[00:00:01] Speaker A: Welcome to Crypto Talk Radio, the podcast for everyday investors like you. Visit us on the
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[00:00:13] Speaker B: Thank you for that, Bailey. And welcome, everybody out there in Crypto Talk radio,
[email protected] I think it's about that time to piss some people off.
That's what I'm going to be doing. I don't want to, but not planning to. It's not intentional, it's not by design. But we must speak again about precious metals. Not specifically precious metals. We must speak about tokenized assets connected to the value of precious metals. Because it occurred to me, likely spurred on by some YouTubers, that there is this rush towards these assets.
And I understand it's Stockholm syndrome. People have become trapped and they cannot look past it, and so they want to stay in it and it provides them an outlet. And I understand that.
I am not trying to tell you that you're stupid. Might seem like I will, but that's not the intent. That just. It's how it translates. I am rather going to make an impassioned plea to make what I believe is a smarter decision for the long haul.
This may go through deaf ears, and I understand. I am not.
I'm not oblivious. I get it. Some people are beyond help.
But I have to do the best I can. If you hear what I say and it has helped you see the light unplugged from the matrix, let us know. CryptoTalk FM. It's a contact form. Let us know.
Today's episode won't take long because it's a simple message. So strap in. Let's go ahead and get. Get right into this nonsense.
Coinmarketcap.com we're going to start with Bitcoin, though I hesitate to do so. It's important we start with Bitcoin because it connects to my later message.
Bitcoin currently hovering around the 89,000 mark over the past month. We always zoom out to the month chart because when dealing with cryptocurrency assets, we are dealing with a significant amount of volatility. It is critical to slow the volatility down and then look for a pervasive pattern.
The pervasive pattern of Bitcoin is a positive trend. Things coming back up after a significant diplomatic not long ago got very close to 85,000.
Didn't stay there very long.
There is a push to hold the line and keep Bitcoin above the thresh.
How long that takes to do that is as yet Unknown, but right now it's looking positive.
I have repeatedly said and will continue to do so that diversification of the portfolio is never a bad thing. That you want a diverse set of assets for your investments, not just one, not to yolo and anyone that you do need to have levels of risk and the risk is according to how much you're willing to lose.
The risk of losing with cryptocurrency diminishes, or I should say minimizes when you're dealing with the main players, especially bitcoin.
It doesn't really go away. There's still a risk there. I don't know if anybody saw da Vinci, Jeremy's recent uploads where he was talking about. He's been talking about precious metals more than he did before. Again, this is the bitcoin maxi guy. All of a sudden he's talking precious metals.
He gave an upload and there was a commenter and I'm with this guy or gal where he's like, I don't get it. Essentially, he's like, I don't get it. I don't get. What's your point with the video? Because the. The title of the video basically said he's going to sell his Maybach.
He didn't. In the video, he didn't really make it clear what it is he's doing after he sells the Maybach. All he did was read a chat GPT post where the chat GPT post essentially said, silver's broken. Well, we already knew that you didn't need chat GPT to tell you that.
So this commenter is basically saying, okay, you're going to sell your Maybach. Now what I'm paraphrasing, that's basically what he said. And I had the same takeaway. He didn't ever conclude with a result. He did say he was going to go long on something, which I think was bitcoin, but he didn't connect it to say, in summary, I'm selling my May box so that I can. What? What are you doing? He didn't ever do that.
So it seems to me, and another commenter said this, a lot of the YouTube folks who previously had sworn off of all things precious metals have kind of jumped back on the bandwagon all of a sudden. I would consider that a form of fomo, wouldn't you? But it seems like they all started talking about precious metals out of thin air after disregarding it for countless years.
Because at the time, 2021 say, you were dealing with the casino, right? And so it was A everything was flourishing. You could talk about all these garbage shoes and and flokies and all these garbage tokens, right? The so called alt seasons, the all of the things we took for granted that have now quieted down. Now we have silence. Except for one project basically confirmed itself recently to be a scam that I won't name.
Without exception, pretty much it's dead silent.
Precious Metals took a front seat. Fiat took a second seat co passenger seat. So then we look at what is it about precious metals. This folks is where I'm gonna go with today's episode. That rhymes because it's important I think in my opinion to analyze why there's so much FOMO happening with the crypto YouTube folks and some of the crypto bros. Quickly though, Ethereum's hobbling about a 3,000 bucks mark. Certainly not impressive. Idiot Vidalik talked about. As I said before, we need to increase privacy after this idiot moved away from proof of work, which is the ultimate form of doing so. I digress.
Ethereum's price is following Bitcoin.
Bitcoin. This connects to my ultimate topic. Bitcoin has liquidity pairs of its own trading pairs of its own.
Part of the trading disaster that was happening with Bitcoin had to do with hash rates and a decline of some of the transactions and traffic that we would expect that helped keep the price up. It was less about people dumping per se and more about lower activity. Turns out some of the mining facilities were actually affected. I almost said impacted. It's basically the same, but affected. I want to say affected because if they didn't go down, they were just affected by the winter storms.
We had significant cold hit in multiple places. That significant cold started to cause some problems with the grid. Texas is dealing with it now. For those that didn't understand when it gets extremely cold and this is my beef with a lot of these places that don't bury their power infrastructure because when it gets extremely cold, you tend your electricity tends to be a little bit sensitive. It has some problems and then if you have winds that makes it worse. If you have, you know, squirrels or whatever makes it worse.
Texas has had problems with its infrastructure during inclement weather in the past.
So it didn't surprise me that was going to happen. I just assumed they would bite the bullet and invest to fix it. And they did not do so. They were running into problems. Other places running into problems. Due to this recent winter storm that's apparently going to continue for a little longer. We expect that most of this horrible weather is Going to last the span of January before it starts to lighten up a little bit in February.
That's at least the expectation. While mining facilities.
The irony is, of course mining is a very heat intensive activity. It generates a lot of heat.
These facilities have to keep those machines cool.
So rather than my thoughts like, well, rather than why don't you just turn off the cooling system and let those things warm and keep themselves weather, you know, temperature controlled from the weather by the natural heat that they generate anyway.
And you might be able to reclaim some of that heat and repurpose it to support some of the other parts of the buildings. But rather they would just, they would prefer to just let the thing go rogue. I don't know, I just. It felt to me like there's not a clean strategy for what's going on there. I don't know for sure, but it seems kind of bizarre to me that of all things to bring down a mining facility, it's just the blistering cold, cold that humans theoretically can walk in. Wouldn't recommend doing it for long. But the point is that these machines apparently were impacted. So now these people on YouTube telling you that Bitcoin is going to sustain all of us to the point we don't need fiat. I would remind some of those people, if you have some sort of currency of any kind that can't hold up to terrifying cold, it's not going to replace fiat, period.
It can supplement it. It's not going to replace it. This exercise taught us this lesson.
So a lot of the dips we saw were due to technological shortcomings rather than a failure of the financial side. But then I noticed. This is my topic. Then I noticed some people were advocating for the use of tokenized assets around precious metals. You might not have known that there are tokenized assets around precious metals. There's quite a few of them. I'm only going to be talking about a couple, but there's quite a few of them. Mr. Segala, when he was on the show, talked about this concept a couple of years back. So this is not new. It's been out for a while, but the attention on them has increased given the Reese recent run ups of silver and gold in particular.
Pax gold is one I will be talking about. There's also tether.
Tether has gold reserves to it.
And then there's X, I believe it's XAUT now, which is tether gold itself. There are people out there who probably didn't do their lessons around the periodic table of the elements.
If you did not, if you're one of those where you did not do your studying about the periodic table of the elements.
Au, the letters is the symbol on the periodic table for gold.
So xaut refers to tether gold. That's its symbol as you trade it.
So it's a beautiful name. And tether. The reserves for this are backed by actual physical gold. So what they've done is they stacked and then they provided this as another token asset. It's not a stable, it's a token asset that is basically, I don't want to say pegged, but that's basically what they tried to do. Pegged to the price of gold.
What's happened is that people have started investing in these tokenized assets paired to the physical metal instead of buying the physical metal.
So there was a run and this started roughly about two weeks ago. Ish there was a run on tether gold. It ran up because gold ran up because it's pegged quote to the price of gold.
So those that bought into the asset or held the asset, ultimately what I'm saying is that they were those that believed from the beginning they just bought into the tokenized asset rather than the physical metal.
But in the recent run ups that we saw, which started roughly about 2024, people have more recently paid more attention to these types of token assets as a form of investment.
I don't mind that in a diverse portfolio, my beef only has been investing in them instead of physical metals.
Why?
Because investing in the tokenized asset is no different than the problem that's caused the price runs we see. Now let me explain to you as simple as I can, why the price run and I'm targeting silver in this.
There's a bit of arbitrage happening between silver and gold as well, but I'm targeting silver when I say this.
Silver is essentially broken and I'll try my best. There's a lot to this.
I'll do my best to simplify it, but I encourage you to do more research from people that are not trying to hype you up into the fundamentals of what's wrong. Please don't go to chat GPT.
There was another commenter on Jeremy's channel that said why is it that all these YouTube people just go into Chat GPT and just reading it? Because Chat GPT's algorithm is coded to basically tell you what you want to hear.
Path of least resistance. So please don't go to chat GPT. Please do your own hard research into these macro type things. I'M about to share with you and educate yourself, force yourself to absorb it. It's going to make you stronger and insulated against what's happening. But I'm targeting silver. With everything I talk about, silver is essentially broken.
This spans over 40 years when you understand how trading works and cryptocurrency is going to fall into the same trap. That's why I'm trying to educate people so you understand what crypto's future is. Because it's already too late and you could hold me to it. My audio is out there.
Here's how trading works. Once it gets in the hands of the mainstream and the institutionals, what they want to do is they want to trade futures, they want to trade options, they want to use leverage. They don't want to deal with the asset itself.
They want to trade and essentially gamble. Because that's basically what it is. If I take options, right, an option to buy, I got an option to buy at a certain price.
It's not real, right? Because I'm not trading the asset, I'm trading the option to purchase. Purchase the asset. And I may never actually use it. I may never actually call calls and puts and I may never execute the contract.
I just want to lock it in and benefit from it on the trade activities.
All of this where we're not really dealing with the actual physical asset and rather we're just gambling on the price movement of said asset.
This is why there's this term tossed around right now about paper silver.
Paper silver is simply, there's leverage going on, there's futures, there's price targeting.
The price targeting and the trade activity that's happening around it exposes to the exchanges a certain fair price that they believe is what it is.
If there's no demand for the physical asset, the price starts to stagnate.
This is part of the cycle. It's a natural cycle.
With silver, there was a time when silver was in the single digits. It ran up to 50 bucks per ounce and then it cracked back down again and it stayed down for decades.
This is the suppression and manipulation that some are talking about that legitimately happened recently.
What broke.
What broke is at some point you get to where the supply outweighs, meaning that we have supply, but we don't have demand.
It causes a price drop, drop.
Then China, China steps in and says, well, we're going to make it harder to ship stuff to certain countries. We're going to make it. We're going to basically hoard it, right? We're going to. You can still do it, but you got to jump through way more hoops to send it out of the country, to send it elsewhere.
Now that means it creates an excess of supply centralized in one place and a significant deficit in, in supply in other places. And the inverse is true. The demand skyrockets in those other countries where they've now been shut off. That happened literally just a couple weeks ago when the supply, that faucet, the supply line gets cut off.
Remember, these businesses still have to manufacture solar panels, they still have to manufacture parts for cars, they still have manufacture parts for phones and whatnot.
A lot of what China did is in direct response to Trump's tariff call.
Now, if you think about what the tariff was intended to do and some of the regulations that they're trying to impose on businesses, they're trying to say, we need you to manufacture in the us we need you to do things here.
If the business wants to do certain activities here, they still need access to the rare metals, the precious metals and other supplies.
When you've created a decades long dependency on other countries for those supplies and that supply line suddenly gets shut off, what happens? A supply shock. We don't have the supplies to do the manufacturing that we've gotten accustomed to.
This is why Elon on X tweeted out when the price started to jump.
This is not good that we need it. We need this stuff. He's not talking about the price, he's talking about silver itself. We need the supply and it needs to be open. And he knew the price jumping as much as it was like every 10 days, he knew that that meant something was terribly wrong and continues to be terribly wrong.
What's happened now is overseas because there's an excess of supply and because they can't, people out here can't get easy access to it.
What's happening? They're just trading, they're trading, they're trading and trading and trading and trading.
And certain countries, it's harder for them to get access to what they have demand for.
And so they're pushing the price up at a wide scale.
When other countries start to dwindle in their supply, the same price appreciation is going to happen.
So you talk about the reserves.
The reserves on hand are only as good as the ability to replenish said reserves.
If you stacked your reserves at 60 an ounce and the price is now $120 an ounce, but you still have demands for the reserve. The demand is open orders, it's futures trading, it's leverage positions, there's all sorts of Demand to have the assets available in the event that somebody wants to call and say, I want, Hey, I want the physical asset. So what ended up ultimately breaking in? Everything I just described was a groundswell of businesses, mostly businesses, but also some retail. But it was really businesses that suddenly started to request physical assets. They want the physical metal. Now there's orders for the physical metal. It was no longer being traded as paper. It was no longer being traded just on price or price target anymore.
Now because of the one break that being China, cutting off the spigot caused something much worse than price discovery. It's no longer price discovery. It's not. Let's find out where the price level really is.
Because it was so far suppressed the real price of silver. All we can do to calculate that is a ratio against gold. Well, gold is going up, if you notice, if you understand what I'm saying to you.
If silver is nothing more right now in terms of its true price than a ratio against gold. And that's what it's been since time immemorial.
But gold is increasing almost lockstep from a velocity perspective to silver.
That means until we get to a point where everything gets back in balance and ideally the supply distribution gets resolved, which it may never because you just had Trump threaten China and Canada over their stuff. And that's going to cause more stuff. You still got the Greenland stuff. That's going to cause more.
You've got so much happening. The solid state batteries which were the new big thing, you know, you could, it goes 600 miles on a charge and you can charge it to full in nine minutes. This is the big.
There's a high anticipation for demand for the new technologies that have been designed. But then there's also these macro level events that are causing people to hedge, they're causing people to go cautious, moving away from risk based assets, which cryptocurrency is, and towards safer conservative asset classes, which precious metals are.
So what does that tell you? It tells you that nobody can really target the true end goal price of silver because it's always been a ratio against gold and gold has been increasing lockstep with silver, which seems to indicate that all of these factors are having an equal impact on both.
But the ratio is also a different, it's also a different variable.
The ratio is extreme on silver. We know silver should not have ever been in the double digits this long. It didn't make any sense. What we don't know is will it stop at the triple digits.
I said 700. Feels like, feels like an upper target even. I don't know for sure, but it felt like an upper target that was prior to seeing gold.
Its velocity start to increase as well.
So let's assume that gold continues to climb. It's going to blow past that 700 mark. These have to plateau. At some point, they have to stop climbing.
Because there's got to come a point when.
And I'm saying when. I say gotta, I don't know for sure. I'm saying there's gotta come a point when everything kind of settles down and we start to see more reasonable price movement than what we're currently seeing. If I looked at platinum, for example, Platinum is just shy of $2,700 right now.
Platinum for the longest time was not anywhere near that high. It was certainly high, but not that high.
Platinum had dropped. It went down to like, what, $22,000, $2,500, $2,000. As of just December 31st. As of just December 31st, less than a month ago, Platinum was at $2,000. It's currently at just shy of $2,700. That's an abnormal rate of increase, which is what I'm saying. There's arbitrage between them for sure, Because I believe a lot of this is being spurred on by the broken silver price runaway that's happening. So some people are saying silver is going to stop, it's going to come down. They're looking at macds, they're looking at our size. They're looking at the traditionals.
What people are saying, other people are saying is this is not the normal. This is not the normal price discovery. This is not the normal movement. It cannot be predicted that way because unfortunately, it's runaway. This supply chain is busted.
As long as it's busted, there is no price target. The sky's the limit.
These, all these companies, all these dealers, all these firms everywhere, They've got to have the metal.
They got to have it.
It's not negotiable. They've got to do it because they've already committed orders. This could be to governments. This could be to other companies.
They've already committed delivering products. They've got to have the metal in order to do it because it's part of the design, which they've already done and they've been sitting on for years.
Everything's got to keep going. It's not like you have a plan b for this.
So when you look at, okay, they got to just keep delivering and they can't stop. They got to keep pushing forward.
You Realize there is no price ceiling. There really isn't. It's whatever. Some people are going to demand 200 bucks per ounce for my silver. Some people demand 500, some people demand a thousand, some people demand whatever.
Until we get to a point where there's enough silver available sold to those entities to sustain them, it's it. It can't stop. That means that spigot, that supply line, has got to be reestablished because there's not enough silver to sell to them.
I'm just talking us when I say this. There's not enough here to sustain all the businesses, all the retail demand. There's not enough here, which is the flaw of depending on overseas for as long as we did.
It's like a trap.
We set ourselves up for a trap by creating that dependency, thinking everything was going to be kosher and cool.
Meanwhile, they had everything under control over there in China.
They could always cut it off. That's why, by the way, Trump keeps talking about, we got to be China, they're going to be this. That's why he kept doing that. That's why he's always anti China, because he understood there are certain things where they control all the cards.
You say, well, yeah, but his tariff triggered them to do it.
He did that because he understood I got to do something because we can't keep giving stuff away. We got to fix our own economy.
What he didn't think through in that decision is before making that decision, you probably better make sure your stockpile of everything is sufficient to sustain and you need to set up mining locally. That's assuming there's even some left. I know there's some mines, but there's not anywhere near as much as there is overseas.
They didn't prepare because they never expected China to just completely cut off the way they did.
I think that's a failure, frankly.
Now it's, what do you do about it?
Even if China opens it up again, let's say China backs down, they say, we're opening it up again, the horse is out of the barn. You kind of have to step back and say, geez, I just don't know. No. So that's the stance I took. I had bought metals ages ago because I knew there's no way silver's priced like this. Copper.
Copper is still suppressed because it's plentiful, but it could be subject to the same whims someday.
All I've ever said, I am not a fan personally, of the tokenized connection to the precious metal. I'm a fan of the precious metal, owning it, controlling it, dictating your own price for it for when you want to sell it.
Some people are not. They're still in crypto. Their crypto's on their mind. They can't let it go. If I do this, it's going to hedge me, I'll make some money and then I'll spin it back into bitcoin. I'm not against you. Okay. And Maybe that's what DaVinci Jeremy was trying to say he was going to do is just tied to these tokenized assets, ride the wave, benefit off the value of those, wait till bitcoin drops, stack some more of it from that and just arbitrage it. I, I, I'm not against it. Right. It's. If you're comfortable there, fine.
I would argue. This is my argument as I close.
I would argue it's no different than the paper silver fiasco that got us in this point first place. Especially when you look at simple weather conditions bringing down the bitcoin mining. I feel relying on the crypto asset equivalent of a precious metal price sets you up for the same risk that sets us up here. I feel that the government at some point will put enough guardrails around those types of assets to where it's going to nullify the benefit you think you're going to get at some point in the future.
Owning the precious metal, there's still a remote risk that they seize it. That happened with gold. They seized gold from everybody that owned it. This is years ago, but there's that risk. But it's an unlikely thing.
I would argue it's highly unlikely to happen again. It could, but it's. I think it's unlikely.
My call to action to you is simply to think it all the way through, not just the spots that the YouTube people are telling you to do. Think it all the way through from what custody really means. Custody really means you must own the core asset in order to realize that you are the owner of said value of the asset. You must own the asset. If you only own a representation of the asset, you don't own the asset. Thus it can be lost or taken from you.
Some are willing to accept that risk. I celebrate those that are. I'm going to recommend that you don't.
At the end of the day, it's up to you what you want to do.
Precious metals are not going anywhere.
We're way past that. We are in an era now where precious metals are going to take a front seat. They're going to be in more of a spotlight, especially with the devaluation of the dollar. But critically, we now are in a. I think people are wisened up to the government damaging cryptocurrency just enough to where that same risk is there that it gets devalued.
Because crypto should have never been tied to fiat in the first place. And I think people are starting to realize that's just as risky business as it was in the FIAT world.
There's nothing wrong with the hedge, there's nothing wrong with having this asset class that is time honored, tried and true. But I'm just saying, if you choose to get in it, please, please consider the physical asset.
Silver is still, in my opinion, underpriced. I would avoid the others.
Silver, in my opinion, is still underpriced.
I just feel there's no logical reason for silver's price right now. It just still feels artificially low.
Time will tell who's right and who's wrong. Whether I got it right or others are telling you the truth, that silver's gonna crash.
But to me, you know, say 100 bucks, right? It's a hundred and 100, let's say 115. 115. $120 for an ounce. And it is hard to find. I'm not saying it isn't, but you know, you can probably go to your local shop, just find a local precious metal shop and I'm sure they have some variation of silver available if you're trying to get in and they can advise you better than I could. If you're trying to consider stacking, they can tell you what might be worth getting into now or how better than I can. All I'm asking is that you look into it. All I'm asking is that you don't turn away from it. And I'm encouraging you to disregard tokenized precious metals. If you want the precious metal, get the precious metal. Not a crypto variant of said.
Sam.
Sa.
