Bitcoin’s disappointing performance this year has obscured a more important shift taking place beneath the surface. In this episode, Tad Smith, former CEO of Sotheby’s and Madison Square Garden Company, argues that Bitcoin is entering a new regime shaped less by reflexive hype cycles and more by liquidity dynamics, institutional behavior, and structural macro forces.
While narratives have rotated toward AI and tech equities, the conditions that ultimately favor Bitcoin are quietly re-emerging.
At the same time, artificial intelligence is accelerating economic disruption, reshaping labor markets, and forcing a rethink of how individuals and institutions approach wealth and work.
The conversation spans Bitcoin, gold, central banking, and AI, but ultimately centers on agency, adaptability, and why the coming decade may be volatile, uneven, and rich with opportunity for those prepared to navigate it.
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Bitcoin’s Disappointing Year and the Setup Beneath the Surface
2025 has been a frustrating year for Bitcoin relative to expectations, despite prices remaining near historic highs.
Bitcoin consistently defies consensus forecasts, particularly when optimism becomes widespread and positioning gets crowded.
Narrative tends to follow price, not lead it; dull price action makes even strong fundamentals harder to communicate.
Capital and attention rotated toward AI, tech equities, and speculative growth stories, leaving Bitcoin temporarily overlooked.
Periods of disappointment and boredom have historically preceded Bitcoin’s strongest structural moves.
Gold’s Outperformance and the Importance of Structural Buyers
Gold’s rally this year is being driven by sustained central bank buying, not retail enthusiasm or narrative momentum.
Central banks have quietly accumulated hundreds of tons of gold, creating a persistent, price-insensitive bid.
Bitcoin does not yet benefit from the same sovereign-level structural demand, explaining part of the divergence.
This gap reflects adoption stage rather than credibility — gold is entrenched, Bitcoin is still emerging.
Structural buyers matter more than storytelling when it comes to long-term price formation.
Institutional Bitcoin Allocation: Quiet Conviction Over Public Signaling
Institutions face real political, reputational, and stakeholder risk when allocating to Bitcoin.
Endowments and sovereign wealth funds often choose silence over signaling, even when allocations are real.
When institutions allocate despite controversy, it suggests long-term risk management, not short-term speculation.
Bitcoin joins gold, energy, and geopolitically sensitive assets as investments that carry non-financial costs.
The decision not to allocate is often easier — making those who do more informative than those who don’t.
The Fed’s Liquidity Pivot and a Changing Cycle Framework
The Federal Reserve is quietly shifting from restrictive policy toward balance-sheet stabilization.
Recent liquidity measures appear designed to reduce systemic risk ahead of leadership transition.
Doing nothing carried growing risk; temporary liquidity provisions preserve flexibility for the next Fed chair.
This cycle differs materially from 2021: ETFs exist, bank custody is expanding, and access is improving incrementally.
Old four-year cycle models may be less relevant in a market shaped by plumbing and policy.
AI, Labor Disruption, and the Generational Divide
Younger generations face higher debt, higher asset prices, and fewer institutional guarantees than prior cohorts.
AI poses a real threat to white-collar labor, compressing wages and displacing roles once seen as secure.
Job displacement will pressure consumption, forcing eventual political and fiscal response.
Government solutions tend to lag reality and arrive only once pain becomes visible at the ballot box.
At the same time, AI dramatically lowers barriers for high-agency individuals willing to adapt and build.
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