[Applause] [Music] [Applause] [Music] [Music] [Applause] [Music] [Applause] [Music] wonderful all right thank you for the warm welcome we love you thank you for the warm welcome so Bitcoin has had an incredible year this year it's up 50% year-to date 130% over the past 12 months and in addition to that we've seen remarkable um adoption of Bitcoin from New Market entrance through the spot ETF yes which launched in January and has over roughly 60 billion in aggregate assets across issuers we have presidential candidates speaking at the Bitcoin conference this year lightning network has seen over 1200% growth in the past 24th months things are going quite well it's an exciting time and yet Bitcoin doesn't exist in a silo and so that's what we're here to talk about today is how Bitcoin is related to other macro investment Trends especially those that large asset allocators are paying attention to those are the decade long Trends where there'll be a great demand for Capital um and Bitcoin naturally fits there and so I I'm specifically thinking of generative AI an investment in Ai and llm infrastructure and the energy transition and how there's a convergence with Bitcoin yeah I guess uh first of all I realize what a tough act We are following so go Michael um yes it's it's been very exciting and and if if we had if we were listening to Michael what what you just said really won't matter much although we think it really will matter that um and I'm just going to start off by talking about the convergence between and among technologies that are evolving today and creating massive growth opportunities um I'm just going to illustrate with one stock we're known for for uh one stock that is a massive convergence uh opportunity many people uh analyze Tesla as an auto company and yet We Believe at ARC that it is uh it is actually the convergence among robotics so autonomous autonomous taxi networks robots uh are going to be a very big part of the equation uh energy storage they will be electric and artificial intelligence creating explosive growth opportunities so the reason for that is each one of these Technologies is follow following an esur and when you have them converging they're going to start feeding one another and creating incredible growth opportunities and I think what we're here or here to do today is to talk about convergence involving Bitcoin um and I I would say one reason that uh we've seen the price appreciation recently is the recognition more and more there's a lot of educating education taking place especially 11 ETFs uh issued at the same time you've got 11 asset managers out there educating as many people as possible and what are we what are we saying to them to make this understandable we're saying that Bitcoin is three very big ideas in one it's a technology right this but but if you think about it it's leveraging off the Internet it's the layer of the internet that developers didn't put in place in the early 90s because they never dreamed that Financial Services or Commerce would take place on the internet so it's it's simply the next generation of the internet um it is uh a monetary system the first Global uh uh decentralized private no government oversight no choke uh throat to choke uh digital rules-based that's extremely important monetary system in history so there's Tech there's economics and then the third thing and this we brought to light with the ETF issuance is it is a new asset class and every asset manager um retail or institutional has to consider putting a new asset class in their client portfolios why because of the low correlation of returns what that means uh you slot some Bitcoin in and your return per unit of risk goes up and every institution knows that and so they have a responsibility to understand what Bitcoin is uh and um what kind of investment opportunity it will represent for their clients so I think that ETF issuance has really helped cement the story and is beginning to generate a deeper understanding more more broadly in the investment World it certainly has and I think that positions Bitcoin well to also be represented in other um macro trends that asset allocators are attending to you mentioned AI when you spoke about Tesla and one of the things that we're hearing from asset allocators is that they're interested in investing in Ai and llm infrastructure and you mentioned in in what you just summarized that there um that Bitcoin one of the things that Bitcoin Technologies can do is fill a gap for payments on the web Bitcoin can uniquely do that but beyond that what we expect to see in Ai and the llm space is an even higher demand for payments and the demand for micro payments at scale and what's interesting about that is that that's an area where traditional Financial systems aren't optimized for and beyond that in the crypto space it's only lightning because of its architecture as a payment Channel network that can reach that sort of transaction volume the TPS transactions per second that will be required in a web- based world or in a world where AI and llms are serving the needs of um users and of Enterprise and so Bitcoin technologies have a role to play here and for for investors looking to invest in a Ai and llm infrastructure they have to think about what payments match the opportunity of the capabilities that those Technologies introduce and lightning can do that and so we're seeing lightning mature as a Payments Technology at a moment where it's also applicable to a large macro Trend sure and I'll follow up on on AI what's going on in AI is amazing uh we we have been very aggressive in our expectations and yet um we're seeing and and Mark Zuckerberg this week uh talked about op Source models and how this might accelerate uh many of the trends that AI has already um has already triggered um and and so I think what we're going to see is uh a couple of things one and we've learned this from the lightning Network and some of the developers working on it um in in Africa I don't know if you know roast beef but he's one of them uh we did a brainstorm we do a Bitcoin brainstorm every month in conjunction with Bitcoin Park and uh he was on one of the first of them so so look that up it's every time I am with the developers or the miners or some part of the Bitcoin ecosystem my confidence in what is about to happen here increases well roast beef uh at the one of the first two of those uh brainstorms um sitting in Africa was saying this is transforming lives in Africa it is going to redefine the division of labor we think we understand the gig economy think micro gig economy and think Global labor force and peace mealing out uh these tasks uh so he says this is transforming people's lives in Africa uh and so uh I think the payments part of this is critical yes uh and I also think the second part so division labor and getting paying for those micro Giga jobs is is one example and then there's the machine to machine you know basically uh you know I am it's called agentic AI I will go I will basically uh direct an llm to create uh a marketing program for me and my new company including a website and Mark marketing program articles uh promotional materials and so forth and the agentic AI will do that from beginning to end when we finally get there and we're getting there faster than I thought we were going to get there uh so how does this happen how do we pay all of the all of the various uh entities involved lightning Network Bitcoin payments ecosystem great so let's drill down there for a second on the technologies that will underly this payments opportunity you mentioned two of still Mark's portfolio companies in what you just said so roast beef Lalu is CTO of lightning Labs lightning Labs of course just announced this week the introduction of a new protocol tap rot assets which brings stable coins digital dollars to lightning Network to have them transact free in a Dependable way and instantly in a peer-to-peer manner you also talked about um llm driven agents or um llm supported agents and their future need to be able to transact both with one another to purchase resources for themselves like access to another model or to a data pool but also to engage with an audience um or a a person on the other end and lightning Network can facilitate those agents having a wallet um one of our portfolio companies vaita is doing exactly that it's entrepreneurs from the Telecom space that recognize the convergence of what's happening in a AI what's happening in Bitcoin and the opportunity in um the Telecom sphere but drilling down for a second on the technology and why it's suitable for an opportunity of this scale let's talk about the unique architecture of bitcoin's lightning Network so bitcoin's lightning networ network is a payment Channel network and what that means is it it's a hub and spoke model so it doesn't um and and there's two special things about this Hub and spoke model that differentiate it in terms of scalability from other crypto L2 Payment Solutions first is that transactions that are happening on the lightning Network don't need to be committed back to the main um chain the underlying Bitcoin protocol and what that means is that they are not constrained by block space second they don't require a global state of transactions across the lightning Network and what and that also means that they're able to achieve incredible um transaction scale now that's different from other L2 Solutions in an important way in that other L2 Payment Solutions like ZK rollups do require block space and a global State and so they can't reach the same sort of transaction volume that lightning Network can now what was the tradeoff the trade-off of course is in the bootstrapping phase that a payment Channel network has to go through so in order for a payment Channel network to reach sort of a critical mass you need to have individuals hobbyists dedicated bitcoiners to invest their time in running and managing a node to invest their capital in in providing liquidity to the network and so that's why why across the cryptosphere you see one lightning Network although there's dozens or more other L2 Payment Solutions including ZK rollups um now of course in addition to lightning earning this sort of unconstrained scale by by taking this Hub and spoke approach it also has created a competitive Moe one lightning Network across the cryptosphere and we've seen other payment Channel networks like uh Raiden in the ethereum space fail because they weren't able to reach that critical point of scale now with this thorough put we have a a partner that can be a reliable partner for AI and llm needs whether that be for individuals or businesses to pay for access to the models themselves or whether it be for those models to be in service to businesses and to individual users you can actually get to a for example payer API call level of discrete um monetization yeah I guess the only other thing I'll add at Le is the that the l402 protocol is critical to this ecosystem uh because uh and and because it involves authentication verification uh in this payments mechanism critically important given how much can go wrong absolutely and that's another protocol introduced by lightning labs and so with l402 we're able to have a specific payment technology that addresses the per API call payments opportunity and we have a partner for AI and llm infrastructure and use cases that can help I think create depth and breadth in what is possible with AI yeah so I guess uh just listening to aise who's uh her business her Venture fund is 100% focused on the Bitcoin ecosystem you can see the depth of knowledge and I know a lot of people are just thinking okay what's the price of Bitcoin going to be uh one of the reasons bitcoin's price will go continue to go up uh uh is because of the opportunities that layer to lightning networks and the convergence with AI is going to create it's going to be phenomenal I think so and bitcoin's convergence with macr Trends and broader technology um uh exploration doesn't just stop with AI and llms of course right macro investors are have are also talking about an attending to for example the energy transition of movement into Renewables and Bitcoin fits very well there both to accelerate what's being built and to stabilize the grid I know I know that Ark has spent time in energy space as well yes the story there is um when Elon Musk Tesla put uh Bitcoin on on Tesla's balance sheet um he faced a Wall of Resistance and criticism having to do with the environment and so we along with block held a a halfday seminar featuring Elon and and Jack dorsy Steve Lee for those of you know who know him and we were trying to disabuse them of this notion the critics uh that this is environmentally damaging I'm going to back up just a little bit and say you know I think that uh we're beginning to hear more common sense generally when it comes to that topic um to grow we need energy you know technology progress takes energy now maybe we can do it more efficiently and we are and O over time of course uh but energy NE necessarily grows as the economy progresses and if we're right and the economy and the growth rate of the economy is going to accelerate because of the massive Innovation that's taking place out there we're going to need even more energy so that's that's the first thing thing but during the the seminar we were able to illustrate that Bitcoin mining in a utility uh ecosystem and other energy ecosystems um is is actually going to help us overbuild uh renewable energy solar and wind why well as you're putting in the this renewable energy ecosystem you're going to have utilities have storage unit and in sunny Florida where where I live now uh the storage will fill up very quickly and then there will be it'll just be wasted unless it's put to some good use Bitcoin Bitcoin mining is that use and what does it do for the utility ecosystem okay mining Bitcoin means you get Bitcoin and if you're really trying to build out your renewable uh infrastructure and accelerated Bitcoin actually will be an enabler of of that and then of course the second one we saw this with Exon I was so surprised to see them putting um Bitcoin mining machines into natural gas fields to take uh the flare instead of flaring gas and and even worse venting it just using it to mine Bitcoin that's Exxon so uh pretty pretty big buying in here and pretty big Pro proof points absolutely so Bitcoin can be a reliable energy off-taker and an anchor tenant for New Generation and that can be used We Believe to facilitate um more efficient investment in new energy production and we've seen that done on a smaller scale um in Africa to go back to a region you mentioned where Bitcoin is flourishing yes still Mark invested in a company called gridless that acts as an anchor tenant for new energy generation sites and what we've seen there is that is that investors will have a more reliable way to predict their return on on investment and they can stabilize expected cash flows from their investment in New Generation that has the function of driving further um development of energy Supply now um Bitcoin can do the same in the US and you um referenced a need for smart regulation and for um a a public private partnership in a sense between what's happening on the Innovation side on the technology side and the way that it is um governed or encouraged how are you think how is Arc thinking about that I wonder in terms of uh government involvement in uh in the encouraging the ecosystem sure what can drive a healthy um energy transition what's necessary or what has been done oh I see and we're still on energy we were going we're we're going to switch to to government next as we as we progress but uh what can be done in the energy uh so it's interesting in in being in Tennessee here um and around Bitcoin Park and uh you know the the energy topic has come up quite a bit I think um accelerating nuclear is going to be a very important part and I'm very happy to hear and and learn of you know the advancement certainly TVA here in Tennessee uh is very important but in order to um in order to satisfy our energy needs uh nuclear has got to be a bigger part of the equation uh so I I certainly think um uh getting the government behind that or should I say getting the government out of it in terms of all of the regulations what what has strangled nuclear since the 70s is uh incredible regulation um and uh it has it has destroyed the learning curve that nuclear was on uh if it had not been derailed by regulation uh we would be at a a much lower cost it is the clean form of energy as well so I I think that that is going to be one of the biggest uh Mo most important um uh ways for the government to uh to to help us generate the need the energy need the energy Supply that we need uh for the economic growth that we expect yes um and to allow for Bitcoin mining's participation in a healthy energy ecosystem absolutely of course so Bitcoin is good at not just being a reliable off-taker in the presence of new energy generation but also responding to the Peaks and troughs of renewable energy and we've heard a bit about that today from this stage already but one of the things that's notable about Bitcoin mining as an energy off-taker is that it's can be much more price responsive than other off-takers and what that means is that Bitcoin mining doesn't um contribute to new Peaks um and and when you have a peak um and a peak Demand on the grid that creates reliability issues and reliability is a primary concern of stakeholders in the energy space so Bitcoin as a partner um provides sort of some resiliency absolutely um a data centers today generally need um you know 100% uptime and so if there is a a part of that ecosystem that doesn't need that actually that that energy at peak times uh can step aside and we heard a lot about that at uh uh bit in at this conference uh then uh I'm sorry I lost my I lost my thought well so what we're say flexibility what we're saying is that Bitcoin mining is unique mhm as a partner to new energy generation and to the energy transition because of its flexibility absolutely because it can be present in times of low prices when demand is low relative to energy Supply and it can back off um and still be productive but back off in times of peak prices where um where demand outstrips Supply and that's quite unique yes absolutely there's one other thing that Bitcoin can do here in the energy space and that is that um supply and demand have to match in real time yes but what doesn't um what doesn't work in real time yet are payments and so we're seeing payments um uh for energy happen over days or weeks or longer and that necessitates the existence of credit in the system absolutely and um and Bitcoin payments lightning Network because it can work in real time and set settle in real time can remove the need for credit in the system and free up working capital in fact to continue investing in new energy development so there's a significant role for Bitcoin to play in a number of ways on this trend absolutely uh you know the taking out the counterparty risk associated with credit is going to streamline our economy incredibly and uh and it is the entire economy it's not uh it's not just the uh energy sector of course um we are going to be taking out the middlemen and most of you probably know this already but um as we start in uh this campaign election season helping uh the average consumer understand what is in this for me or what is this um this idea that there's attacks in the system uh just because of the risks associated with credit the counterparty risks and other risks uh and the tax we we we know this from our credit cards for example is anywhere from 2 to you know 5% and that's consistent ACR that's a huge tax on the economy think about that as a nice tax cut awaiting us so I think I think we're we're trying as an educator in the community we're trying to help people understand sure uh in this is important in energy but it's important for the entire uh global economy yes lightning solves the credit problem for sure perhaps we should switch quickly to regulation yes and and how we what we would like to see or hope to see from Regulators going forward to to drive innovation in the space and keep the US competitive from an innovation and Technology perspective for Bitcoin sure um I I have been so impressed by uh really the evolution here and how quickly and up to speed our um our legislators are and I think we've seen a few things that um that are extremely positive and I'll just mention uh former president Trump uh accepting campaign uh donations in Bitcoin that caught of a lot of attention we're we're again trying to educate everyone out here but his um his uh statement that he would fight to preserve the right for self- custody that's critical and so I I'm hearing legis yeah is that yes yes and uh and while he does want all the mining to take the rest of the miners to come here to the United States I think uh the ecosystem uh the the the Bitcoin ecosystem would want that to to remain very decent centralized that's an issue in there right now but the understanding of this topic and having met some of our lawmakers here I am very hopeful that something is going to happen I know there's rumors of a strategic Bitcoin Reserve rumors out there yeah there are rumors out there think about that and if they do it in the right way meaning you know this is not an instrument of monetary policy at all but it simply goes on our balance sheet Michael sailor gave us some really good talking points there um this could be transformational transformational fantastic um from our perspective of course we're interested in making sure that Innovation is safeguarded self- custody of course is foundational to bitcoin and so to protect that is key as well and then finally I'll say that thoughtfulness and a research-based approach to regulation in this field is going to be important and a focus on how traditional definitions apply to the Bitcoin space for example money trans transmitters what does that mean in a in a Bitcoin or lightning World um and making sure that as um as if you're running a node for example that doesn't have control over user funds that you don't get mislabeled as a money transmitter and and and that thoughtful regulation applied to the space can maintain um a leadership for Bitcoin in the US um both from an innovation perspective and from an infrastructure perspective as well yeah well I'm really excited um I'm really excited for tomorrow uh we're going to have a very interesting uh speaker on that topic uh president TR Trump uh I think and I'm not going to uh make the you know introduction but I I think you're going to hear from senator lumus from uh Wyoming and just listen carefully to what she is saying again you'll you'll you'll see the depth of knowledge and understanding and the the passion and and and why I I have met her a few times why is there this passion it's it's so American it's Freedom right it's freedom so and and what's interesting about that uh one of our analysts David puel he's a a very well-known onchain Bitcoin uh analytics expert has developed some of the metrics out there he uh he said uh recently that he thinks that this is the biggest uh Revolution uh since the since the we uh since the Bill of Rights so I and he's from Mexico he said this is so American and I think that I think that is what is going to carry us uh all the way in terms of the political landscape out there wonderful well thank you so much it's a pleasure to have this discussion with you thank you thank you so much thank thank you bye-bye byebye [Music] the Bitcoin conference we started with a dream to build a community focused on bitcoin it all started in 2019 in the heart of San Francisco the first major Bitcoin conference in years that kickstarted a revolution and then Miami a place where enthusiasts developers dreamers and innovators could come together to make Bitcoin better it has been an amazing 5 years and eight conferences thanks to all of you Bitcoin conference has become thear largest Premier Global Bitcoin gathering in the world leading hyperbitcoinization while Miami was incredible it was time to set the stage for Bitcoin in a new city so we took the conference on the road Nashville Tennessee was the obvious choice a city known for music and freedom next year the conference is hitting the road again in search of the next Global stage we are headed to a new city next year with hyperbitcoinization right around the corner we have no plans to take the foot off the gas find out where we are headed next scan the QR code and be at the main stage for the big announcement [Music]