Bitcoin Explained: The Simple Crypto Strategy That Made Billionaires Bet on Bitcoin!

If you want to know what Elon Musk, Bill Gates, Warren Buffett, and other successful entrepreneurs and investors think about Bitcoin, then this video is for you.

If you're a true adventurer and you really want to throw the Hail Mary, you might take 10% and put it in Bitcoin or Ethereum. But if you do that, you've got to pretend you've already lost your money.

I think Bitcoin is probably a good thing.

It's not a currency. I mean, it does not meet the test of a currency. It— I wouldn't be surprised if it's not around in 10 or 20 years.

What's up, Believe Nation? It's Evan. My one word is believe, and I believe in you. And I believe you have an amazing gift inside you that I want to see explode out into the world. And so to help you on your journey today, we're going to learn what successful entrepreneurs and investors think about Bitcoin. Enjoy.

Cameron, I want you to explain Bitcoin for us. I mean, there are some people out there who they don't understand what Bitcoin is. Yeah, I went to the florist the other day and the woman said to me, my son is loving Bitcoin, he's making all this money. I don't know what it is, but, but— so tell us why you, you know, why you initially got into this business and what Bitcoin is.

So we think Bitcoin is gold 2.0. It's a store of value. And so So today it's about a $300 billion market cap. Gold is at $6 trillion. So we think it could very well go up another 20 times from today. We've been saying this since when Bitcoin was a billion dollar market cap. We've been in Bitcoin for about 5 years. It's grown about 300 times to this point. So we think it's definitely realistic that it could grow and disrupt gold and maybe even beyond that.

So you think that it could actually replace gold as a safe haven or as a hedge?

As a store of value and a hedge. All those things that gold provides in a portfolio. If you look at the characteristics and properties of gold, like scarcity, portability, divisibility, fungibility, Bitcoin equals or surpasses gold. So Bitcoin— gold is scarce. Bitcoin is actually fixed at 21 million. Bitcoin's divisible into 100 million pieces. It's way more portable. It's a 24/7 market. I can send Bitcoin to you on your phone right now or anywhere around the world. It's very easy to move.

What happens when I want to get out, when I want to cash in my Bitcoins and I want dollars?

That's easy.

You go to Gemini.com. We are a New York Trust Company. We've been building Gemini for 4 years so that you can go and sign up and buy and sell and store your Bitcoin in a safe, regulated manner. We are the same licensing structure that that companies like State Street and Bank of New York started out as trust companies over 200 years ago. So we've taken sort of the old— one of the oldest licensing regulatory frameworks and married it with one of the newest technologies in the world. It's not easy to do, but that's what we've been working on doing. And we think that's why CBOE was excited to work with us and price these Bitcoin futures with the Gemini price.

When I look at the dollar, the dollar is backed by the full faith and trust of the US government, the Treasury. What is Bitcoin backed by? Just Gemini.

So Bitcoin's— no, no, Gemini is a company on top of Bitcoin. Bitcoin is backed by cryptography, mathematics, and one of the largest computer networks in the world. The dollar being backed by the US government, a lot of people would cynically say that's injecting counterparty risk. If governments collapse, currencies, their average lifespan is 27 years. Something— Bitcoin's more like a gold. Gold's been around for thousands of years, so As long as this math persists and the security of cryptography that's never been hacked on Bitcoin, and as long as the network and people continue to believe in it the same way they believe in United States as a country or gold as a commodity, Bitcoin will have value. It's also open source and it can evolve and grow over time. So Bitcoin, when we first got into Bitcoin, is a very different source code than today. Obviously, the fundamentals and the rules are very similar. There's always been 21 million. It's fixed. Gold's not fixed. It's scarce. We find gold all the time. And people, people joke about how, you know, asteroids have gold and eventually maybe someone will, you know, Elon Musk or Jeff Bezos will find gold up there. Bitcoin's actually fixed.

So I don't think you have to totally understand Bitcoin to, to use it, to buy it and invest in it in an asset class similar to most people don't understand how email works. But they use it and they get the benefits of email. So, you know, we've been learning for the past 5 years and we'll continue to learn about Bitcoin. But I think the easiest way to think about Bitcoin is really to analogize it to gold. That's a very good framework of thinking about it.

You think Bitcoin will be disruptive in that way? I mean, we know it's a speculative currency. Will it be something that that will be what normal consumers will use and will disrupt the banking industry?

My opinion of Bitcoin is that— I mean, I think Bitcoin is probably a good thing. But it's essentially— its main thing will be— I mean, this will probably get quoted here and there, but I think it's primarily going to be a means of of doing illegal transactions. But that's not necessarily entirely bad, because some things maybe shouldn't be illegal. So, but a combination of Silk Road and Bitcoin will save us? Well, it will be useful for legal and illegal transactions, otherwise it would have no value as a of— for, for legal transactions. You have to have a legal to illegal bridge. Yeah, I don't own any Bitcoin.

The need to move money from place to place, the cost of doing so, the overhead as you put it, makes me think, believe it or not, of Bitcoin. Because some people have said, hey, Bitcoin is the answer to those problems.

Are you a believer?

Well, Bitcoin is exciting because it shows how cheap it can be. Bitcoin is, is better than currency in that you don't have to be physically in the same place. And of course, for large transactions, currency can get pretty inconvenient. The customers we're talking about aren't trying to be anonymous. You know, they're willing to be known. So the Bitcoin technology is key, and you could add to it or you could build a similar technology where there's enough attribution that people feel comfortable. This has nothing to do with terrorism or any type of money laundering.

If you're a true adventurer and you really want to throw the Hail Mary, you might take 10% and put it in Bitcoin or Ethereum, but if you do that, You've got to pretend you've already lost your money. And it's like collecting art, it's like collecting baseball cards, it's like collecting shoes. You know, something's worth what somebody else will pay for it. It's a flyer, but I'd limit it to 10%.

If you ask what are the things where there's, you know, what's very charismatic and that people are not paying enough attention to, I think there are these pockets in biotech that I find like that. You know, the one other one that I've been looking at a lot more have been the cryptocurrencies, and while I'm skeptical of most of them, I do think people are a little bit, maybe underestimating Bitcoin specifically, because it is like, it's like a reserve form of money, it's like gold, and and it's just a store of value. You don't actually need to use it to make payments. And it's been, you know, it's— there's about $70 billion worth of Bitcoin in the world. There's $9 trillion worth of gold. And if Bitcoin ends up being the cyber equivalent of gold, you know, it has a great potential left. So that's— and it's a very different kind of thing from what people— so people in Silicon Valley normally focus on companies, not, you know, algorithms or protocols. But this may be, this may be one exception that's, that's very underestimated.

Well, people question it, and I know there's been so much debate about Bitcoin, but they question it because what is it based on? I mean, you see that the dollar is based on, you know, the trust of the Treasury, the trust of the US government. What is Bitcoin based on?

Well, the argument, it's based on the, on the security of the math, which tells you that it can never be It can never be diluted by government. It can never be— it can't be hacked, and it's a form of money that's absolutely secure in an absolute way. And of course, you could ask the same question about gold. That's why I used the gold analogy. You could say, what is gold based on? Why is gold valuable?

Well, it's a tangible asset, though.

It's a tangible asset, but it's also hard to mine. So if it was easy to mine gold, then it wouldn't be that valuable because we would just have way more more gold. So Bitcoin is also, um, it's mineable like gold. It's hard to mine. It's actually harder to mine than gold. And so in that sense, um, it's more constrained. And so yeah, there are a number of things that, uh, that, uh, that I think make it somewhat similar to gold. And then the question is just, does this become, does this become, um, more widely—

and it's anonymous, right? I mean, that's one of the beauties of it. You can be anonymous using Bitcoin.

Yeah, it's half anonymous, half not. So it's again this intermediate thing. There's a question whether that's right or not, but it's a bearer instrument. So if you have the Bitcoin, if you know the key, you can go anywhere most of the time. Most securities are registered, not bearer securities, so it's a very unusual kind of a security.

Honestly, I'm not that big fan of Bitcoins. Um, but I pay special attention to the, uh, to, to the, uh, cashless society, blockchain technology, Bitcoin. The, the thing I want to know is that, uh, what value, what things that the Bitcoin can bring to the society, but Behind the Bitcoin, the technology itself really very powerful. So my job and Alibaba, Alipay's job is trying to making sure that we will move— the world will move into a cashless society. The society can make make everybody equal, make everybody inclusive to get the money they need, and making sure it's sustainable, inclusive, and transparent. I hate corruption. I don't have opportunity, it's okay, but I don't want somebody through dirty way take away my opportunity. This is why we want a cashless society. But Bitcoin, we watch it very carefully. I will not say I'm a fan of Bitcoins. I'm always also as curious as you are, and I don't think I'm expert on that. I don't pretend I know. There's one thing that I want to share with all of you. One day when you do business or do whatever, if you don't know, it's not shameful. But if you don't know but you pretend you know, it is very shameful. I don't know about Bitcoins.

It's not a currency. I mean, it does not meet the test of a currency. I wouldn't be surprised if it's not around in 10 or 20 years.

Why does it not meet the definition of a currency?

Well, because people say, well, I'll sell you goods in bitcoins, but they change the price of those every time the price of the dollar changes in relation to bitcoin. They're pricing off the dollar. They could say, well, I'll sell it to you in barrels of oil, but every time the price price of oil changes, they change the number of barrels you have to have. That's not— your oil is not the currency.

Let me ask you about Bitcoin.

Okay.

Bitcoin, people say the same thing.

It's a store of value. You've got to have it diversified.

The dollar's not safe.

There are two purposes of a currency. Is it a medium of exchange? And is it a storehold of storehold of wealth. Those are the basic ingredients. Bitcoin is not an effective medium of exchange by and large. And if I go— I have a Bitcoin, I want to go buy things. It's not easy to buy things with the Bitcoin. And in terms of a storehold of wealth, a storehold of wealth more reflects— like gold more reflects the opposite of what money is doing, right? And so you look at it, it's a storehold storehold of wealth. Bitcoin is a speculative— it's a speculative bubble, right? Its price is like a greater fool theory in terms of its price. If you say what is its intrinsic value, if Bitcoin was made into a more effective medium of exchange and also operated in terms of a storehold of wealth, not of the reflection of that volatility, it would be a viable instrument.

It.

It is to me a vehicle for speculation that's attracting people in, and it has all the classic ingredients of a bubble— people leveraging themselves up— and it doesn't have that same intrinsic value. Even the privacy value, okay, is suspicious. In other words, it has a purpose to some extent. If you're living in a country and you don't know your currency, whether it's going to be good or not, and you might try to hold that. But that thing you're holding is running around like crazy for reasons that you don't understand. And then it's— so it's not going to be an effective storeholder of wealth. And the privacy will be stress-tested. In other words, governments are examining who is operating in their own clever ways of what that— and so you can't even assume that that's— so it's going to be a privacy vehicle. So I don't see the effectiveness of Bitcoin. I could see, uh, cybersecurity, uh, currencies and and so on, but cryptocurrencies. But this is not what we're having. It's, it's, you know, it's a possibility that I think has been captured as a speculative vehicle that's in the middle of a bubble.

Bitcoin is something that you've been interested in and supportive of. In fact, one can pay for tour on Virgin Galactic up to the moon with Bitcoin. I think the Winklevoss twins have said that they would do exactly that. You think this is a currency, a currency that's really going to work eventually?

Well, I think it is working and there will be other currencies like it that may, may be even better. But in the meantime, there's a big industry around Bitcoin. And, you know, people have made made fortunes out of Bitcoin. Some people have lost money out of Bitcoin.

It's volatile.

It's volatile.

Yeah, it is quite volatile. But, but, you know, when in volatility, volatility, people can make money out of volatile.

Why was it important for you to give it sort of that stamp of approval, that endorsement, by saying to the Winklevoss twins, yes, you can pay for the ride with Bitcoin?

Because I'm not foolish. I mean, if people have got lots of bitcoins and they want to go to space. I'd much rather they spent that money on our spaceship. Whether I keep it in bitcoins is another matter. I'd much rather they spend that money on a Virgin Galactic spaceship than on— you know, Elon will be sending people to space one day on Elon's spaceship. So we'll grab the money while it's there.

Thank you guys so much for watching. I hope you enjoyed. I'd love to know what did you think of this video. There's a mix of different opinions on Bitcoin. On where it's going. I'd love to know who do you think is right, whose advice you're going to listen to. Is there your own take that you want to add to it as well to help your fellow members of Believe Nation? Leave it down in the comments below. I'm really excited to hear from you. So thank you guys again for watching. I believe in you. I hope you continue to believe in yourself and whatever your one word is. Much love. I'll see you soon.

Raise your standard.

Apple At the core, its core value is that we believe that people with passion can change the world for the better.

Not one drop of my self-worth depends on your acceptance of me.

I don't ever give up. I'd have to be dead or completely incapacitated.

Hey, Believe Nation, if you want to see my all-time favorite top 10 rules of success, I have a very special secret video for you. These are the individual clips that I have personally learned the most from and applied to my life and my business. Check the link in the description for details.