The Man Who Owns 4% Of All Bitcoin: "I Made $15 Billion By Using ChatGPT!" | Michael Saylor

I used AI to make 15 billion dollars last year.

I did because the AI gave us a solution to the problem that no one had ever encountered before in the history of the world. And so my advice is don't try to outwork the robots. What you want to do is ask the AI to do something that's never been done before. And if you want to create these incredible success things, you want to locate the magic opportunity. I know this because I'm a technology entrepreneur and we're the biggest buyer of Bitcoin in the world. So, what is my mission? I'm preaching the gospel of digital empowerment and Bitcoin is digital money and it's going to be the best long-term capital asset and you can actually own something and someone more powerful than you can't take it away from you.

So, this is a stack of currency. You walk through an airport on this, they ask you if you have cash, they just take it. So cash in a physical form is a problem. So what do you do? You put it in a bank. So the bank then decides whether you get to keep it and whether you get it back. But I could move a million dollars of Bitcoin from here to anywhere to London to anywhere in cyberspace in a few seconds. So the last thing in the world you want to save is money.

Well, gold is up 12% a year, but Bitcoin is up 33.

I will tell you why you shouldn't buy a house.

Because

I always wanted to make a technical contribution. So, the early business was business intelligence. So how do you extract intelligence from large raw data sources and that was what MicroStrategy did. We created a global business intelligence company and I think in 2020 when the COVID lockdowns took place and the world turned upside down that was when I discovered my greatest idea and it wasn't even my idea right it was Satoshi's idea but I discovered Bitcoin in 2020 and the company today is $60 billion but we peaked about 125 billion so we got somewhere between 100 and 200 times bigger since we discovered Bitcoin.

Bitcoin is digital empowerment, digital capital. We're living through the digital transformation of assets and this is just as profound transformation as digital intelligence. The real profound breakthrough of Bitcoin is this idea that you can take economic energy, convert it to digital form and tightly bind it to the person, the family, the company, but the country. We can talk about how we all hate countries, but you know, the history of the world is all the weak countries getting smashed by all the big countries. So if what you're interested in is empowerment and fairness and equity for the small company, the small family, the small person, the small country, the weak. How do you do it? Well, you basically encrypt the money, put it in cyberspace, protect it with a private key. It's like now you can actually own something and someone more powerful than you can't take it away from you.

Okay. So, this is a stack of currency. You walk through an airport on this. They ask you if you have cash. If you do, they just take it. Cash in a physical form is a problem. So what do you do? You put it in a bank. Well, a bank is a counterparty. So the bank then decides whether you get to keep it and whether you get it back. You go to the bank and you ask for it back. They might ask you why you ask for it back. If you ask for that much back, they file a form with the Treasury Department. You know, if you ask for too much money back too soon, right? Someone comes knocking on your door. So the challenge with this is this is fiat currency and you hold this at the pleasure of the nation state and by not just your nation state it's like every country on earth gets to decide whether you get to spend this stuff right- which is interesting and if you want to actually transfer money to someone in another country you need the permission of your bank another bank the central bank of their country the correspondent bank there might be seven different banks that have to decide whether the money gets from here to there. So, this is permissioned money, you know, that's managed by the state. And with Bitcoin, I can take a million dollars. I can actually encrypt it in a chip in a physical coin, the Casascius coin, and that's a million dollars. I slide it across and it's literally a bearer asset, you know, and so that's one manifestation of it. But you could also put it into information form. I could transfer this to you just in the form of a private key that I wrote on a piece of paper that I gave to you.

Yeah. Or I could send you a message. I could send a text message like, "So, good luck getting a million dollars of gold from here to London if people don't want you to move it. But I could move a million dollars of Bitcoin from here to anywhere in a few seconds." The idea was I don't want to trust Apple or Google or Morgan Bank or a central bank or a government, right? And so in the extreme case, you know, two people can meet in Africa and I can trade you some Bitcoin for your truck and I don't need the permission of seven banks and 16 governments and 32 other bureaucrats in order to buy that truck.

So, this is about $10,000, I guess. One acre of land in Miami Beach on the water cost $10,000 about a hundred years ago. I know this because I have a house on the water and I have the deed of sale and it was about on two acres and it was $20,000. The entire house cost $100,000 and it's about $20,000 worth of land today. One acre of land on the same acre on the water $10 million maybe $20 million. So, you know what happened here, right? It's the same dollar. It works out to be a 1,000x increase in price. So when land goes from $10,000 to $10 million, that means that the currency, the dollar, the money, lost about 7% of its economic value every year for 100 years running. If you lose 7% a year, you know, then you get cut in half, right? 10 times, right? So what do most people not know about money? What they don't realize is that the best currency money being a medium exchange unit account store of value, the dollar, the best in the 20th century and the 21st century, the US dollar lost 7% of its value every year going for 100 years. That's the best it's ever going to get. It's not that good for everybody else. If you go to most other countries, they lose 14% of their value. And so they collapse in about 30 years. So what you have is a situation where if you store your wealth in currency in the money of the society the question really is just are you going to lose most of your money within 10 years that's the weak currencies in Africa for example most currencies in Africa you couldn't hold your wealth even for 10 years maybe 5 years or are you going to lose all your money in 30 years hyperinflation happened in Brazil happened in Argentina you know that's Mexico. That's most places and that's the status quo. The average fiat currency, you know, collapses in about 29 years, I think. And then the best is if you happen to be a citizen of the greatest nation in the world and you win all the wars, you're just going to lose all your money in, you know, half life is 35 years, you're going to lose your money over the course of a hundred years.

So, you get to the next interesting point, which is that $100,000 in 1926 in Miami Beach today would be worth $100,000. That house $50 to $100 million. So, the house is better, right? In fact, if you're trying to preserve your wealth, you have to acquire scarce desirable property. So, your choice is, do I buy real estate? Do I buy residential real estate? Do I buy commercial real estate? Do I buy a private company? Do I buy a public company like stocks? Do I buy collectibles? So, let me tell you why you shouldn't buy a house. Because there's a 2% property tax on houses in Florida, which means that if you buy a house, you pay 2% of the value every year. 2%, you know, means that every 36 years, you actually pay the cost of the house in tax to the government. Not a very good store of value because you're taking on a massive tax load and you're taking on a maintenance load. But having said it, it's still a better deal than just holding cash in a bank or holding cash in a safe. You know, commercial real estate looks a bit better, right? Because with commercial real estate, you can offset the tax, the insurance, and the maintenance cost with rents. So, what really works out with commercial real estate most of the time is you buy a million dollars commercial real estate, you have a bunch of fees, you charge rent, the rent offsets the maintenance cost. You don't really make any money on the rent, but the underlying million dollars appreciates 7% a year every year. And so, you actually can build wealth with commercial real estate if you can just cover the maintenance expenses.

The only way that it's a good strategy is you're buying the house in a jurisdiction where the property taxes are manageable, then yeah, you can generate some wealth. But if I flip that and you end up taking a 7% mortgage and you get massive tax and massive insurance expenses, then that same investment, you know, works out the other way and it crushes you to death. So, a better idea generally is commercial real estate if you actually have the business acumen to get in the commercial real estate business because you can pass all the expenses through to your tenants. These things are all hard, right? Real estate business is hard. Starting your own company is hard. Investing in other companies is hard. The conventional thing, the safe thing is I just put all my money in a money market and I get paid 3% and then after tax I've got one and a half%. And the currency is losing 7% of its value a year and you're just losing five or 6% of your wealth every year for your life. So that's why Bitcoin is such a compelling thing. That's why people that believe in Bitcoin are passionate about it because the average person shouldn't have to be a real estate expert. They shouldn't have to be a tax expert. They shouldn't have to be capable of launching their own restaurant or bar or bakery. You shouldn't have to be a stock picker. Why shouldn't the typical person just be able to take their money, put it into an asset which appreciates in value 15% a year, and they don't have to worry about it?

Yeah. John Bogle's real contribution and the success of the S&P 500 is this idea that currency is not a store of value. Real estate is illiquid and scary and difficult and inefficient and high maintenance. So what is the liquid capital asset that I can buy? And it turns out to be like SPY. It's just the S&P 500 in the form of an ETF. So that has returned 15% over the past 6 years over a 100 years maybe 10% something like that every year. And if the US dollar is losing 7% of its value in scarce desirable terms over the course of a 100 years and you're getting 10% you're getting a 2 or 3% boost and return for accepting the volatility of being invested in the stock market but it's not a bad idea right if you want the conventional best idea to preserve your wealth without taking on individual corporate risk and individual real estate risk. I just buy the S&P index and wait.

This is gold.

It's not an awful idea to buy gold. Gold is up 12% a year for the past six years. So whereas the S&P is up 15, gold's up 12, the NASDAQ's up 18, Bitcoin is up 33. Okay. So generally if you look at the world and you say where do you want to save your money, you want to buy a capital asset, gold's a winner, S&P's a winner, diversified tech stocks are a winner, Bitcoin is a winner. Now you're going to say to me, well then, well, why Bitcoin? Well, the answer is if you're living in Turkey, if you're living in Argentina, if you're living in Brazil before the currency collapses or Mexico or Venezuela or any country in Africa, you don't get gold, you don't get the S&P, you don't get QQQ, you can't buy diversified real estate in the US. Those options I named are a western world conventional capital assets. So, the big mistake, don't invest in non-capital assets. Don't put all your family's money in soybeans, you know. Don't buy barrels of crude oil. Don't buy cotton. Don't invest in things that a factory or a robot or an AI can generate infinite of. You buy things that the robots and the AIs and the big factories cannot pump out by the million gallons. And so what is that? It is maybe an ounce of gold. It is a share in the 500 most desirable companies in the world. It is one out of 21 million Bitcoin. All of those things are things that the robots are not going to create infinite of. Those are capital assets. Which capital asset is a function of where you live and what your mindset is. If you're living in a war zone, my advice is Bitcoin because you're not carrying this through a checkpoint, right? Like, you know, if you need to go through an airport, you want something that you get to keep and take with you.

Yeah.

Technology fails until it succeeds. When I was at MIT, people were trying to make speech recognition work. It just didn't work. For a thousand years, people wanted to fly and it didn't work. And in 1902, the New York Times declared that every learned scientist knows that you'll never be able to fly. And then in 1903, we fly. In 2023, the AI started working. You can see what's happening. We've effected the digital transformation of intelligence, cars are going to drive themselves. It's pretty clear that anything that takes massive human labor, whether it's lawyering, writing a contract, or composing a poem or composing a script or composing a book. It's like, you want a book? Tell the AI what kind of book you want. Here's my 10. You know, I want this. I want it to be set in London. I want these protagonists. Can you make it like that? Put some more violence in it. You know, Voltaire was impressive because he created this much literature and when he did it, it came out of the mind of one man and that was quite amazing. And, you know, I think we're always going to admire the people that did it first, right? But, you know, the AIs will think for us. Put the AI into the robot. We're not that far, right? Like when I sit and I talk to my voice assistant, whether it's Chat or whether it's Grok, and it's like she knows everything and she keeps getting smarter, you know, every single week she gets smarter and it's like what happens when they go into a robot? It's like, well, you can pretty much imagine a billion robots and maybe we'll pay 200 bucks a month for a robot and the robot will just pretty much do everything. And so the question is, do you want someone to do everything to cook, to clean, to take out the trash? Would you like a self-driving car? Of course you do. We're on the verge of these perfect products, right? That we'll get to the point where we're like I used to actually have an oven that burned things like what it was stupid. Yeah, it was too stupid to know it was going to burn the food. Why didn't you just put intelligence into the appliance, right? Why would you ever have an unintelligent appliance right at this point when it gets exponentially cheaper? We used to get in traffic accidents, right? The big inversion is when people realize that the self-driving cars are safer than the person driven cars, right? It's like you used to make mistakes. You know, the irony of course is now when you send a message to someone, if you want to prove that it came from you, you have to actually put errors in it, right? It's like if you put errors in it, I believe you typed it. The AI can draft a thing as though it had a PhD in English and it had 20 years experience as a copy editor. And so we're reaching this point where lack of effectiveness is just laziness, right? Like if you wrote something which wasn't perfect, it's because you're lazy, not because you're not perfect. I mean, the AI create perfect documents. They do perfect research. The robots will do any amount of work. And I think Elon makes this point which is we're about to trip over an age of abundance.

He's half right. I agree with part of what he says that consumer goods, consumables, utilitarian goods will become abundant, but there are always going to be scarce desirable goods that will not become abundant. And I think he overstates the case. Money will still be valuable. Wealth will still be valuable. But I'll give you an example. Henry VII didn't have clean water. Did not have heat. Did not have cooling. These things the king of England did not have and technology gave all these things to the middle class and so if you live in the middle class today you can have your appendix out but Henry VII didn't have dental crowns he didn't have x-rays so you get modern medical care the infant mortality rate has plunged life is safer clean water clean air clean food and technology gave them to us We stamp out infinite Coca-Cola, infinite Hershey's bars, ice cream, right? Running water, right? Electricity. So all of those things have been given to the middle class, the working class in the developed world, right? Not everywhere, but let's say in the developed world. But everybody doesn't get a Hamptons house. Everybody doesn't get their own private jet. They don't get their own private yacht. So what happened with the explosion of affluence? Massive utilitarian entitlement. Lots of cars, but you know, okay, so everybody gets a car, but how many people get a Porsche? What happens with humanity is we always invent the luxury car? We come up with the trophy asset. And again, but most people don't actually want that. They want to be able to feed their family and not have to worry about the bills. So all of those people, you saying that those people are going to be good. They're not going to have to worry. I'm saying that if your aspiration is a good life, if you want infinite food, infinite energy, infinite education, infinite entertainment, right, you're probably going to get it. My point is in theory, right, why does money matter today? Because everybody has electricity and water because people want to buy something more than water. By the way, water is the proletarian drink.

It means that if you go to a restaurant, you don't and you can't afford anything else, you ask for a cup of water, right? And then if you have some more money, you get yourself a Coca-Cola or a soft drink and that costs five bucks. But if you have more money, you buy yourself a vodka. And then when you have more money, you want to buy yourself the specialty high-end tequila. And eventually people find a way to spend $38 on a drink. And you know in New York City, you can see that everywhere. Why do we go to restaurants and pay $300 to eat at a restaurant because you can actually feed yourself on three bucks a day? And the answer is there's always going to be a hierarchy of affluence and people are going to find things to aspire to that will be more than the utilitarian mean that everybody gets. If I give you universal healthcare, people want private healthcare. If I give everybody a house, someone's going to want a house twice as big. Everybody's always going to have a reason to want something more, you know,

That's the cynical way to look at it. But the other way to look at it is I wanted to be sitting on a mountain peak skiing, but not that mountain peak because the snow's not good on that mountain peak this week.

Yeah. And that one's too crowded. You know, it's like there's always going to be some exclusivity. You know, there's going to be a quest. So, I think that money's not going away. I think it's pretty obvious if you look around you that people still need money. It is true that the basic needs in life, basic transportation, basic energy, basic health care, all of those things can be manufactured in quantity and they'll get progressively cheaper. We'll call them consumer goods. If this knowledge work does become taken by the robots and the AIs, there's some people say there's going to be new jobs created and everyone will be fine. But it's not clear to me that there will be enough new jobs created in a period of time to satisfy the demand of people to have something to do professionally. It used to be everybody was a farmer, right? And then all of a sudden in America, we have new jobs like called accountants and lawyers and film producers. You're a podcaster. Your job didn't exist 20 years ago. It did. You know, the job description did not exist. The business did not exist. There's a lot of things that exist today. Yeah. There are people that make a living putting on makeup and clothes and posting on Instagram and that was not a job that existed 30 years ago. So there'll be a lot of new jobs. There'll be dislocation. There's going to be political unrest. What do I think? I think this is the best argument in favor of encouraging a free market and allowing liberal unregulated businesses to prosper because if you have a progressive society and by the way the United States is sort of more progressive

You're allowed to start a business you're allowed to sell a product it's not illegal to create a business. But you can't do what you're doing in Cuba, right? In North Korea, you couldn't do it.

We wouldn't want people to not crash. Yeah. So the point is there are all sorts of laws and restraint of trade like you can't have an Airbnb in the face of modern technology. If you have modern technology and it's creating dislocation if your goal is to embrace the technology, create maximum productivity and then minimize the disruption and the inflammation then the more degrees of freedom you offer the less pain there'll be. Because in a more free society, you're going to have 10,000 new kinds of businesses pop up or 100,000 new business opportunities that no one conceptualized. And they'll be threatening to the status quo, but they'll be rational and they'll create value. And then they will create gainful employment and they'll create wealth for all the people that are displaced, right, by the technology.

Yeah, you're using that as an example, but at the end of the day, you have to govern the state space. For example, anybody could say what question should I ask? But the real issue is what are the input constraints? If you're a baker in Nigeria in Lagos, right? There's a certain set of conditions that are different than if you happen to be a fireman in Los Angeles. Right. And so what's the state space that you're exploring in order to create a contribution? And I'll give you an example like I used AI. I used AI to make $15 billion last year.

This is true, right?

I did. Yeah. And I used an AI to make $15 billion in a way that no one would ever conceive that you could make $15 billion.

Okay. Yeah. Let's go back to me in 2025.

We have a company that has billions of dollars of Bitcoin, $30 billion of Bitcoin. We want to actually raise capital to buy more Bitcoin. We maxed out the equity markets. We became the largest issue of convertible bonds in the world and we maxed out the convertible bond market and that was our journey in the first five years of our Bitcoin.

Yes.

To buy Bitcoin.

Yeah. By the beginning of 2025, we had issued as many convertible bonds as you could issue. We were the largest issuer in the world and it wasn't scalable. So, we needed to invent a new type of security, a new type of credit instrument that we could use to borrow money to buy more Bitcoin. So, we went to the AI. I went to the AI and I started exploring how do I design a preferred stock? And so, I said, I think I want to create a security that's not a common equity and I don't want it to be a bond. I want it to be some hybrid in the middle. A preferred stock, for the layman, it's just a security that could be anything. You can give it any terms. I can sell you a preferred stock and give you the right to put it back to me in 12 months and it looks like debt. I can give you a guaranteed coupon on it. I can give you conversion rights and make it look like equity. So, we used AI to design a convertible preferred stock called STRK. When we did it, no one had ever created a preferred stock that was backed by Bitcoin before and we'd never issued it. And so it was kind of a combination of financial engineering and digital asset engineering and legal work and securities law. So we built it and when we asked the lawyers and the bankers, they're like, 'Well, no one's ever done it before.' Okay? And their answer by the way is no one's ever done it before and people don't do that. So, we don't think you should do that. And we're like, well, everything else that people have done, we've maxed out. And so, we're kind of at the point where our growth is going to stop unless we find a way out of the box. So, we're going to have to do something no one's ever done before using new technology, right? We're using digital capital, we're using digital intelligence, and we're using a digital treasury company. So, three new forms of something in order to create value. And after we done three of them, we decided what we wanted to do was create a short duration credit instrument, one that would trade stably around $100, around par. And we're trying to figure out how do you get a preferred stock to trade at a stable level. It's what you would call technically short duration credit, but it's like we're trying to create a money market type instrument where people can buy it at 100, sell it at 100, collect the yield, and not worry about it trading up and down or being sensitive to interest rates. Well, if you do that, in order to get it to trade stable, if you want the price to be stable, you have to change the dividend rate. And so, we created an instrument where we could change the dividend rate every month. Now, had anybody ever done it? No. In the history of the world, no one ever created a variable dividend rate preferred stock. Is it illegal? No. Why has no one ever done it? No one ever had a reason to do it. They never thought to do it. The lawyers, the bankers, the conventional investors, they're like, 'Well, we've never seen it done before. We're not sure you can do it.' We go to the AI. We said, 'Well, can we do it?' They're like, 'Of course you can do it. Just do this, this, and this, and this, and that.' Well, they said they don't like that. We'll just do this, this, this.

ChatGPT, OpenAI. So, ChatGPT made you $15 billion.

If you're an entrepreneur, right, if you aspire to create a business or create something of value, then the no-brainer is you definitely should pick one or more of these AIs and maybe you want to become adept using multiple of them. They're just different tools. It's kind of like saying you got to learn how to use a computer and you got to learn how to read, writing, arithmetic, right? Just basics. And then once you've done that, you do need to have some domain expertise in something, right? The question is what are you going to do, right? You either want to create a new product or you want to create a new service or you want to radically transform an existing product or service using AI to be much cheaper, much better. But to my mind, I would try to create something magical. Like for example, can you create something that does everybody's accounting, does the work of a million accountants and sell it for 10 bucks a month? Right?

You want to study the new thing, right? You want to learn the new thing. And so if you look at the history of science, the real question is what's on the S-curve.

The whole theory of the S-curve is for a thousand years we try to fly and infinite energy makes no progress. You cannot fly. And then in 1903, all of a sudden we can sort of fly. And in 66 years, we go from flying 20 miles an hour to flying 300 miles an hour. First a fighter jet, then a passenger jet. Then we have like rockets that are unmanned. Then we have man rockets and then we have rockets that go to orbit and then we have rockets that go to the moon. And so that's an example of an S-curve. But then you know what happens in the mid-70s we designed the 737, the 747 and we hit a wall and the 737 is still the primary airplane for the next 50 years. And if you look at the efficiency of an airplane from 1975 to the year 2025 over 50 years the modern airplanes are 15% more efficient. So what you got was a diminishing return and when you're on the S-curve things are doubling every 3 years you're doubling you're doubling you're doubling your exponential growth and then you hit diminishing returns and then you stagnate and then you stop and then things are just not getting any better. So

Like when I was at MIT, everybody basically flocked to electrical engineering and computer science because that was the cool thing. And so the mistake to make when you go to school is you get at the end of the S-curve. You basically start studying something that has hit diminishing returns. And once you hit that diminishing return, no material progress may take place for 100 years. It might be that you just can't break through. Propulsion technology is the limiting factor. Like why don't we have planes that will fly supersonic on a tank of gas that's this much, right? Or fusion drives. Well, because we don't. Now on the other hand, semiconductors started exploding and semiconductor technology has continued to advance. We haven't hit that limit yet. And that's why so many profound breakthroughs were made in computer science over the past 50 years.

Yeah. You know, the iPhone 1 didn't have cut and paste and we didn't get cut and paste till the version three. And so, there was a rapid improvement versions 1 through 6 or 1 through 7, call it. And at that point, you start hitting diminishing returns. And if you were to do some utility function and you were to score it on a scale of 1 to 100, you would have gone from like 5 to 70 in a hurry and then you would have gone from 70 to 90 over the next few iterations and then you're 91, 92, you hit that limit and now if you are starting a company, you don't create another iPhone, right? The real question right now is can I create smart glasses where I have something that's like my Maui Jim sunglasses. I put them on, they weigh nothing and they have the camera and they see what I see and they hear what I hear and they know where I am and plug that into AI. And in that point, I can just say, 'Hey, Eve, what is that?' You know, where am I? And tell me about that. And it's like, why do I have to type anymore? When I met Mark Zuckerberg, he showed me the device that's on the way from Meta. This is not a secret because I know they've talked about it publicly, which is just a plain wrist strap with no screen on it, but it linked to the glasses. And in the glasses, when I looked around, I could see all of my screens and everything like that. And if I just because of this wrist strap, if I just click, it clicks on all the stuff. So, I was just sat here with this little wrist strap. The wrist strap again was just like a cotton bracelet, very thin cotton bracelet. And as I just looked around, I could click on everything and open things and call people and text and go on YouTube, etc. And it was just up here in my peripheral. You imagine again, imagine that on an S-curve. At some point, it's going to be some sort of almost like contact lens type thing that I can just...

Neural link?

But should you go study that because conceivably the artificial intelligence and the robots are going to be the ones that create that technology if they have a PhD and everything and that's accelerating.

No.

No.