus is going to be to continue to find opportunities to basically legislate what has been found in DOGE. The other activity is well beyond DOGE. Every department head, every agency is looking for ways to streamline regulations and to cut costs and to operate more efficiently. And I've got to believe there are tremendous opportunities there and many billions more dollars that'll come out of the budget as

• 1:12:57Speaker 05

  a result. But we've gone into a fairly partisan mode right now and I think it's going to be tough for the next little while. While we're in this sort of partisan gap, I think what we should be doing is focusing on market structure. For digital assets and we're working on that. I just talked to some of my colleagues in the house today about how we're going to marshal that forward. I'm going to look forward to your leadership there as well and many people in the industry.

• 1:13:18David Sacks?

  But just so everyone knows what that is. So market structure is the legal framework. It's the rules for all the crypto tokens that are not stable coins. So the Genius Act just passed. I gave the legal framework for stable coins. Now we got market structure for all the other tokens and it deals with questions like what's a crypto security? What's a currency? What's a commodity? Who regulates those things?

• 1:13:37Speaker 05

  Yeah.

• 1:13:37David Sacks?

  Just providing clarity. That's the name of the bill.

• 1:13:40Speaker 05

  That's exactly right.

• 1:13:41David Sacks?

  So that market participants know what the rules are because the last four years under Genzer, they're basically prosecuted without knowing, you know, how to abide.

• 1:13:51Speaker 05

  Yeah, they called it regulation by enforcement. You don't know what the rules are, but they just launched an enforcement proceeding against you. President Trump was funny today because he looked at the audience. He said, I guess half of you were being prosecuted here about a year ago by the previous administration. Things are going to change.

• 1:14:05David Sacks?

  He was, he was on fire today. I mean, people should go back and watch. I mean, he spoke off the cuff basically like he normally does for 20 minutes and was very funny. But the reason why he said that is when we did the crypto summit at the White House back in March, the, you know, the Winklevoss brothers, Tyler and Cameron were there and they told the story about how a year before they thought it would be more likely that that'd be in the big house in the White House. That it was like, the fact that they were at the White House was...

• 1:14:37Speaker 05

  President in the big house.

• 1:14:38David Sacks?

  Yeah. Because that's the way it was looking. I mean, they were dealing with so much unfair lawfare. But anyway, we've moved past that. So thank you for your leadership on this. And by the way, on the recisions, I know that this is the one issue that I think all of the hosts, the four hosts of the All In Pod all agree on is that deficit spending is out of control. Anything we can do to try and rein it in and have more fiscal sanity is appreciated. Even Cal Canis can, can agree with that one. He's sort of like the token. Lib on the podcast.

• 1:15:07Speaker 05

  We're going to continue to work along those lanes. The big beautiful bill is doing, it's oriented toward growth stimulation, right? Everything that we can do to stimulate more capital investment in the United States is embodied in the tax law as part of that bill. So with the growth coming out of the big beautiful bill, and if we continue to go through the cuts with decisions, I'm very optimistic that we're going to get back on the right path. That's the objective, that's the goal. Meanwhile, taking us into the 21st century with our payments, with digital assets, we're going to continue to work along those lanes as well, and I appreciate your leadership in that regard.

• 1:15:38David Sacks?

  Well, and we appreciate you. I think the state of Tennessee, where by the way, I grew up, I grew up in Memphis, is very lucky to have you as their senator. The Republican Party is really lucky to have you, the Senate is very lucky to have you, to have someone with your business background, to have your skills, who has now gotten through this first piece of legislation through, again, this wasn't a budget bill, it took 60 votes in the Senate. I mean, when's the last time that even happened? I mean, it's been years.

• 1:16:00Speaker 05

  It's rare.

• 1:16:01David Sacks?

  I heard the Senate Banking Committee, I mean, I heard they hadn't passed a bill in like 10 years, basically, because it takes 60.

• 1:16:07Speaker 05

  It's been over 10 years to get out of the Senate Banking Committee. One of my friends wrote me yesterday and he said, "I didn't think you could get the Ten Commandments passed out of the United States Senate." So congratulations, and I don't want to take the credit for it because it's been a wonderful team. As I said, your leadership in the White House and the executive branch, our friends in the House of Representatives, my great staff led by Luke Pettit. Done just a terrific job.

• 1:16:27David Sacks?

  Luke Pettit was amazing, we work closely with him.

• 1:16:29Speaker 05

  Oh, he did a great job.

• 1:16:30David Sacks?

  Yeah, he was the director of the Crypto Council, who was on the show earlier today.

• 1:16:34Speaker 05

  Tyler was wonderful at Treasury.

• 1:16:35David Sacks?

  Yep, Tyler Williams at Treasury, who was Secretary Bessein's staff person. The staff people never get the credit they deserve for all the work they do, right? But Tyler, Luke, and Beau were amazing through this process.

• 1:16:48Speaker 05

  And in the Senate too, we've had great leadership. Our chairman for the Senate Banking Committee is Tim Scott, he's been a true proponent of this. Cynthia Lamas is very focused on digital assets, was very supportive of me as she chairs the Digital Asset Subcommittee of our Banking Committee. So we've had great support in the Senate, and I think it's going to continue to grow, both sides of the aisle.

• 1:17:08David Sacks?

  Cynthia Lummis, she's been great. I've met with her many times. Tim Scott's been great. I understand that Kristin Gillibrand, the Democrat senator.

• 1:17:16Speaker 05

  She's great to work with.

• 1:17:17David Sacks?

  She brought in a lot of Democrat votes. I think you got 18.

• 1:17:20Speaker 05

  The great thing about Kristin too, she was a Wall Street lawyer at Davis-Pope. She understands the markets and to have her level of technical expertise was a huge asset. And she was able to really convey to the Democrat side that we were here trying to get the right thing done for the country. This was not a partisan effort. This was something that really is aimed at growth, leadership, technology leadership, and frankly, dollar dominance that we all should be for.

• 1:17:45David Sacks?

  Amazing. So I think it's really amazing that we got this done. When you compare this to where we were a year ago, I mean, it was nonstop, I guess, regulation by enforcement, basically regulation through prosecution, lawfare, and the crypto community was being driven offshore. There wouldn't have been a crypto community in the United States. And then President Trump won the election. Now, thanks to the efforts of Bill and others, it's law. The Genius Act is now law. We have a legal framework for stable coins. And market structure's next. The Clarity Bill is next. We're going to try and do that by October. So it's really amazing that this is, you know, I thought that working for President Trump would be a once in a lifetime opportunity because he's a president who really wants to get things done, and that's what's happening. It's really been amazing. So thank you, Bill, for being here.

• 1:18:27Speaker 05

  Thank you, Dan. Appreciate it.