| More Articles | Free Reports | Premium Services Charles Sizemore: There’s talk of the new Trump administration setting up a Bitcoin strategic reserve for the U.S. federal government. Essentially, the government would hold bitcoins in reserve much like they hold gold in vaults in Fort Knox. The idea is to hold an asset – like gold – that holds its value in the face of inflation of the dollar and other fiat currencies. Macro Wutzer: A lot of people cheer on this idea because it would send many more billions of dollars flowing into Bitcoin. It would certainly be good news for people – including many of your readers – who already own Bitcoin in their portfolio. But from a philosophical point of view, do you really want a government to hold a significant amount of power in the Bitcoin network? Bitcoin was created in the wake of the 2008 financial crisis, and the bank bailouts that followed, as a lifeline from the dying fiat currency system. That includes the dying dollar. Do you want your government to pull itself out of the mess it’s created with fiat currencies using Bitcoin and then become a significant player in the new system? I would argue against that. The longer it takes for these governments and large sovereign wealth funds to get in there, the better. The more cryptocurrencies are for us individuals, the more power we can soak up from the system. Charles: That reminds me of the old ruling party of Mexico. It ran the place for about 70 years. And it was called the Institutional Revolutionary Party. It was Institutional and revolutionary. How exactly does that work? There’s a similar paradox with having governments owning bitcoins. We run the risk of them damping its libertarian spirit. But even in a bad case scenario the underlying technology is still there. As we’ve discussed in the first part of our conversation, blockchains will still improve payment systems. They’ll still provide the extra security you get with the decentralized ledger. They’re still resistant to hacking. All of that would still be in place. Like you, I view government interventions with a healthy dose of skepticism. I'd like to keep crypto as free of government interference as possible. But even if the government does get its tentacles in there, most of the benefits do remain intact, no?
Marco: Absolutely. And of course, you can always count on governments to do the wrong thing. My home country, Germany, is famously always doing the opposite of something good. They're a slow-motion suicide right now economically. And they just got a large number of bitcoins and sold everything. We also must keep in mind that the idea of a Bitcoin strategic reserve was election talk. Look at Trump's last presidency. On the election trail, he talked about eliminating the deficit. And he left office with the biggest deficit in history. So, like you say, you must take this with a dose of skepticism. Charles: So far, we’ve been talking about the granddaddy of crypto, Bitcoin. On the other end of the spectrum, you have Dogecoin and other meme coins. This is where, I must admit, I roll my eyes a little. Maybe I’m showing my age – I don't know. But we live in a world now where assets with a funny photo that made the rounds on social media are worth tens of billions of dollars. Take Dogecoin, a meme coin that Elon Musk has promoted. It started out as a joke based on the “Doge” meme of Shiba Inu dog. Today, it has a market value of about $63 billion. That’s more than the market value of consumer staples giant Colgate-Palmolive, the blue-chip company that makes Colgate toothpaste and Palmolive soap. Dogecoin is also worth more than Occidental Petroleum, a major player in U.S. oil and gas production. Something doesn’t seem right there. So, what’s going on in the world of meme coins? And what does the future hold for these coins?
Marco: It’s the more degenerate end of the crypto spectrum, for sure. And I understand your skepticism. But looking at this from a bird's eye view, a meme coin is tokenized attention. In the age of social media, individuals, influencers, advertisers all compete for engagement. Meme coins translate this attention into a digital asset. If a meme coin’s narrative, branding, or image captures a lot of attention – from tweets, TikTok videos, Reddit threads, or wherever – this can fuel demand and price appreciation of that asset. There's a meme coin for almost everything these days. Thousands are being created daily. So, as we look into the future, any joke, any idea, any funny moment, anything that stands out, will be turned into a meme coin you can use to speculate on the popularity of that meme. That’s why I call it tokenized attention – it encapsulates attention into an asset. About 99% of these meme coins fade into irrelevance within days. A few of them maintain attention over time and then stand out more. Dogecoin came out in 2013. And it’s still around and worth tens of billions of dollars. So, that tells us something about the durability of some of these assets. Charles: What does that say about society in the early 21st century? Does it worry you that there’s so much focus on this kind of speculation? Marco: It’s a great question. Let’s peel the curtain a little bit more. I link it to the Weimar Republic, the German state that existed from 1919 to 1933. That’s when Germany, in the wake of its defeat in World War I, went through its infamous hyperinflation. The Weimar Republic became synonymous with nightlife, sexual liberation, avant-garde art, and intellectual ferment. Cabaret become huge. And like today, you saw people openly defying traditional gender roles and social norms. Meantime, you had rampant currency and stock market speculation as people tried to keep up with the ravaging effects of hyperinflation. Get-rich-quick schemes flourished, as did underground gambling dens. This all happened as the traditional structures that had underpinned German society eroded away and fell apart. We’re now 100 years on from the Weimar Republic. And I would argue that we’re in the early stages of a new version of it. Within this decade, I expect we’ll see significant collapses of the dollar and the broader fiat currency system. As this crumbles, we’ll get even more Weimar Republic craziness before we end up in hyper-bitcoinization and hyper-tokenization. Digital assets will become completely integral to everyday life. Bitcoin will become the world's dominant currency to rein in inflation. And almost every form of value – stocks, real estate, intellectual property, even your personal data and time – will be represented by and traded as a digital token on a blockchain. This is the most important trend in crypto. And we’re already seeing some of that craziness show up in meme coins and meme stocks like GameStop. Bitcoin – and crypto more generally – is the number one way to protect yourself from and profit from the paradigm shift that we're going to see globally. Charles: I like that historical perspective on what’s going on today with meme trading. It’s a sign of the degeneracy of the current system. It’s something I’ve been writing about a lot at The Freeport Society. And it’s why, when we launched a year ago, one of the first recommendations I put out was to buy gold and Bitcoin. It’s why we founded The Freeport Society – to be a haven from all of that. We’re very much in the same camp as you. We believe the financial house of cards will eventually fall. And like you say, we’re getting a sneak preview of that with the turning of the financial system into a kind of casino. | 
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