Peter Thiel’s Uncanny Bitcoin Presentation in Miami Beach

Peter Thiel at the Bitcoin 2022 conference in the Miami Beach Convention Center

During the Bitcoin 2022 Conference at the Miami Beach Convention Center Peter Thiel, the iconoclastic investor, entrepreneur and political activist takes to the stage. Dressed in jeans, a white polo and sneakers, he starts his presentation by explaining the concept of money.

As a prop for his presentation, as well as a way to grab the audience’s attention, he pulls out a wad of hundred dollar bills, walks away from the podium and tosses it into the crowd.

He then goes on to praise Bitcoin’s potential to reach $115T in market capitalization using global equities as an addressable market for the cryptocurrency. In fact, this was a 11x larger market size than what Cathie Wood, the founder of Ark Invest, used when suggesting Bitcoin as a substitute for gold.

What was striking about Thiel’s presentation is its uncanny nature. Thiel has long been a proponent of focusing on small but growing markets, areas where people are paying little attention to and steering clear of herd like mentality. This approach led him to invest in Facebook in 2005 when it was run by a 21 year old college dropout as well as pledge support to Donald Trump for the 2016 presidential election at a time when no one thought a real-estate mogul and TV personality could ever be nominated on the presidential ballot and win.

His business, and one can argue philosophical principals are codified in his startup book, Zero to One. One of the ways in which Thiel analyzes a startup’s potential is in the scope with which a startup presents their market size and plan to capture value in that market.

He uses the example of Solyndra and the failed clean tech startups of 2008 who sized their total addressable markets in the multi-trillions of dollars declaring their mission to conquer the entire energy market.

So when Thiel describes Bitcoin’s potential with regards to the centi-trillion dollar global equity market, you would think he’s lost his way.

In fact, this proves quite the opposite. By framing Bitcoin as a 100x investment opportunity to the tens of thousands of viewers that watched his presentation, he’s convincing more people to own Bitcoin.

And if more people own Bitcoin, then the likelihood that Bitcoin becomes a currency used for online purchasing, day-to-day transactions and a viable store of value also goes up.

This methodology works because the value of a currency is dependent on other people also owning and accepting that currency. This is what Thiel believes. In an interview at the Economic Club of NY in 2018, Thiel said: “Money is the bubble that never pops”.

This concept also applies to Bitcoin and cryptocurrencies. For Bitcoin to become a de-facto store of value (and possibly the standard for which other currencies are pegged to), it must be adopted by a large percentage of the world’s population.

Thiel’s presentation reaffirms his unique thinking as an investor. If he said Bitcoin was a bubble and that it’s not worth investing in we likely would’ve nodded our heads in agreement. We would have pointed to the countless finance articles, videos and tweets reinforcing Bitcoin FOMO as our evidence.

But the fact that Thiel champions Bitcoin’s potential, in an environment filled with bubble-like commentary and goes on to describe Bitcoin in the exact principals which he has cautioned against, encourages us to pay attention.

Not to point out Thiel’s contradiction, but to realize it’s in line with his fundamental beliefs about how the world works.

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