December 11, 2024 • 1hr 4min

BTC212: Jack Mallers on Bitcoin 2025 Expectations and Strike's New Features (Bitcoin Podcast)

We Study Billionaires - The Investor’s Podcast Network

In this episode, Preston Pysh interviews Jack Mallers, CEO and founder of Strike, to discuss the current state of Bitcoin adoption, regulatory environment, and new developments in making Bitcoin more accessible for everyday use. The conversation covers everything from government policy to practical implementation of Bitcoin in personal finances.

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Key Takeaways

Bitcoin Strategic Reserve - Jack Mallers advocates for the US government to hold Bitcoin as a strategic reserve, viewing it as potentially one of the biggest positive economic announcements in US history
Operation Chokepoint 2.0 - The previous administration engaged in systematic banking discrimination against Bitcoin and crypto companies, forcing many to operate without traditional banking services
Strike's New Feature - Strike launched a new product allowing users to pay bills with Bitcoin while automatically handling tax basis calculations, enabling easier adoption of a "Bitcoin standard" lifestyle
Wall Street Evolution - Major financial institutions are starting to understand Bitcoin's role in portfolios, particularly through vehicles like MicroStrategy's zero-coupon convertible notes
Bitcoin vs Inflation - Bitcoin has averaged 63% annual appreciation over the past decade, effectively making life "half price" each year for those using it as their primary savings vehicle

Introduction

In this episode, Preston Pysh interviews Jack Mallers, CEO and founder of Strike, to discuss the current state of Bitcoin adoption, regulatory environment, and new developments in making Bitcoin more accessible for everyday use. The conversation covers everything from government policy to practical implementation of Bitcoin in personal finances.

Topics Discussed

Bitcoin Strategic Reserve Discussion (6:12)

Jack Mallers makes a compelling case for why the US government should consider Bitcoin as a strategic reserve asset:

Historical Context - Previous major economic announcements (1933, 1971, 2008) were largely negative or restrictive
Positive Announcement - A Bitcoin strategic reserve would represent the first major positive economic announcement
American Values - Bitcoin aligns with core American ideals of freedom, innovation, and equal opportunity
"Supporting Bitcoin is pro technology, it's pro innovation, it's pro freedom. I think bitcoin carries a lot of the American ideals that the country was founded on." - Jack Mallers

Operation Chokepoint 2.0 Experience (14:36)

Mallers shares personal experiences with banking discrimination during the previous administration:

Banking Challenges - Strike was forced to find creative ways to maintain basic banking services
Silvergate Situation - Discussion of how Silvergate Bank was forced into bankruptcy despite being solvent
Personal Impact - Detailed story of Chase Bank giving Strike 48 hours to close accounts
"We had 48 hours to find a new bank account so I could process payroll for my employees." - Jack Mallers

Strike's New Bitcoin Payment Feature (19:47)

Details about Strike's new product enabling Bitcoin-based bill payments:

Functionality - Works like a traditional checking account but holds value in Bitcoin
Tax Management - Automatically handles capital gains calculations and reporting
User Experience - Designed to work seamlessly with existing credit cards and payment systems
"If you have a currency that only goes down historically, how much of it do you want to own? Zero." - Jack Mallers

Bitcoin Integration with Traditional Finance (26:51)

Discussion of how Bitcoin is becoming more integrated with traditional financial systems:

Credit Card Integration - Users can maintain Bitcoin savings while spending through traditional credit cards
Banking Features - Account and routing numbers for direct deposit and bill pay
Inflation Protection - Bitcoin's appreciation helps offset rising costs of living
"Over the last year, bitcoin is up over 100%, which is a fancy way of saying my life has gotten half off." - Jack Mallers

Wall Street's Bitcoin Evolution (32:53)

Analysis of how traditional financial institutions are approaching Bitcoin:

BlackRock ETF - Major institutions creating Bitcoin investment vehicles
Fixed Income - Growing interest in Bitcoin-backed bonds and notes
Market Demand - Oversubscription of MicroStrategy's zero-coupon convertible notes
"I think this becomes a 5 to 10 trillion dollar asset fairly trivially in the next 12 months." - Jack Mallers

MicroStrategy's Market Impact (35:38)

Detailed discussion of MicroStrategy's innovative financing approach:

Zero-Coupon Notes - Successfully raised billions with no interest payments
Accretive Dilution - Unique approach to making share issuance immediately valuable
Market Position - Created a difficult-to-replicate position in public markets
"No one else is able to sell 150-200% exposure to Bitcoin in the form of equity." - Jack Mallers

Lightning Network Developments (50:40)

Overview of recent Lightning Network progress and implications:

Global Adoption - Strike now operating in over 100 countries
Integration - Seamless connection between Bitcoin and traditional finance
Future Growth - Positioned for significant expansion in coming years
"We pride ourselves on being there for bitcoiners and focusing on bitcoin financial services." - Jack Mallers

Conclusion

The conversation between Preston Pysh and Jack Mallers reveals a maturing Bitcoin ecosystem that's increasingly bridging the gap between traditional finance and cryptocurrency. With new products like Strike's Bitcoin-based checking account and growing institutional adoption through vehicles like MicroStrategy's convertible notes, the infrastructure for mainstream Bitcoin adoption continues to develop. The discussion suggests that despite past regulatory challenges, the future looks promising for Bitcoin integration into both personal and institutional finance.