Digital Asset News hosts Rob and Jerry reflect on four crypto market cycles and the lessons learned
Rob and Jerry from Digital Asset News discuss what they've learned across four Bitcoin market cycles.
Summary
Rob and Jerry from Digital Asset News reflect on their experience across four cryptocurrency market cycles — with tops in 2013, 2017, 2021, and 2025 — and look ahead to 2029. They discuss how the market has fundamentally shifted from retail and Bitcoin OG dominance to macro-driven, institution-led dynamics, and why that changes how participants should think about strategy. Jerry shares a personal account of how a leveraged portfolio strategy that nearly reached $1 million in 2021 collapsed through the 2022 bear market, resulting in forced liquidations and destroyed value. The episode covers the macro thesis underpinning Bitcoin — government debt, currency debasement, and the scarcity argument — alongside practical warnings about leverage, scams, boredom, and the psychological traps that affect both new and experienced investors. A security warning about malware targeting Claude AI users is also discussed. The episode closes with a Q&A in which Jerry identifies Japanese monetary policy tightening and the US Treasury's bond buyback program as recent catalysts for Bitcoin's appreciation, and argues that crypto AI tokens such as Render, Akash, and Tao lack the real-world user base needed to succeed — illustrating the point with the Helium network as a model of utility-dependent token value.
Key Takeaways
FULL TRANSCRIPT
Introduction and the four-year cycle framework
Rob: This is our fourth cycle going into it. Me and Jerry got in in 2017 — that was the first top. Then we went to 2021 with y'all, and 2025 just passed, and now we're coming up on 2029. There are some things that we want to reiterate and make crystal clear — things that we've learned. So we're going to get into it.
Before we do that, Jerry, how are you doing, man? How is everything going?
Jerry: I'm good. I'm happy to be here. I went and scheduled my time to join the Digital Asset News telethon on Thursday, and I'm lifting all the couch cushions to gather up my coins so I can put together my donation for the cause. I just wanted to thank you for doing that. I think it's important that we look beyond wealth and ask what we can do that benefits something larger and greater than ourselves. I think you're doing that and I want to commend you for it.
Rob: Thanks. It comes down to life goals — you always want to constantly improve yourself and then improve the ones around you. If you're not familiar with what Jerry's talking about, we're going to do a live stream on Thursday. It's going to go 20 hours straight. It's for the organization Amigos de Animales. They lost their lease. It's an animal shelter here in Puerto Rico and we need to raise $200,000 in 20 hours. I know that sounds pretty crazy, but we have a lot of people coming in — over 30 guests — and Jerry is of course one of them. Usually we get between 10,000 and 20,000 views, so if everybody pitches in 20 bucks, it shouldn't be an issue.
I'll just say this before we get into the four-year cycles and what we've learned: I'm pretty blown away because yesterday when I talked about this, I said, "Here's how this all works, here's a link to learn more about the story, and if you want to donate some crypto, go right ahead." And a lot of you have already donated. We're at 2.3% of our goal — $4,500. I'm blown away. I'll take it. I think we'll hit our goal. There's a link in the description if you want to read about where this is going, the people behind it, and what this entails as far as how we're going to build this organization.
But let's talk today about cycles. Jerry, it's been a long time coming, and I think these are the things that if we don't reiterate — talk about our screw-ups and our wins — we're a little bit shortsighted. So let's start with number one.
How the four-year cycle has changed
There are eight different topics that me and Jerry think everybody should really hone in on. The first one is this: the four-year cycles have changed. I know people say, "But Rob, you're always talking about four-year cycles, you're always talking about dollar cost averaging, and nothing's changed." But things have changed — specifically who is behind the scenes pulling the levers. Before, it was a lot of retail and a lot of Bitcoin OGs. Well, guess what those Bitcoin OGs did? They sold. I have no problem with that — you take your profits. There was a gentleman who's always on Anthony Pompliano's show — I believe his name is Vinny — who talked about how this was like an IPO moment for Bitcoin as the ETFs came in 2024, and they sold off. Now we're seeing this become a macro-driven type of play, and also an institution-driven one. That's why we're always talking about the ETFs that are going through, and there's a bigger thing behind just this.
I want to reiterate one thing: the four-year cycle timing is the same. We topped in Q4 of 2025. We topped in Q4 of 2021. We topped in Q4 of 2017. We topped in Q4 of 2013. And the year after that, we had a big slide down. What I'm talking about changing is what's behind the scenes — the macro part, the institutions, and the sovereign nations.
There's also this thing about debt. The core circuit of deficits, debt, and interest are feeding on each other. Jerry, just real quick, touch on this and guide us through this piece.
The macro thesis: debt, debasement, and Bitcoin
Jerry: Sure. The underlying premise is that the foundation of all of our economies — the exchange of a unit of measure for a good or a service, this thing we call an economy — is basically being driven by governmental monetary policy. And there's no one bigger in the business than the US government right now.
Without going into a huge long history lesson, we have migrated from a productivity-based monetary policy and economic growth model to one that's been replaced by debt. The creation and issuance of debt is what drives the ability for our economy to function. Companies need to be able to borrow money so that they can expand. Even households like ours use debt to obtain the house itself, the car, and so on. Governments and corporations are the largest players in this.
The debt cycle — which some call the doom cycle — is literally the way things work. When a government does not take in the tax revenue to cover all of its spending, it goes into a deficit. That deficit needs to be paid for, and the only way they have figured out to pay for it is through the creation of debt. Debt on a government level is created through bonds and bills. It's created an entire industry called the bond market.
Rob: I've heard of that.
Jerry: And that bond market controls debt — what we pay for debt, what it costs to repay debt. In other words, how much debt is being issued and what is the cost of that debt to acquire?
What we all need to know as people investing in the world today is that there is nothing that will change the pattern of governments having deficits, deficits needing to be funded by debt, and that debt needing to be returned, turned over, recycled, and refinanced. That is the game we're playing. The direct result of that game is inflation — a degradation of purchasing power in the unit of measure that the debt is being issued in. Our debt is being issued in US dollars, which means the purchasing power of the dollar is going down with the issuance of more debt denominated in the US dollar.
If you understand that, then all you need to do is put your dollars that you're earning today into the things that are not subject to that same inflation. What does not degrade over time? Land, gold, certain stocks — you could debate which ones. Assets and commodities tend to be circulatory. You can always create more electricity, more of this, more of that.
Here's where the Bitcoin thesis came in — what you and I fell in love with and built on. Bitcoin is the first commodity where more cannot be created. There is a hard limit.
Rob: Right, right, right.
Jerry: There is a hard limit. That scarcity, in a monetary environment where the denominator — the dollar — continues to lose its value, is the catalyst for Bitcoin to go up. There are what we'll call micro elements in that, but that's the macro thesis.
The micro elements are: who are the buyers? Are the buyers from yesterday going to be the buyers of today? You just illustrated that the buyers of Bitcoin when it was a dollar, $10, $100, $300 have become sellers when it's $100,000, $80,000, $120,000. We all understand for good reason why you would do that. On that graph, that is the thesis. If you understand that global monetary policy is not going to change — in other words, there is no life preserver that a government can use other than the issuance of more debt — then you know the purchasing power of its currency is going to continue to diminish. So when you get that currency, get it into an asset that is not subject to that same debasement. Hence gold, real estate, Bitcoin, et cetera.
Rob: Well said, Jerry. I think it comes down to this: put your money in assets. Cash is being debased, it's going to keep happening. Jeff said it really correctly — it's a spending problem. There is a spending issue, and there's a trajectory of cash as we can see with the M2 money supply. I don't know if you guys knew this, but we're at around $40 trillion in debt and for some reason we're just able to keep printing. Wish I could do that with my credit cards.
The danger of overconfidence at the top
So that covers the thesis at the very beginning — this is why we get into it. And we feel smug sometimes. I hate to say it like that, but we feel smug sometimes. We've got the hardest asset. Michael Saylor loves to talk about that, and he's right. But sometimes we get too smug and we're thinking, "This is going to go up forever and it's going to be awesome."
The problem — and this is the second thing we've learned — is that once we actually get verified and we start to see everything around us playing out: I knew it, I knew this altcoin was going to crank, I knew Bitcoin was going to go up, I knew an ETF was going to hit, I knew sovereign nations were going to get involved. And now I've got my mom, my dad, my three kids, my cousins, my uncles, and they're all asking me because I'm the smartest investor of all time. It feels so right and it feels so good.
But guess what? Those are the top indicators, and we tend to ignore them for some reason. Once everybody's coming to you for advice and you start to see everything around you just going up and up and going a little bit parabolic, those are the times to maybe think about selling just a bit — taking some off the table and moving forward.
Jerry, what are your thoughts on this? And how did you, if you did, mess this up in previous history?
Jerry's personal story: leverage, liquidation, and the lessons learned
Jerry: Okay, long story short — when I came to this space in 2017, I was financially illiterate. I did not understand the real game. So I just want to preface that. My journey into this space started with learning in 2017. Through no brilliance of my own, I was able to put $23,000 US into this market and it grew to $998,000 in November of 2021.
That was remarkable. And yes, people were coming to me — "Jerry, give me your advice, do this, do that." I had a plan that I would not sell. What I would do is leverage — I would take loans against this massive portfolio.
Although the principles were sound if I was in a different market — for instance, if I had a million dollars of Sonoma County, California real estate and I took a mortgage for $250,000, 25% of the value of that property — I could have secured very clear and secure terms against that property, knowing that property would most likely continue to appreciate at an 11 to 12% a year clip, and the borrowing against the asset would have been a very sound plan.
However, I was not in real estate. I was in crypto. What ended up happening is that the money I borrowed against that large portfolio, and the portfolio size started to contract through 2022, I was facing a liquidation event if I did not sell the assets myself and repay the loans. And that is what I did.
What I literally did by doing that was destroy a ton of value. I was too early with that principle for this market. This market is not established like real estate. It was a fledgling market, and I basically brought the wrong playbook to the wrong game. I brought a football playbook to a game of baseball and it just didn't work.
What I've learned is that until this market matures, we need to be smart. There will be circulatory cycles, and the thing is, when you're in massive profit and you're old like I am, secure yourself. If you're young, you can go through the next seven cycles and it doesn't matter, because this is for your long-term wealth, not short-term. I no longer am playing a long-term game. I'm playing a game for the next 20 years, not the next 60.
It's important for me to understand what game I'm playing. And it's important for all the viewers to understand the game they're playing, because it will matter — what is your income, what are your financial needs, what are your goals, what are all the details involved in your journey — all of that should be taken into account in how you build and execute your strategy.
I should have, in my situation at damn near a million dollars, taken at least $400,000 off the top. Minimum. I should have sold and not leveraged. That was the biggest mistake I made. I leveraged my portfolio in a highly speculative market when I should have taken profits in that speculative market. I would have been able to build my dream house on the property that I bought. I would be sitting on a chunk of cash which could have been deployed when the speculative cycles come into play. I learned a lot in my seven years here.
Rob: And you know what, it's a good point because there is a saying that we use here — my goals are not your goals. And your goals are not Michael Saylor's goals. You're not a billionaire. Maybe some of you are — I'm not, for sure. But everybody has their own goals as they're setting out.
I have to agree with you about the loans part. I did the same thing with Celsius. I did that for the house, put it in in December of 2021, and got margin calls.
Jerry: Peak.
Rob: Peak. Yep. That's how it was. And people say, "Well, that's the smart thing to do because you just do loans." Of course, back in 2021, it was never going to go down because everything was going to keep going up and to the right. Didn't happen.
What actually ends the runs
So that leads us to the perfect segue: what actually ends the runs. It's not your bad picks. It's not that you got into the wrong altcoin. It's not that you decimated yourself that way. It is, first of all, not diversifying just a little bit into what you're getting into. "I put everything into Luna — I don't know what happened. Well, here we are. I put everything into a specific centralized exchange. Well, here we are." And so on and so forth.
Jerry talked about the margin call from a loan. But there are a lot of people I hear about who use leverage. When you leverage yourself two or three times, okay, not too bad. But when you're doing 10x, 20x, 50x, 100x — that's a little bit crazy. You get margin called. That's where most people end up, and that's where the story comes from.
The people that made it through just didn't have to sell. Even as low as it goes, the people who don't sell their Bitcoin probably don't really need it that much because they've taken a little bit of profits along the way — just a little bit. They don't have to sell everything. And that's a bigger difference, because the people who don't have to sell don't have that issue of "I need this to pay these bills, I need this to pay the mortgage." They don't have any life events forcing them to sell things off.
I personally — and I can't give you financial advice, but I do believe this — I believe that everybody should take some profits. It is way better to have dry powder on the sidelines when Bitcoin goes from, what was it Jerry, 67K all the way down to —
Jerry: 15K.
Rob: — or when it went from 125K, 126K all the way down to 58K. It's so sweet. And when Solana went from $250 down to like $9 or $10 in the last cycle, those are the days when you're like, "I really do wish..." I know we're not supposed to because diamond hands, bro. But that's what really ends runs.
Rookies versus veterans: different psychological traps
The other thing we've learned is that there's a difference between rookies and veterans. Everybody watching this show, I can almost guarantee, is a veteran. Most of you — this isn't your first cycle. This may be your second, third, or maybe even the fourth like what me and Jerry are talking about.
There's a dichotomy, a separation between these two people. The rookies are the people you orange-pilled and need to go back and give a pep talk — have them take their thumb out of their mouth and say, "Stop crying, it's going to be okay. Crashes are good. This is where all the money's made." Rookies fear the crash.
The veterans have a different problem. Tell me if this is you. You don't fear the crash. You don't fear the dips. You buy the dips — not a big deal. What you concern yourself with is, "Damn it, I took some profits off the table like Rob's always talking about, and the damn thing went up another 20x. Yeah, I did a 5x, but I could have done a 12x." And this just sucks. It's the worst thing of all time.
So the rookies have a problem with the crashes. The veterans have a problem with thinking about all the money they left on the table. And it shouldn't be like that. Once you sell, you sold, and that's it. Make peace with it and keep going.
Jerry, thoughts on this?
Jerry: I think you're right. I would definitely react differently to the same set of circumstances I had in 2021. I would act differently today than I did then. And I think that's one of the greatest lessons I've learned on this journey — that I can change my strategy, my perspective, and my opinion based on new, different, and enlightening information as circumstances change.
Also — and I hope my son Dylan, if he's watching, does not take this negatively — I'm growing less and less concerned with having a monster generational wealth trust to pass on, and getting more and more concerned with just having a really nice home that I want to live the next 15 to 20 years of my life in. That's a little selfish, but I'm kind of getting down to: I need to take care of me. I really need to take care of me, because I know the government isn't going to, and I know my neighbors aren't going to. If I need to adjust where I live and how I live to do that, I will. Living here in Costa Rica is evidence of part of that — I got out of a very expensive area, Sonoma County, California, and moved to Costa Rica.
Rob: We should all be so lucky. California and taxes — got to love that.
Identity, boredom, and the scam of the season
So to finish up before we get into Q&A — the other lessons we learned are about identity. Jerry even brought this up: when you get new information, you change. When the facts change, I change. The problem is that a lot of rookies come in here and start spewing off about Bitcoin, how great it is, how they're going to diamond hand forever, and that becomes their identity. They can never ever sell it. And they just get those bags pulling them down. That's what you don't want to do.
You want to stay clear to the thesis — the government's going to keep printing money, they're going to debase the currency, it's going to make assets more valuable, I bought some Bitcoin, I bought some gold, I bought some real estate, it makes a lot of sense. It's not "to hell or high water, you have to buy this or else you're a loser."
Also, I will say to round this out: the people who have been around for quite some time know that this is the time where they make all the funds. And the real test is boredom. How long were we in that range-bound $60K, Jerry?
Jerry: Oh my goodness. It seemed like an eternity. Maybe 10, 11 months.
Rob: Yeah, roughly about that. What really kills you is the boredom. It was the same thing with gold bugs — "I can't believe this, it's the same thing forever." And it was, until it broke out and then everybody's like, "I told you, gold!" It's the same thing here with boredom right now.
For me, I felt pretty good. I would have much preferred a massive dip — I didn't get it, but I still dollar cost averaged every Monday. Seems to work out okay. The real test is going through the boredom, because it is exciting when we see a 25%, 55%, 75% crash and we're like, "That doesn't affect me, I've got ice in my veins." Or when we see our portfolio numbers go up like crazy and we're like, "I knew it the whole time." The real test is boredom, and it's going to happen again.
Also — scams. Scams wear this season's clothes. Be aware of the next big thing and whether it's actually going to be the next big thing. I remember in 2017 it was ICOs. Remember those, Jerry?
Jerry: Oh, everybody could do it. It was great.
Rob: Then we had yield farming for DeFi, and yet it seems like every DeFi project gets hacked in some way, shape, or form every single week. Then of course it was big NFTs. Hey Jerry, you're not a Bored Ape Yacht Club guy, are you?
Jerry: No.
Rob: Just curious, because those were some of the most annoying people of all time. They would always talk about how great it was, they had their Bored Ape Yacht Club NFT they bought for millions of dollars, and now here we are. Airdrops — those weren't so bad. And now the big thing is AI agents and tokens.
I remember in 2017 there was Ravencoin —
Jerry: Yes, Ravencoin.
Rob: — and all the Decentralands and Metaverse plays from back in the day. Whatever was big back in the day sometimes won't repeat. Although there are some that continuously stay in the top 10 — things like Ethereum, XRP. XRP people, you've got to love that. And some of the others that are going to do well — Chainlink. And you know what's funny? Dogecoin seems to stay in the top 20 no matter what.
Just remember that the cycle leaders that come up may not be the same ones. Don't marry a thesis. Like Jerry said, when the data changes, you change.
The most important lesson: it's not how much you make, it's how much you keep
That leads me to our last point — I think the biggest one. It's not how much you make, it's how much you keep.
Jerry, did you hear about this story about Claude?
Jerry: Yes, it was on X.
Before we talk about that, Jerry, give us some of your wisdom on the last three things we just talked about. What do you have?
Jerry: I have realized that there are so many risks — the risks I know about, and then there are much greater risks that I don't know about. And this article that you're about to go into falls into the risk that I'm not that aware about, and I get a little frightened. I have to fall back to: where do I feel safe and comfortable? What do I believe is the best for Jerry?
We've talked about this on the show a few times. I've begun this process of getting out of wallets and into my Schwab and Coinbase accounts. Those are entities that hold my assets that I feel okay with. I don't need to be a "not your keys, not your crypto" guy. I don't need it. That isn't my identity.
Rob: Not your keys, not your problem. I know that's sacrilegious, but hey, whatever.
Claude AI malware campaign: a security warning
So here's what we're talking about, and this kind of blew me away. This is from the show over at Coin Bureau — Nick, Guy, and the crew. Alert: if you use Claude like I do a lot, you could lose your crypto to malware without ever knowing you were hacked.
There's a campaign targeting Claude users. It spreads info stealers that silently grab passwords and browser data, putting exchange logins and hot wallets directly at risk. Here's how they do it: a user got hacked through a download link served inside his own Claude chat. That's crazy. A user got hacked through a download link served inside his own Claude chat.
If you don't know, Claude is available on your phone, on desktop, and there are like three different versions — Claude.ai chat, Claude for work, and Claude Code. When you're in Claude chat, it's more of an open type of thing, but it can actually give you download links — "go here and get this" type of thing. And I've got to tell you, that sounds so weird that Claude gave somebody a download link that was linked to malware. It was a copycat site bundling malware. The backup hit a fake skill Markdown file — just another type of file with different icons and things in it that make it easy to read — rigged to silently reinstall the malware every time the AI loaded it.
Here's the good news though. Jerry hit the nail on the head — this is why he's into Schwab and ETFs and things like that, because he's diversifying his portfolio and diversifying his security. I've said this many a time. I'm doing the same thing. I have an IRA, I have a Ledger in tandem, and also ETFs.
But there is good news about this hack. I asked Claude, "Claude, how do I protect myself against this?" And Claude said, "Trust me, bro." So right there, I think everybody should feel an alleviation.
Just kidding. Let me share this with you. There's actually a prompt in the description. I asked Claude this exact same thing — "Hey, how do we save people?" — and it gave me a big long list. And then I said, "They're not going to do that, Claude." And it said, "Okay, here's a quick version."
All it's saying is: run this prompt — "Read .claude/settings.json, every script in Claude hooks, and every skill in Claude skills. Do not change anything. Tell me which hooks or skills make network calls or run downloaded decoded code. Which skill files tell you to auto-run something on load? Let me know what that is and whether I should recognize every skill listed. Give me a clean 'needs attention' verdict."
You can do this and go through all your files without downloading anything. This is good practice whether you're using ChatGPT, Grok, or Claude. You just run this through Claude and go, "Where did you screw up? Let me know if you did, because I want to be aware of this."
Q&A with viewers
Rob: Alrighty, let's see what we've got. Oh, this is a good one — totally away from crypto. Rob Brower says, "Just saw Chris Hansen is making a new show to catch a scammer or something like that." That'll be a good one. Jerry, what was that one — "To Catch a Predator"?
Jerry: That was a good one. I like that one. To see actual real predators on camera — they don't even necessarily know they're on camera — and just the genuine look once they realize what's happening.
Rob: "Oh, my life is over." Priceless. I think that's where you got the photo — I designed a photo of you after one of those guys.
Jerry: No, I got that through Grok. I think the prompt was like, "Make Jerry look like he just made a million dollars on his portfolio." That's what it spit out.
Rob: Here's further proof that we are entering the bull market — this is my fourth person who was always in the live streams now coming back. Uncle Ricky says, "Happy Sunday, Rob. Long time since I caught you live." People are coming back and it feels pretty good. That's not to say we can't have a big drop off in Q4 — I'm actually hoping for one — but I like to see that for cycle gang.
This is a good one. Green Blue Algo says, "Shipping containers are not an ideal building material, especially in a tropical environment." I'm going to guess that's about corrosion.
Jerry: Corrosion and rust. But there are plenty of finishes that you can put on metal that will last 10, 15, 20 years.
Rob: Anything in a salt environment — a beachy environment — is going to require maintenance.
Jerry: Nothing is ideal. Everything requires maintenance.
Rob: I will say this — in the States it's all particle board and drywall. We use drywall everywhere. There are some older buildings that are brick and concrete, but I don't know what it's like in Costa Rica, Jerry. It looks to me like you do a lot of cement houses. Is that how it goes?
Jerry: Concrete and brick.
Rob: The people that I know here in Puerto Rico — all the houses, most of the houses, and the ones that I have — they're all concrete. I said, "Why the heck do they use concrete? It's so difficult to do everything with wiring, plumbing, Wi-Fi." They go, "Oh, it's really easy. When the hurricanes come through and they're destroying everything, especially if you have particle wood or plywood, that just goes away. And if it's soaked, especially if you have drywall, forget about it — you've got to replace everything. But concrete — my friend Victor said, 'Yeah, the water was up about three feet and I just had to replace some outlets and dry it out.'" I'm like, "Damn, that's pretty good."
Pirate Justin had a good one: "The kids and grandkids are going to squander it anyway. So take care of yourself."
Jerry: Thank you, Justin, for co-signing that check I wrote.
Rob: The Benler says, "I agree. We need a final reset whether it's a high or low or not." Jerry, what's the catalyst? What's the catalyst for the next either big run or the big decline? And which one's more likely?
Jerry: The big pump.
Rob: Okay, now we're talking.
Jerry: It's simple. We know for a fact there is no way governments around the world can fix their deficit problem. They can't raise taxes to meet spending. Therefore, they are guaranteed to run at a deficit. Deficits need to be funded by debt. Debt is issued, and when debt is issued, new dollars are created — which is nice for us. That mechanism, which we can guarantee is not going to change anywhere on the planet, is literally the foundation for the thesis that you take your currency that's being debased today and put it into an asset that is not subject to inflation — in fact, one that appreciates with the debasement.
We've just had Bitcoin have a really nice appreciation rate over the last two weeks. Many people attribute it to two major catalysts. One, the Japanese government changing monetary policy — they are actually becoming hawkish, increasing the rate to borrow money.
Rob: That slows things down but makes it hard to acquire more debt at the same rate.
Jerry: Then you have our Treasury Secretary saying we are going to double our buyback program. Now, in essence, buying back bonds with bonds is not the creation of new money. But when there are no buyers of the new bonds that are being issued, the buyer of last resort is the Fed — the Federal Reserve. And when the Federal Reserve buys those bonds, currency is issued.
Rob: See, this is the same thing I do with my credit cards. When I max out one credit card, I use the other credit card to pay that one off. Follow me for more financial tips — just kidding. But that's essentially what we're doing, right? If you have a card you need to pay 18% on and you can get a card at 12% and pay that off, you've just arbitraged interest in your favor.
Jerry: And then to pay the 12% card off, you can get a card at 5%. You are doing great. But what happens when you can no longer get a new card at a lower rate? That is when the music stops.
Rob: Then I start scamming people. That's what it comes to.
Jerry: The government has the Fed to backstop it. And the Fed doesn't actually need real money to buy things. It can buy things with reserves — which is another way of saying an IOU.
Rob: Gotta love that. This is America.
Ricky says he agrees with you, Jerry, that his plan is different from yours. He believes we all have to sit down and figure out the profit margins we want to take and act on it — take emotion out of it.
Jerry: Take emotion out of it and learn the lessons. I hope we all get an opportunity to look at an app on our phone and see our portfolio 500x, 1,000x, 20,000x. It's in that moment — when the whole world is telling you it's only going to go up — what do you do? That was my biggest mistake. I should have gone with two in the hand is better than five in the bush. I did not follow my mother's advice.
Rob: The problem is you see that portfolio and you check it in the morning, then after breakfast you check it again — "Wow, it just went up 12% and I didn't do anything." Then you check the next day: "Wow, 28%." Then the next week: "Wow." And that dopamine hit — especially as you just see appreciation after appreciation after appreciation — that's why it's harder to sell. Maybe we don't have a plan, like Uncle Ricky said. You've got to take the emotion out of it. Very difficult.
Jerry: Then you see it go down 3% and you say to yourself, "It'll pick back up after lunch. It'll pick back up tomorrow." Exactly. "Oh yeah, Luna has some algorithmic stablecoin issue. I'm sure it'll be just fine in a bit."
AI crypto tokens and the user problem
Rob: Darth Mike says, "War could also be a good excuse for Western governments to print money."
Jerry: Always has been. Never going to change. That's a tale as long as history.
Rob: And Mim asked Jerry — this is a good one to leave off with — any update on decentralized AI space, anything with the AI sector?
Jerry: There is a big disjointment between activity and value in the AI space, specifically in crypto. Lots of activity — you've got the Akash and the Renders and the Tao and all these players doing all kinds of great stuff. Then you have the real world of AI where ungodly amounts of capital have been unleashed to the frontier models, data center creation, business formation, all of these things.
The money that's being deployed — I don't believe it will ever see its true value recaptured and repaid. I think there are going to be a lot of losses written off in that industry, and I think that is going to trickle into the AI space in crypto until something in the crypto space creates a value to users who use it — not speculators who are speculating on it.
A quick example of that: you saw Project Helium. Helium is a network for communications — peer-to-peer cellular communication, for lack of a more technical description. Providers of that utility can earn money. Own a box, provide the utility, get paid for it. It's dependent on users. The more people who find it useful, the more profit opportunity is available. That is a wonderful thing, but it's dependent on users. Without users, it will die and it won't be profitable.
With a lot of these other instruments — Tao, Akash, and so on — users aren't using them. Without users, regardless of their utility, regardless of how wonderful they are, they're not going to be successful. The downside in the AI space is that the money and the users are not going to Tao, they're not going to Akash, they're not going to Render. Very, very small segments of the larger market are using these tools. Most everybody is on Claude, OpenAI, Gemini, Grok — the big guys. And until that changes, I don't think you're going to see any of those investments be thousand-Xers.
Rob: Yep. It's all about speculation and a little bit of utility. When you get a bunch of that together, things move. And if you want to hear more about what Jerry was talking about with Helium and Solana Texas and how that actually came about and why there was a pump of almost 100% for that token, there's a link in the description for yesterday's video.