Is crypto still the trade? Kyle Reidhead on AI and altcoins

Transcript

What I think now is we're actually going into the large one of the largest and biggest bull runs in history, right? And you have the macro backdrop to back that up. But the real reason I think this is going to happen is because we have a race for AI. GM, good morning and welcome to the Milk Road Show, the daily crypto show that connects the dots before the market does. I'm your host LG Ducet, joined by my co-host Kyle Reedhead. Today is November 4th, 2025 and we are recording this on November 3rd as the market bleeds out yet again and everyone is asking just like I am why crypto feels so slow and painful this time around. Well, the four-year cycle doesn't exist anymore and we're entering a completely new type of economy, the AI arms race, which is set to print trillions and be actually kind

of good for our Bitcoin and all the equities that surround it. And that's why Milkroad is going allin on AI and making a brand new channel to prove it. So, I'm happy to announce that we are launching Milkroad AI the podcast next week, which will air twice a week with two very excellent hosts and featured guests, deep dives, maybe some tickers, and definitely a lot of nerdy talk, but hopefully that is simplified enough for us to understand it. So, if you want to listen to that and get the eventual newsletter, go to the link below for the wait list. Put in your email and you'll be contacted or you'll get a notification as soon as the first episode comes out, which is imminent.

And to celebrate all of that, we're kicking it off today by having Kyle, who is a co-owner of Milk Road, give us his thesis on why AI is set to print many more multiples from here and how that is good for crypto. Today's episode is brought to you by Bridge. Power your business with instant stable coin payments. No friction, no banks, just global finance made simple. Gemini credit card. Turn your everyday spending into Bitcoin. Stack sats without even thinking about it. And figure markets. Ern solid returns on your cash because sitting idle is not a strategy. Enough from me. Kyle, what what's happening to my coins, man? Please help. Bitcoin, ETH, everything that I own. I'm so I'm afraid. Help me, man.

>> Yeah. I mean, so if you look right today as we're speaking, I have, it's funny, on my Trading View, I have crypto and then I have like AI and just like stocks and it's like red and a lot of red on the crypto side. And then stocks are up. They're all up. Like Tesla's up 2.7%, uh, Microsoft is up, Nvidia's up 4%, Amazon's up 5%. And then you look, it's like ETH down six, Soul down nine, like GTO down 13, a down 10. It's crazy. Um, and it's been like this for a couple months, right? like we're at all-time highs in the NASDAQ, S&P 500, and crypto continues to to just lag. The question is why? There's a few answers I would say. I'd say the first one, at least in terms of Bitcoin, is there are a number

of like OG like whale like people that have been holding Bitcoin since like 2010 that are like billionaires that this is just what they do. They, you know, when we have big runs up, they unload a bunch because, I don't know, they need to buy a home or they want to diversify, which they should do, and they tend to do it every four years because, well, for them, crypto has gone up and down every four years. And so, it kind of makes sense. And so, they're sort of unloading and that is holding Bitcoin back from making new all-time highs. Look, Bitcoin's not doing bad. Still at 107. Like, that's [ __ ] amazing in the grand scheme of things.

Uh earlier this year, we were at what, 70,000 or 75,000. It's like we're still doing well, but you know, we're not getting that. You know, macro backdrop is great for Bitcoin. Uh, you know, we're cutting rates. We just ended QT. There's all these things where you're like numbers should go up. You know, China and US just got rid of their tensions, but it's not. And I think it's because we're having a lot of these OGs that are that are selling. Um, maybe because that liquidation event we had a couple weeks ago, there's some rumors that, you know, money makers or exchanges or something blew up and so like, you know, they've got to sell to to pay off some of the stuff. I don't know if that's actually true, but obviously there are some big wallets that are unloading. And so I think that's just holding Bitcoin back uh and

that's kind of consolidating of course as a result of that. And so I think when that stops by the way, Bitcoin should continue on its journey upwards similar to like what gold is doing or the NASDAQ. Um it feels a lot like if you remember last year in this same time there was all this good stuff in the macro backdrop but then like Germany was selling billions. you had like I think Celsius and FTX were unloading the Mount Gaus uh released however many tokens. So it was like there was just a lot of like unloading that had to happen then and it was like we know crypto is going to go up but it just couldn't because of all those big entities that were selling. It feels like we're in that exact same thing and so whenever that's done I think we're going to have a really big

run of Bitcoin. So I'm very bullish there on the altcoin side. I don't necessarily feel the same and there's a there's a few reasons for this. I would say there's just zero demand for altcoins right now. There is zero like additional demand because there the only people that ever bought altcoins was basically retail and there's not a lot of retail that's investing right now and more so there's not a lot of retail that has the money to invest, right? Because things are getting worse. The economy is not is great in terms of like companies investing money and all that kind of stuff, but like a lot of people are not making a lot of money. there's a lot of jobs that are not we're not getting a lot of new jobs and um wages are not

really going up and so you know the average person's not making more money and it's not like 2021 where they were getting free stimulus checks and so there's not a lot of retail to buy dog [ __ ] stuff and then institutions won't come and buy dog [ __ ] stuff right and I know people are like well a lot of crypto is doing good things and blah blah blah there are a lot of good projects in crypto there are not a lot of good tokens in crypto and so most of the things in crypto are just not investable. And I think this is the thing that a lot of people are not understanding right now is look, Bitcoin, Ethereum, Salana, these are investable assets, right? They're they're big assets. They're, you know, decentralized. A lot of people that hold them. There's not a lot of like holders

of the like, you know, founders or investors that hold it uh in in a large amount. Um there's access, you can access them in different ways on the stock market, whether that be ETFs or DATs or other versions, but really nothing else in crypto has any of that. And then the big problem why institutions won't buy the stuff even if they get a DAT for example or or an ETF as we're starting to get more like alt ETFs is without a market structure bill these tokens they're so different than buying an equity right why will people put you know I don't know what Coinbase is at today like $150 billion company or something why will they they pummel money into Coinbase and Robin Hood these things but not all it's because digital assets have no requirements to report earnings to report like what the

governance is. What do you actually own when you hold these tokens? Like there's no rules around these things. And so no smart person in their mind will ever buy this stuff until you like know what you're buying. It's a very basic thing, but for some reason the crypto world has not wrapped their heads around it. So everyone's sitting here waiting for alt season. It's like, guys, that is not happening because you're not going to get institutions to buy these dog [ __ ] tokens until we have rules around the reports, the reporting of it. when investors and founders are selling or not selling or buying like you don't have any of that and so just like no one's going to buy that at scale at like large amounts until you have those things even like the Milkro portfolio we have some alts but they're a very very

small percentage of our total portfolio because there's just no way you can size these things and look look at the freaking prices of these things like if you just look at the the charts they look terrible it's because there's no demand from retail there's no demand from institutions and so there's There's no reason to buy this stuff. It's literally uninvestable in my opinion. And that's not going to change until we get the market structure built. And even then, I don't think that it's going to make that big a difference for 90% of the industry. So, a lot of digital assets, a lot of tokens are just cooked because they're either shitty tokens or they represent shitty technology. Like a lot of crypto that we know today is [ __ ] technology that just still exists and for some reason they just have kept

their way in the attention game on Twitter or whatever and so like they still have big market caps but they're literally useless. Yeah. People >> got people got bags, bro. People got bags. >> It reminds me and I wasn't really like an investor at this time but if you look back at history and you try to understand things is like the dot boom like in the 1998 1999 things went crazy and you could buy anything and everything went up. That's what happened in 2021 in crypto as well. when we flushed out and we realized, oh [ __ ] the valuations of these things went way too high versus like the actual usage and the actual revenues, everything went down 99%. Including the best assets like Amazon and Google, etc. But then what happened over the next 10 years, we did not rocket into all-time highs. It took

literally like in most cases seven, eight years for like the Amazons and the Googles to come back to all-time highs. But most of that stuff did never came back to all-time highs, right? Most of it. So over the next 20 years, if you're investing in internet companies, you did well if you invested in a couple of the majors. If you were in Google, Amazon, Apple, Microsoft, you got wrecked if you invested in anything else. And it feels like that's the world we're in right now with crypto. >> Well, and you know, some of the biggest companies didn't even exist then in terms of tech companies, right? Facebook, Facebook was made by Zuckerberg when he was 19, four years after the do crash, right? And that was on the on the built in the ashes of the dot boom. Boomer is like, "Okay, we have to come, you know, everyone's trying to

come up with new ideas going more social than what they had before." But that, you know, being in one of the top five companies or whatever he's part of or Facebook's part of, >> it's still that was built after, right? So, you could also I've always argued that like we still haven't seen the best crypto company out there. I guess you could say that hasn't even come along yet. >> Well, that plus the best companies that did that were around were just the best companies at the time, right? Like the majors. And so, it's like there's nothing wrong and you I say it all the time, right? major spot, zoom out, chill. It's like that held true through the internet. And those who did that and held Amazon through the whole craziness, they became millionaires and billionaires, right? They didn't jump around trading pets.com and whatever.

They just bought Amazon or Google or, you know, Apple and just held it for two decades, you know? >> So, you can also just do that and outperform and do really well. >> Stable coins are the biggest use case in crypto right now. But, let's be real, using them on chain is still way too complex. That's exactly the problem Bridge is solving. Recently acquired by Stripe. Yep, that's Stripe, Bridge helps businesses send, store, accept, and launch stable coins instantly. Explore the future of global financial infrastructure at milkroad.com/bridge. Did you know you can earn Bitcoin without ever buying it? That's where the Gemini credit card comes in. Here's how it works. Earn up to 4% back in Bitcoin on gas, transit, and ride share. 3% on

dining, 2% on groceries, and 1% on everything else. Use it just like any other credit card, and you're building a crypto portfolio at the same time. The best part, the Gemini credit card has no annual fee and works anywhere Mastercard is accepted. When you're approved and spend 3,000 in the first 90 days, you'll get a $200 Bitcoin bonus. Spend as usual, earn Bitcoin instead at milkroad.com/gemini. One thing I've noticed too this cycle, Kyle, and you know, again, obviously, you know, coming from the from the trenches is that there's such a focus on revenue and last last cycle with all the BS that was on the timeline like NFTs, right? Something that's largely vaporware. Um these companies are raising money, they're creating

marketing, they have huge their NFTts are over overpriced, but there's how does the company make money, right? Like Yugalab's good example. It's like when they're making games, how do they make money in the end, right? What's what's their actual revenue stream? It's it's impossible to build a competitive gaming studio, right? And I think this time it's funny, you know, even in the trenches, people are focused on revenue and the top two earners uh are Circle and Tether by far. They make the most revenue and those companies rightfully so. Stable coins have been one of the big stories this time around. That's where a lot of companies are being developed. That's what everyone's trying to make. That's very competitive. It's one of the most uh accepted uses of crypto, of course, digital payments. The next thing after that, if you look at onchain revenue, is hyperlquid. and

they've had to spend so much of their money buying back their token just to appease the crowd. So there's there is a product there, but it's something where it's like but even the money that they're making there's so much focus on it that everyone's saying you're like you better use that money to pump our the price of the ticker, right? So it's something where it's like I'm just saying I'm just speaking to all the vaporware talking about all these blockchains all this stuff. >> After a couple years they're not making you know it's already been a couple years of not making money. They're still not making money in this new bull cycle. They're not making nearly enough compared to their massive market caps and the massive in infrastructure they've built. How long do you survive like that?

>> Yeah. And I think so in 2021 it all worked out because one, everyone was getting free stam checks. So there was just all this extra money to buy dumb [ __ ] And then two, no one made any money. And so there was no like who is the better company? We didn't know at the time cuz literally no one was making any money. So everything was fair game. There was no way to value like to to have valuations on these things cuz there was nothing making any money. So it was just like the internet in $98.99. Like at the time Google was making zero dollars and you know what I mean? Like most of these companies were making next to nothing. Amazon was not profitable. So like you were just sort of like hoping and guessing for the future. And now it's like well there's things that

actually have real money. We can see real adoption. And so like we can be people that are allocating are much smarter and understand what's going on which is why again these people won't buy things without a a market structure bill. And then the other thing I would say is the SEC held back so much innovation not just on like the companies and like the the products that were building crypto but also on tokens and like innovating around how to make tokens useful and good. And so this is the reason why I'm not saying that the crypto industry sucks. I don't think that at all. I actually think that most of the good companies they're either staying private and not having a token right they're IPOing or they're getting bought by some of the biggest companies in the world. So like Bridge, they got bought by Stripe, right? You have um

what's it called that just got bought by Mastercard. You have And then you have like Kraken and Yeah. Zero. Exactly. Then you have Kraken and Consensus who are IPOing this year. Right. It's like >> these are the best companies in crypto which is we should be proud of. These are amazing companies. We've built some incredible stuff. >> But it's not smart to launch a token. It is actually stupid to launch a token. Why? Because the crypto industry has ruined tokens. We all whine and cry that you don't give enough of your equity to the industry, which is the dumbest thing ever. I would never launch a token if they're forcing me to give 80% of my company to users who are going to sell it anyway. That's so dumb.

>> Or yours use your revenue entirely for for stock buybacks, right? Like companies do that, but strategically, but they don't spend their entire revenue. They don't report, you know, Tesla doesn't revenue. >> Yeah. Not at a stage where you're a brand new company and you need to use that funding to like grow your company, right? So, I just think we've it's not necessarily our fault, but it kind of is. But like we've created a problem around tokens. So, we don't have a good way to launch tokens. We don't know what a good token is yet. And honestly, there's more capital in public markets or even in private investment from existing companies or VCs than there is on chain. And so, it's not a good idea as a good entrepreneur. So, this is the problem is like the good entrepreneurs don't launch tokens. They IPO or get

bought. The bad entrepreneurs launch tokens. And that's why most tokens suck. So, it's not a problem of the crypto industry. It's just we haven't built good systems yet to create good tokens that actually like have a lot of capital that will allocate to them that will come. So, I'm not bearish on crypto. I think that launching a token is the better way to do it eventually. But today, most of the capital's not on chain. So, it doesn't make sense to launch a token on chain. And then most capital is not on chain because it doesn't make sense to be on chain or there's not enough rules to be on chain. And so, good entrepreneurs won't launch tokens today. Okay. And I just think the people in the industry need to figure that out. And then I I think the big issue here is so many people in crypto

are so pissed that we don't have an altcoin season. And I was I was just giving this like lecture to our team today, which is why I think we had this this episode, which is what I was saying is most people listening to this podcast and most people that you know subscribe to Milk Road and most people that are invested in crypto, they started investing in crypto, right? their first investment was probably Bitcoin or Ethereum or some stupid altcoin or memecoin back in 2021 or maybe 2017. That was the entry point to a lot of people in their 20s and 30s to becoming investors. And I think the problem is everyone in crypto continues to think that they have to only invest in crypto and that has to be their bubble. They must invest in altcoins to outperform the market. And I think what you need

guys need to understand is you don't have to do that. One, you can still buy crypto. I'm not saying crypto is bad. Bitcoin, I think, is going to do very well. Ethereum and Salana, when the market structure bill um comes, there are going to be some assets that are going to get significantly repriced. I've talked about that in our pro reports. It's in our portfolios. Like, I'm not saying crypto's dead. I just think we need to be smarter. But what people need to realize is, hey, if you want to invest, crypto is not the only place to invest. There's a whole other world out there. There are crypto equities, which have been amazing. If you've bought Robin Hood, Galaxy, Coinbase, etc. There are some DATs that have done very well, right? like you don't always have to buy digital assets, but then there's a whole other world of

an even bigger bigger secular trend that's coming or that exists today, which is AI and energy and infrastructure and all the things that are going on there where you can get way bigger outsized gains. I'll give you an example today. If you look at the stock market, the two biggest uh stocks that are up, Cipher Mining and Iron, these are crypto companies. They are Bitcoin miners. But what did they do? They pivoted to AI and now they moved their data or their their facilities that they had to be data centers for AI and they just inked deals with Microsoft and Amazon. So they're up 25% today and they're up 700% year-to- date. So that's altcoin type price movements, right? You don't need to be in altcoins to get these kind of movements. You can do this

in AI, you can do this in energy stocks, you can do this in infrastructure. There are other places if you understand tech and you understand exponential adoption which is the key thing and network effects which are all the things that we've taught here in crypto you can also express those type of investments based on the macro cycle in different ways outside of just altcoins right and I'm not saying again don't buy crypto but you can have Bitcoin and then maybe some AI stuff and you can do extremely extremely well at some point there will be another crazy bull run in digital assets it's not today and it won't happen today because there's nothing investable over there. So, I just think that, you know, our audience and this is what I was saying to our team at Milk Road. We need to open our horizons if

we're investors. Let's just look for the best investments, not the best investment in crypto because we love crypto. Let's look for the best investment everywhere. This is a big reason why we're launching Milk Road AI. Was it next week or two weeks from now? >> Here comes the plug. Here comes the plug. >> Well, the reason is not that we're selling out on crypto. We listen, we're going all in on crypto still. We've always been like, we're launching products in crypto. Like, don't get me wrong, crypto is going to upgrade the financial system, give economic freedom, and it's going to change the world. But there's other technologies that are going to do that, and you need to be investing in both of them because don't forget what's going to happen soon is all these opportunities in the AI world are about to be tokenized and put on

blockchains. And so, the best assets on blockchains are not even going to be digital assets in the coming years. It's going to probably be AI or energy or other things. So, you really need to open up your horizons and become an investor in everything that's happening rather than just waiting for an altcoin season because if you do that, I'm telling you right now, you're going to be broke if you're not already broke. >> So, I've got a few things on the personal side to say about your your excellent rant uh that dovetailed perfectly into um some of the new stuff we're doing at Milk Road. But first of all, um I'm definitely one of those people that sure, you know, I invested in indexes and ETFs before very passively, but never I was never successful in a trade that I felt like I made personally until I was in crypto.

Right. And I think a lot of people are held and a lot of people are held hostage by that because >> I think we underestimate how quickly we can learn about a different industry >> and we overestimate how much more giga returns there are left where we've already made giga returns right so for somebody who entered here five six years ago >> early to defi summer earlier to nf early to NFTs early to a lot of the meta through the bare market right and that's something where I'm like well of course I'll be able to do that many more times if I just stay in my lane in the place that I understand and I hope so. I think so. I think there will still be great returns in crypto. I agree with that.

But that blocks me and it I think holds me a little bit hostage of like I can't even possibly begin to learn about other equities, other industries and even gives me the same bias that probably other people had on c- on crypto when I first got into it that it's like I already missed the I already missed the bus, man. Like you're telling me that these uh mining stocks the crypto mining stocks are up 10% today? I'm like well [ __ ] man. I wish you >> 25% >> 25. I wish you told me this a week ago, Kyle. But I think you kind of have this like I missed it kind of bias and you're like, well, when you see stuff like that, you're like, well, you know what? I'll just stick to what I already know and I'll continue to try and make it.

And the thing is that, you know, if you're listening to this, you're probably pretty good at crypto. And one of the reasons you keep up with Milk Road is you want to continue to be good at crypto. You want to see what else is happening in crypto. You want to learn new things. You want to keep up with the market. And I think being here, you're doing a good job. One of the biggest benefits for me um being at Milk Road has been to learn from you guys uh learn from the macro team, learn from the pro team about how the macro works, how um global liquidity works, and to like look ahead and now um I'm really excited for the AI stuff, you know? I'm excited to to to see your passion. I'm excited um for our new podcast host to come on for

the AI podcast that starts next week. uh and to learn from them because I'm a little bit blind to that. But I'm also accepting that it's like I don't think it's going to take me that long to get it get up to speed, especially and again this sounds like just a huge plug, but I I swear it's not. It's it's one of the reasons I want to be here. I don't think it's going to take me that long to get up to speed on what I can actually start to invest in on that side. Um especially buying into your thesis. >> Let me put it this way. We are so crypto people think we are in these four-year cycles because of the Bitcoin happening, right? And so again, just just peek anywhere outside of the crypto world and you realize that's the dumbest thing you

could ever think because stocks also >> because it happened twice already. >> It happened twice. It can only happen forever. Yeah. >> Stocks also have a four-ear cycle. And so if you think the Bitcoin having makes Apple have a four-year cycle, then you're out to lunch, right? So obviously the Bitcoin having has nothing to do with that. And I think a lot of crypto people learned this over the last bare market in the last couple years here. And so what's interesting is a lot of crypto people went and learned macro over the last three years. Milk Road Macro is our fastest growing channel. Um, it's been just was the thing that everyone wanted before we launched it. All of our audience was like, "Yeah, we want more macro content because people understood, oh [ __ ] you know, crypto really relies on the macro world to to

do well." And so, a lot of you went and learned macro. And now, like, look, are you a macro expert? Maybe not. But like, you you understand it more than most people in the world. So, kudos to you. But what I think now is we're actually going into the large one of the largest and biggest bull runs in history, right? and you have the macro backdrop to back that up. But the real reason I think this is going to happen is because we have a race for AI. Okay, but the reason why I'm gonna get to that in just a second, but the reason why this matters is if you're have an opportunity to capitalize and make money in one of the largest and biggest bull runs ever and you already understand macro and you already understand crypto. If there's another technology that is also going to

do well so you can diversify and own a bit of both the new financial system and the new internet, let's call it, right? the new efficiency of the world, a new type of species, you might want to get in on that too, right? And so being able to understand both while understanding macro is such a big opportunity. If you've already learned crypto, you've already learned macro, you can definitely learn AI, too. And here's why you should because this also matters back to to to crypto because what's happening in AI is macro. We used to always say crypto is macro or bitcoin is macro. AI is also macro. So if you want to understand macro to understand crypto, you need to understand AI because if you don't get AI, you have no idea what's happening in the world. So here's what's happening right now that makes me think we're going into one of

the largest bull runs in history and why the four-year cycle is cooked. So right now we're at a point where the largest companies in the world and the largest economies in the world are racing to win AI. Okay. Now what does that mean to win AI? Right? So for companies they need to get the most data and the most processing power. So the most data centers and the most energy to power those data centers because if you have the most data and the best ability to process that you can create the best AI which means you can create the best product right and so you have open AI or you know you have with chat GBT you have Google you have Tesla you have or not Apple sorry Microsoft Amazon these are all racing to build the biggest data

centers get the most energy and create the best AI because they know that'll create the best product and whoever creates the best product is going to win Okay. So, literally, if you don't go into AI right now, and you've heard Mark Zuckerberg talk about this, he's like, I think he's planning to spend $500 billion by 2028, which is what, 3 years from now, 500 billion by 2028. And he's going to do that. And he said, I don't even care if I misspend a hundred or $200 billion because that's how important it is to win this AI race. So, you have the biggest companies in the world using their balance sheets of billions of dollars, hundreds of billions to invest in AI. That is mega bullish in of itself. But then, let's think from the economy standpoint. you have China and you have US spending and

they've already said they're going to spend as much as they can. The big beautiful bill was all about AI. Um you know you had Trump getting that huge investment for um for uh for open AI uh with like 500 billion I think it was to build data centers. Um you have them pushing to lower rates so that they can you know raise more capital etc. And the reason is whoever wins AI wins national defense, right? So if you think about war, right, war doesn't matter with the amount of humans anymore. That used to matter. Now war is all about drones, right? It's all about humanoid robots.

It is all about AI, right? And so China and US are in a race to win AI because that gives national security. They actually have to win this. If the US decided to just sit back and not do anything and let China win this, China will crush the US. They are literally done. And this could be a deadly done. It could just be a tactical done. I don't know. It doesn't matter. But the AI will decide what they do and they will win whatever it is. Okay? And so these these countries, the big economies have to win AI. And so we're in this world now where they cannot take their foot off the pedal. They have to have low rates. They have to print more money. They have to find ways for the companies in their countries to win AI.

That is the most bullish backdrop you've ever said. Why are the biggest economies in the world running the economy hot? You've heard us talk about that. They're doing that because they need to make sure that capital is cheap and available in their countries so that the companies in their countries can go and focus on AI so that they can build the biggest data centers in the world so that they can find ways to build renewable energy to power these things. If they can't do that and if they lose, it is literally a matter of national security or in the company side of things, it's a matter of like existence of their companies. And so when you have that kind of arms race, this isn't just like a hey, I'm going to slowly build data centers and I'm slowly going to put some capital in, but oh

inflation's a little bit high. Let's actually raise rates and let's wait three more years and then we'll come back to the data centers thing. No, that cannot happen. So I can tell you right now they are forcing this through. regulations are changing to make it easier to build data centers and get energy and do all this stuff, right? Capital is coming that way. Whether they're going to print money or they're going to find new ways to make bills or whatever they're going to do, they have to just load this industry with money. And this is yes, massive for the AI world, massive for data centers, massive for the energy world, right? So again, there's opportunities to invest. Why does this also matter for crypto though?

It matters because if they're going to keep rates down, they're going to print money to build AI, etc. This is a good thing for Bitcoin because it means they're going to debase their currencies to try to win this AI race. So, of course, Bitcoin and gold are going to do well in that world. Now, that is extremely bullish thing. But if you don't understand that whole AI side, then you don't understand that there's going to be a longer bull market. Instead, you think that we're going to end in October because it's the four-year cycle. So, this is why I'm saying you need to learn and understand AI because it matters for crypto and it matters for macro. So, it's actually so much more important for the fundamentals of the way you invest and the way that you live life than you even realize. So, that is why I'm like, guys, you have to

learn AI and maybe you might want to put some money in there instead of just putting it all in these stupid altcoins. Um, so I don't know if you have any questions on LG if that made sense. I'm just going to summarize it back for myself to make sure I fully understand what you said. So, AI is the race that nobody can lose. They have to every country company has to unload every dollar they can find to win that race. And it's both like um from a business standpoint to stay competitive to to win the new internet or whatever the whatever you want to whatever the next phase is going to be called AI obviously but the new the new paradigm let's call it.

>> Yeah. >> And from a government standpoint and a defense standpoint you're right. Yeah. Like battlefields that kind of stuff. It's like very few humans. I would also say like cyber security as well, right? It's something where um that's that's probably where there's the most war waged that we don't see in the news or we're not privy to is you know massive uh hacks and all that you know so many examples the last couple years of these discrete systems right of people finding ways to hack each other nuclear programs all that kind of stuff. Um so that's happening that's what every every company is signaling that's what the countries are signaling that they're going to continue to devalue their currencies. anything they can do u print more dollars to win this AI race especially because a lot of these

countries are now broke they're incred they're in incredible debt um and that that we're seeing that in the charts right and what you referred to earlier with you know the economy is kind of tricky right now where you have S&P 500 printing all-time highs but you have uh employment isn't moving a lot of these companies are maybe in hiring freezes right you have what they you call a K-shaped economy I believe where stock market goes up employment goes down and nobody can really figure out why and I think it's because of this. So, the theory for us uh as crypto people and as potential AI investors too is we're going to look for the best places to get returns on this and we're going to stay bullish on our crypto tokens because um the riskon environment is going to remain. They can't tighten money anytime

soon. >> Um because they need to keep spending it. They need to keep printing it because they can't lose this race because there's no point in austerity if you've lost the AI race down the road. >> Yes. And and so like look, a lot of people like, well, but AI's in a bubble, so it doesn't make sense to invest there either. And so I just want to show this is a chart I showed in the pro portfolio, which is okay, here was the bubble of the the internet world back in in the 1990s and 2000s. You can see how valuations went way away from earnings. Today, earnings are going up higher than than the prices are pretty close, right? So there's no bubble because earnings are going up along with the valuation.

So that is very that is very strong. The next thing to understand is that um when I said Mark Zuckerberg wants to put you know 500 billion or 600 billion is actually the number in AI infrastructure by 2028. That's not happening with leverage at least not today. It's happening don't forget like Apple has what like $600 billion in cash just sitting there on their balance sheet. So they don't have to take out any any loan. They will take out loans but they don't have to and their loans will be backed by real cash and real revenues because earnings continue to go up. This is true of every Meg 7. So Meg 7 will continue to get bigger. Why? Because they have the capital to spend on this stuff and this isn't something that's getting overheated because there's no leverage to do this. And then if you

think about well what do they need to spend on? So remember that in order for AI to work and to be good. So the LLMs you use at chatbt or the autonomous cars in Tesla or the autonomous uh you know um humanoid robots, all of this requires uh compute. And what that means is for a car to turn lanes, right? There's 8 million Teslas on the road right now. All of them are bringing in data. They don't all have fully self-driving capabilities, but they're all have cameras that are bringing in that data. And that data needs to be processed. So, every time they change a lane, they park, they accelerate, they have to use AI power to do that, right? Humanoid robots, they're not big yet, but they're coming, they have to use AI to do that.

All the humanoid robots or even just the machines in Amazon's factories that are being used, it uses compute and processing to do that. Every time you type in chat GBT, Grock, Gemini, all the ones you use, every time you use Sora, that is just using so much processing power. And so what's happening right now is if you look at the numbers, we are um data centers right now to process everything we do in AI is around 4.4%. It's using up 4.4% of all the electricity in the United States. Just the data centers to process all the amount that we're using AI. And we barely use AI today compared to what we're going to be. The projection here is that by 2028 instead of 4.4% we will use 12% of the entire US's electricity

consumption. Now remember the US already has problems with their grid, right? They have power outages in Texas all the freaking time. That's where most of these data centers are going, right? So the the the existing grid today is not built for this amount of data centers. Okay? And so not only are we building more of these data centers and spending hundreds of billions on them, we have to rebuild the entire not the entire but most of the infrastructure for energy, right? Because the existing grid we have and using gasoline uh it doesn't work for this. And so we can build nuclear which obviously is catching a bid and people understand that. But the problem with nuclear is takes like 10 years to build a nuclear plant and there's a lot of weird regulations and stuff. And so the one uh example that is actually

might be able to actually solve this problem today is solar, right? And so there's a lot of investment going into solar companies. So there's just there's a lot of demand for this that is needed because there's actual usage from a consumer level on this whether it's Tesla, humanoid robots, chatbt, blah blah blah. And so these companies that are making money need to go and build these things which just means there's so much more infrastructure and energy to be built here that it's not possible really to go into a bare market in this world. Now it doesn't mean we won't go into an AI bubble. Of course we will at some point we will run out of cash and the valuations and the investment in capex will go above the earnings and they'll start to take out leverage and then you need to be scared. But I just

think we're nowhere near that today. And then the last thing I'll say is like everyone's always worried about inflation going up, but you got to remember that the more that this AI stuff works, the more inflation is going to go way down. The more we use renewable energy for uh and build out this renewable energy and put investment into that, the cheaper electricity goes, right? So like a lot of the things that people think are going to cause inflation are actually going to lower inflation because of what we're doing here. So that gives us so much more room for this bull market. And then as you said, as you summarized, is like if this continues this amount of spend and we keep rates low as we h as we do and AI actually works to keep inflation down, there's no reason to to increase rates

and there's no reason to stop printing money and putting into the system, which means Bitcoin is going to do extremely well. And then when you think about it, when you're risk and you have low rates and you have a lot of money being printed, what else does good in that world? The the the innovation stuff. So, anything that's like on a far end of like the risk curve in terms of not risk curve in terms of like meme coins that needs money in the hands of like stupid people, no offense LG, let's call it uh leftrain people. What is it? Mid left brain, right brain, whatever it is, >> left curve. Left curve people with an for um >> for an appetite for extreme risk. Let's put it that way. But but in in in the world where so outside of just that

that's what we saw in 2021 because the stim checks but you also got to remember what performed really really well in that world when money is cheap the things that are like the future technologies there's your crypto right there's your DeFi and your stable coins and your all like that stuff's coming no matter what we're getting adoption especially when we get the market structure bill but that stuff's going to do even better in a world where people are putting money into the future technologies right so that's where crypto still will do really well, certain parts of it. It's just you got to remember that a lot of the assets I said are just uninvestable. It's not crypto's fault that crypto isn't going up. We're building great technology.

Like you said, Tether and Circle are some of the greatest companies in the world. Coinbase and Robin Hood, these are incredible companies. So, like that world is still growing. It's just there's only a few assets you can invest in on the crypto side, but that's only going to accelerate here as we go deeper into this bull market because of the AI boom. You just have to put your money in things that actually acrue value, right? Uh and so that's your Coinbases, your Robin Hoods if you want to get in the crypto space. And then let's say DeFi or stable coins, etc., etc. It's like it doesn't mean crypto sucks and you only need to do AI. You got to understand AI to understand the macro. But then you just got to put your your capital in investments that actually acrue value in this world. And I think a lot of people

are just missing that point. You know, why do people invest in real estate? Because it spits off cash flow. But I'm not here to manage rental properties. That's why I'm looking at Figure Markets. Their new democratized prime product backs your money with real cash flowing assets and returns up to 9% APY. It's the first real world asset borrow lend pool built for everyone, not just institutions. Ready to lend like a bank and get more than the 5% A is offering you? Download the Figure Markets app today and get 9% on your idol funds. go to milcro.comfiguremarkets.

>> For me, it's I think it's also a matter of product market fit, right? Where for cryp like I think I think one of the things with crypto is that it's lost a bit of its speculative appeal because because of because of what's happened in the last two years. It's like listen, Wall Street is buying the tokens. People are using stable coins. Visa is buying Mastercard is buying crypto companies. Like there's only so many and and the regulations aren't there. No one's, you know, no one's going to come after you in the short term, right? Even for stuff that might not be like super okay. So I think it's like that's one thing where you know they'll still be really good in returns and maybe even kind of like the dotcom boom it's like well it just needs to chill now. You know a lot of the

vaporware is going to die and you need to chill and you need the companies that are actually built right. Uh you got to give them time to acrew value and and and eat market share of the things that they're replacing right like payments. It's like okay it's one thing for people to open up stable coin payments. It's another thing for 20% of global payments to be stable coins right like that's those are two completely separate things. Same with Amazon. 20 years ago, it's like, well, it's one thing for Amazon to be a company that's making money and sending books to people. It's another thing for them to literally replace the postal service, right? And that's almost that takes a long time. I'm just going to And then back to AI.

What I like about AI, and I asked you this, Kyle, after you wrote this report internally, I asked you, I was like, what does success look like for these companies, right? It can't just be that we every everyone's using chat GPT as their chatbot and ask them for advice. You know what I mean? Like that can't that's not the end goal that everyone's trying to get to. there's so many more applications and we don't know what those are yet. Um because even saying like governments um everybody's trying to trying to race to what right and I think that that's the really exciting part as well for this AI race is like I actually don't even know what the next couple phases are of what these what they're trying to make AI do the so as a quick answer I don't know the endgame that's very I mean we can have that

conversation that's a fun one but that needs to be its own episode the next phase for AI is AI going into real physical things which means real world AI which is AI going into cars, AI going into robots, right? That is the next step for AI. Right now, we're AI chat bots, AI creating content, etc., etc. And that that's going to exist and we're going to continue to grow that. But the next step, which we haven't really hit, which is just happening now, is AI going into physical things and interacting in the real world. And really Tesla's leading that. There's others of course, but that's the next big thing. The world is going to change drastically when you have autonomous cars everywhere and autonomous robots everywhere, whether that's in factories or getting your groceries for you or folding your laundry. That's going to be a whole new

world. And that's that's the phase we're entering right now. We're literally going to a point where probably by the end of this year, robo taxis will be actually self-driving with no supervision in them in in Austin and in um in the Bay Area. That's going to start to scale in 2026. So, that's huge. Humanoid robots, we're finally starting to sell them. Both Figure and Tesla are starting to sell them and they're going to start to scale them up in 2026. Again, small amounts, don't get me wrong. Um and they're not amazing yet, but like it's starting, right? And so we're we're beginning to have that moment for physical AI, which is huge. And I I don't think people really understand how big that is. But I want to tie this back to crypto one more time so people kind of understand what I'm trying to say here is I think everyone

can grasp the idea of, okay, if rates are low and we're printing more money to win this AI race, Bitcoin probably does well. I still think people are probably like, well, why does the rest of the crypto industry do well? And one thing I want to understand is, well, here's an easy one that you can you can grasp. If rates remain low for the next couple years because we got to win this AI race, it's not like everyone just puts all their money into risk assets. People still want to hold dollars and get yield on it. But the problem is if rates are low, you can't get any yield. What are they going to do? Well, there's something called Sky, right? or Athena or there's these other very innovative things that exist in crypto and on chain that can't really exist in the traditional finance world where you can

hold dollars in stable coins the biggest adopted thing in crypto right now and you can get yield on them in some very safe ways using things like Athena and Sky and you can get four five 6 7 8 9 10%. So think about the adoption that will come. Why is that adoption coming? Well, it's because AI exists and there's this race for AI, which means we have to hold rates lower and people still want yield on their dollars. They're going to have to come on chain to get that. And so, crypto is creating products for this new world. And so, again, I'm not saying I'm not bullish on crypto. I'm very bullish on crypto. I just think that there's because of what's happening in AI means certain things in crypto will get adopted. So, these are just things that you need to be thinking of to get

ahead of that curve, right? Um, so and there's a lot of those examples. >> I think that this is I think that's the best value in milk road honestly you Kyle yourself and and the team is that you know making sure that we're on top of whatever is happening next right and um both for crypto and for other industries and make sure we don't miss too many opportunities. And I think that that I think you're really giving us a really compelling thesis. I think you're you're making it clear that we haven't missed the AI trade either. Right. I think that's the most important part is not to feel like we missed it. And even, you know, you could have said the same thing about crypto in 2017 or 2015 and be like, I totally I missed it. Bitcoin was $10 when I saw it and now it's

2,000. Ah, you know, and there was still there was still another 50x at least for you, right? So, I think it sounds like AI, you know, even with the big companies or the new ones or the incumbents, the ones we haven't even heard of. Sounds like there's a nice race upcoming and Milk Road AI launches next week >> just conveniently. >> For for the listeners, the the main goal of Milk Road is to make sure that all of you guys make money investing, right? Our whole goal is like let's help retail people right people that don't have what institutions have let's help them understand how to invest and make money in this world and for a while and still today that means probably putting a lot of your capital in crypto is going to really help you right I mean a lot of you guys have done really good on our on

our calls of buying Coinbase buying Robin Hood uh buying obviously Bitcoin Ethereum and Salana you know we were calling Salana at 20 bucks so like we've done really well there we'll continue to to do well in in the crypto world but I think The the thing is is that in the next, I don't know, 5 to 10 years, I have no idea what the world is going to look like. And I don't know what jobs will exist. I don't know what life is going to be like then, but it's going to be weird because we're going to have a lot of AIs running around this world. And I don't know what that means for us. And so, I really think that right now you need to dial in and get as many much capital as you can, as I've been saying, get as much revenue income as you can

and invest it and invest it and make returns on that. Right? They don't have to be a 10x every year, but if you can double your money every year or even 50% every year and just keep doing that until whatever happens with this AI boom and we no longer have any jobs and we're all in like universal basic income or something like that is the key to separate yourself so you're not screwed over 5 10 years from now. And so at Milk Road we're like well whatever the opportunity is we need to make sure that you guys are aware of that. And so when we realize hey AI is the opportunity we're going to launch a channel that it's AI right? when we realize macro is so important, we launch a channel for that. Um, and so don't think, oh, we're leaving crypto. We are definitely not

leaving crypto. We are just adding to our arsenal of investments so that we can all stay ahead of the curve of this like new world that we're going into, which involves both AI and crypto. And who knows what's next? Maybe, I don't know, robotics or like something else we'll we'll launch. Um, but it's wherever the opportunities are, we need to be there. We need to understand it because we need to understand where the world is going because that's how you become a good investor. Couldn't have said it better. Kyle, you're a legend. Thank you for sharing your thoughts and your thesis. Uh any last things you want to add uh before we wrap up and leave this very bullishness FOMO on AI?

>> So, I showed you guys some charts from the report that I wrote on Saturday. So, you can check that out on milkro.com. Just go to our our most recent uh pro report. It was put out on Saturday. Um it was like called why the four-year cycle doesn't exist anymore or something like that. I forget what the title was. And next two weeks from now, Martin has put out a whole deep dive on AI, understanding the different sectors and parts to invest. Uh, and actually, I think he names a couple tickers for you in there. So, if you are not subscribed to Milk Pro, do that. Uh, it's at that's coming two weeks from now, and that'll come at the same time that we'll launch Milk AI the podcast, uh, which we're really pumped for. And then in the coming weeks to months, we'll have, um,

Milk AI Pro coming as well. So, uh, check those check this pro report from last week and then check out the one coming out two weeks now because this is really going to get you up to speed on what you need to know in AI. As LG said, we are not too late, but you will be if you sit there and you just hold alts for the next year and get completely wrecked. So, update your priors. Let's go. >> A lot to look forward to. Bright road ahead for the Milk Road. Kyle Reedhead, you're a legend. Thanks for coming on and we will see you guys tomorrow for another episode of the Milk Road Daily Show. Signing off for for today. This is LG. Kyle, we got to get you back on more often, man. This is this I think this is a better episode than the last one we

did together. Just put that out there. >> Want insights on what's moving crypto markets and how we're trading each event? Subscribe to our channel and join the Milk Road Daily and Pro Newsletters and start investing like the top 1%. This show is for educational purposes only. Nothing we say is financial advice. Investing is risky. Never invest more than you can afford to lose.