How Bitcoin investors pay less tax and never sell, with Zac Townsend

Transcript

GM. Good morning. Welcome to the Milk Road Show, the daily crypto show where the bears are hibernating and the bulls are throwing an open bar. I'm your host, Jay Hamilton. It's Tuesday, May the 13th. This episode was actually recorded on Friday, May 9th. Today, we are asking a couple very important but somewhat morbid questions. What happens to your Bitcoin when you die? What if you haven't thought about protecting your Bitcoin ahead of you dying and your wife or your partner doesn't know how to use your seed phrase or doesn't know where it is? How do you access your Bitcoin and the gains right now, but do it in a tax optimized way? These are all questions that are being asked and I get

asked quite a bit, but I noticed I'm getting asked them a lot more and I know I will get asked them a lot more in the coming years when Bitcoin continues to go up in price as we all know or expect that it will. Today, to break this all down, we're joined by Zack Townsend, co-founder and CEO of Meanwhile, one of the first life insurance companies built on the Bitcoin standard. You heard that right, life insurance and Bitcoin. These aren't two things that you would typically think about putting together, but Zach is a friend that I have spoken to a lot over the past year. And you guys are going to love what he is building and how he is thinking about the future of the Bitcoin economy.

Before we jump in, do me a quick favor. If you guys like the show, give me a subscribe, give me a like, give me a review, wherever you are. It helps us huge, helps the algorithm, and helps us make sure we get the best guests on the show to make you informed with your crypto investments. Today's episode is brought to you by Leen. Get cash without selling your Bitcoin. It's also brought to you by Coin Shift, powering top crypto treasuries with their yield bearing stable coin, CSUSDL. Without further ado, Zach, welcome to the Milk Rose Show. RJ, I just want to start by saying we're the only life insurance company, not one of them. There you go. The only one. I want to start with um sort of a zoom out here. Everybody focuses so much on

Bitcoin's price, but you really focus on Bitcoin's purpose. What is Bitcoin's purpose in your mind? Wow. I was asking J to steal it. Um, so for me, Bitcoin's purpose is as a long-term store of value. It is global, is decentralized, it's outside the control of any government. you know, it's truly the the highest version of like digital money and uh money as store value. And that's exactly right. Uh we happen to be reporting this on a day where Bitcoin is approaching all-time highs. We'll see if it happens. But honestly, we uh try to run the company

not asking ourselves like what's the price of Bitcoin today or this week or this month, but that long range perspective of like where is the like what's the purchasing power of Bitcoin going to be in 10 years, 20 years, 30 years. And for us, there's no question that Bitcoin will still be here, will be a persistent store of value, and will be more persistent as a store of value than most, if not all, fiat currencies. Um, so that's how we see Bitcoin as having this really differentiated uh long-term purpose. Yeah. What I what I love about you guys and all the conversations we've had over the years

is the not a lot of people in crypto are focused in decades yet. Like crypto is still so new that so many of the crypto companies right now are trying to grab the now opportunity. And you guys are really building. You're building. You're one of the few companies I've met that's building for the next 100 years of Bitcoin and thinking about where is Bitcoin going to be 100 years from now. And that really that frames it very differently than I think a lot of a lot of the companies that we talk about currently are are are seeing in a different way. Let's let's talk first about what do you think happens to most Bitcoin when people die? I I want to ask you

that question because I feel like you've thought a lot about this. I have not I have not thought about honestly I haven't even thought this about this at all. What happens to my Bitcoin and my crypto when I die? Like if I die tomorrow, it would be a problem. I have not thought about this. So what do you think will happen? Why you need a a big life insurance policy? Let me just start by saying, you know, that long-term perspective, you know, I do think that there are lots of people building for the long term, but it's absolutely the case that like there's so many like trading firms or like yield chasing and I think that all of that is important.

Like I actually do a lot of that stuff too. Um but if you look at the like global traditional economy, there's also um institutions that think in the really long term. And that's what we try to do. And that may be my personal feeling. By the way, I I do not know what's going to happen with the price of Bitcoin, you know, between, you know, day to day between now and when this show is released. Um if you ask me if Bitcoin is going to go up or down uh relative to the dollar, like I have absolutely no idea. So I've definitely built a company um sort of around that idea. But the other thing I'd say is there is this strand of like thought of culture in Bitcoin that I like place us like squarely in around hodling around intergenerational wealth transfer around

retiring your bloodline. Um and those ideas are very much in sync with like what life insurance is, what life insurance is for. So, we I think there's a lot more press and a lot more play on the day-to-day, but um actually I think the culture and purpose of Bitcoin is more long-term and we're like happy to be part of that, like building that institution. I completely forgot the question. I just like said what I want to say. You just did exactly what anybody should do when they're getting interviewed, which is Yeah. Say what you want to say.

Don't listen to the interviewer. Uh what happens to everybody's Bitcoin when What happens to Bitcoin when you die? Yeah. Well, this is actually like part of the original theory of the company, right? Like I have uh young kids. Um I'm uh I have a you know seven-year-old or three-year-old and my wife uh is very sophisticated. She is smarter than me in so many ways, but I would not uh say that she is a big believer in Bitcoin. And I was thinking about this very problem. I think I was on Reddit or Twitter like five years ago and you hear these horror stories of people who die and then their their wife, their kids, their loved ones like don't know where the Bitcoin is, don't know where how to

access it. And as people do more and more risk for their Bitcoin, you know, you put on a hardware wallet, you bury it that hardware wallet in the backyard, whatever it is, I think that this is like a serious problem. And the truth is, you don't want to think about it. Like, nobody wants to think about dying. And also just me, my friends, um you know, a even those of us who like really got introduced to Bitcoin in 2013, 14, 15, we all tend to be like pretty young.

So I think we um haven't really we're just starting to grapple with that question of like how does self-custody how does Bitcoin like interact with you know my eventual demise and then similarly a lot of what life insurance is about and I think we'll talk more about this is not just about protecting your kids and making or your nieces and nephews or whoever your loved one is um but it's also about there's a lot of tax benefits to life insurance. Um, so I think it, yeah, we we see that resonate with people because so many Bitcoiners, so many crypto folks, so many dens are sort of transitioning in

life from, you know, just being themselves to like having a serious girlfriend to getting married to having a kid or two. And we see that in our customer base that like you're somewhere between like serious girlfriend and two kids. Like that's um and that's when you like at least the thought is crossing your mind like what happens to these this loved one or these loved ones uh when I die and like how do they get my Bitcoin? Yeah. And and let's be real I don't want to think about it either. Yeah. I feel sometimes I'm like I'm the bearer of bad news like um but it's but it's but it is it is a very it is a very important question to ask because when you do ask yourself that question like

if I sit here right now and I don't know if you've ever speculated or guessed made a guest on this but like if if most people holding crypto right now any of them were to die my guess is that a lot of their Bitcoin would not be recover a lot of their crypto would not be recoverable because they probably do not have their seed phrase anywhere where anybody else can find it and access it on purpose on purpose on purpose on purpose right like you know so so so this is a this is a is it is a problem and I think anybody can acknowledge that okay so let's shift now you you you teased sort of the next question which is let's talk about let's talk about

life insurance as a product because life insurance is a very interesting. It's an it's one of the oldest financial products which was really created not just as a means to ensure your life and protect your family and and the what we typically think about life insurance but it also is created and has become one of the best tax optimization products in the world. So for at a very basic level can you just explain life insurance to us? Sure. Sure. So, um, as we're talking about, we're all going to die and, um, we don't really know when that is going to happen. Um, hopefully it is like far

far in the future. And the uncertainty that exists for any like one person when you start to like take a bunch of people and you put them together you start like through the law of large numbers just like through statisco regularity you can say okay if I have a thousand I'm 39 if you have a thousand 39 relatively healthy year olds then we know statistically that like two or three of these people are going to die. So the original idea of life insurance is okay, the thousand of us will like put $1 in a pot. So then there's $1,000 in the pot and then if three of us die, we'll each get $333, right? So although the chance that we're going to die is very small, we

don't know who among us um is going to be the poor, you know, so who who dies this year or the next 10 years or whatever, right? So that's the like ancient like very original theory of like risk pooling your mortality risk. So life insurance is very much about like what happens to your family when you when you die. And what happens as you mentioned Jay is that society governments um they we feel like buying life insurance is a good thing because you know orphans and widows starving is bad. So we decided that we should incentivize people to buy protection um on the off chance that

they die. And that has led to a series of tax benefits and tax privileges for life insurance also for annuities was like the flip side of life insurance. And um like any you know decent wellthoughtout you know tax benefit what happens over time is that you end up with products uh that still provide the critical protection that like your family needs and deserves while also you know being optimized and like sort of making sure you're getting these tax benefits. I think our product uh the only other like generic thing I'll add about life insurance is that life insurance tends uh I think lots of people think about term life insurance and term life insurance is like it lasts

for a certain term right so it lasts for like 10 years or 20 years and um since you're very unlikely to die in the next 10 years then the payouts are very high right you might like pay $1,000 a year for a million dollars in coverage um because you're just likely to like get to the end of those 10 years and not have like received any any money. You did receive something by the way which is like protection in case you died. But we didn't want to start with that product because we think there like there's a bad history in Bitcoin and crypto of you know uh taking Bitcoin from users and then not giving it back to them. Um and that is like a regular

like that is the course of business of running running a term life business is you collect a lot of premiums from people and only a few of them die so you only pay a few people. Um so we started with a product that's called whole life and it lasts your whole life and back to what we've talked about and fortunately you will eventually die so there will eventually be a payout. So the way our product works is you pay us um you know a certain amount of Bitcoin over uh 10 years. That amount's sort of up to you, but let's say it's like one bitcoin a year for 10 years to make the math simple. And then the coverage lasts your entire life, your whole life. And then you

die hopefully, you know, at age 95 happily. Well, the death won't be happy, but like, you know, you're happy that you live to 95 and then you uh we pay your your beneficiaries out, you know, more a little bit more than you paid in. So, you paid us 10, we might pay out, you know, 14 or 15 or 16, like depending on your current age. So, that's both uh like what life insurance is like for um how you ended up with tax privileges uh because we don't like orphans when they're starving. and then how um that evolves into products like whole life that we offer for everyone's benefit. What is the uh what is the

range of of policy? You said uh uh you said that the example was one one bitcoin a year. So the smallest policies we're doing right now are a tenth of a bitcoin a year for 10 years. So like one bitcoin in total. And then the largest policies we do sort of how much you exactly pay depends on like your age and how healthy you are. But the biggest policies we've done are like three bitcoin a year for 10 years like 30 bitcoin. We've had users and you know congratulations to these folks who have asked us to buy bigger policies and much bigger policies than that because of the benefits. But you know we are running an insurance

company and one of the things about insurance companies is you can just get unlucky right? So you don't want to sell you know a thousand bitcoin policy to one person and then like that person gets struck by letters and they're hit by a bus you know that's just like like you can just get unlucky. Um so one of the ways we manage that is that we have a policy limit. Um, and to go back to the original question of like what happens to Bitcoin when you die, we're actually pretty clear with people like we don't think that you should take all the Bitcoin you have and like put it in the policy. What we find is that people are putting some amount of the Bitcoin they have into the policy. Sort of like how much of this Bitcoin are you planning to

hodddle or that you want the like tax I should just explain the tax benefits. Yeah. So, let's go for that. One is that you um your beneficiaries get the Bitcoin they receive the 15 in my sample taxfree. The second is we're turning that 10 into 15. And even if you were doing that like through the exact same meal strategies that we do, you which we should talk about, you wouldn't be getting um the same compounding because there's no uh tax every year, right? So if you had a bitcoin and you earn 3% then you would owe interest income tax

that year. But because it's like a 401k or an IRA or something like that, you know, it's growing compounding taxree then um that uh you know that's tax benefit. And then the third thing is, as you mentioned briefly, you can borrow against the policy tax rate. So what that means is um you know, you put that 10 bitcoin in, you're now in year 15. Bitcoin's appreciated to a million dollars a coin or $13 million a coin, whatever number you think it's going to be. Um and then you can borrow Bitcoin out of the policy. And what's nice about that is um one you we don't actually expect you'll pay us back. We expect you'll die and then the loan will be

netted out against the amount we owe you. So you're not really borrowing with the expectation that you'll pay back in your lifetime. You're borrowing with the expectation that you're like sort of borrowing against, you know, the benefit that your kids or wife is going to receive. The second is that it's new tax basis Bitcoin. So if Bitcoin has appreciated to a million dollars from $ 103,000, then you don't owe any capital gains between that $100,000 and that million dollars. And the third thing is there's like no margins falling. There's no posting of margin. There's no ability to get blown out of this position, right? Because it's like the loans denominated in Bitcoin, the collateral

is denominated in Bitcoin. Uh so it all just you know there's no risk of um ruin even if Bitcoin goes down 50% uh which you know occasionally happens. So what we see is to go back to like the rational allocation is even people who have a thousand bitcoin who they don't really need the protection per se but they sort of put some bitcoin in the life insurance policy in case they ever need some liquidity like that's the bitcoin they want to get liquidity from.

And then we have other people who are planning to h you know they they have 10 bitcoin they're planning to hodddle almost all of it so they might buy a six seven eight bitcoin policy um and they just want that rest uh in case um they they um you know something happens. So you know we're not a we don't try to say we're holistically solving your problem. I think it does force people um to think about what they're doing when they die. So like we have a legal obligation to make sure your you know your wife or your kids get your Bitcoin but then also you know there's solutions at Unchained or Casa or whatever that also I think help you and what we find is that people

sort of make some rational allocation between like hardware wallet buried in the backyard you know some like you know failsafe measure like an unchained or CASA and then like our um our life insurance policy which is the combination of the legacy management, the protection, and the tax benefits. Selling your Bitcoin should be a last resort when you need cash. That's why there's Lein, the trusted platform for Bitcoin backed loans. You can unlock cash in as little as 18 hours with no monthly interest payments and no prepayment penalties. They've issued over 9 billion in loans and never lost a single satoshi of client funds, even

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Put your treasury cash to work. Earning native yields and protocol rewards built by the team behind Coin Shift which is trusted to manage over 1 billion in business treasuries on chain including a Gitcoin and hundreds of leading institutions. See why CSUSDL is gaining traction at milkroad.com/coinshift. Mhm. Okay. Bunch of things to unpack there. Uh but if I can try to simplify it. So on the if we separate the like the when you die from the tax benefits right now on the when you die side you you are guaranteeing a payout to your family. You have to trust this that that

you have to trust meanwhile with the custody of your Bitcoin which we're going to talk about that in a second. And I want to talk about that trust and what that's that's Yeah, we have a like we have like a legal regulatory like obligation to make sure that like we have to like you know if they've moved like we have to hunt them down, you know, like we have to find the people that you say should get your Bitcoin and give them your Bitcoin. You have you have to like hire like a bounty hunter to like find them if uh if they if they if you can't find them easily. But this is but this is a an important point and and I want to be clear like I wouldn't have invited you on this show unless I believed that that Meanwhile was a trustworthy company and I'm not the only

one. You guys raised $40 million recently. There's a lot of people that trust you for good reason. But we should we'll come back to we'll come back to centralization and custody uh trust in a second. Um, but so on the on the passing on your wealth side, check. This is a great way to ensure that your Bitcoin wealth passes on. Plus, you're getting gains on what you're passing on versus just hodddling it. And so, not only are you getting price gains, you're also getting gains because of some yield. And I want to talk more about how you guys generate that yield in a second, but okay. So, on that side, feels like a no-brainer. Check. On the tax optimization side, there's there's really like there's two parts to that.

One is the ability to get some gains right now. And we recently had Lein on the podcast. There's another way to get some gains. You know, it's just to do more of a traditional Bitcoinbacked loan, right? Uh now those function very differently. They don't have tax optimization in them in the same way that f life insurance products do. Um, so, okay, you want to get some gains on your Bitcoin, this is a good way to do it. On that one, just quickly, I just want to understand the obviously you can't I can't get immediately take out a loan on on a policy, right? What is the timing on that?

I guess there's two different elements of it. The first is um you're putting value in the policy and then there's like um you can think of it as the savings account that's sort of like growing inside the policy and when you sign up you get the whole table that's going to be true for your entire life. Um so that is the amount of Bitcoin that's like the policy is worth in dollar nominated policies is called the cash value. We just call it the like surrender value because you and then that value is like advertising over time and you can borrow against it. So, uh, you put it in and then like you can borrow more the longer you've had the policy. There's a really practical limit which is we don't let you put money put

Bitcoin in and immediately take it out. Uh, because that is a um great way to money launder. Um, so there's like a cooling off period of like when you put Bitcoin in getting it out. Okay, that makes sense. Uh, so so you should if you are like there's just definitely be thinking in the long term. This is not thinking in the long term. It's specifically a way like way to put money policy in now or value in now and get uh you know do some borrowing in two months. Yeah, you should think more like what portion of my Bitcoin am I going to huddle really is like long-term hold and then uh um you know if in year 10 you you know Bitcoin has appreciated

so much that you're you know buying your second home in uh you know Puerto Rico uh as you know crypto folks do then um you can do that by borrowing value out of the policy. Yeah. Yeah. Which is very very interesting, right? That you could you could you we actually despite what I said, we do have some some policy holders who don't even have kids because just like oh well eventually I'll name beneficiaries and you know the ability to borrow value out of a policy is in time so valuable. In fact, so valable if you're doing it when you're 25 and you're looking out, you're saying, "Oh, well, actually at 35 or 40, that might be when I want to like get some

liquidity on this to to buy apparently the second house in Puerto Rico. I don't perhaps I could have, which I don't have, but like what about the Lambo, Zack? Come on. Everyone wants to buy the Lambo. Let's buy the Lambo." Okay. Okay. So, so on that side, very effective as well if you want to get liquidity from your Bitcoin cash, get some cash in a tax advantage way. But the key is just it's you, it's not an immediate thing. You'd have to be willing to do that, looking to do that more down the road. Um, okay, let's talk about two things. How do you guys generate yield? How does that work? And then let's talk also about custody and how you uh offer security. are like

intimately related. Like first I want to start by saying like briefly how the company works is we are a licensed and regulated life insurance company in Bermuda. Bermuda is not the Bahamas. It's not BVI. It's not Cayman. It is like the insurance capital world. This is where many of the most serious most wellrespected insurance companies are regulated. Our regulator is very collaborative, very you know understanding. They let us do this interesting things. But you know, they are like up in our business, right? There's an insurance code. We meet them.

We send them uh monthly reports. We meet with them quarterly. There's an independent board of Bermude a halfindependent board of Bermudeians who we like report to quarterly. There's an internal auditor. There's an external auditor. There's a chief risk officer. There's corporate policies. There's there's all the stuff of an insurance company sort of there to like manage the company and the risk and one of the things is like we have to have a bunch of capital right so our every time our customers you know become policy holders there's a bunch of ma actual real math done to make sure that like we are also have enough bitcoin there that like we have enough like first loss capital to

be solvent in the terms of insurance companies, right? So, there is a lot of um there's a lot of oversight and what makes the company special is that instead of being in dollars or euros or yen or Swiss Franks, the entire insurance company is in Bitcoin. So, we take premiums in Bitcoin, we pay claims in Bitcoin, then we do all that like insurance mumbo jumbo I just mentioned like the audit financials and the solveny calculations and the reserves, that's all in Bitcoin. So there's no chance that the price movement of Bitcoin can like blow up our company.

Like our company has existed um or I've been running the company, you know, Bitcoin went down to like whatever 16,500 and you know, now it's close to all-time highs. That doesn't like in a in a fundamental sense affect the business because like we have a set of assets that are denominated in Bitcoin and we have a set of liabilities are nominated in Bitcoin and they like match entirely like in Bitcoin. So um for custody we use Anchorage um which we find is the right balance of respectability and you know people know who they are and I don't want anyone to think that if they start chopping off my fingers like they can get our Bitcoin.

Um so there's just like a practical reality that like lots and lots of people at the company are involved in the movement of Bitcoin. Um we are in different places um very uh very secure. How do we get yield? Basically, we get yield by doing we have something that basically no one else in like cryptoland has back to like core fundamental long-term nature of the company which is like we have duration. um like we are we're gonna hold this Bitcoin for a long time. And what we do is we go to institutional counterparties with like big names. Some of them are public. Uh several of them have credit

ratings and then we lend them Bitcoin. Um and what we get in exchange for the duration that we're providing them is we get credit protections. So we get like more collateral, we get seniority, we get covenants, like we negotiate like 100page lending agreements um with our counterparties. The number one trade we're doing right now or lending we're doing right now is actually just like a a different tax ARB where if people have low tax basis Bitcoin they don't and they want to do something with that Bitcoin they want to pivot into micro strategies they want to do Babylon or LBTC or whatever that would be a t that

would be a taxable event for them they would owe capital gains tax if they did that. So what they do is they give us low tax basis Bitcoin. So they like hand us 100 Bitcoin that we put in a segregated wallet and then we lend them, you know, 97 bitcoin back. We re it's a repo, so it's not a taxable event for them, but we've repoed them I basis Bitcoin. So they can do what they want. They can go do DeFi or whatever, pivot into Micro Strategies or 21 or whatever it is. So what's amazing about this is it's just a complete result of the fact that Bitcoin acts more like a currency I think in our conception and our

understanding but it is taxed like a commodity and that mismatch between its use and its taxation leads to this like interesting exchange that we can do with folks. But what's amazing about it from everyone's perspective is because they've given us 100 Bitcoin and we've given them 97 and what we're really doing is very carefully through the legal agreements uh trading basis we have no credit risk. So in that story I just told you we we are earning the yield we need to meet our obligations but we are not actually taking credit risk. Um, so we try to do things like that as much as we can. But long term like we have a vision that Bitcoin is money, money moves, money is used, it is

useful. There will be capital markets and there will be debt capital markets in Bitcoin and eventually there will be a yield curve and like we are part of building that. But that we are very much focused on like low risk, low yield, really concerned about credit risk. We've never had a credit loss. Uh, and we have been doing this in since before BlockFi and Celsius and Genesis blew up. I think one of the the other ways that I know uh that when I was researching you guys and learning about you guys that made me trust you was looking at your investors and you know, Sam Alman was one of your first investors. you've got quite a uh a a an impressive set of

investors who believe in you and have put their na name behind you and then you recently uh as I said earlier in the episode raised $40 million uh as part of your next round. uh when we when we look at um the Bitcoin economy and the the energy that is happening around not just Bitcoin but the rest of the economy, you know, life insurance products and many other lending and borrowing and many other products. Where where do you see the Bitcoin economy now compared to where do you see it in the future? I love the framing of we think of it as an account. Actually, that's how we started

this business. We my co-founder and I sat down and we actually had this mental model that there's this country called like Bitcoin land. And Bitcoin land is unique in that it's global and it's decentralized and it doesn't have a government. But it is not unique in that or it is like other um countries in that like it has an economy. it has an economic system and that economic system will have very similar financial institutions um to every economy in the world. Um so there'll be things that look like banks and there'll be things that look like lending and exchanges and payment systems with lightning um and and and

others and that they'll be a life insurance company. Um and life insurance is something like 3% of global GDP and we believe the Bitcoin economy will be huge and that 3% of its GDP should also be life insurance premiums. Where I see it in the future that's different from now is I think that there'll be a lot less volatility and a lot more a lot more like trading that happens potentially denominating in Bitcoin. I think that they're um instead of oil contracts being settled in dollars, I

could see them being settled in Bitcoin. And actually there's like a fundamental connection between or there should be a fundamental connection between the price of Bitcoin, the price of electricity, the price of energy. So I I envision a future where I'm not sure that Bitcoin itself will be like what microtransactions are done in. I think that is going to end up being lightning or something else. But I think this notion of like big uh like trades and transactions in the world whether those are happening between sovereigns or they're happening between like ultra high net worth individuals or they're happening you know between us and our policy holders those types of transactions I think will

over time move away from the dollar which has all the challenges of being a fiat currency has all the challenges of um like control from, you know, banks and um and and the Fed and inflation and all that and it'll move toward Bitcoin. And that doesn't I think some people have the vision that that'll mean that there won't be any any centralized financial institutions, but I don't think that is realistic. I think that what makes Bitcoin unique is both that it is uncontrollable and that everyone has the ability to self-custody. That and that ability doesn't mean that everyone will

self-custody, but that that like changes the fundamental dynamic of like where the locus of power is. And that then financial institutions like ours and London and and Coinbase and and others um are going to build up new structures that support that economy and the people who are participating in it. It it just feels like we're so early. I I feel like I say that all the time and it feels so cliche to say it, but it is it is so true. It is we are so early and there is what is happening is as as the Bitcoin economy and the digital asset

economy grows there is this natural crossover between these traditional financial products which still have a place and I think it's very easy for somebody to especially a lot of crypto native people and people who've made their wealth from crypto and from being early to Bitcoin or being early to Ethereum or whatever token in the past, you know, decade that they don't they have this, oh, I'm I'm breaking out of the old system, right? I I don't want to participate in the old system. I don't I don't I'm not using life insurance. I don't want that product, right? But then you step back and you're like, okay, but wait, this product exists for a lot of good reasons and has a lot of benefits

towards it which can be used still today. So I think that there's you know for our listeners I I really encourage everybody you know whether it's meanwhile or whether it's another financial product if you are if you have made wealth in your crypto and you are trying to think about how to manage that wealth in the long term you really should look at Meanwhile and these other financial products because don't just look at the decentralized products right because a lot of these decentralized products they're not taking advantage of tax optimization in the right way because they don't appro they're they're approaching it from tech and they're thinking about how does the tech work the best and how does the blockchain work the best and sure that has a place

but for the long term like tax is still such a big part of your life and nobody is you know blockchain tax in every Bitcoiner's heart there's this uh there's a tension maybe between uh self custody and a um you know dislike like of taxation and um you know we've built an institution um that that can help you but fundamentally I actually think what you said is really important which is we have so many folks Bitcoin native maxis you know people who own a bunch of ETH who you know um have some Bitcoin for the long-term store value who come to us and they say like hey you're the first company that I've

talked to who feels closer to that like being native like because we that's like who we are. That's where we come from. And then we get asked and help people as much as we can. It's not our business of like, you know, you should probably think about a will. You should probably think about trusts in estates. And um you know, usually what happens is you get referred to like your uncle's wealth advisor and that person like can't even spell Bitcoin, right? Um so we're really happy to like be part of that transition. And the two other things I'll mention is one that I I mean I'm you know much less illustrious and much more less important to the history of the world than Satoshi but we are

similar in that like my whole fintech insure techch journey began you know graduating from college into the financial crisis and sort of looking around and being like this is broken and this doesn't work. Um, so like I'm very happy to be building what I think is going to be a like long-term durable institution entirely built on Bitcoin. Uh, that it it definitely rhymes with Tradfi, right? Like that like you couldn't say it doesn't with life insurance. But, you know, our ultimate vision is that whether you're an American or you're an Argentinian or someone from Nigeria or India or whatever, that you know, having access

to a product that protects your family that's denominated in a store of value outside the control of governments is super important. Like Argentinians don't buy life insurance because they are going to live longer than the Argentinian peso. And you know, some, you know, you can have varying degrees of belief about the dollar. Like I'm I'm actually less of a maxi than some of our policy holders. Like I think there probably will still be dollars. But like if you bought a life insurance policy in 2020, you've seen the purchasing power of that policy go down 30 or 40% with inflation. If you had bought, we didn't exist, but if you had bought a life

insurance policy in 2020 in Bitcoin, you would have obviously seen the purchasing power of that go up, I don't know, 3x um you know, minus the 40% because the dollars worth. So, so but like significantly more and that's what we believe is the fun like yes there's all these amazing tax benefits and yes there there is the literal protection but like in some fundamental sense we also think like if you want to buy a legacy or you want to provide a legacy to your loved ones you should do that in an asset that's going to We believe increasing

his purchasing power and not decrease. Yeah, it's I I I couldn't agree. I couldn't agree more. It's uh it's really whether you're a a crypto, Bitcoin digital asset investor that believes in the future of of of this space and that's why you're here or whether you're just a a a non-crypto person that is looking to get life insurance for your family like th those people should also you could you could onboard a lot of people for us into crypto here, Right. I should say we don't try to convince people to buy Bitcoin. Yeah. Yeah. But I kind of

want to use you guys as a way to convince people. What we do find is we have two pretty distinct like personas of policy holders. One is the like crypto native, Bitcoin native, like Max CD DJ, it doesn't really matter, but like they're very like in the world. And then we have another set of users particularly now that like Blackbox and Fidelity are out there saying you should have 2% of your retirement savings in Bitcoin. Well, you should have 2% of your insurance assets in Bitcoin or um so we are now starting to have like family offices and entrepreneurs and like people who own you know a business and you know the great state of

Mississippi like just random people. they've already made the choice to buy and hold Bitcoin and then like why are you going to hold the ETF if you're planning to hold it forever and they like find us and they buy a policy but they obviously don't need to be convinced about life insurance the tax they often already know about that they um they just sort of see this as the right way to protect their family they're yes life insurance and now they're yes Bitcoin and I think we also have a bunch of users who are yes Bitcoin and like we are helping helping them become Yes. Life insurance. Yeah.

Yeah. Yeah. Yeah. Wonderful. Zack, thank you so much for joining us today. Shout out to you and the whole team at Meanwhile. Appreciate what you guys are building. Uh and anybody listening, if you want to check out Meanwhile or you want to speak to Zach and the team, we'll throw a link in the show notes. Uh this isn't an affiliate. They're not a sponsor of the show. I'm not getting paid to say this. I just legitimately believe in this product and think you guys should check it out. Thanks again, Zach. Appreciate your time. Thanks so much, Jay. Good conversation. Thanks for listening in everybody. Have a wicked awesome day. We'll see you back again tomorrow. Thanks for tuning in y'all.

Appreciate your time and listening all the way to the end. Before I let you go, got to let you know about this partnership that we have with OKX where you could win up to $60,000 in cash prizes. That's onchain cash USDT cash, the good kind, the stable coin kind. Uh why do we set up this partnership with OKX? Because they're one of the leading crypto exchanges. They're they're trusted. They've got great security. They've got tons of great features, tons of great tools. Really a great place to trade and do it in a safe way. Hit the link in the show notes. Check it out today. Thanks again for your time, y'all. Have a good one. As always, if you liked today's episode, please hit subscribe and make sure you follow us so you don't miss out on the next one.

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