MSTR: Stretch the Normie Mind? STRC Exists Because Normies Don't Care about Bitcoin (BTC Killer App)

[00:00:00]Hello everybody. So this video is entitled MSTR plus stretch.

[00:00:06]Specifically, this video is about the stretch preferred instrument created by Saylor. An instrument created to stretch the normie mind and I'll get to that in a second. This explains why the maxis simply can't understand stretch. And they can't understand MSTR because MSTR and stretch are not for them. MSTR is for the investor. MSTR is riskier than Bitcoin. Stretch is for an entirely different profile. Stretch is for the so-called normie to use a word um maybe a little condescending of a word, but it's created by you know internet communities. It's an internet community word. It's an X word. Um it's kind of a fun word. I kind of like it. So anyways, before I go um to the whole normie thing, I want to talk about the the elephant in the room later, stretch. Uh before before that, let's talk about strategy.

[00:01:05]Strategy is slightly outperforming Bitcoin. Um that's good. We should outperform Bitcoin a lot cuz we didn't do too well these past two days. Uh but we're very stable. Bitcoin is stable.

[00:01:16]Strategy is stable. For strategy to go back up, we need we need Bitcoin to go back up quite obviously. Uh perhaps more signal can be read in the fear and greed index. We are traveling back towards the middle of fear and greed. I look forward to this getting back to neutral and when we get back to neutral is when I believe uh we we rally potentially and it's when I believe a lot of the stocks related to crypto and Bitcoin and stocks in general once we get back to normal, once we get back to neutral, that's when I believe the markets become somewhat investable again because if if you watch my other known strategy videos, you probably know what I think. I think the markets are very tough to invest in right now because of nonsensical volatility on things that is unrelated to the stocks that you own. And And the volatility has been just crazy ever since 10/10. And that's true in traditional markets and that's true in crypto markets. Okay, let's talk about the topic of the video.

[00:02:20]Stretch was not created for Bitcoiners.

[00:02:24]Stretch and strategy neither. Strategy was never created for Bitcoiners.

[00:02:28]Strategy is not a substitute for Bitcoin. Strategy is riskier than Bitcoin. It is It is riskier. Some might say it is much riskier than Bitcoin. A lot of the maxis might say it is much riskier than Bitcoin. I think a lot of us who've covered MSTR, we've always said that. We've always said that MSTR is more risky than Bitcoin. It certainly is. Saylor himself has to say has has said that before that you have to trust him. You have to trust the issue. You have to trust their OPEX. All right, their their OPSEC. Sorry, their operation security. You have to trust that they don't lose the keys. There's so many things you have to trust.

[00:03:04]So, MSTR is for the risk-on investors.

[00:03:07]And but MSTR is for for forms a new form of company, a company built on Bitcoin and not a company built on fiat. And there's a few of our these companies built on Bitcoin, you know, Block, Square, the Cash App with the ticker symbol XYZ built on Bitcoin. Coinbase, you know, and Gemini, the exchanges, even vote. They There's a lot of fair criticism that can be you know, done here on the exchanges. They're still built on Bitcoin, right? Coinbase stacks Bitcoin. I could have put bullish bullish Peter Thiel related institutional exchange for Bitcoin. They're built on Bitcoin, too. They stack Bitcoin. A lot of the miners are pivoting to AI, unfortunately, but some of them are original miners, the OG miners who who stack Bitcoin, they are also derivatives of Bitcoin. They are built on Bitcoin.

[00:03:57]When you have a company built on Bitcoin, that's riskier. And and that's fine. And that's not pure Bitcoin.

[00:04:02]You're not buying the pure commodity.

[00:04:05]You're not buying the steel or the aluminum. You're buying the application of that steel and of that aluminum. And of course, at some point, uh I believe, and that's that's Saylor's presentation right here. I'll get to that in a second. I believe there will be other companies that are derivatives of Bitcoin. Um um Bitcoin-backed stablecoins, I think they're going to be a big big topic. Yes, they failed in the past. Eventually, they will stop failing. Uh flight flying, right? We failed a long time at flying. And eventually, we stopped failing at flying. I believe at one point, and maybe maybe it's going to be stretch, maybe it's going to be Saylor, maybe it's going to be this type of instrument, but at some point, we'll succeed at creating a Bitcoin-backed stablecoin. At some point, I believe that. Um insurance, right? Uh Bitcoin insurance, a company that could be built on insur- that could, you know, provide you home insurance, but built on Bitcoin. So, they invest the float in Bitcoin instead of investing it in treasuries. Uh that would be absolutely amazing. You could have Bitcoin annuities. You could have Bitcoin retirement systems.

[00:05:07]Anything in finance can be rebuilt with Bitcoin and can be made better with Bitcoin. The analogy that I've always used is the analogy of steel. So, let's talk about stretch. Stretch is for people who do not want to understand Bitcoin.

[00:05:26]It's for people who do not want to understand Bitcoin, right? Uh uh A bridge is for people who do not necessarily want to understand how steel works. Steel is necessary to build a bridge. Steel is a servant mix of iron and carbon.

[00:05:49]It's complex. Well, well, it's it's easy to understand nowadays, but at least back then it was fairly, fairly darn complex to understand.

[00:05:58]Most people didn't care about steel.

[00:05:59]They they they they could not care about steel.

[00:06:03]Until we were able to build build a bridge over the Mississippi and all of a sudden half of America was unlocked for exploration, unlocked for development.

[00:06:15]So, steel unlocked something absolutely amazing by its application to a higher purpose. So, the application of steel in my example was building a bridge and people didn't trust the bridge back then. They had to have elephants come on the bridge to show the townspeople that the bridge was sturdy enough.

[00:06:38]Saylor uses a similar analogy for aluminum.

[00:06:41]People don't care about aluminum. People actually criticize aluminum. If you ever use aluminum foil, it rips. It bends easy. It's not sturdy.

[00:06:53]Most people couldn't care less about aluminum. Most people Most people would prefer steel or iron.

[00:06:58]Until you create an airplane with aluminum. And then all of a sudden people really start caring about aluminum because you just created something amazing, you know, New York to Shanghai in 15 hours.

[00:07:12]Whereas in the past it was nearly impossible for the common man to do that trip. So, all of a sudden you start caring about airplanes. You don't really care about aluminum, but airplanes can't exist without aluminum.

[00:07:24]Right? And of course, bridges can't exist without steel, at least the big ones. So, so the analogy of Stretch is what? Stretch, an instrument like Stretch, can't exist without Bitcoin.

[00:07:37]But people care about what Stretch is.

[00:07:41]Stretch is one of these applications.

[00:07:44]Stretch is an application. It's a proxy for a checking account that pays 11 and 1/2%. Now, it's much riskier than a checking account.

[00:07:55]It doesn't have a track record that banks have.

[00:08:00]At least in the minds of people, it doesn't have that track record. It doesn't have the FDIC insurance. So in So So for the normie's frame of mind, it is still very much at the edge and very very much riskier.

[00:08:14]And And it still requires a tremendous belief in Bitcoin. You have to You still have to believe in Bitcoin.

[00:08:21]Um but eventually, people didn't People stopped having to believe in steel or understanding how steel works. Eventually, people forgot that flying was something tough to do.

[00:08:32]It just worked. Eventually, it just worked.

[00:08:37]And so I think over time, Stretch will become a separate product as it just works. As the Lindy effect comes in and and and and it it starts staying longer, staying longer. Using a little bit of reference, right? Or or or of of of Nassim Taleb and antifragility, etc. As ironic, right? Cuz he hates Bitcoin. But the long the the the longer these instruments are going to be out, the easier of a sell it's going to be to the normie investor who are going to judge them by the track record. And of course, whenever we depeg, it hurts Stretch. But Stretch is like a bridge is what a bridge is to steel.

[00:09:21]Stretch is what an airplane is to aluminum. Stretch is to Bitcoin what an airplane is to aluminum and what a bridge is to steel. And I could go on and on about the analogy. Saylor has used all sorts of analogies, you know, the gas engine is another very good analogy. Most people don't care how a gas engine works. Works they just want they just want a mechanical horse. They don't really care about how a gas engine works and you know, it explodes etc. It's highly volatile but you can harness that volatility and create smooth motion, a smooth ride in a car. So that's another analogy that Saylor has used.

[00:10:02]And of course we are at the bridge phase.

[00:10:06]We are at the at the I'm never getting on an airplane because I'm flying too close to God and it's a sin. You know, in the airplanes when airplanes became a thing in 40s and the 50s, people wouldn't get on airplanes because they would think it was sinning to get in an airplane. You were you were going too close to God. People people wouldn't go on on tall buildings too built built with steel because they didn't trust the tech.

[00:10:29]So it's going to take a long time for people to understand and see that oh, actually these products these products are working. And so the checking account that pays 11% or 12% or less or more that's a new category, right? Saylor built a big bridge with stretch, right? Sayta also built a big bridge.

[00:10:51]And so we argue about the features of the bridge.

[00:10:55]But for for for normal folks they focus on the fact that it's a bridge. They don't have a religion in Bitcoin. A normal person does not need to have a religion in Bitcoin. They judge the instrument based on its features on the surface and they don't try to understand the deep reasons as to why Bitcoin is very likely to outperform.

[00:11:21]And of course Saylor does a very good job at saying in all of his speeches really that you shouldn't touch that product if you don't believe in Bitcoin. This is not if you if if you if you if you absolutely that product could fail. I don't know if that makes sense. That product could fail.

[00:11:43]If if if steel fails, the bridge is going to fail. If aluminum fails, the the bridge is going to fail.

[00:11:50]To say or this product doesn't seem risky because Saylor has developed an absolute religion in Bitcoin.

[00:11:57]But to the average person who doesn't have that religion about Bitcoin who does who doesn't really understand how it works, it's still important to let them know that you kind of need Bitcoin to work for these instruments to work. But that argument will be less needed over time as the track record as the track record establishes its own Lindy effect and kind of overtakes under the the the fundamentals of understanding the steel behind Stretch and the steel behind sETH.

[00:12:29]So, it will take years for us to establish this track record.

[00:12:32]Briefly, I want to talk about the difference between those two here.

[00:12:35]Of course, think about it in the normie mind. You have a normie mind. You're not really interested in Bitcoin. You're interested in the yield. What you want is the yield.

[00:12:44]If you want the yield, sETH seems more attractive right now and that's probably not helping Stretch.

[00:12:49]sETH seems a little more attractive right now. Why? sETH pays more yield.

[00:12:52]It's quite simple.

[00:12:54]It's it's the most important thing, right? The yield is what most people care about the most.

[00:12:58]sETH has a higher yield right now.

[00:13:00]Uh um and and and and unfortunately, uh it seems like 11 and 1/2% is now a little too low and the market will require higher yield for Stretch to trade at 100. And to me, the drop in Stretch is mostly explained by the the meltage the melt the big melt that we had in the crypto crash that started of course in late May, early June. That's the because the Bitcoin stack backing stretch melted by so much. Now stretch is trading below par and now Saylor to make it more attractive needs to increase the yield.

[00:13:39]And that's that's what I think he will do. But there's other things and and the view up indicates he will do that by the way. But there's other things that you could do for stretch to get back to 100.

[00:13:47]Um and for Saylor too all the all the Saylor seems to be trading routinely at 100. So Saylor has the right yield. If Saylor wants to keep that lower yield and wants to trade back at 100, there needs to be a few things. One of them is Bitcoin needs to go back up. If Bitcoin needs to go back up, we are going to go back well above a 3x BTC rating. The instrument will be seen as sturdy by the market and it will go back up in yield.

[00:14:09]You could have a very good news this afternoon on the Fed [clears throat] front. We we will be reading uh the minutes from the new Fed chair from for the very first time. The yields could drop this afternoon. If the overall yield if the 10-year yield drop if eventually the Fed drops for rate, then stretch should naturally trade up.

[00:14:30]There's not much that stretch needs to do. The FUD could dissipate. In my view, a portion of the price action of stretch is related to the FUD. The the the maxis have just have just used strategy as an enormous enormous target. Um uh and and and and and you know, they're they're having a field day. They're having so many views uh go go going and hitting on stretch.

[00:14:55]Saylor is not as as famous as stretch and and you know, the the the the leadership at Strive even though they seem pretty good from everything I've listened from them, they are not nearly and they will admit to that. They are not nearly as as famous as Saylor.

[00:15:11]They're not nearly as famous as Saylor and they're not an easy target like Saylor. So everybody's going after stretch. The FUD is hurting stretch. Uh or like I said, to go back up to 100, we need to increase the yield. Um uh, need to increase the the the the yield maybe 12%, something like that.

[00:15:25]Or we need to pay off more converts or deal with the capital structure. A lot of people note that the capital structure of Saylor is a little cleaner, and they're right, it's a little cleaner with strategy. So, and that's something that of course Saylor is actively working on.

[00:15:39]Or, and this is thinking like a normie once again, how about switching to daily dividends?

[00:15:46]I think I I I I I think eventually Saylor will do that. I I I I I think to me it's obvious that Stretch should also switch to daily dividends. Uh, Saylor right now, he has a wait-and-see approach, and and I understand that.

[00:15:57]And, um, the question is what's the what's the better narrative uh to the normie mind?

[00:16:02]Is it Is it um paycheck twice a week twice a month? Is it Is it Oh, the Stretch paycheck, is that a better narrative? Or the daily dividend?

[00:16:12]And I I I if I if if I were to to bet, I would I would bet that the daily dividend is a better narrative because you get that that that dopamine rush whenever you open the the the the broker the brokerage account, and you you have a payment every morning, you have a teeny tiny payment coming up. So, you create a rush, and you you'll you'll also eliminate a lot of arbitrage opportunities uh that used to exist for the longest time on Stretch. Well, now, unfortunately, there's not really much arbitrage as much now. Um, but you you'll you'll also avoid that. So, so I think eventually we'll move to to a daily dividends, although Saylor has a wait-and-see approach. And there's some chances that a paycheck uh uh like like saying, "Oh, Stretch pays you the same frequency as a paycheck." There's There's a chance There's a chance that that could be a better narrative, but I think it's a smaller chance. So, these instruments are built on Bitcoin, just like a plane is built on the aluminum protocol. If you don't believe in aluminum, you should not get on an airplane. If you don't believe in the features of Bitcoin, you should not get on an instrument built on Bitcoin.

[00:17:21]But Saylor is an engineer.

[00:17:23]He studies Bitcoin like an engineer. And he happens to know Bitcoin. He happened That's why I say he have religion. If you follow like, you know, Aristotle, for example, you can have faith in God or you can know God, right? That's kind of like a Okay, this is like an our fair take.

[00:17:41]But but but at some point we once you've studied something so much, having having religion is very similar to faith at some point.

[00:17:50]Like if you followed physics so much, if you follow the rules of nature, if you follow math, right? You can use the word proof. So for Saylor for Saylor, I think Saylor is extremely genuine in his in his belief in Bitcoin. But right now we have a lot of people who absolutely do not believe in in steel.

[00:18:10]And they will fight against steel.

[00:18:13]And they don't believe in it. So so So So so you know, we need to establish that track record.

[00:18:19]Speaking, selling these instruments via the track record will be much much easier as we go through the years than selling that instrument in an era where Bitcoin still needs to prove itself to the to the masses. And I And I think we're getting there. And of course you understand the analogy, right? Steel, aluminum, Bitcoin, it's a commodity. These are commodities. Anyways, this is not investment advice. This is not financial advice. This is not investment advice whatsoever.

[00:18:51]Only entertainment. Hence the style Hence the style stretch the normie mind.

[00:18:55]This is an entertainment video. I'm an entertainer.

[00:18:58]Please like. Please subscribe. Follow me on Patreon. Follow me on X. Thank you for watching and have a wonderful wonderful day.