May 26, 2021
CD23: the state of bitcoin with @gladstein, @dergigi, and @croesus_btc
EPISODE: 0.2.3
BLOCK: 684945
PRICE: 2657 sats per dollar
TOPICS: the state of bitcoin
@gladstein: https://twitter.com/gladstein
@dergigi: https://twitter.com/dergigi
@croesus_btc: https://twitter.com/croesus_btc
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00:00 - Bitcoin market sentiment and capitulation phase
19:34 - American mining and Chinese mining
38:58 - Geopolitical implications of Bitcoin mining
44:47 - Bitcoin mining and decentralization
51:34 - Bitcoin's impact on humanitarianism and energy independence
01:08:26 - The Mining Council and transparency in energy consumption
01:31:19 - The environmental benefits of Bitcoin and Bitcoin mining
01:33:01 - Increasing the number of Bitcoiners and the importance of education
01:43:31 - The problems with proof of stake and the importance of proof of work
02:14:48 - Insanely bullish on Bitcoin and Lightning
02:15:54 - Engineers and stackers
02:17:09 - Bitcoin's impact on the world
WEBVTT
NOTE
Transcription provided by Podhome.fm
Created: 3/17/2024 4:32:32 PM
Duration: 8925.179
Channels: 1
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Meantime. So here we are at 35,000,
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Kathy. Do you think we go much lower from here?
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You never know how low is low when a market gets very emotional.
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A lot of traders see Bitcoin,
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dropping below the 200 day moving average,
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which is which was at 40,000.
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So traders, once that happened, they just dumped. Some just, dump and run.
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I think we're in a capitulation
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phase. Yacine has
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a dashboard. We were looking at all the indicators this morning. They are all suggesting
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that we are in the capitulation
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phase, which is a really great time
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to buy,
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no matter what the asset is. A capitulation phase is buy. It's on sale.
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Now am I saying 35,000
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is the low? You know, if traders,
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and there are a lot of speculators in in Bitcoin. If they are,
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running for the hills just because,
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Bitcoin has broken through a moving average that is important to them, it could continue. But, all of our indicators are saying this is capitulation right now.
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Do you have a low point on your model for Bitcoin?
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No. These metrics,
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are are more
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a measure.
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Are we in a truly capitulation
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phase?
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Okay. And it's very detailed. Yacine uses on chain analysis,
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which this is the only asset where you can see exactly who's doing what, when, why, and how.
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And all of those metrics
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are saying this is a capitulation.
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This is as as bad as it got during the coronavirus
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crisis.
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Happy Bitcoin Tuesday, freaks.
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It's your boy, Matt Odell, here for Citadel Dispatch 23,
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the interactive live show about Bitcoin distributed systems, privacy, and open source software.
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Holy shit. It has been an insane week,
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in Bitcoin land.
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To all the freaks joining us via our audio streams,
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that was Cathy Wood
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and Carol Massar on
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on Bloomberg on May 19th, Wednesday, May 19th,
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where Kathy was obviously trying to hit everyone's bingo boards by saying capitulation as many times as possible.
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I think that was the feeling that a lot of people had,
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that day. I mean, there was blood in the streets. You should I you should've seen all the clips I could've used for this intro. I had, I had CNBC
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panicking.
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I had boomers, boomers blaming Bitcoin for causing stock market collapse.
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It was just,
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you know, for for a lot of these,
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new corners, that's what I'm gonna call the boomers on CNBC.
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This was their first real
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dump in the middle of a bull market, so it's pretty crazy to watch unfold.
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Before we get started here, I just wanna do a quick shout out as always to the ride or die here in the live chat,
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that that make it for these live shows.
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This show is, you know, dispatch is all about the live audience and interacting with you guys, so thank you for joining.
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And a big shout out to the ride or die that constantly support this show with Sats.
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You guys make it so that so that I can keep this show ad free and sponsor free,
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and keep the incentives aligned. So it's just it's just me and you guys.
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So fuck yes on that, especially if you're in the sphinx tribe.
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We have a lot of fun conversations over there. If you do not know what I'm talking about,
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you can go to citadel dispatch.com,
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and there's links there to join that tribe.
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With all that said, I got a great group of guys joining us today.
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This is the first time on dispatch that we will be doing it with 4 people rather than 3.
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But like I said, I mean, it's been a crazy couple of weeks. So I I feel like,
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it's it's fitting here for for that to be the case.
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We have first time
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first time guest,
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and good friend, Alex Gladstein, chief strategy officer
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chief strategy officer of the Human Rights Foundation. How's it going, Alex?
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Going very well. Wild times. Happy to be here to
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react with y'all.
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And then we have Croesus and Gigi,
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who were on Citadel Dispatch
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the 3rd episode. So if you go to citadel dispatch.com/cd3,
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you can see their episode after this, obviously. Don't don't leave us right now.
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And it's kind of fitting because we were around the same price. You know? We're you it was it was 20 episodes ago. It was 20 dispatches ago, 20 weeks ago,
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and we were trading around 34 k, and we were bullish as fuck.
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So I'm I'm hoping to get that same kind of vibe here today, boys. How's it going, Kreuz?
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It's going well. Feels like I've been answering emails all day, so the only thing left to do is get hyped about Bitcoin.
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That's what I like to hear. Gigi, how's it going by you?
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Oh, I'm doing amazing. Still bullish as fuck. Nothing has changed in my mind.
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There we go. There we go.
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So, gentlemen, I mean, we have,
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we have a lot of places we can go here.
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I don't know where I wanna start. I guess I guess we should start with,
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is the bull market over? Is the top end? Will Bitcoin ever pass the all time high again?
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No.
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I guess it's over, boys. Let's pack it in. We have a good run. It becomes dead.
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If people are saying it's over and the people who are saying it are the the new ones who have only been around for half a cycle or less,
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that tells you everything.
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Someone, sent me a screenshot logging into their Charles Schwab account today, and it's just a giant Bitcoin logo. And it says, you know, Bitcoin FAQs read more.
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Like, as you log in to your Charles Schwab account.
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What what is the meaning of that? Are they they're shilling they're shilling the coin? Or No. They're shilling it. This is, like, they're pushing it. So that's my way of saying that the market is not not over right now. I mean, it's a really interesting it's a really interesting dynamic, I mean, watching it on CNBC, and and and you had Jim Cramer
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and David Faber over at on CNBC.
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They were literally blaming the stock the they were they kept saying crypto. I mean, I hate that term, but they kept saying crypto, and they were blaming
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the fall of Bitcoin. They were they were blaming the stock market on it. They were saying that the stock market,
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no. That they were blaming the fall of the stock market on the fall of Bitcoin, but I can't help but think that there's gotta be some macro connection there that in reverse. You know, it's almost like Bitcoin is just so
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showing some of
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the insecurities of the broader market.
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But, at the same time, I mean, I I was
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I guess all of us except for Croesus were were here last run. Right?
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Yeah. Well, I was I was here. I was just on the other side of the fence. I was in Altcoin land watching it as an Altcoiner
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and, you know, watching the,
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the hard fork
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in, in in
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disbelief and and,
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fear,
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as somebody who didn't understand what was going on in Bitcoin land yet.
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I mean, because we had dumps like this last time. Right?
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Yeah. And and if you look back at the chart, like, this is what summer 2017 looked like.
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This is also what
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the mid 2013 bull market low looked like.
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It seems to be that there's there's something about human psychology in this market where
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after a year a 1 year post having, which is where we're at,
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you can't sustain bullishness forever,
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and there's some sort of major fear
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resurgence
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and shakeout that causes a dip.
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Let's call it, like, 2 thirds of the way through the bull market.
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It's just what what we're doing right now. If you line up the the chart of the 2017
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bull market with
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right now,
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the the dip that we experienced in in summer 2017
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is, like, within a week of the exact time frame of of the dip we've just gone through,
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in terms of its relation to to the halving date.
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I I also feel like that this is kind of necessary from time to time because,
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we just saw all kinds of insanity. I mean, just from leverage trading to, you know, everything that had a dog face on it, shooting up 10,000,000 percent. So I think some some spring cleaning, so to speak, was in order and this was this spring cleaning, but I think it's nothing to be worried about really.
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You need to, like, clean out the leverage. Right? You need to,
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Yeah. Like yeah. Get a proper base to to work from again. There's something about the way I think I think it's the way free markets work generally, but, like, you know, it's it's most clear with this market where
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we have this catalyst for price growth with the having, and then and then, you know, price drifts upwards
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as,
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as the shortage of supply,
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you know, causes demand to drive price up.
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And and and that's inherently so bullish, and people get overly excited
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and take on too much risk,
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add leverage.
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And the the market
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the the market has a way of reestablishing
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equilibrium
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by punishing that risk.
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And it's it feels like it's
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in a free market, you know, and this is really the only example of a truly free market in the world today.
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This sort
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of volatility is necessary to keep everything on a level keel.
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And and that's especially necessary when you have these structural reasons why the price will keep going up, and yet you have to shake off,
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speculators and and the overleveraged
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during that process.
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I I've just thought the psychology of people has been so fascinating, like, that you were you watch people be so sort of, like,
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just overcome
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with emotion,
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you know, around January 2nd or 3rd when we, like,
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broke 30 k, which was so shocking, I think, to a lot of people including me, just that moment. And then, you know, that's we're we're higher than that now, but people are, like,
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they're, like, so psychologically damaged. It's really crazy to see The normalization of
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the of the progress of the price is is something that,
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it it it's just it the world changes and people don't realize it. And then, you know, this whole thing has happened in the last few years where it's become probably not realistic for, like, the average American to
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probably have a full Bitcoin.
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That has happened, like, relatively quickly and, like, no one really notices. It it's really truly stunning. Absolutely stunning. As someone who,
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was, like, kind of loosely paying attention to Bitcoin at the end of the previous bear market
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was along for the certainly, you know, as an observer of the ride
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up in 2017,
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but but then really started diving in, like, let's say philosophically, politically, economically
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to the system
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in the previous bear market. It's amazing because, like, all the stuff that I was blown away by and had my mind blown by, you know, it was that the price was at rock bottom and I was just, like, this is the coolest thing ever. And and now it's now we're in a different situation,
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and how could I not be bullish, you know? Yep. Yeah. Absolutely. And I I was just about I was just about to say, you know, like, come on, people. Everyone wake up. I mean, not too long ago,
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like,
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we were crashing to
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like, the COVID crash was to 3,800,
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something like that. So we are 10 x that, and people are talking about the death of Bitcoin. I mean, how ridiculous is this? I don't know. If you I don't know how it is. Ridiculous. Like, do you I feel like a lot of Bitcoiners were, like, pretty hyped about the COVID crash, and they were, like, trying to stack. And and they're they've actually been, like I don't know. A lot of people were less excited this time. Does that make sense? I don't know.
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Yeah. I don't know. I I I feel like my feet got a little bit polluted by but my my hardcore,
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filter bubble is still as excited as ever when the price dips because,
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I mean, like, everyone, when we hit 60 k, everyone was, like, dreaming of these prices. You know? I wish I could go back when it was 30 k and just buy more, and and now we fell back to to 30 k or something. I like how we had to pass through the,
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Dogecoin.
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It is pretty much Bitcoin phase. Like, that was really important to pass through, narrative wise.
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Yeah.
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Yeah. Like, leading journalists in America's top financial publications
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were trying were arguing that that really at the end of the day, Dogecoin was the same as Bitcoin. Right. That was an amazing moment to pass through. And and and also just just to yeah. Just to I I was just about to say, you know, just to to cherish the fact that we have billionaires
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fighting about like the soul of Bitcoin and how it is different from those coin. And we have Billionaires
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fighting publicly about it on Twitter. Well And people are bearish on Bitcoin. Like, I don't understand. Part of me like, look. Elon has a very high bar because he's fucking Elon Musk. But,
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you know, part of me is just really,
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you know, acknowledging of the fact that he's going through what I went through and what most people went through, but just live in front of 50,000,000 people. Yes. Everybody's going through. I went through the same, like, oh, these all coins look cool. Like, I mean,
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you know, didn't we all? Like, it's just crazy that he's going through it live with no filter
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in front of 50,000,000 people. Yep. Yeah. Because everybody goes through 1,000,000 of dollars to to spend to spend. Yeah. Right. And toss around and and and move markets with his tweets. In retrospect, it was inevitable that that that would happen, though. Right? That that Yeah. The world's most powerful people would go through the same phase we all went through. Right. And pick and pick, flavor of the month altcoins to
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show. Yeah. Of course. I think I think there there truly is no shortcut. I think everyone has to go through the similar through through a similar journey. And I truly think there there is no shortcut, and you have to kind of arrive at maximum maximum pain to really learn. And Elon is not at maximum pain yet, so he he will have to go through that as well. And to be fair, like, we should also, as Bitcoiners,
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try to use these moments to educate the onlookers because those are valid questions. Like, why is Bitcoin so different? Then what is the soul of Bitcoin? And what is it about? And and how
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like, why is Bitcoin different than Dogecoin, for example? Why is proof of work necessary? Why is it necessary to why does it take so much energy to do something like Bitcoin? And I think I think we,
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I I think we would do the the future coiners, disservice if we don't at least try to
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to educate from time to time why these things are important. And we actually you know, like, the last 10 years, a lot of people thought about those things very deeply.
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So we went through this before. We just have to kind of summarize it and and, preach it to the masses if you want. It was kinda funny to read the block size war and have,
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you know, Johnny write that great book and and then, like, all of a sudden, like, you know, narrative that no one saw coming, Elon Musk, big blocker, 2021,
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like, completely insane.
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But also perfect, like, educational moment for people where, hopefully, those who are paying attention could see the Bitcoiners arguments of, like, you know,
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how ridiculous this was. And I think we're just well much better positioned now than we were maybe 4 or 5 years ago on that front.
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So Elon again has to go through the big block phase because he's an engineer, of course, and he's here to fix Bitcoin.
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And, you know, he got kind of repelled properly, hopefully.
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Yeah. Yeah. And I agree. Like, I think it's, sorry, Crow. Just to to get this in, I think I have a little bit of a delay. But, just to get this in, I think it's very understandable if you have an engineering mindset
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to just look at the parameters that you
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can change kind of, like the knobs that you can twist and think, yeah, why not, like,
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I don't know, increase block size by 10 x? Why not try to increase throughput by 10 x? And and, like, what do you have to lose? You know? I can't just build a better system just like you can build a better rocket maybe. And,
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he he just, I think, lacks the
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necessary history and understanding that we went through that all that already.
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And it's it's a very nuanced problem, and it's not necessarily easy to understand even if you are a smart engineer.
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Yeah. And and I I think there's a to build on that, it was a great point, Gigi, that
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there's this this problem that narcissists face
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when they when they come into Bitcoin
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of,
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I think Max Kaiser put this well that there there's no room for narcissism in Bitcoin because
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narcissism is about is about me. It's about the individual, the ego, and Bitcoin rejects that. It doesn't it doesn't allow for that because
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you can't change Bitcoin. Bitcoin changes you, and that's fundamentally at odds with the
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the the, you know, internal
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story that narcissists are are constantly, you know, guiding their lives based on. And and that's Elon Musk. Like, you you don't become the the
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richest person in the world and, you know, the person that Iron Man's character is loosely based on,
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without developing a god delusion of some kind. And so, of course,
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somebody like that is going to,
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run
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head into this
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this
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problem with Bitcoin of I can't do anything to change it, but I want to. I want I want to feel like I have that power.
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Yeah. The question is humble or be humbled? Yeah. The question right. The question is, is he gonna do the typical Bitcoin villain plot where he ends up, you know,
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forking off or making his own coin, or is he gonna find redemption? You know, the door is still open. Right. I I okay. And I think that's a that's, like, maybe it's jumping ahead, but that's sort of how I view what,
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Michael Saylor, I think, is trying to do with this
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mining council of
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potentially teeing up like
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a way to save face
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for Elon of, like, you know what, Elon? Here, you can have some sort
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of input and a say, and you can you can
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influence how Bitcoin is, approaching, you know, energy,
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by being by being on this council and feeling important even though it it's not gonna change anything. And in fact,
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if anything, that council stands
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to celebrate the the organic wins that are already happening in terms of Bitcoin leveraging,
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stranded fossil fuels,
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and,
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excess renewable energy. That that's already happening, and here's here's a way for Elon to feel like he can, you know,
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he he can say that I was a part of making this happen even though it was gonna happen already.
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Gotta hear Matt's framing,
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on this.
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Well, I mean, we're 20 minutes into the show, Khrysos. I was hoping that we could have a little bit more bullish talk before you just Alright. Go right into a fucking meat.
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You know? Billionaires
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fighting over Bitcoin? This is extremely bullish. You know, I've I've,
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for the last 3 years, I've had to publicly give my take weekly on every single happening in Bitcoin.
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And instead of taking a break,
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at the end of last year, I decided to lean into it, and I added a second show to my roster dispatch.
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So here I am again
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talking about the newest the the newest,
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development in Bitcoin. I'll tell you, these types of weeks
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are the types of weeks in past cycles
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where really the most prudent move
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is to just go outside, enjoy life,
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and, you know, just keep stacking and just ignore everything and just not pay attention to any of this shit,
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is is is
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is probably the best for your wallet and your mental health.
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But,
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the 4 of us and a lot of the the freaks of this live chat
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have chosen to be completely obsessed with Bitcoin, so we're not gonna opt for that path. So,
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with all that said, first of all, before we leave the bullish thing, I just wanna say, because I because you guys were having a great conversation there. I didn't get to jump in. It's just pretty ridiculous to me that I have,
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like, my normie friends from college and stuff, like, reaching out, making sure I'm all right because they're like, oh, Bitcoin dumped. Like, are you okay? And I respond back. I was like, Bitcoin's at $40,000.
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It it was it was at 10 k in November, and it's at $40,000.
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I'm doing alright. You should buy some.
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But for this okay. So let's jump into this. So I have, on on my spreadsheet here, I have a couple things that I want to hit, and the 2 big things
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is American miners
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and Chinese miners.
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I think,
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you know, that distills what this last week has been.
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On the American Mining side, this mining council now I don't think anyone should be surprised
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that Saylor is
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who he is. I think Saylor has been extremely consistent.
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I think he's been
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amazingly consistent.
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I have never once thought that he was gonna protect the
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the interests of self sovereign Bitcoiners,
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And and that's okay. I think for a
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a a regulated type of dude, for a for a billionaire type of dude,
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He's, like, a pretty great Bitcoin advocate. They're they're he's extremely consistent.
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He speaks really well.
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He cleans up nicely.
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You know, the guys on CNBC and shit love him. You know, the the he gets along with the Ross Stevens of the world. They're, like, in a whole different ballgame than us. Right? They're playing they're playing a different game.
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What's cool about Bitcoin is, you know, Bitcoins are enemies and for friends. Right? So,
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we can play our game, they can play their game, and for the most part, we can benefit each other.
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But I think it's important that people and and and it's kind of nice that this happened when it happened, because I think it's important for people to take
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a step back and not just, you know, idolize all these guys, including myself. Like, you shouldn't idolize me. You shouldn't idolize Gladstein. You shouldn't idolize Gigi.
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You shouldn't idolize Croesus. Like, don't idolize people.
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Think for yourself, you know, be critical. Because on Bitcoin Twitter, especially, people tend to just,
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you know, just go with whatever the prevailing narrative is for whatever particular time, and they're too scared to speak out, and they're, you know, they're afraid they're gonna get called out by other people, and, you know, block culture is, like, really high in in Bitcoin land. So think for yourself. I want people to think for themselves.
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So back to that. The American mining thing
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is something that I've been concerned with for a long time, and it's really interesting to me because,
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you know,
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we I've maybe we're surrounded I'm surrounded more by American Bitcorners. I think it's a time zone thing on Twitter,
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but also, obviously, like, I'm in America. Right?
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And on the American Bitcoin side, there's, like, this really easy,
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hole to fall into where you demonize Chinese miners.
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And, you know, I love Marty,
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but, you know, the name of their company is the same idea. Right? Great American Mining. Right? It's this idea that we're gonna bring mining back, bring mining to America and Bitcoin is gonna be better for it because America's the best country in the world.
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And I love this country. Like, I I'm not saying I don't love this country. I'm very grateful that I live in this country, especially with this whole corona bullshit that happened. We've seen that, you know, the freedoms we have in America are way stronger than most parts of the world.
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But I have always been concerned
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that
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if,
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you know, if if we have a large contingent of mining in America,
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it it it presents an existential threat to Bitcoin,
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and and a threat that is almost
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more to me than a threat from Chinese miners. And you can you know, the the biggest issue with Chinese miners is that they did have a large portion of the hash for a long time. They still do. It is decreasing,
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and the positive note is I don't think that, you know,
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even if, you know, in best case scenarios for for American miners,
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they probably can't come anywhere near 50% of the hash rate, so that's, like, a good saving grace.
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But America is the country that imposes all this k y c a m l crap on everyone. America is a country that goes after BitMax. America is a country that shuts down one broker.
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All this FUD about Chinese miners and the first miner to start doing this blacklisting
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clean block bullshit was the 1st large American miner. Right? It's like they, like, finally hit the scene, and then the first thing they fucking do is decide that they wanna do OFAC mining.
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And my issue is,
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you know, I could give 2 shits about the environmental whatever bullshit. I think that, you know, if if people wanna fight that fight, they can fight that fight. But the when it comes down to this whitelist, blacklist shit,
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what I expect to happen and I see a lot of people, you know, talking real cocky on Twitter, like, oh, American miners are just gonna choose to go to a different pool that isn't doing the the the blacklist, white list stuff,
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because they'll make more money. Yeah. They would make more money if they go to a different pool, But the thing is, it's gonna be the same ideas chain analysis where they're gonna lobby government to make their them a requirement. Right? They're gonna basically
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they're they're gonna do a regular regulatory moat kind of bullshit where they where they force any large minor in America
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to follow this practice. Otherwise, they'll be pariahs. And that that is to me has been a a major threat. This is one of the reasons why I've been advocating for CoinJoin.
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You know, I had Adam back on the show
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couple episodes back.
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He made a really good point. Like, when it comes to minor censorship,
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like, if you have on chain privacy, minor censorship is harder to do because they don't know what your transactions are. Like, if if Marathon
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wants to or anyone they're working with wants to censor my transactions, they're gonna have to censor all CoinJoin users. They can't just censor me. And if we have more CoinJoin users,
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then, you know, they're gonna have to censor a large portion of the user base if they wanna censor me. And I I think,
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we should be thinking more in in that kind of vein, like, how do we,
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you know, actively use this tech to to make it untenable?
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So if there was, like, a super woke billionaire, Matt, you would say that they should go out there and set up mining operations in, like,
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80 different countries to prevent the rise of potentially American hegemony over Bitcoin mining. Would that be, like, a cool woke billionaire?
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I mean, if it's just a single person, it kind of defeats the purpose a little bit. It's like almost decentralization. No. No. No. Investing in the app, in in the infrastructure. Yeah. Not actually owning it. I think that's what we want. I think the narrative shouldn't be let's see Hash come to America. It should be let's see Hash disperse globally. Right? Let's see it go to Kazakhstan. Let's see it go to Iceland. These are places that already have it. Right? But, you know, let's see it spread out.
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And and then also on top of that, right, is stuff like,
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Stratum V2, Better Hash. Right? Things that try and take
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power out of the mining pool's hands. Right? Because right now, mining pool operator is the one who constructs the blocks, which is a is a is a major issue in in terms of centralization.
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Yeah. I agree. And I think it it's it's bound to happen. Like, I I think Bitcoin is the buyer of last resort for energy.
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I think it's it's something that has
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natural
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decentralizing
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effect. I think it just needs time, and I think we are at the kind of a peculiar
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place in time right now where we have, like, a chip shortage, for example, and just all kinds of things going on that,
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kind of
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hinder the the progress on that front, I would say. And I think just give it another couple of years and, like, get the ASIC production ramped up, and I think the the incentives are aligned in such a way that this is bound to happen. And I I think we're just early.
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Ironically, it may in retrospect, in 20 years, we may look back at this as kinda like a beautiful setup in a weird way because,
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you know, there's no I mean, it's almost unrelated. Like, obviously, the reason why there's there grew to be such a mining presence in China was because of all this infrastructure build up the CCP did, and they had all this curtailed energy.
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You know, they're they're they're basically curtailing,
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you know,
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more energy than other countries even use,
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you know, at times.
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And miners are smart and they're like, okay, you know, I'll I'll go take that.
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And, you know, if that era is ending, that's gonna disperse.
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But if the if the opposite had been true, if mining had been concentrated in the United States
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at more than 50%
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for its 1st decade,
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you're right, Matt. Like, maybe that would have been a worse outcome. And I say that as someone who's, like, obviously very anti CCP,
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but, like, they just don't really seem to have their shit together here. So I think it's a little bit different.
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Well, I mean so that's the other I mean, so first of all, I'm I'm curious on before we go to it, I mean, I'm curious on Creasy Crease's,
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opinion here. What what what are your thoughts here, Crease? Yeah. So I I keep coming back to like, if you if you zoom out and you think about, like, the the theoretical
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economic
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forces at at play here and and kind of the longer timeline
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of mining,
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I think most people probably in in this in this chat have a,
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a strong sense for it. But for people listening to the podcast later or whatever,
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the the largest input cost to mining is electricity, is energy.
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And
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that means that
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globally, miners are competing to find the cheapest source of energy
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in order to maximize their profits.
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And
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so long as you're profitable,
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you're incentivized
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to to add,
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computing power to the network. Right? To increase
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the the amount of of profits you're getting,
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until you can't find any any,
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until the the marginal
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energy that you would be using,
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makes it so that you're, you know, no longer you're destroying profits rather than creating profits.
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And and that is playing out on an individual basis
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globally,
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constantly.
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And as Gigi alluded to, like,
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right now, mining is especially profitable because of a chip shortage.
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And so there's this lag between
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Bitcoin's price action and the ability of miners to
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to spin up additional hardware to drive down the profitability of mining
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to the to what's in business called the hurdle rate,
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meaning the required
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rate of return
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for investing capital into a project.
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And,
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you know, so if you if you zoom out and you think about those
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theoretical economic forces
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playing out, what we're gonna see inevitably
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is Bitcoin mining over time
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shifting to,
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energy sources that have no other use case, no other bidder, and therefore can be bought for purchase by miners for next to nothing.
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And and that can be that means that's going to happen wherever there's excess. Wherever there's excess specifically for
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low variable cost
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energy. And I'd make that distinction between because,
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like, if you think about, like, a coal fired power plant, their primary input cost is coal. Right? They they they have a
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high variable cost for producing energy because they're they're burning something.
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But if you think about, like, a a solar farm
393
00:32:21.200 --> 00:32:23.540
or or even a nuclear power plant,
394
00:32:24.080 --> 00:32:25.860
their variable costs are
395
00:32:26.160 --> 00:32:28.165
less, a lot less because they're not
396
00:32:28.645 --> 00:32:35.065
oh, it's you know, with nuclear, they are using some resource, but it's not the same as burning
397
00:32:35.470 --> 00:32:35.970
coal.
398
00:32:37.390 --> 00:32:42.450
Anyway, so so those are the energy sources that are going to be the cheapest,
399
00:32:43.425 --> 00:32:45.605
that that when there's excess,
400
00:32:46.625 --> 00:32:50.405
producers are willing to part with it for the least amount of revenue
401
00:32:50.840 --> 00:32:51.340
because
402
00:32:51.799 --> 00:32:55.400
they don't need that much to cover their variable costs that the that,
403
00:32:56.120 --> 00:32:57.580
is the contribution margin
404
00:32:58.685 --> 00:33:03.185
is so much higher when you have low variable costs in your in your operations.
405
00:33:03.805 --> 00:33:04.785
So, like,
406
00:33:05.780 --> 00:33:13.080
just in a free market, this plays out over the next 10 years. Mining is go Bitcoin mining will gravitate towards the cheapest
407
00:33:13.655 --> 00:33:15.195
energy sources on the planet
408
00:33:16.375 --> 00:33:17.435
almost exclusively,
409
00:33:17.815 --> 00:33:26.780
and that's going to mean excess renewables or completely stranded energy that has no other use case. Or government subsidy or government subsidy. Yeah. Right. Absolutely.
410
00:33:27.240 --> 00:33:29.260
So Alex makes a good point here, and
411
00:33:29.560 --> 00:33:33.385
we were Alex, we were both on the exact same page on that one.
412
00:33:34.425 --> 00:33:41.485
Chris says, you make a really good point there, and and this is this is, you know, a key aspect of Bitcoin. Right? These financial incentives.
413
00:33:42.990 --> 00:33:44.289
But there
414
00:33:44.830 --> 00:33:48.610
and and and specifically when it comes to censorship, this idea that,
415
00:33:49.549 --> 00:34:01.480
if a large amount of pools are censoring your transaction, you can keep raising your transaction fees, and someone some minor somewhere is gonna have the financial incentive to include it because he's gonna get paid more because your transaction fees are higher.
416
00:34:01.960 --> 00:34:10.140
Mhmm. My concern a bit is that there's these out of band incentives as well that are going on at the same time that people tend to ignore,
417
00:34:11.255 --> 00:34:12.315
mostly because,
418
00:34:13.335 --> 00:34:14.795
Bitcoiners don't like
419
00:34:15.174 --> 00:34:15.915
to vocally,
420
00:34:16.855 --> 00:34:20.530
think critically because they're afraid that they're gonna be called a bear.
421
00:34:20.990 --> 00:34:28.050
Can we break that down, Matt? The out of out of band, I think, is important. We're about to. So so so for starters, right now,
422
00:34:28.915 --> 00:34:31.975
a lot of the big pools will allow you to just pay them
423
00:34:32.515 --> 00:34:42.770
completely separate of the Bitcoin Blockchain. You can pay them, you know, with a credit card or PayPal or something or a cash in a briefcase, and they'll confirm your transaction for you. Alternatively,
424
00:34:43.470 --> 00:34:46.210
I kind of feel like we're entering this new geopolitical
425
00:34:47.035 --> 00:34:48.015
era of Bitcoin
426
00:34:48.555 --> 00:34:49.055
where
427
00:34:49.355 --> 00:34:50.175
large governments
428
00:34:50.795 --> 00:35:09.375
and countries are gonna start to realize it's in their national security interest to have Bitcoin miners within their borders. And this is what I wanted to dive into because I don't think I think this Chinese mining ban thing is bullshit. I think it's complete bullshit, and I'm not gonna believe any of this shit until I actually see some tangible shit. I can verify
429
00:35:09.755 --> 00:35:12.895
that Hash is leaving in droves out of out of that country,
430
00:35:13.779 --> 00:35:16.839
because it's in their financial best interest as a government,
431
00:35:17.539 --> 00:35:21.160
to control the mining there. They they want to have miners there.
432
00:35:22.115 --> 00:35:22.515
You know,
433
00:35:23.395 --> 00:35:32.110
they they they they wanna have miners that they can that they can push to confirm their transactions. They wanna have miners that can protect their interest in terms of other miners
434
00:35:32.650 --> 00:35:34.190
not confirming their transactions,
435
00:35:35.855 --> 00:35:39.474
and they want to be able to have access to this global neutral network.
436
00:35:40.174 --> 00:35:43.875
So so there's all these other incentives that are at play on the outside,
437
00:35:44.970 --> 00:35:47.470
that I feel like we kind of ignore. Right, Alex?
438
00:35:48.010 --> 00:35:52.829
Yeah. Well, I I think what I've tried to learn from speaking to a bunch of minors in,
439
00:35:54.005 --> 00:35:55.785
in the last couple weeks months
440
00:35:56.164 --> 00:36:07.319
is that even if there's, like, strong incentives to change, the the sort of logistical environment is just not that easy to change. So stuff happens slowly. So even if there's, like, this freak out in China,
441
00:36:08.525 --> 00:36:18.960
well, guess what? Like, there there's not that much rack space available in the United States right now. There's very little. I mean, there's just minor sitting, thousands of ASICs just sitting. They can't be plugged in.
442
00:36:19.740 --> 00:36:20.240
There's,
443
00:36:21.420 --> 00:36:22.540
issues with, like,
444
00:36:22.940 --> 00:36:27.464
like, getting the the equipment out. I mean, there will be a lot of equipment from what I understand.
445
00:36:28.005 --> 00:36:29.145
If this is true,
446
00:36:29.765 --> 00:36:32.345
moving by truck to Kazakhstan and Russia,
447
00:36:33.525 --> 00:36:38.369
but, you know, getting that equipment to America or elsewhere or maybe to Africa is is non trivial,
448
00:36:39.150 --> 00:36:41.650
and it takes time and you have this sort of,
449
00:36:42.109 --> 00:36:43.890
you know, chip crunch. So
450
00:36:44.270 --> 00:36:46.369
it's kind of an amazing moment where,
451
00:36:46.975 --> 00:36:54.675
you know, we're almost insulated from massive change because we can't just snap our fingers and make more chips and make more miners. We're kinda stuck with what we have.
452
00:36:55.460 --> 00:36:57.720
And the world is in such a kind of weird,
453
00:36:58.180 --> 00:36:59.160
dynamic where,
454
00:36:59.539 --> 00:37:03.400
you know, you know, there's still sort of majority hash rate in China, but it's dwindling.
455
00:37:03.885 --> 00:37:06.865
But America's too you know, you know, I would say, thankfully,
456
00:37:07.165 --> 00:37:16.480
America doesn't have, like, 40% yet. I mean, we're still probably in the I don't know what you guys think, but from what I understand, like, anywhere from 8 to 12% maybe in America.
457
00:37:16.860 --> 00:37:22.960
So, you know, things just takes take time to to to shift in this environment. It's not so easy.
458
00:37:23.315 --> 00:37:26.615
So, I just would be, I'm interested to watch what happens.
459
00:37:27.715 --> 00:37:43.325
But, I agree with Matt, like, some of your comments about, like, you know, if all the miners, like, stopped right away in China, we would we would figure that out pretty quickly. Right? Like, that's not it's not hard to, to see. I just feel like when the CCP wants to, like, truly ban something, like, they do it.
460
00:37:43.705 --> 00:37:47.244
Right? Like, you're scared for your livelihood, are you not? Like, is is there
461
00:37:48.090 --> 00:37:50.590
do do they like do they like half band shit?
462
00:37:50.970 --> 00:37:52.670
Like, from what I understand, like,
463
00:37:52.970 --> 00:37:57.355
even the this this was so everything's blown out of proportion. Of course, it's like the China FUD stuff,
464
00:37:57.915 --> 00:38:06.015
but this was like a warning to certain people in certain industries. It was not like some sorta, like, you know, blanket ban or anything like that. So
465
00:38:06.329 --> 00:38:20.325
everything is just a continual loop of FUD, and the the speech itself the speech itself that mentions it mentions it's like a huge it's a huge speech. It's like a huge document talking about the speech, and there's one little line that says Bitcoin mining and trading.
466
00:38:20.785 --> 00:38:32.700
Yeah. There there is, however, Lucas Newsy who does great stuff, stuff, he did publish something today with some stuff from Coinmetrics. I mean, what's quite clear is that, like, miners fucking sold. Like, Chinese we could see it. Like, Chinese miners sold. Everyone's sold.
467
00:38:33.095 --> 00:38:46.210
That's true. So the question is is it related to the market, or is it related to the crackdown? And, you know. Like, my college my college friend sold. Like, that wasn't related to the CCP banning their mining operation.
468
00:38:46.750 --> 00:38:49.570
He just panicked. Like, miners are people too.
469
00:38:51.055 --> 00:38:59.210
Yeah. The other thing that's confusing and and is gonna make things harder to even interpret is that it is literally right now is when the miners, like, move all their shit from Right.
470
00:38:59.690 --> 00:39:12.425
The sort of, like, inner Mongolia and Xinjiang over to, like, the the Yunnan and Sichuan kinda, like, hydro provinces. So you're there's already gonna be a drop off in hash rate as they, like, disconnect equipment and move it. Which, by the way, is a new narrative
471
00:39:13.125 --> 00:39:16.265
that we've only heard the last 2 wet dry seasons
472
00:39:16.645 --> 00:39:23.420
after a hash dropped, and, like, we've been normalized into that normal like, normalized into that concept. Like, we never
473
00:39:24.040 --> 00:39:24.360
I
474
00:39:24.895 --> 00:39:36.340
as as a Bitcoiner, I never heard that narrative before. And then all of a sudden now it's just, like, common knowledge. It's like, oh, if the difficulty drops by, like, 18%, it's because the miners are moving from wet to dry season or vice versa.
475
00:39:38.000 --> 00:39:40.980
Yeah. That's true. I I I want to but,
476
00:39:42.154 --> 00:39:56.359
I want to point out one thing what which I think is insanely bullish. Like, it it doesn't even matter kind of what is true and what isn't. The fact that Bitcoin mining is as mobile potentially as it is is insanely bullish because even
477
00:39:56.660 --> 00:39:57.720
like, imagine
478
00:39:59.065 --> 00:40:01.325
China banning gold mining. Like, there's
479
00:40:01.785 --> 00:40:31.180
you can't move a gold mine. You know? And it's it's just I I think the property of the Bitcoin network that the only thing you need is a a power source and a communication link to mine is so insanely beautiful, and you can actually take the ASICs and move them somewhere else and just continue mining. It like, it's it's literally it's it's not that big of a hassle. Of course, you know, there are some things involved and so on and so forth, but but but still, there is no other industry where you can do that that easily. And, again, like, you need nothing except for an energy source
480
00:40:31.640 --> 00:40:32.140
and
481
00:40:32.464 --> 00:40:33.765
a communications link.
482
00:40:34.065 --> 00:40:36.165
And I think even, like, considering
483
00:40:36.625 --> 00:40:37.125
a,
484
00:40:37.905 --> 00:40:53.485
a broadband on mining, it's really difficult to do because if you are motivated for for the for whatever reasons, like, even if you're a a very small player, you can still mine, and it's very easy to kind of hide your footprint because you don't have Right. Like, a big signature. And it's I I think this is underappreciated
485
00:40:53.865 --> 00:41:02.990
and not often talked about. Like, it's you you can take your shipping container and move it somewhere else. Like, cool. Yeah. It's And I think I think long term, the incentives favor smaller miners.
486
00:41:03.370 --> 00:41:13.005
I think it's it'll be easier to get cheaper electricity in smaller amounts. I think it'll be easier to hide under the radar in smaller amounts. I think it'll be easier to capture waste to reduce your cost,
487
00:41:13.545 --> 00:41:21.130
and stuff like, you know, like, heating a home, for instance, once ASIC start to level out in terms of, life cycles. Look at the s nine. The s nines lasted forever.
488
00:41:21.830 --> 00:41:28.595
You get one of those, you're heating your home with it. You're all of a sudden, you're able to cut costs more than a an industrial miner that has them all in the warehouse.
489
00:41:29.695 --> 00:41:35.900
And and I do agree with you, Gigi, that I think one of the most bullish things we have with us is that it is it can be highly mobile.
490
00:41:36.360 --> 00:41:51.235
But that's also one of the reasons why I'm less concerned about actual bans, specifically bans that are, like, so loose that they're a ban, that they allow you to move your minors out of the country or sell them, which is like, okay. Like, you're gonna ban weed, but you're gonna let me move my weed out of the country.
491
00:41:52.320 --> 00:41:54.820
I'm more concerned about seizure and capture.
492
00:41:55.520 --> 00:42:01.300
And seizure is obvious. Right? You know, people busting down your doors and taking control of your mining operations.
493
00:42:02.085 --> 00:42:03.865
But capture is way less
494
00:42:04.245 --> 00:42:11.625
obvious and happens slowly over time, and that's kind of what we're seeing with this American Mining Council. Right? That's the fear of something like the American Mining Council,
495
00:42:12.230 --> 00:42:16.170
where you have, like, regulatory capture and then they're all playing and reporting,
496
00:42:16.549 --> 00:42:28.735
you know, reporting all their information and playing by certain rules and stuff. Kind of like what we've seen with the exchanges. Right? Just just to dwell on this, like, really interesting geopolitical moment for a second. There's a really good, interview,
497
00:42:29.630 --> 00:42:33.029
that Nick Carter did with the fry with the fryer from Australia,
498
00:42:33.470 --> 00:42:36.289
on Bitcoin and energy and electricity is excellent.
499
00:42:37.115 --> 00:42:38.474
But they bring up a good point that, like,
500
00:42:39.595 --> 00:42:43.694
this chip shortage is not gonna last forever. Like, by 2025 or so,
501
00:42:44.610 --> 00:42:57.035
all these big fabs are gonna be up and running, and and there will be a lot more chips available. And and there are, like, key industrial use cases of Bitcoin mining that are gonna be, like, brought into the fold. Like like, they were talking about how,
502
00:42:57.575 --> 00:42:59.275
I think Friar said that, like,
503
00:42:59.790 --> 00:43:03.810
like, methane waste alone is enough to take Bitcoin to, like, $50,000,000,000,000.
504
00:43:04.430 --> 00:43:14.665
That's it. It just there's not enough chips, and the companies that are doing it are ignorant. But once they figure it out, it's gonna happen. And, you know, he thinks that by, like, maybe 2025, 26,
505
00:43:14.965 --> 00:43:38.099
maybe you have a quarter of all Bitcoin mining is is done through straight up just sort of waste from an existing industrial sites. But it can't get there until we have more chips. So it's like, we're in this weird geo geopolitical moment where we can start making, we can start seeing the future a little bit, but it it there's, like, a lag time because just can't make a 6 fast enough. I mean, the a 6 that were made, what, a year, the s nines or whatever were a $100
506
00:43:38.400 --> 00:43:40.820
or something like that a year ago. Now they're $1,000.
507
00:43:41.440 --> 00:43:44.415
Like like, this is old equipment. So there's, like, 3
508
00:43:44.955 --> 00:43:56.070
The s nines, you could buy, like, a, like, during the March drop off after the having, and then had the having happened, like, you could've you could've bought, like, a garbage truck full of s nines for, like, a $100.
509
00:43:56.770 --> 00:43:58.230
Yeah. Now they're, like, $900
510
00:43:58.530 --> 00:43:59.590
or something. Each.
511
00:44:00.050 --> 00:44:12.520
Yeah. So we're in this weird moment where, like, stuff can't move as fast as it might move, which may be advantageous to the Bitcoin community here. It it restrains people. So it's, anyway, that's that's just wanted to zoom in on that for a second.
512
00:44:12.820 --> 00:44:15.480
But where are the where are the ASICs being made?
513
00:44:19.305 --> 00:44:25.085
I mean, he was saying that the last shipment out of Bitmain was, like, a I mean, the big manufacturers
514
00:44:25.545 --> 00:44:31.680
are stuck. Like, at the it takes what? How long would it take? Like, 18 months right now to get, like, a big shipment
515
00:44:32.059 --> 00:44:33.520
if you place the order today?
516
00:44:34.895 --> 00:44:41.155
Yeah. I I don't know. I mean, you're an idiot if you preorder miners. I mean, that's just like a that's an old Bitcoiner knowledge
517
00:44:41.615 --> 00:44:43.235
knowledge shop right there.
518
00:44:44.650 --> 00:44:53.515
But where? I mean They're all made in China. Yeah. Yeah. But a lot I mean, obviously, a lot of the the pieces that go into it are made in other Asian countries as well. Right.
519
00:44:54.234 --> 00:44:57.135
So it's kind of a supply chain is distributed a little bit.
520
00:44:58.394 --> 00:45:16.615
But anyway, to to just cap to cap that off, in 3 or 4 years, it'll be a very different environment. Like, I I I believe pretty firmly that there'll be a lot more chips available and that'll really diversify mining. Like, that will help decentralize it in a massive way. So that's where we're going. We have people in the comments. Yeah. A lot of it's done in Taiwan as well. Mhmm.
521
00:45:17.235 --> 00:45:24.250
By the way, Taiwan is a country. We fucking love Taiwan. Yeah. Seriously. Am Ra John Cena. Yeah. Here here at Dispatch, we,
522
00:45:25.190 --> 00:45:27.610
we recognize Taiwan as the one true China.
523
00:45:29.845 --> 00:45:56.125
And, I just want to tag on something that someone said in the comments that, Bitcoin mining is so portable that we could even move it off the Earth. And while that is true to some extent, just keep in mind that we have, like, a hash horizon of, like, 10 minutes because of the 10 minutes block time. So we can't move it far away from Earth, and that I think that's something that's underappreciated because we could sell this to Elon very hard that if he manages to
524
00:45:56.460 --> 00:46:08.645
to settle on Mars, he is like he can start his own proof of work chain there and call it whatever he wants and put a dog logo on that. So I think that's fair game to build a side chain on Mars, but
525
00:46:10.065 --> 00:46:11.905
I I just think everyone should,
526
00:46:12.464 --> 00:46:20.960
who, who's interested in that should read, Dhruv Bansal's piece, Bitcoin Astronomy, where he talks about that at length. I think it's, very interesting.
527
00:46:23.585 --> 00:46:24.565
Yeah. I mean,
528
00:46:25.665 --> 00:46:26.165
maybe.
529
00:46:26.705 --> 00:46:33.369
I I haven't thought about all the attack factors that might be possible because of the time lag, but, it might be possible.
530
00:46:34.950 --> 00:46:36.410
So so Gladstein,
531
00:46:37.165 --> 00:46:51.200
first of all that that that that I think it was multiple pieces, it's very good. Yeah. I mean, I just like sci fi. I I just wanna be clear, like, Elon, like, if you try and launch a Mars shit coin, like, I'm still against it. Like, I'm not giving you the the pass that Gigi is giving you.
532
00:46:51.500 --> 00:46:59.984
It's kind of it's kind of a miracle Mars. Like, I prefer definitely not mine it. I prefer a Mars versus Earth, like, Hash War
533
00:47:00.444 --> 00:47:04.740
than a Mars shit coin. Yeah. That's good. That's that's good. That's just because I like I like I like
534
00:47:05.280 --> 00:47:09.220
I love this when conflict happens. You know? I love the adversarial shit.
535
00:47:10.465 --> 00:47:12.565
Gladstein, you made an interesting point
536
00:47:15.185 --> 00:47:18.485
on I think it was a a a tweet today where you said,
537
00:47:20.640 --> 00:47:28.915
like, who basically, who is the bigger concern. Right? Chinese miners versus American miners. I'm not paraphrasing you well. Yeah. Yeah. Yeah. No. I was like, basically,
538
00:47:29.775 --> 00:47:32.515
we're in this we all of a sudden, like, in the last week,
539
00:47:32.815 --> 00:47:37.609
it has really kinda crystallized that we could be in this moment and it it may take a couple years,
540
00:47:37.990 --> 00:47:41.050
but we're we're all worried about, like, China centralizing
541
00:47:41.830 --> 00:47:45.770
the hash rate and then all of a sudden we're starting to worry about America centralizing the hash rate.
542
00:47:50.445 --> 00:47:52.145
Right. So should we be worried?
543
00:47:54.190 --> 00:48:00.609
But then, yeah, I think I think you just, like, kind of corrected yourself in the same tweet. You're, like, but I don't think, like, American can actually get
544
00:48:01.125 --> 00:48:10.025
enough hash rate to be a concern. Right? Well, I tried to provide the counterpoint counterpoint. Like, point being, hey, maybe we should be really worried about America centralizing the hash rate.
545
00:48:10.350 --> 00:48:11.250
The the counterpoint
546
00:48:11.630 --> 00:48:12.130
being,
547
00:48:12.670 --> 00:48:21.455
it may be impossible for any other nation to to gain the 50% that that China once had due to the general, like, trends in the market and lack of chips available right now.
548
00:48:22.635 --> 00:48:24.815
And and and the game theory of,
549
00:48:25.995 --> 00:48:31.690
individual countries starting to realize that that they have an opportunity to perhaps generate the world's reserve currency,
550
00:48:32.470 --> 00:48:35.610
from their own resources. This has not been possible before,
551
00:48:36.305 --> 00:48:37.285
in the same way.
552
00:48:38.465 --> 00:48:41.605
You know, normally, resources have to be sort of purchased with dollars,
553
00:48:42.065 --> 00:48:48.079
you know, in today's in today's world. So here's an opportunity for folks to turn their own resources straight into Bitcoin.
554
00:48:48.779 --> 00:48:52.640
So I I I think that there's a a kind of a point counterpoint.
555
00:48:53.975 --> 00:48:56.635
Are we gonna see, like, could we see,
556
00:48:56.935 --> 00:48:57.755
like, alliances
557
00:48:58.135 --> 00:49:04.530
unfold where, like, minor but, like, different countries, like, pool their hash rate with each other to have a favorable position?
558
00:49:04.910 --> 00:49:08.290
Yeah. I mean, that would mirror what has happened with dollar diplomacy,
559
00:49:09.195 --> 00:49:10.975
with the US and the EU,
560
00:49:11.355 --> 00:49:12.815
kind of trying to,
561
00:49:14.795 --> 00:49:17.190
create an alliance and then sort of China, Russia,
562
00:49:17.650 --> 00:49:19.029
and some of the other states
563
00:49:19.410 --> 00:49:24.150
creating an alliance. And then and then there's, like, the nonaligned countries. I thought this was very interesting. Someone
564
00:49:24.825 --> 00:49:35.040
commented today that, I guess, Malaysia is gonna try to absorb a bunch of this mining, and maybe Malaysia is like a a a a non aligned country. You know, maybe they're, like, in the middle between China and America.
565
00:49:35.500 --> 00:49:38.620
So these, like, non aligned countries could be very powerful and important,
566
00:49:39.500 --> 00:49:44.575
I think, if we start to have this kind of, you know, new sort of China versus US thing.
567
00:49:46.635 --> 00:49:50.300
Yeah. Yeah, Matt. I I sort of wonder if, like, if we're
568
00:49:51.160 --> 00:49:55.320
we're asking the wrong like, if we're focused on the wrong part of this story,
569
00:49:56.595 --> 00:49:59.494
because, like, the glad scene is born here. This this mirrors
570
00:50:00.115 --> 00:50:03.734
what happens on the geopolitical stage right now. Like, countries
571
00:50:04.275 --> 00:50:05.174
vie for
572
00:50:05.590 --> 00:50:06.250
for greater
573
00:50:06.790 --> 00:50:11.610
influence over money. And that's that's just an inevitable outcome of
574
00:50:12.070 --> 00:50:13.530
of human nature.
575
00:50:14.915 --> 00:50:19.655
And so, like, that just might be that might be what happens with with Bitcoin as,
576
00:50:20.435 --> 00:50:22.214
as as nation states
577
00:50:22.869 --> 00:50:23.369
accept
578
00:50:23.990 --> 00:50:27.289
the economic reality that Bitcoin imposes upon the world
579
00:50:27.750 --> 00:50:29.450
and buy into this
580
00:50:29.910 --> 00:50:31.369
new future of
581
00:50:31.744 --> 00:50:35.924
trying to generate the reserve currency of the world using their own resources,
582
00:50:37.265 --> 00:50:42.770
that this is the the how the game will shift, you know, away from trying to influence,
583
00:50:44.270 --> 00:50:45.170
fiat currency
584
00:50:46.030 --> 00:50:46.530
policies
585
00:50:47.550 --> 00:50:48.290
and power,
586
00:50:48.910 --> 00:50:50.290
and trying to
587
00:50:50.825 --> 00:50:51.645
trying to
588
00:50:52.185 --> 00:50:53.085
have power
589
00:50:53.625 --> 00:50:54.445
over Bitcoin,
590
00:50:55.225 --> 00:50:55.725
which
591
00:50:56.505 --> 00:50:58.970
they may achieve to some extent, but
592
00:50:59.530 --> 00:51:04.830
to a much less great extent than than they ever could when they controlled the money themselves.
593
00:51:05.290 --> 00:51:09.925
So I don't know. I guess I'm sort of celebrating. I'm, like, taking stock of what's happening,
594
00:51:11.185 --> 00:51:17.720
and how the narrative is shifting and how there seems to be things going on behind the scenes with really big players
595
00:51:18.099 --> 00:51:21.400
starting to make moves and trying not to make ripples on the surface.
596
00:51:22.500 --> 00:51:30.415
And it looks like Bitcoin is winning Even though people are starting to fight and try to drive wedges into Bitcoin in the Bitcoin community,
597
00:51:30.715 --> 00:51:33.615
it's because it's winning. I don't know if that makes sense.
598
00:51:34.829 --> 00:51:44.275
The other thing I just wanted to add was that I have a piece coming out tomorrow on Bitcoin Magazine on this, but, like, essentially, I'm what I wanna try to incept is this idea in in the humanitarian,
599
00:51:45.455 --> 00:51:48.595
in, like, aid community, which is massive. It's like a $20,000,000,000
600
00:51:49.215 --> 00:51:50.115
a year industry.
601
00:51:50.560 --> 00:51:55.460
And then foreign direct investment is, like, 1,000,000,000,000 of dollars a year from, like, you know, rich countries to poor countries.
602
00:51:56.000 --> 00:52:00.694
If we could, like, incept this idea that, like, a really noble way of doing humanitarianism
603
00:52:01.075 --> 00:52:05.734
would be to pay for and set up mining operations in emerging market countries,
604
00:52:06.440 --> 00:52:14.220
you know, if if rich Americans and Europeans would be willing to do that, you know, to help these countries become energy independent, become financially sovereign,
605
00:52:14.805 --> 00:52:19.465
that really helps. Not only does it help those countries, but it helps prevent against this kind of very
606
00:52:19.765 --> 00:52:21.865
kinda, like, based risk or, like,
607
00:52:22.270 --> 00:52:26.610
kind of deep seated fear that that maybe America becomes too centralized in its control.
608
00:52:26.990 --> 00:52:29.965
So that's one way of fighting back would be to try and
609
00:52:30.445 --> 00:52:30.945
convince,
610
00:52:32.365 --> 00:52:33.185
people who,
611
00:52:33.645 --> 00:52:36.145
you know, spend all this money in international development
612
00:52:36.685 --> 00:52:39.745
to consider the, like, humanitarian and environmental upsides,
613
00:52:40.510 --> 00:52:49.410
of Bitcoin and of of countries running Bitcoin mining off of their, like, massively stranded renewable energy. So that that's something I've been become very interested in lately.
614
00:52:52.735 --> 00:52:57.235
If if if you everyone out there, if you haven't read, Gladstein's
615
00:52:57.700 --> 00:53:00.040
piece on on the hidden cost of the petrodollar,
616
00:53:00.660 --> 00:53:04.040
it is a tour de force. It's awesome. It's in Bitcoin Magazine.
617
00:53:04.579 --> 00:53:05.060
And it
618
00:53:05.645 --> 00:53:09.105
I think it it better than anything else I've read highlights
619
00:53:09.805 --> 00:53:11.905
that the system that we have today
620
00:53:12.365 --> 00:53:14.385
has very, very high costs,
621
00:53:15.039 --> 00:53:17.460
and we take that for granted. And Bitcoin
622
00:53:17.920 --> 00:53:18.740
has costs,
623
00:53:19.519 --> 00:53:23.700
but how do they stack up? And it it creates quite an an amazing contrast.
624
00:53:24.135 --> 00:53:31.194
Well, it's all about dependency. Like, the US forced the world to be dependent on us for agriculture, which didn't make any sense in a free market.
625
00:53:32.160 --> 00:53:39.300
And then, you know, we forced the world to be dependent on the dollar, which didn't make any sense either in a free market. So none of these things were like free market phenomena.
626
00:53:39.995 --> 00:53:47.695
So here's an opportunity to kind of have a different kind of future where it's not, like, 4% of the world's population dictating terms to everybody else. But,
627
00:53:48.090 --> 00:53:49.550
you know, these countries,
628
00:53:50.890 --> 00:53:52.190
you know, aren't gonna
629
00:53:53.130 --> 00:53:58.654
you know, there's an opportunity here to make a difference in the next 5 to 10 years where, like, they they could,
630
00:53:59.595 --> 00:54:04.174
again, both help Bitcoin's long term network security, but also help themselves, like, kind of bootstrap,
631
00:54:05.035 --> 00:54:12.380
more economic activity. And I I don't know if we'll ever see this opportunity again. So it's it's really interesting to and and worth thinking about.
632
00:54:16.440 --> 00:54:22.845
I mean, I kinda wanna dive into the petrodollar a little bit because, I mean, I think a lot of the
633
00:54:25.680 --> 00:54:29.700
environmental stuff, but, really, I think the battle is gonna be sanctions.
634
00:54:30.400 --> 00:54:30.900
And
635
00:54:33.225 --> 00:54:33.965
I don't
636
00:54:34.905 --> 00:54:40.205
I don't think sanctions can be enforced in a post Bitcoin world, but I think governments will try.
637
00:54:42.360 --> 00:54:43.660
You know, what does that entail?
638
00:54:44.840 --> 00:54:50.380
Yeah. There's a good I'll try to find it for the show show notes or whatever, but there's a really interesting academic paper
639
00:54:50.744 --> 00:54:53.005
about how the US weaponizes the dollar.
640
00:54:53.785 --> 00:54:55.805
It it has nothing to do with Bitcoin, but
641
00:54:56.345 --> 00:54:59.885
it's written a couple years ago and it's it it just details, like, how,
642
00:55:00.540 --> 00:55:08.480
the US uses its control over Swift and, like, all these other networks to ensure that any government that it doesn't like, like, we're just basically has a really hard time.
643
00:55:08.955 --> 00:55:11.855
So those governments are the ones now turning to Bitcoin.
644
00:55:12.315 --> 00:55:17.615
I'm not supporting those governments. In fact, in my day job, I try to, like, expose them because they're often terrible.
645
00:55:17.970 --> 00:55:21.590
But the reality is that, like, what are they gonna do? These are, like, rational choices.
646
00:55:22.290 --> 00:55:28.654
And they're gonna be they they're led to Bitcoin, and they're gonna use it. I don't know exactly how you would how you would stop,
647
00:55:29.595 --> 00:55:33.855
you know, this this network from functioning in that way. I think it's this this just sort of natural
648
00:55:34.720 --> 00:55:37.140
evolution of a new system that's a little harder to,
649
00:55:38.080 --> 00:55:41.460
to to control in that way. But but on the ESG piece,
650
00:55:42.640 --> 00:55:43.220
I think
651
00:55:43.775 --> 00:55:46.115
that is really interesting to also dive into.
652
00:55:46.655 --> 00:55:48.275
Again, yeah, we have, like,
653
00:55:48.655 --> 00:55:50.115
the very, like,
654
00:55:51.099 --> 00:56:04.135
ignorant public about the ESG impact of the dollar, which, of course, as as as, you know, you just mentioned or alluded to is has been over the last few decades, the fact that it it funds this huge warfare state.
655
00:56:05.815 --> 00:56:08.869
It has led America to spend, like, profligately
656
00:56:09.170 --> 00:56:13.270
and and extravagantly in terms of social programs that that don't work very well,
657
00:56:13.570 --> 00:56:17.430
has hollowed out the middle class, increased inequality to, you know,
658
00:56:17.865 --> 00:56:21.085
ratios we haven't haven't seen in a really long time,
659
00:56:21.545 --> 00:56:23.165
many many many many decades.
660
00:56:23.705 --> 00:56:28.960
And then, you know, props up all these dictators and and and the fossil fuel industry gets a subsidy.
661
00:56:29.819 --> 00:56:31.680
So that those are the cost of the dollar.
662
00:56:32.220 --> 00:56:32.720
So,
663
00:56:33.475 --> 00:56:38.055
you know, where where do we go from here? And the irony is, like, the ESG people,
664
00:56:39.315 --> 00:56:46.130
if they allowed us to debate them on ESG terms, Bitcoin wins. I mean, Bitcoin is easily the most ESG compliant,
665
00:56:46.910 --> 00:56:50.450
like, investment you could make. I mean, it's tremendous financial liberation,
666
00:56:51.005 --> 00:56:52.625
bootstrapping of renewable energy,
667
00:56:53.484 --> 00:56:55.665
transparent governance process that's uncorruptible.
668
00:56:56.525 --> 00:57:06.400
The problem is that's not what they're interested in. ESG people are not interested in, like, the truth or, like, in actually achieving those things. They're interested in control. So that's kinda where we are now.
669
00:57:06.805 --> 00:57:12.725
Yeah. Yeah. I think I I that's that's a point that I think Bitcoiners should harp on more, though, is
670
00:57:14.010 --> 00:57:16.430
and maybe that's what the the mining council
671
00:57:16.970 --> 00:57:19.390
in in theory wants to to do.
672
00:57:20.170 --> 00:57:23.815
But, you know, Bitcoin is the most the single most ESG
673
00:57:24.755 --> 00:57:25.255
positive
674
00:57:26.835 --> 00:57:31.494
force on Earth today. As far as I can tell, this is the the single greatest
675
00:57:31.860 --> 00:57:33.640
tailwind for all of those
676
00:57:34.100 --> 00:57:36.600
aspirations that, you know, liberal
677
00:57:36.900 --> 00:57:40.280
western society has decided it wants to champion.
678
00:57:40.775 --> 00:57:48.395
And and Bitcoin does all of those things. It's it it it is, you know, fueling the adoption of renewable energies,
679
00:57:48.930 --> 00:57:49.910
and then there's also
680
00:57:50.210 --> 00:57:51.430
liberating people
681
00:57:51.730 --> 00:58:00.185
from from the tyranny of of inflation or or, you know, sovereign control over their money in more extreme examples.
682
00:58:00.965 --> 00:58:06.265
This is the thing, and we need to own that narrative more than than we have in the past.
683
00:58:08.440 --> 00:58:10.060
Gigi, what do you got on this?
684
00:58:11.480 --> 00:58:12.440
Yeah. I think, you know, like,
685
00:58:13.800 --> 00:58:14.765
we we've said it before. You know? Bitcoin because you're because you're working with CT. I mean, CT CT must be
686
00:58:23.540 --> 00:58:32.505
Yep. Yeah. Absolutely. I think, you know, again, I think it all comes down to incentives and just what makes the most sense also economically speaking. And,
687
00:58:32.945 --> 00:58:34.085
if you have
688
00:58:34.704 --> 00:58:39.045
in Bitcoin in Bitcoin, you have the buyer of last resort
689
00:58:39.380 --> 00:58:41.960
for whatever energy is produced and just
690
00:58:42.260 --> 00:58:43.319
it that it's
691
00:58:43.779 --> 00:58:56.260
it is perfect for renewables just for that reason alone. And the the problem with the energy fund, I believe, is that first of all, people don't understand Bitcoin and proof of work, like, not at
692
00:58:56.560 --> 00:59:06.795
all. And second of all, it's just a very easy argument to make. You know? Like, it's just bad. It uses up a lot of energy, and, we kind of have to battle that problem.
693
00:59:07.175 --> 00:59:12.119
Flipping that argument on its head and making people understand that it's not actually
694
00:59:12.420 --> 00:59:17.720
a problem in the first place and that every kilowatt hour that the Bitcoin network
695
00:59:18.964 --> 00:59:23.145
uses is put to good use because it secures the best soundest,
696
00:59:23.685 --> 00:59:25.945
more most available, freest money
697
00:59:26.260 --> 00:59:40.415
that humanity has ever seen. That's something that I think only exposure to Bitcoin and education can fix. And I think I think once you realize that all all the points that are made in the mainstream media that are currently,
698
00:59:40.795 --> 00:59:44.170
like, packaged together in this energy thought narrative,
699
00:59:44.470 --> 00:59:47.610
they they will become mute because we don't, like,
700
00:59:48.150 --> 00:59:48.890
we don't
701
00:59:49.475 --> 00:59:52.695
we don't harp on about how how much energy,
702
00:59:53.555 --> 01:00:00.839
fridges consume, for example. You know? I it it's it all comes down to the question, is the energy use worth it? And I think as Bitcoiners,
703
01:00:01.460 --> 01:00:04.040
we, like, we we have internalized
704
01:00:04.980 --> 01:00:06.839
for a very long time that
705
01:00:07.635 --> 01:00:12.615
it's it's worth it. Every, like, every ounce of it is worth it. And I think just,
706
01:00:14.194 --> 01:00:16.454
making more people understand what's
707
01:00:17.119 --> 01:00:18.819
what's at stake here and what
708
01:00:19.200 --> 01:00:30.045
sound money entails and what, like, moving the world to a Bitcoin standard entails and that it is actually a good thing. And it's not only number go up, but it's also freedom go up massively.
709
01:00:30.424 --> 01:00:35.404
I think that's that's what it's all about, and I think that's what we as Bitcoiners can kind of,
710
01:00:36.550 --> 01:00:42.410
work on to talk to family and friends and other people about it. I I also think that those of us who aren't minors, like,
711
01:00:43.095 --> 01:00:51.995
you know, maybe we can even help explain some of the phenomena better than than than what's out there now. I mean, only in the last few weeks researching this mining piece,
712
01:00:52.610 --> 01:00:55.830
did I start to get a understanding of the, like, energy market,
713
01:00:56.530 --> 01:00:59.110
and the reason why that Bitcoin does not,
714
01:00:59.810 --> 01:01:12.220
use energy that would be otherwise used. It it doesn't because because of the price. And, like, I didn't again, I didn't know this. I put this in my article, so it'll be out tomorrow. But, like, you know, Bitcoin miners kinda need to be in the 2 to 5¢ kilowatt,
715
01:01:13.400 --> 01:01:17.420
range. Right? Otherwise, it's unprofitable and they're gonna turn off their machines. And,
716
01:01:17.964 --> 01:01:18.785
you know, industrial,
717
01:01:19.724 --> 01:01:21.184
energy in the,
718
01:01:21.724 --> 01:01:25.184
you know, developing developed world is, like, 5 to 6¢
719
01:01:25.484 --> 01:01:26.224
per kilowatt.
720
01:01:28.620 --> 01:01:34.560
And, you know, residential use is, like, 10 to 15¢. So there's never gonna be a case where, like, a residential customer.
721
01:01:35.185 --> 01:02:03.700
If there's residential customers around, there's not gonna be any Bitcoin mining. They will outcompete them by far. And in Africa, it's 20 to 40¢ a kilowatt. So anywhere in Africa where there's, like, anyone else who who is is a customer of that grid, there can't be any Bitcoin miners. They can't make any money. So this idea that, like, Bitcoin, like like, you know, eats energy that would have otherwise gone to something else literally make makes no economic sense. And I feel like these are things that people need to actually talk more about. No? Yeah. Absolutely.
722
01:02:04.000 --> 01:02:05.620
Alex, have you seen the,
723
01:02:06.400 --> 01:02:07.460
Lawrence Livermore,
724
01:02:08.080 --> 01:02:11.060
flowchart of energy produced in the US? And and
725
01:02:11.585 --> 01:02:17.845
the takeaway from it is that 2 thirds according to them, 2 thirds of the energy produced in the US
726
01:02:18.305 --> 01:02:20.109
every year goes unutilized,
727
01:02:20.890 --> 01:02:21.390
unused,
728
01:02:22.410 --> 01:02:34.355
you know, for all of these different reasons between Oh, and there's just waste. I mean, in like, again, there's more there's enough energy today being wasted or curtailed to to easily run the whole Bitcoin network. In fact, America
729
01:02:34.735 --> 01:02:35.475
is decommissioning
730
01:02:35.935 --> 01:02:49.174
this year enough nuclear power to run the whole Bitcoin network. So I just don't wanna hear it with the whole the ESG thing is just such bullshit because it's not like I mean, as someone who actually cares about the environment and and probably has different views than a lot of Bitcoiners on this stuff,
731
01:02:49.474 --> 01:02:49.974
like,
732
01:02:50.355 --> 01:02:53.974
it it it should be we should be able to argue this in different ways according to our own
733
01:02:58.020 --> 01:03:09.345
Bitcoin without fucking up whatever anyone else wants to do. Like, it's just that's clear, you know? Right. And and you can even improve the environment by, like, by actually using that thing and and processing it.
734
01:03:10.065 --> 01:03:13.960
Puts I was listening to Friar. I mean, they were breaking it down, like, you know,
735
01:03:14.340 --> 01:03:15.640
coal uses like
736
01:03:15.940 --> 01:03:21.320
a like a like a, you know, puts like a ton of carbon in the air for Mhmm. For a particular denomination and,
737
01:03:22.115 --> 01:03:47.654
you know, natural gas does about half that and then, you know, clean coal maybe does, like, a third of that and then renewables do, like, way less. So, I mean, it is some I'd I would like to see less coal. I mean, that's what I'd like to see. And guess what? Bitcoin is the fucking subsidy that makes it possible to do renewables and hydro and and nuclear in places where you don't have a grid built out yet. Because it just boosts that revenue just just enough to make it tip the scales.
738
01:03:47.980 --> 01:04:11.390
No. It's it's like I did I profiled this operation in the Congo. It's incredible, like, because all these, like, outside investors are trying to get hydropower for the Congolese people. Only 9% of Congolese people have electricity. How fucking crazy is that? Wow. So what they do to this is we're talking about, like, a country of 90,000,000. So they they cook, they cut down the trees, which of course is horrible for the environment, releases all the carbon, it kills the gorillas, like nobody wants that.
739
01:04:11.710 --> 01:04:14.075
And then they they make charcoal and they cook
740
01:04:14.555 --> 01:04:22.415
with with that because they don't have a grid. Okay? So if they can harness these incredible rivers that are literally running through the jungles, which they live in,
741
01:04:23.120 --> 01:04:31.540
You know, they could have a robust grid and they could produce agriculture and contribute and and lift themselves out of, you know, what the legacy of colonialism,
742
01:04:31.995 --> 01:04:33.615
But they need they need the power,
743
01:04:33.915 --> 01:04:52.125
and no one wants to come in because the hydro plants take too long to hook up to the grid, and they're either not sustainable or if it's an investor, they're not profitable. Well, guess what? Now there's Bitcoin miners moving in, and they could be immediately generating revenue. So it completely bootstraps the process. It's it's a really, really crazy thing to think about.
744
01:04:52.745 --> 01:04:56.380
That's perfect. Yeah. Love that. And I I just want to you you pointed,
745
01:04:57.660 --> 01:05:01.599
all already to Friar Haas and his most recent episode,
746
01:05:02.145 --> 01:05:12.470
with Nick Carden on the brink. And I would urge everyone to listen to that who wants to have an informed opinion on on this debate because he also like, he repeatedly makes the point that,
747
01:05:12.850 --> 01:05:21.190
as Alex also mentioned just like 5 minutes ago, Bitcoin doesn't need to steal away anything from the electricity grid. You know? Bitcoin only needs energy,
748
01:05:21.535 --> 01:05:30.434
and that's all you need to mine Bitcoin. It's an energy source and a communications link. And it could be, you know, like, it could be a satellite link. So it can be everywhere, and you don't need to
749
01:05:30.770 --> 01:05:35.910
steal anything away from the electricity grid. Like, it doesn't need electricity literally run Bitcoin
750
01:05:36.370 --> 01:05:38.150
on the methane from landfills
751
01:05:38.755 --> 01:05:40.935
and from the existing kind of, like, flaring.
752
01:05:41.315 --> 01:05:56.110
And that that would again, he said that would take us to 50,000,000,000,000 market cap. Like, it's like, it's insane. And if remember, methane methane is a 100 times worse as a greenhouse gas than the c o two that is produced from burning methane and or processing methane properly.
753
01:05:57.265 --> 01:06:00.885
So I fear where there's, like, an interesting conflict brewing here is like,
754
01:06:01.905 --> 01:06:03.605
I think there's people who are like,
755
01:06:04.225 --> 01:06:04.945
obviously like,
756
01:06:06.570 --> 01:06:12.590
I I get a vibe here that some of us here at least in this chat are, like, excited about Bitcoin as a technology that can, like,
757
01:06:14.010 --> 01:06:15.390
you know, bring us to,
758
01:06:15.984 --> 01:06:24.244
maybe like a more fossil free world. But then there's, like, Bitcoiners who are really pro fossils. So I think there's gonna be a really interesting debate on this over the next couple years for sure.
759
01:06:25.220 --> 01:06:32.360
Yeah. And for me, I I it always comes back to, like, what are the economic forces here? Like, Bitcoin miners,
760
01:06:32.694 --> 01:06:39.355
because they're in constant competition with other bit Bitcoin miners all over the world, they will seek the cheapest source of energy.
761
01:06:39.734 --> 01:06:40.234
And
762
01:06:40.535 --> 01:06:40.855
and,
763
01:06:41.990 --> 01:06:44.410
for maybe that's fossil fuels, particularly
764
01:06:44.710 --> 01:06:48.090
when it's, like, stranded methane, you know, flared gas.
765
01:06:49.270 --> 01:06:49.770
But
766
01:06:50.070 --> 01:06:51.425
long term, you know,
767
01:06:53.185 --> 01:07:00.830
renewable energy sources like like the sun, they're pretty hard to beat. I don't know what the cost. I don't know how true this is, but someone who I trust a lot said that,
768
01:07:01.130 --> 01:07:01.930
told me that,
769
01:07:02.970 --> 01:07:05.790
basically, the only reason that there's so much coal mining done in China
770
01:07:06.410 --> 01:07:09.465
is because essentially it's like quote unquote, like, free electricity
771
01:07:10.005 --> 01:07:17.305
through corruption. And that in a free market, there's no way that they could use that coal. Mhmm. I don't know what your thoughts are on that, but, I mean, that I found that very interesting.
772
01:07:19.060 --> 01:07:23.400
Yeah. I mean I mean, that sound that sounds right. I I think your point earlier that, like,
773
01:07:24.420 --> 01:07:27.080
the free market forces that I was describing earlier
774
01:07:27.725 --> 01:07:28.865
are true insofar
775
01:07:29.165 --> 01:07:32.705
as there is not subsidies or government intervention or some sort of
776
01:07:33.005 --> 01:07:46.885
way that Yeah. Props out the business. We have to remember the free market doesn't work, like like, all the time or is not allowed to work. To to go back to what Matt said on the petrodollar, like, it wasn't like the petrodollar system just sorta happened in a free market. Like like, the US used its hegemony
777
01:07:47.825 --> 01:07:52.245
to create it and sustain it, and it killed other competitors. Like, it killed the SDR,
778
01:07:52.830 --> 01:07:55.890
which OPEC wanted to use as the world reserve currency in the seventies.
779
01:07:56.190 --> 01:08:11.529
We did a deal with the Saudis to bring them into the IMF. And then in exchange, the Saudis agreed to not push the SDR as a reserve currency and not to nominate their oil in it. And then the euro came along in the late nineties, early 2000, and, you know, we killed that off too. I mean, I would argue largely through,
780
01:08:12.230 --> 01:08:23.745
you know, flustering Saddam's efforts to create a Petro Euro. So, I mean, we we, you know, we can't assume the global free market is gonna work this out, I guess, is what I'm saying based on, you know, economic history of the world.
781
01:08:24.650 --> 01:08:40.250
It's a good point. That's a good point. The difference being It would be good if the US did not have hegemonic power over over Bitcoin. Right. The difference being that that anyone if you get the hardware if you get your hands on the hardware, anyone could just plug into power and Internet and be a part of the network,
782
01:08:40.710 --> 01:08:42.650
which so so the entry cost
783
01:08:42.950 --> 01:08:47.210
the the the entry cost is is significantly lower than pretty much any other
784
01:08:47.555 --> 01:08:49.175
global network we've ever seen.
785
01:08:49.555 --> 01:08:50.055
Yeah.
786
01:08:50.675 --> 01:08:54.915
So so so that that should increase competition and help foster a
787
01:08:55.700 --> 01:08:59.080
like, as far as I'm concerned, Chris has said earlier that Bitcoin is the
788
01:08:59.460 --> 01:09:04.120
the closest thing we've ever seen to a truly free market. I'd go further than that. I would say,
789
01:09:05.235 --> 01:09:07.335
specifically distributed proof of work is.
790
01:09:08.114 --> 01:09:19.340
It's it's not you know, it's great that we have global exchanges, and we have all these different exchanges that compete off of each other, but, really, the the true global free market exchange is that conversion of energy into Bitcoin.
791
01:09:20.440 --> 01:09:22.860
I just I'll let you guys continue, but
792
01:09:23.425 --> 01:09:24.645
I I'm just I mean,
793
01:09:25.985 --> 01:09:35.110
your your conversation that you just had triggered a lot of Bitcoiners on different sides and maybe both sides or Yeah. Probably both sides. Even know how many sides there are.
794
01:09:36.050 --> 01:09:36.790
To me,
795
01:09:38.025 --> 01:09:49.070
I don't think it matters at all. I I think this discussion is like mental masturbation. I think it's just, you know, something that big corners wanna talk about while we're going sideways, and we have nothing better to do.
796
01:09:50.250 --> 01:09:52.910
Why why does this conversation matter at all?
797
01:09:54.515 --> 01:10:01.015
What why does well, because no. Because, like Whether it's environmentally friendly or not. You know, this idea did you see, like, these,
798
01:10:03.480 --> 01:10:06.220
these articles that people dig up about, like, Amazon?
799
01:10:06.680 --> 01:10:11.705
Like, there's, like, butthurt people that were, like, Amazon, when they sell a book, it, like, takes a couple lumps of coal,
800
01:10:12.185 --> 01:10:20.605
and, like, no one should use Amazon. Well, Amazon's one of the largest companies in the world now. Like, that article didn't matter. And there was some guy who was arguing with him on the Internet about that article,
801
01:10:21.040 --> 01:10:38.660
and I don't know if I think he wasted his time. Right? I I don't think that was those it's an art I don't think it's a battle that needs to be fought. So, well, there's that well, okay. So there's 2 examples I'll give where it it's not about some sort of, like, general threat, but really specifically how it could practically improve your life. So, again, these these folks, there's, like,
802
01:10:39.440 --> 01:10:39.940
700,000,000
803
01:10:40.560 --> 01:10:41.060
people
804
01:10:41.520 --> 01:10:43.460
who don't have access to electricity,
805
01:10:44.885 --> 01:10:46.905
and they they burn, like, biofuels
806
01:10:47.285 --> 01:10:56.070
to to do stuff. And that creates, like, enormous not only pollution, but this, like, indoor air kinda sickness that that actually ends up killing, like, tons of children every year.
807
01:10:56.770 --> 01:10:59.990
Like, 5,000,000, I think, children or something every year.
808
01:11:00.370 --> 01:11:01.670
And, you know, like,
809
01:11:02.095 --> 01:11:02.835
you know,
810
01:11:03.695 --> 01:11:06.115
it it is manifestly better for them to use hydro,
811
01:11:07.055 --> 01:11:13.520
than than to burn coal. I I just, you know, like, to burn coal, you you have to do a lot more, like, damage to the environment around you.
812
01:11:13.980 --> 01:11:22.535
It's just, like, obviously, having some foreign investor pay for a dam and that just churns out like like a like solid energy for you.
813
01:11:22.915 --> 01:11:33.730
I just don't see why this who would want the cold side? I don't really understand that. And and then the other piece would be the sovereign individual thesis. So if if Bitcoiners really care about being sovereign individuals,
814
01:11:34.670 --> 01:11:41.195
what's more fucking sovereign individual than me running my own solar panels, running everything in my house, having solar cars,
815
01:11:41.575 --> 01:11:49.659
electric cars, and not having to deal with the grid and not having to deal with the government and being able to mine the solar. I mean, that's a very strong possibility for many Americans.
816
01:11:49.960 --> 01:11:53.340
So what's wrong with that? Own diesel generator. Just Yeah.
817
01:11:53.719 --> 01:12:02.344
Why? If you wanna do that too, but like and you have then know, then you're reliant on imports. So we go back to the dependency theory. All these countries around the solar panels.
818
01:12:02.724 --> 01:12:03.945
That's a one time deal.
819
01:12:04.650 --> 01:12:10.110
And you have to maintain them and stuff. Right? It's the last 20 years. I mean, I think it's just a disingenuous comparison.
820
01:12:10.570 --> 01:12:11.070
Like,
821
01:12:11.775 --> 01:12:16.594
Both at the individual and geopolitical level. Like, all these countries are reliant on importing oil
822
01:12:16.895 --> 01:12:23.659
when they could be harnessing the renewables in their countries. I think this is a very important and strong position, and
823
01:12:23.960 --> 01:12:26.060
I'll go I'll debate that one for sure.
824
01:12:27.400 --> 01:12:30.554
Matt, so sort of to to dovetail with,
825
01:12:30.935 --> 01:12:34.715
Alex's first point there. Like, why this matters to me
826
01:12:35.500 --> 01:12:40.880
in terms of like, why is it an important thing to talk about and and focus on with Bitcoin?
827
01:12:41.260 --> 01:12:41.920
Is that
828
01:12:43.455 --> 01:12:50.915
I like to I I often take it back to, like, the the classic bell curve of technology adopters. Right?
829
01:12:51.409 --> 01:12:54.550
We're still in the very early stages. We're still in the innovator's
830
01:12:55.090 --> 01:12:56.869
stage of Bitcoin adoption.
831
01:12:57.650 --> 01:13:00.630
And the mainstream is still ahead of us.
832
01:13:01.135 --> 01:13:01.635
And,
833
01:13:02.655 --> 01:13:04.835
you know, Bitcoin doesn't need marketing.
834
01:13:06.335 --> 01:13:12.350
I think it's an economic reality that everybody is forced to to come to terms with and figure out eventually,
835
01:13:12.970 --> 01:13:15.630
but it doesn't hurt for people to
836
01:13:16.090 --> 01:13:18.990
to realize the benefits of it through
837
01:13:19.594 --> 01:13:22.175
through word-of-mouth or or, you know,
838
01:13:22.475 --> 01:13:24.175
insightful articles or whatever,
839
01:13:25.114 --> 01:13:26.815
and embrace it,
840
01:13:27.710 --> 01:13:31.410
you know, rather than resisting it and trying to fight it and all that.
841
01:13:31.950 --> 01:13:40.505
And what does the mainstream care about? Well, it seems like a good chunk of them at least actually or think they care about ESG.
842
01:13:40.965 --> 01:13:41.625
You know,
843
01:13:42.405 --> 01:13:44.025
the environment, global warming,
844
01:13:44.710 --> 01:13:45.690
whatever it is
845
01:13:46.150 --> 01:13:48.410
about ESG that gets them going,
846
01:13:49.110 --> 01:13:49.610
individually.
847
01:13:50.390 --> 01:13:54.765
And Bitcoin is the thing that is the best for those goals
848
01:13:55.385 --> 01:13:56.685
and talking about,
849
01:13:57.864 --> 01:14:01.565
the mechanics underneath Bitcoin mining and how,
850
01:14:02.265 --> 01:14:03.324
you know, this
851
01:14:03.740 --> 01:14:07.360
this, creating a a alternative minimum to,
852
01:14:08.540 --> 01:14:10.560
to unused energy.
853
01:14:11.355 --> 01:14:16.495
It how that has this positive flywheel effect of of lifting people out of poverty
854
01:14:16.875 --> 01:14:22.160
or, you know, shifting the mix of energy production to renewable energy and therefore reducing,
855
01:14:23.100 --> 01:14:24.640
you know, greenhouse gases.
856
01:14:25.260 --> 01:14:27.360
That's all going to be popular
857
01:14:27.925 --> 01:14:28.985
with the mainstream
858
01:14:29.364 --> 01:14:32.025
that I would like to see embrace Bitcoin
859
01:14:32.405 --> 01:14:33.625
rather than fight it,
860
01:14:34.245 --> 01:14:36.025
you know, and then and then eventually
861
01:14:36.490 --> 01:14:54.765
submit to it, I think. Yeah. Well, if and again, going back to the again, we keep referencing it, but the the conversation with Friar who has, like he's Lebanese and he lived in Lebanon for a while, and he describes this crazy situation where, like, all the, like, Lebanese are basically entirely relying on diesel. And in each building, there's, like, a diesel generator.
862
01:14:55.210 --> 01:15:10.565
And this is all, like, imported diesel. So they're, like, completely reliant on foreign powers for everything. And that this is the case for so many, not only countries, but communities and individuals. So if we wanna think about being more sovereign and then, you know, I just it strikes me that
863
01:15:11.185 --> 01:15:12.645
a lot of these renewable tech,
864
01:15:13.185 --> 01:15:14.725
or even nuclear ventures,
865
01:15:15.400 --> 01:15:17.980
could be could be really helpful from that perspective.
866
01:15:18.520 --> 01:15:30.264
I'm I'm not saying that's not the case. And if if you and Chris just wanna go and convince, you know, Newcoiners to adopt Bitcoin because it's good for the environment, then that's your prerogative. Yeah. It's not necessary.
867
01:15:30.885 --> 01:15:38.440
I just I just don't I I don't think it's necessary, and I I think at the end of the day, the value prop is censorship resistance.
868
01:15:38.895 --> 01:15:39.875
And the overwhelming
869
01:15:40.255 --> 01:15:42.195
majority of people, not just the mainstream,
870
01:15:43.055 --> 01:15:50.110
overwhelming majority of the people on the planet do not understand that it's about censorship resistance yet. And that's mostly because
871
01:15:50.810 --> 01:15:51.550
our competitors,
872
01:15:51.930 --> 01:15:53.710
the competitor chains and whatnot,
873
01:15:54.170 --> 01:15:56.985
have not really faced censorship yet. And a lot of this
874
01:15:57.465 --> 01:16:01.885
bullshit environmental FUD that we hear is coming from proof of stake
875
01:16:02.264 --> 01:16:02.764
promoters,
876
01:16:03.385 --> 01:16:05.965
and and those those those promoters,
877
01:16:07.400 --> 01:16:07.560
are
878
01:16:08.760 --> 01:16:14.540
they're they're ignoring the trade off of censorship resistance, and until those chains actually get attacked
879
01:16:15.105 --> 01:16:15.685
and sanctioned
880
01:16:16.385 --> 01:16:17.125
and censored,
881
01:16:17.985 --> 01:16:24.710
people will be blind to it. So as, you know, as far as I'm concerned, we keep our heads down, keep moving forward, keep improving Bitcoin,
882
01:16:25.570 --> 01:16:38.595
and and sooner or later, you know, the powers that be can't help themselves. They censor everything. It's not like people don't realize, like, PayPal would prefer if everyone could just send their transactions to whoever. They don't wanna censor transactions. They're forced to censor transactions.
883
01:16:39.770 --> 01:16:40.730
And and there
884
01:16:41.770 --> 01:16:42.830
all these different
885
01:16:43.690 --> 01:16:49.815
chains are gonna gonna be censored if they're not sufficiently censorship resistant, and that's where proof of work matters.
886
01:16:51.315 --> 01:16:53.255
Yeah. Should we re should we, like,
887
01:16:53.555 --> 01:16:54.455
read or,
888
01:16:54.835 --> 01:16:56.115
and discuss the,
889
01:16:56.595 --> 01:16:57.095
minors,
890
01:16:58.020 --> 01:17:00.360
counsel's response. Have you guys seen it?
891
01:17:01.140 --> 01:17:05.780
The the CoinDesk article that went out? No. No. No. It's a thread that Michael Shale Sailor just shared.
892
01:17:06.420 --> 01:17:11.515
No. I'll just it's not it's not that long. If it's okay, Matt, I can just read it for the Go for it. Everybody.
893
01:17:12.375 --> 01:17:18.699
Bitcoin's energy consumption is transparent, making it an easy target for criticism. But what critics can't see is the breakdown of energy sources.
894
01:17:19.160 --> 01:17:43.815
Bitcoin is more carbon free than most industries, but we need better data. Instead of standing by and continuing to write pieces on the topic and hope that the issue goes away, a group of miners came together to say, look, we need to be transparent and we should encourage others to be transparent too. Maybe the word council was too strong. Bitcoin's fungibility matters. Bitcoin's decentralization matters. No one's arguing that. I believe in transparency and I believe in moving towards a carbon free future, but the fundamentals of Bitcoin are nonnegotiable.
895
01:17:44.355 --> 01:17:50.695
We at Galaxy mine with Slush Pool and eagerly await the data Stratum V2 has enacted to further protect Bitcoin's fungibility.
896
01:17:51.150 --> 01:17:51.969
The mining council's goal
897
01:17:52.270 --> 01:17:59.409
is to provide energy transparency. It's that simple. We haven't signed anything for up for anything beyond that. So I'll let you guys react to that.
898
01:18:02.185 --> 01:18:08.110
Maybe it's the, the the vestiges of of, being a Yuppie that are in me,
899
01:18:08.490 --> 01:18:10.190
and, you know, being part of the establishment.
900
01:18:11.450 --> 01:18:16.375
But I don't know. I I I want to believe that Michael Sailor is doing,
901
01:18:17.075 --> 01:18:19.415
you know, is is doing the PR campaign
902
01:18:19.795 --> 01:18:21.895
that he sees as valuable,
903
01:18:22.730 --> 01:18:26.670
as a CEO who's, you know, very familiar with the politicking of
904
01:18:27.050 --> 01:18:28.510
of, image management.
905
01:18:28.810 --> 01:18:32.595
And to be clear, he didn't write he re he shared that. Somebody else wrote that.
906
01:18:32.975 --> 01:18:36.995
Yeah. Yeah. Yeah. But, you know, I I think that I think that he has some
907
01:18:37.375 --> 01:18:40.675
some hand in in this initiative overall.
908
01:18:41.159 --> 01:18:45.580
How is that different how is that different than when Coinbase says Open Finance?
909
01:18:48.199 --> 01:18:49.099
What do you mean?
910
01:18:49.585 --> 01:18:54.804
They say open finance with one hand, and then they sell surveillance software to the US government with the other hand.
911
01:18:55.264 --> 01:19:07.395
Absolutely. So the I've been I've been torn on this all day of, like, how do I feel about this? Because part of me wants to hope that this really is as that thread just described that it's limited to,
912
01:19:08.835 --> 01:19:11.415
you know, trumpeting the winds of
913
01:19:11.875 --> 01:19:12.375
of,
914
01:19:13.155 --> 01:19:14.375
you know, how renewable,
915
01:19:16.040 --> 01:19:19.100
Bitcoin mining already is and how this natural shift
916
01:19:19.560 --> 01:19:20.060
towards
917
01:19:21.000 --> 01:19:21.500
stranded
918
01:19:22.120 --> 01:19:23.820
fossil fuels and and renewables
919
01:19:24.375 --> 01:19:29.914
is is taking place. I wanna believe that there is a there is a slippery slope
920
01:19:30.295 --> 01:19:32.534
that gets really bad really quick,
921
01:19:33.600 --> 01:19:36.900
if this group of miners believes that they have
922
01:19:37.200 --> 01:19:38.420
some power to,
923
01:19:39.440 --> 01:19:42.985
you know, be an arbiter about what kind of blocks are acceptable
924
01:19:43.365 --> 01:19:57.289
or trying to understand. Right? Like, we're we we just spent, you know, 30 minutes or 20 minutes talking about the environmental concerns, and it's not about environmental concerns. It's it's it's a distraction. The real threat is the OFAC shit.
925
01:19:57.750 --> 01:20:06.185
The real threat is is is is agreements between American miners or any miners on on which transactions get included in the block.
926
01:20:07.045 --> 01:20:13.700
Yeah. I just just to clarify, and I totally agree and there's no way that this doesn't turn into a slippery slope and that's why I think it's a horrible idea.
927
01:20:14.400 --> 01:20:22.075
But I I wouldn't say we were talking about environmental concerns. I would say we were describing how there are, like, factors in the world that will,
928
01:20:22.455 --> 01:20:23.275
like, basically
929
01:20:23.975 --> 01:20:25.275
take advantage of Bitcoin,
930
01:20:26.120 --> 01:20:28.620
and that Bitcoin mining will spread in a certain direction
931
01:20:29.160 --> 01:20:40.385
because of, like, stranded and otherwise, like, unusable energy resources. I I don't think we're I'm not trying to make, like, a judgment here. I'm just trying to sort of describe what's happening and what will probably likely continue to happen.
932
01:20:41.250 --> 01:20:46.710
But, yeah, we don't have to pander to to anybody. I just think it's kinda cool that that's happening. Yeah. Agreed.
933
01:20:48.449 --> 01:20:48.949
So,
934
01:20:50.225 --> 01:20:51.925
no. Yeah. I I didn't mean to,
935
01:20:55.505 --> 01:20:59.890
yeah, I mean, I I I agree with that. I I I didn't I didn't mean to to say otherwise.
936
01:21:01.470 --> 01:21:05.235
The but my point is is that it's it's coming from an
937
01:21:06.514 --> 01:21:11.335
from a perspective of response, basically, like like that there needs to be a response here.
938
01:21:12.960 --> 01:21:15.139
And I I really do think it's a distraction.
939
01:21:15.440 --> 01:21:16.500
We have 6102
940
01:21:17.040 --> 01:21:17.860
in the comments.
941
01:21:19.600 --> 01:21:27.735
I a lot of times, I talk about this being, the 61 02 show because he refuses to dox his voice except for that one episode on Stefan Lavera,
942
01:21:28.755 --> 01:21:37.190
and he's kind of upset with me. He woke up on the wrong side of the bed today, but he's kind of upset with me because this is supposed to be a show about actionable Bitcoin discussion.
943
01:21:37.810 --> 01:21:39.510
It's something I pride myself in,
944
01:21:40.425 --> 01:21:43.485
that we talk about real steps that Bitcoiners can take today,
945
01:21:44.425 --> 01:21:45.645
to improve their
946
01:21:47.630 --> 01:21:49.170
current situation or
947
01:21:50.030 --> 01:21:51.010
or threat model,
948
01:21:52.830 --> 01:21:54.130
and how they use Bitcoin.
949
01:21:54.830 --> 01:21:56.450
I do think that
950
01:21:56.835 --> 01:21:58.295
this is very topical,
951
01:21:59.635 --> 01:22:00.455
and I think
952
01:22:00.755 --> 01:22:02.775
the conversations we've had so far
953
01:22:03.155 --> 01:22:03.655
are
954
01:22:04.300 --> 01:22:08.240
questions that a lot of Bitcoiners, especially new corners, are asking themselves
955
01:22:08.620 --> 01:22:09.120
about.
956
01:22:09.980 --> 01:22:12.560
So I would push back a little bit that it's not actionable,
957
01:22:13.085 --> 01:22:15.265
but he does have a good point.
958
01:22:16.285 --> 01:22:17.425
In terms of
959
01:22:18.845 --> 01:22:19.345
censorship,
960
01:22:19.725 --> 01:22:21.265
if we start to see
961
01:22:22.340 --> 01:22:22.840
miners,
962
01:22:25.059 --> 01:22:27.960
if we if we start well, we we're already seeing miners,
963
01:22:28.579 --> 01:22:30.679
censor transactions. Right? We're seeing
964
01:22:31.355 --> 01:22:32.415
Marathon Pool,
965
01:22:33.275 --> 01:22:34.815
doing this OFAC thing.
966
01:22:35.835 --> 01:22:36.815
In that situation,
967
01:22:38.350 --> 01:22:42.210
you know, what can a user do? Right? And I think
968
01:22:42.910 --> 01:22:43.570
I mean,
969
01:22:44.510 --> 01:22:48.635
they can basically do all the privacy techniques that we've discussed on this show
970
01:22:49.095 --> 01:22:50.795
in the other 22 episodes.
971
01:22:51.735 --> 01:22:54.795
A big one to me, I think, is CoinJoin, and I think
972
01:22:55.780 --> 01:22:58.119
one of the aspects of CoinJoin that is
973
01:22:59.460 --> 01:23:03.480
and no KYC. Right? So I I I think one of the big
974
01:23:10.475 --> 01:23:10.975
is
975
01:23:11.550 --> 01:23:16.930
that a lot of Bitcoiners seem to prefer the pay join model. This idea that you could have,
976
01:23:18.405 --> 01:23:29.280
a privacy gain in Bitcoin without it being obviously apparent on chain, because CoinJoin is completely apparent on chain. PayJoin, under certain circumstances, can look like normal transaction. You can't tell it's PayJoin.
977
01:23:29.980 --> 01:23:35.119
I think CoinJoin is kind of really useful here because it's obvious on chain, because
978
01:23:36.015 --> 01:23:40.595
if miners want to start censoring coin join transactions, it's gonna be immediately obvious,
979
01:23:41.295 --> 01:23:43.955
and it's gonna affect every single coin join user.
980
01:23:44.600 --> 01:23:47.860
So to me, I think the single biggest thing that
981
01:23:48.360 --> 01:23:52.140
and 6102, I mean, you could correct me if you disagree here in the comments.
982
01:23:52.885 --> 01:24:02.310
I think the single biggest thing a user can do to protest this kind of OFAC block list type of thing is to just coin join everything and constantly coin join.
983
01:24:03.350 --> 01:24:09.610
I agree. And I I want to tag on on onto that because I think that's an important point, and also it
984
01:24:10.455 --> 01:24:17.275
speaks to the actionable advice of Citadel Dispatch. I would also say just coinjoin and also learn about coinjoin. Learn about,
985
01:24:18.110 --> 01:24:30.304
how Bitcoin works, also learn about proof of work to push back against, like, the narratives that are spun up. But I I would still say even though you're saying that coin joints are obvious on chain, that's kind of true, but still,
986
01:24:30.685 --> 01:24:32.945
paint is something that is external
987
01:24:33.540 --> 01:24:42.120
to Bitcoin. And you can only tell if a Bitcoin is like a bad Bitcoin, if UTXO is a bad UTXO by applying heuristics.
988
01:24:42.505 --> 01:24:45.485
And this will always be true. And the question remains,
989
01:24:45.864 --> 01:24:56.150
like, what do you need to do with a new UTXO so that it becomes clean again? Because if you go through the whole transaction graph, the it's it's very probable that your UTXO
990
01:24:56.690 --> 01:24:59.590
was in touch with a coin join in the past. So
991
01:24:59.915 --> 01:25:17.225
all these questions remain unanswered, and all these, like, OFAC compliance like, all all this bullshit, it doesn't really take it into account because how many hops are enough hops until the Bitcoin is back into normal circulation again and is clean again. And it's it's it's not it's it's also
992
01:25:17.844 --> 01:25:18.665
like Bitcoiners
993
01:25:19.045 --> 01:25:27.450
know of these problems, and I think, you know, we talk about Taproot a lot. And I think Taproot truly solves this problem in a sense that you can't differentiate
994
01:25:27.830 --> 01:25:35.675
between coin joints and normal transactions anymore. And once once we have that, the heuristics kind of fly out of the window. And, again, I repeat,
995
01:25:36.554 --> 01:25:40.175
a tainted Bitcoin is always an external property. It's nothing
996
01:25:40.635 --> 01:25:45.010
it's nothing that you can definitely say intrinsically that this is, like,
997
01:25:45.550 --> 01:25:50.290
a a a bad Bitcoin, so to speak. And I think regulators should kind of
998
01:25:50.910 --> 01:25:52.130
I I don't think currently
999
01:25:52.510 --> 01:25:54.344
this is taking into consideration.
1000
01:25:54.804 --> 01:25:59.065
True. Right? You you could still see an equal output coin join. Right? Like, that's not
1001
01:26:00.244 --> 01:26:01.385
why would that change?
1002
01:26:02.000 --> 01:26:08.820
Yeah. I can I can do a normal transaction where it just happens to be that I have an an equal output with multiple parties?
1003
01:26:10.085 --> 01:26:10.585
Okay.
1004
01:26:11.525 --> 01:26:19.250
It's it's like there there are different kinds of coin join. Like It's a bad transaction. It's a bad send transaction. Mhmm. And it's also, like,
1005
01:26:20.110 --> 01:26:25.250
still that like, you you've also the the ownership is also a heuristic. You know? Like,
1006
01:26:26.135 --> 01:26:30.315
even even putting identities onto UTXO is is it's,
1007
01:26:30.775 --> 01:26:41.500
like, it's it's not a done deal. That's what I'm trying to say. You know? Your heuristics can always be wrong. Yeah. I I can pass on an open dime and your all all your heuristics are destroyed. You know? Like, I can do
1008
01:26:42.195 --> 01:26:44.855
I I can pass on UTXOs without doing a transaction.
1009
01:26:47.715 --> 01:26:55.870
Yeah. This is not reflected in chain surveillance. That's what I'm trying to say. I mean, I guess it gets to the heart of the whole show in terms of, like, what mining centralization
1010
01:26:57.050 --> 01:26:59.230
and, like, this potential trend of mining
1011
01:26:59.715 --> 01:27:00.215
decentralization,
1012
01:27:02.275 --> 01:27:11.219
is, you know, at the end of the day, like, if you're worried about sensorius miners, like, they have they have to as you said, Matt, they have to know who you are. Like, they have to know what transactions are yours. Right?
1013
01:27:11.679 --> 01:27:14.420
And that's what you wanna defend yourself, you know, from.
1014
01:27:15.040 --> 01:27:16.000
Well, I mean, like
1015
01:27:16.615 --> 01:27:19.435
so in a lot of ways, you know, to me,
1016
01:27:20.135 --> 01:27:25.115
you know, my miner based censorship is something that's been discussed in Bitcoin land for a long time,
1017
01:27:25.650 --> 01:27:36.534
and it's always been considered, especially on the tech side, has always been considered, like, the the ultimate threat, right, to to get past this threshold where, you know, mining is distributed enough that you don't have,
1018
01:27:37.395 --> 01:27:38.455
this kind of censorship.
1019
01:27:38.995 --> 01:27:45.010
And as we mentioned earlier in the show and 60102 pointed out in here, a key aspect, right, is that
1020
01:27:45.710 --> 01:27:52.165
if if you don't have all minors playing ball, especially as transaction fees become a larger and larger part of their reward,
1021
01:27:53.105 --> 01:27:59.045
if one miner tries to censor you, you can just raise your fee and and get into a block by by a different miner.
1022
01:28:01.300 --> 01:28:05.080
Part of me thinks that a lot of this is also mental masturbation
1023
01:28:05.380 --> 01:28:05.880
because
1024
01:28:06.260 --> 01:28:07.800
it's not even really necessary.
1025
01:28:10.235 --> 01:28:13.135
Most Bitcoiners are coming in through KYC exchanges.
1026
01:28:14.635 --> 01:28:16.094
You can make it prohibitively
1027
01:28:16.395 --> 01:28:18.880
difficult to withdraw from those KYC exchanges.
1028
01:28:19.260 --> 01:28:26.719
You can just, you know, keep them on Robinhood. They don't even withdraw they're not even allowed to withdraw if they use Robinhood or PayPal or Venmo or or
1029
01:28:27.165 --> 01:28:29.665
any Revolut, I think, still doesn't allow withdrawals.
1030
01:28:31.485 --> 01:28:33.505
So there's a lot of ways to attack.
1031
01:28:33.965 --> 01:28:36.225
You know, there's a lot of ways to censor Bitcoin,
1032
01:28:37.730 --> 01:28:39.510
especially the low hanging fruit
1033
01:28:40.130 --> 01:28:40.630
for,
1034
01:28:41.489 --> 01:28:48.885
you know, the overwhelming majority of the mainstream as Chris has said earlier. Right? It's it's relatively easy to censor them just via these KYC
1035
01:28:50.225 --> 01:28:54.610
elements of of the exchanges and the on ramps and the off ramps and the wallets and and whatnot.
1036
01:28:55.330 --> 01:28:57.350
What what does concern me though,
1037
01:28:58.610 --> 01:29:00.469
I guess, is, like, kind of like an endgame.
1038
01:29:01.090 --> 01:29:08.215
I don't think it's really conceivable that it happens, but the fear to me on the minor censorship side is less a blacklist
1039
01:29:09.155 --> 01:29:11.735
mentality and more a whitelist mentality
1040
01:29:12.435 --> 01:29:12.935
Mhmm.
1041
01:29:13.885 --> 01:29:14.385
Where
1042
01:29:14.730 --> 01:29:15.950
they have basically
1043
01:29:16.650 --> 01:29:20.110
a list of known actors that they're only confirming transactions of them.
1044
01:29:20.570 --> 01:29:27.675
Right? And that's that is, you know, there's no there's no doubt in that. Like, with chain analysis, there's doubt as Gigi said,
1045
01:29:29.850 --> 01:29:38.510
and and we have people talking shit about proof of stake. It'd be more likely we see it in a proof of stake chain. Yeah. And, hopefully, we will see it in these weaker chains first before
1046
01:29:40.285 --> 01:29:41.085
Bitcoin. But,
1047
01:29:41.805 --> 01:29:52.130
this idea that, like, imagine if if Coinbase just submitted their xpubs to Foundry and Marathon. Right? And said that any transactions that come from these xpubs are ours,
1048
01:29:52.510 --> 01:30:00.045
and, you know, we'll pay you a certain flat rate for the year to to mine those transactions for us. Something like that.
1049
01:30:01.145 --> 01:30:07.750
Yeah. I mean, look, as far as actionable, I mean, it 6102 just pointed out that, like, you know, you would need 51%,
1050
01:30:09.409 --> 01:30:10.630
to effectively censor.
1051
01:30:11.010 --> 01:30:14.309
Right? Right. So, I mean, it is not, it is not
1052
01:30:15.235 --> 01:30:20.295
not actionable to be talking about how, you know, we could act potentially make an impact in terms of,
1053
01:30:21.715 --> 01:30:22.695
you know, encouraging
1054
01:30:24.449 --> 01:30:34.335
many jurisdictions to do mining. Like, I think that that is one clear way to to proceed here. I mean, it may not be Cypherpunks right code, but I mean, Bitcoin is is
1055
01:30:34.955 --> 01:30:44.130
a little bit more than that. I mean, now we're out there in the manufacturing world. We have physical hardware that that is, you know, an important part of the nervous system of this network.
1056
01:30:44.670 --> 01:30:47.890
And, it may seem like an impossible task, but
1057
01:30:48.965 --> 01:31:02.560
weird shit's gonna happen in the next 5 years and we're at a very impressionable moment. You have people like Elon Musk who are, like, they don't know what the hell is going on and they're, like, learning about it now, And they're they're gonna learn some bad stuff. I mean, he's pretty clear he's getting very into proof of stake in Ethereum,
1058
01:31:03.020 --> 01:31:07.165
but they're they're also gonna learn more, you know, opportunity to teach about Bitcoin. So
1059
01:31:07.725 --> 01:31:11.665
I think it is a time when we can be actionable about trying to think about,
1060
01:31:12.125 --> 01:31:16.785
paving a way for a future where where the mining is is more decentralized in terms of operations.
1061
01:31:19.070 --> 01:31:19.570
Yeah.
1062
01:31:19.870 --> 01:31:21.570
To piggyback on on
1063
01:31:22.270 --> 01:31:26.685
that idea of, like, what is actionable and and how does what can we do to reduce,
1064
01:31:27.005 --> 01:31:27.665
you know,
1065
01:31:28.605 --> 01:31:29.745
improve our threat models
1066
01:31:30.125 --> 01:31:33.425
as Bitcoiners here. I guess that's that's why I
1067
01:31:33.885 --> 01:31:35.265
feel strongly about
1068
01:31:37.410 --> 01:31:40.070
pointing out the the environmental
1069
01:31:40.610 --> 01:31:41.110
benefits,
1070
01:31:41.490 --> 01:31:44.150
the energy renewable energy benefits
1071
01:31:44.525 --> 01:31:46.545
of of Bitcoin and Bitcoin mining,
1072
01:31:47.885 --> 01:31:51.985
is because one of our one I think as Bitcoin is one of our big threats
1073
01:31:52.530 --> 01:31:53.990
in the 10 plus
1074
01:31:54.530 --> 01:31:57.590
year horizon is the persecution by the mob.
1075
01:31:58.530 --> 01:31:59.830
You know, and and
1076
01:32:00.290 --> 01:32:01.990
to the extent that we can
1077
01:32:02.835 --> 01:32:09.574
take the narrative that is being stirred up for them by the media of Bitcoin is bad for the environment
1078
01:32:10.920 --> 01:32:11.320
and,
1079
01:32:11.960 --> 01:32:14.860
point out through education, through whatever sort of,
1080
01:32:16.280 --> 01:32:16.940
you know,
1081
01:32:17.480 --> 01:32:19.820
information we can generate as a community
1082
01:32:20.265 --> 01:32:21.324
that no, actually,
1083
01:32:21.705 --> 01:32:25.005
it's very much the opposite. In fact, this is the best thing,
1084
01:32:25.625 --> 01:32:26.125
for
1085
01:32:27.120 --> 01:32:30.660
for the environmental goals that you have, as the mainstream.
1086
01:32:31.440 --> 01:32:33.460
That I think can reduce
1087
01:32:33.760 --> 01:32:37.244
the likelihood of us being persecuted as a as a group,
1088
01:32:37.625 --> 01:32:42.764
and individually. And I think that's that's one of the big concerns I have as a as a Bitcoiners.
1089
01:32:43.640 --> 01:32:46.380
You know? At what point does the mob turn on me?
1090
01:32:47.000 --> 01:32:50.940
And I think this is currently the the single biggest narrative
1091
01:32:51.425 --> 01:32:55.125
for generating animosity towards Bitcorners as an out group,
1092
01:32:56.385 --> 01:32:58.325
when it doesn't need to be that way.
1093
01:33:01.540 --> 01:33:04.280
Yeah. I I think I think there are 2, like,
1094
01:33:04.980 --> 01:33:07.080
ways that this can be mitigated.
1095
01:33:07.515 --> 01:33:25.820
Increase the numbers the number of Bitcoiners drastically. So urge everyone to stay humble and slack, and I think that kind of works. You know, once you once you dip your toe into the water, it seems to be a one way street. And on the other side, I think education is just key. And I just want to go on a
1096
01:33:26.425 --> 01:33:32.685
a a little proof of stake rant there because the chat is still talking about proof of stake. And I just Thank you.
1097
01:33:33.065 --> 01:33:42.550
I just want to point out that if you think that proof of stake is a good idea, you don't understand proof of work in the first place. And I I I truly believe that
1098
01:33:42.945 --> 01:33:44.165
the main misunderstanding
1099
01:33:45.185 --> 01:33:48.405
of of just the general population and also of of shitcoiners,
1100
01:33:48.705 --> 01:34:04.815
for that matter, is around proof of work. Proof of work solves all the problems that proof of stake has, and proof of stake is actually a non solution. Like, it's it's it's like talking to physicists and and explaining to physicists that, like, wouldn't it be nice if we could build a a perpetual
1101
01:34:05.115 --> 01:34:14.380
motion machine? You know? Yeah. That would be awesome. It would be great. It would be great if proof of stake could work, but it doesn't work. Like, it's it's literally against the laws of physics. Like, it's
1102
01:34:15.260 --> 01:34:24.630
if you understand proof of work well enough, this kind of becomes obvious. You know? And in proof of stake, you don't have an objective truth, and that's the whole problem. Proof of work builds up
1103
01:34:25.429 --> 01:34:34.330
and a time line that you can't argue with, and you have an objective truth. If you have 2 proof of work chains that that map onto 10 years of reality, you can look at them objectively
1104
01:34:34.695 --> 01:34:36.395
and determine without a doubt
1105
01:34:36.775 --> 01:34:40.635
which one is true by definition, and that's what we have with Nakamoto Consensus.
1106
01:34:41.255 --> 01:35:11.295
The the chain that has the most work embedded in it is true by definition. You don't have this with proof of stake. If I present to you from the same Genesys plot with the same validators, 10 years of history of 2 proof of j stake chains that had a split somewhere in the past, you cannot tell which one is the accurate one and which one isn't. So you always have to rely on trust of of some external trust, and it's proof of stake is like like the electric plug that plugs into itself. And that's the whole problem. And you have you you will always have timing problems
1107
01:35:11.675 --> 01:35:14.815
in proof of stake because you have no way to tell the time accurately,
1108
01:35:15.275 --> 01:35:16.175
in an adversarial
1109
01:35:16.950 --> 01:35:26.835
environment. That's a really deep problem. You have random selection problems, like who is gonna be the next validator. You have no outside cost. You have no operational cost. This leads to massive centralization.
1110
01:35:27.215 --> 01:35:37.620
Like, if you think proof of stake is a good idea, you have no idea what kind of problems proof of work solves, and you you need to study proof of work more if you think proof of stake is a genius idea.
1111
01:35:38.000 --> 01:35:38.160
I,
1112
01:35:39.120 --> 01:35:50.420
a question for you, Gigi. I I I agree, obviously, and I I went on Lex Freeman a month ago. I guess that's gonna come out soon, and I I wanted to address that with him in terms of, like, the fact that Bitcoin,
1113
01:35:51.600 --> 01:36:02.215
you know, doesn't have a bureaucracy that runs the monetary policy and every other cryptocurrency has, like, essentially a currency board, like a small group of people that get to decide the monetary policy. And that even in the 2nd largest cryptocurrency,
1114
01:36:02.860 --> 01:36:15.094
we don't even know what the monetary policy is gonna be in 2 years. No one has any freaking clue how much ETH is gonna be minted in 2022 or 2023. It's like, I I talked I talked to a bunch of ETH engineers very politely, and I was just trying to get, like, a sense of what they had in mind. And
1115
01:36:15.395 --> 01:36:25.600
the answer is they're gonna figure it out, and they're gonna do their best. And and that is, you know, not a recipe for success in this world in terms of currencies. Like, a handful of currencies have done pretty well, but most of them have totally shit the bed.
1116
01:36:25.980 --> 01:36:32.735
So good luck to them. I mean, they have no experience doing that, like, out there in the real central bank world. So we'll see what happens.
1117
01:36:33.594 --> 01:36:37.695
But I will say this is very interesting. I wanted to bring this up with you guys. Did did all these see Vitalik's
1118
01:36:38.449 --> 01:36:39.190
latest post?
1119
01:36:40.849 --> 01:36:47.270
Can't say I did. Nope. I think what I've observed is this trend and a lot of, like, the, I would say,
1120
01:36:47.735 --> 01:36:48.475
more savvy
1121
01:36:49.015 --> 01:36:55.995
ETH people are are are, I think, hinting at this narrative shift where they're basically saying, we needed proof of work to bootstrap.
1122
01:36:57.480 --> 01:37:17.829
But really what what preserves Bitcoin's freedom is the full notes, not the proof of work. And we're gonna go to proof of stake, and we're gonna have full nodes and proof of stake, and we're not gonna have proof of work and fuck you guys. And this is what I I I I started to, like, get this vibe, when I was, again, talking to these ETH engineers and they're like, no. No. No. Bitcoin is special because of full notes, not because of proof of work.
1123
01:37:18.449 --> 01:37:28.695
And they really push on this. And Vitalik's latest post was about how important full notes were. I swear to God this is happening. So this is their theory is that they're gonna say, you need proof of work to bootstrap,
1124
01:37:29.070 --> 01:37:30.690
then you can go to proof of stake,
1125
01:37:31.470 --> 01:37:32.690
after the quote, unquote,
1126
01:37:33.390 --> 01:37:35.170
fair distribution. Okay? Right.
1127
01:37:35.870 --> 01:37:45.780
But then it's all about full nodes. And now Vitalik's gonna put on the show about how he wants to make full nodes more doable in Ethereum. So I don't know what your reactions to that are, but that that's what I'm sensing here.
1128
01:37:46.420 --> 01:37:48.760
God. What a dog and pony show. Because
1129
01:37:49.139 --> 01:37:56.735
if I'm not mistaken, the the calculations for for what a full node has to be able to handle is
1130
01:37:57.035 --> 01:38:00.015
3 petabytes a year, I think, of of data,
1131
01:38:00.395 --> 01:38:02.175
just just to keep synced
1132
01:38:04.340 --> 01:38:07.480
under the the new proof of stake model they're shifting to. Owners,
1133
01:38:08.980 --> 01:38:18.325
owner is burden on anybody who's trying to to run a full node. And it and it's beyond you know, it doesn't even matter because you're still talking about the fact that,
1134
01:38:19.410 --> 01:38:20.630
a group of insiders
1135
01:38:21.250 --> 01:38:23.750
with a 70% pre mine is
1136
01:38:24.450 --> 01:38:25.590
arbitrarily deciding
1137
01:38:26.375 --> 01:38:28.795
future changes in monetary policy and,
1138
01:38:29.494 --> 01:38:30.954
has the ability to revoke
1139
01:38:31.414 --> 01:38:33.175
transactions like with the DAO,
1140
01:38:33.750 --> 01:38:35.110
at any point. It it
1141
01:38:36.070 --> 01:38:38.250
so frustrating how, they they
1142
01:38:39.110 --> 01:38:40.410
distract you with,
1143
01:38:40.790 --> 01:38:42.090
arguing about details
1144
01:38:42.455 --> 01:38:43.415
when the bigger picture,
1145
01:38:45.335 --> 01:38:46.315
is so stark.
1146
01:38:47.975 --> 01:38:53.969
Yeah. But this is their way of of, like, trying to have their cake and eat it too. Like, they're trying to go all in on this
1147
01:38:54.349 --> 01:38:57.969
energy narrative, which I know we've beat the horse to death here, but,
1148
01:38:58.429 --> 01:39:06.550
it it's it works, folks. I mean, you you you know, we are sitting here. We all are long term Bitcoiners. Like, we know what's gonna happen, and it's unstoppable. But, like,
1149
01:39:07.030 --> 01:39:17.375
short term is important too and there's years here between now and then and fortunes are gonna be made and lost. And, like, them getting Elon and all these people to buy into the green stuff is,
1150
01:39:18.175 --> 01:39:26.760
is highly profitable for them. Highly profitable. I mean, look. I mean, if you guys think ETH is gonna disappear, you're wrong. It's not. It's gonna be around. It's gonna continue to make people
1151
01:39:27.060 --> 01:39:44.510
shitloads of money. I mean, they're just profiling the 3 arrows guys in the Wall Street Journal today. I mean, they've got a massive youth position. And, I mean and, you know, I think they know how to manipulate the markets. So So you know, they're they're they're set up here. I mean, I think Gigi hit the nail on the head, with his description.
1152
01:39:46.250 --> 01:39:49.310
I think proof of work, distributed proof of work is a real innovation.
1153
01:39:50.625 --> 01:39:57.525
I think it's insane that it almost seems like an overwhelming majority of people in the industry, including so called smart money,
1154
01:39:58.030 --> 01:40:03.409
think that proof of work is a problem that needs to be solved rather than the innovation itself. So early.
1155
01:40:03.790 --> 01:40:07.145
I think that's really bullish for us who realize it.
1156
01:40:07.945 --> 01:40:13.325
It's one of my most, you know, bullish fundamentals with Bitcoin, and I don't think that's priced in,
1157
01:40:14.105 --> 01:40:17.085
even if a lot of Bitcoiners disagree with me on that.
1158
01:40:17.850 --> 01:40:20.830
And one thing I was I would add there that Gigi missed,
1159
01:40:22.090 --> 01:40:26.350
is, you know, a proof of stake system is inherently permissioned. It's not permissionless.
1160
01:40:27.915 --> 01:40:29.615
You can't get into the system
1161
01:40:30.235 --> 01:40:44.080
without an existing holder selling you some of their coins, trading you some of their coins. With Bitcoin, you we existing holders can't block new entrants. They can get miners. They can plug in those miners. They can get coins automatically via the network.
1162
01:40:44.925 --> 01:40:49.025
But with proof of stake, that's not possible. And then just one thing I would add here,
1163
01:40:49.725 --> 01:40:52.465
I mean, they've been talking about proof of stake since before the ICO.
1164
01:40:52.790 --> 01:40:57.290
Yep. So once again, here we are, you know, arguing about something that doesn't exist yet.
1165
01:40:58.630 --> 01:41:00.489
And I feel like when
1166
01:41:01.114 --> 01:41:09.695
if they ever get it together and make it launch, I'm not gonna say they're never gonna move to proof of stake. We'll see if it happens, and I think there'll be a fight with miners if it does happen
1167
01:41:10.000 --> 01:41:13.139
because why would minors, you know, wanna lose all their revenue?
1168
01:41:14.560 --> 01:41:21.915
They're gonna have major issues, and they're gonna have major censorship issues, and they're gonna have major reliability and stability issues. They're gonna have
1169
01:41:22.295 --> 01:41:26.555
you know, there's so much complexity there. I'm I don't pretend to know all their different complex
1170
01:41:26.910 --> 01:41:43.635
bullshit they talk about, but, like, people are gonna get slashed that aren't supposed to get slashed. People are gonna lose money, and it's gonna prove to people, you know, why it's such a bad idea. So, like, people need to touch the stove, and the stove is being built. It's been built, you know, being built and hyped for, like, the last decade.
1171
01:41:44.060 --> 01:42:03.035
Yeah. And I just want to point out that there is a reason why Ethereum is still a proof of work coin, and they have been talking about transitioning to proof of stake forever. And there is also a reason why all proof of stake systems that got a little bit bigger were attacked and ran into issues. There is a reason why all proof of stake systems suffer
1172
01:42:03.360 --> 01:42:06.340
from timing attacks and from stake grinding attacks
1173
01:42:06.720 --> 01:42:45.620
and why all proof of stake systems had to add a little bit of proof of work to just make it work. You know, if you research that, it's it it becomes blatantly obvious the proof of stake just does not work and can never work. And if you understand proof of work deeply enough, it becomes obvious from first principles because what are we trying to do? We are trying to build up an internally consistent global construct that is made of pure information that nobody can cheat and that everyone can verify. And you cannot do that without proof of work Because without proof of work, you will always have to rely on external sources of truth. Only with proof of work can you embed the truth inside of the information,
1174
01:42:45.925 --> 01:43:18.190
And that is actually the innovation that Bitcoin brings with it, and that's why it works. And the difficulty adjustment is just like the the the genius cherry on the top that makes all of it kind of work beautifully and leads to a to a finite supply and all of it. And if you don't understand that, you just have no idea what you're talking about. And if you want to build, like, proof of stake castles in the sky, be my guest. Like, as Alex said, okay, it's gonna be profitable in the long run, and they're very good at marketing and so on and so forth, but make no mistake, all of it will collapse. Proof of stake can never can never work. It can never work, and it will collapse.
1175
01:43:18.730 --> 01:43:30.775
And and so it's be my guest. Like, build it and see it firsthand and burn your both burn both of your hands on the stove, and I'll be sitting here with my popcorn and just staying humble and sucking sense. That's also actionable advice.
1176
01:43:31.300 --> 01:43:37.835
Rather than I mean, for me, rather than saying it'll never work, I mean, that that's what we escaped from. Like, for me, I feel like
1177
01:43:38.315 --> 01:43:40.655
fiat currencies are proof a proof of stake in a way.
1178
01:43:41.114 --> 01:43:45.055
And, they they have a rather aggressive lifespan, unfortunately,
1179
01:43:45.950 --> 01:44:06.140
and and they've wreaked havoc and and do things, but you'd like, proof of work plus One more thing. You go ahead and say one more thing. It it cannot work in an adversarial environment. It cannot work because you can cheat your time stamps, and that's basically it. Like, it cannot work. If you want to fuck shit up in a proof of stake system, you absolutely can. It's really difficult to do in a proof of work system.
1180
01:44:06.600 --> 01:44:14.425
Yeah. I guess what I mean by that is in a vacuum where it's controlled, like, they could they could keep the straight going for for a long time, but, like, the the fact that proof of work
1181
01:44:14.805 --> 01:44:19.305
plus full nodes, very important. There's a bunch of, shitcoin proof of work coins that that are meaningless.
1182
01:44:19.925 --> 01:44:22.630
You know, this this this you gotta have both of these things.
1183
01:44:23.270 --> 01:44:26.570
User control of a proof of work system, which is only possible in
1184
01:44:26.870 --> 01:44:29.645
Bitcoin. Like, once you have that, that's our ticket out of proof of stake.
1185
01:44:30.205 --> 01:44:33.665
Mhmm. And into a system where a small group of people do not control the monetary policy.
1186
01:44:34.125 --> 01:44:39.800
And and that's the key for me. So that's kinda it for the folks in the chat. That's the way I'm trying to explain it to people
1187
01:44:40.179 --> 01:44:56.440
who aren't very, very into this. Like, it's it's really our opportunity to get out of having, like, a currency board, a small group of people who are usually the elite, almost always the elite, who who get to make the decisions for everybody else. Well, guess what? In Bitcoin, we don't have that and, no one's making any decisions about 21,000,000.
1188
01:44:56.740 --> 01:45:02.600
So that's kind of the way I would put it. I think that's that's why Ethereum has staying power is
1189
01:45:02.945 --> 01:45:04.325
Ethereum is the
1190
01:45:05.505 --> 01:45:09.125
it's this local optimum of of variables
1191
01:45:09.505 --> 01:45:12.950
if you are determined to not break your worldview,
1192
01:45:13.890 --> 01:45:16.630
you know, to to continue to view the world as,
1193
01:45:17.010 --> 01:45:18.025
you know, as
1194
01:45:18.485 --> 01:45:26.665
necessarily working the way the fiat system today works of having insiders that control monetary policy and can can,
1195
01:45:27.610 --> 01:45:28.910
you know, be responsible,
1196
01:45:30.170 --> 01:45:33.950
stewards over the chain and decide what what
1197
01:45:34.735 --> 01:45:35.235
transactions
1198
01:45:36.014 --> 01:45:39.375
are allowed and and which ones get rolled back. Like, that's
1199
01:45:40.335 --> 01:45:47.290
if you if you want to view the world that way, which is how we've all been indoctrinated to to see the world, then Ethereum,
1200
01:45:48.790 --> 01:45:50.890
is in line with your worldview.
1201
01:45:51.345 --> 01:45:53.925
And getting to that deeper value of Bitcoin
1202
01:45:54.545 --> 01:45:55.045
requires,
1203
01:45:56.705 --> 01:46:05.710
facing your worldview head on and and, you know, casting out the elements that are that that have been indoctrinated into us and,
1204
01:46:06.030 --> 01:46:07.570
you know, seeing a deeper truth,
1205
01:46:08.425 --> 01:46:17.245
That's hard to do. Luckily, it's an economic reality that will be playing itself out, but I think that's why Ethereum has its staying power. Also, to to
1206
01:46:18.530 --> 01:46:20.630
talk up I talked up Alex's
1207
01:46:20.930 --> 01:46:21.830
recent article.
1208
01:46:22.850 --> 01:46:26.950
If if listeners were interested in in what Gigi was just talking about,
1209
01:46:27.585 --> 01:46:30.085
check out his, Bitcoin his time
1210
01:46:30.465 --> 01:46:37.240
piece, which I think was probably the the deepest article I've read about the nature of Bitcoin in the last year or so. So,
1211
01:46:37.780 --> 01:46:39.240
highly recommend that one.
1212
01:46:41.220 --> 01:46:42.980
Yeah. Thanks. And to your point that,
1213
01:46:43.955 --> 01:46:51.415
Ethereum has staying power, I'm not so sure about that. Like, the the underlying technology of Ethereum is like rack pull technology. So,
1214
01:46:52.060 --> 01:46:58.720
like, it's it's a rock pull from the start because of the 70% pre mine, and they just enabled all the other rock pulls. Yep. And I think just
1215
01:46:59.105 --> 01:47:13.110
I I wouldn't be surprised if there is, like, one rug pull to end it all. And, of course, you know, like, as Matt likes to say, it will trend to 0 in Bitcoin terms as well everything else. So I wouldn't I wouldn't bet on Ethereum having staying power.
1216
01:47:13.970 --> 01:47:18.835
I I hope you're right. I I wouldn't be surprised if nobody talks about it 15 years from now.
1217
01:47:21.075 --> 01:47:25.975
God. I hope so. I hope it's the death rattle of of an old, you know, an old way of thinking.
1218
01:47:27.330 --> 01:47:29.270
But It's gonna be a very expensive lesson.
1219
01:47:29.650 --> 01:47:37.355
Yeah. That's that's for sure. And and, you know, like, I'm an example of that. Like, I I started as an Ethereum person at 2016.
1220
01:47:37.735 --> 01:47:43.034
That's what I got pulled into, the narrative of of what Ethereum could do that Bitcoin couldn't do.
1221
01:47:43.800 --> 01:47:46.220
And I and that caused me to stay
1222
01:47:46.840 --> 01:47:52.860
in altcoin land for until 2019. You know, it took a bear market and absolute bludgeoning
1223
01:47:53.994 --> 01:47:55.614
in terms of my sat value
1224
01:47:55.994 --> 01:47:58.415
to capitulate basically into Bitcoin.
1225
01:47:59.034 --> 01:48:02.494
And the stock to flow model was also important for me to to, like,
1226
01:48:02.980 --> 01:48:07.400
start to go down the rabbit hole of of the nature of stores of value
1227
01:48:07.780 --> 01:48:09.960
and realize what Bitcoin really is.
1228
01:48:11.645 --> 01:48:16.385
Yeah. But, like, the you know, that if I hadn't gotten pulled into Ethereum,
1229
01:48:16.685 --> 01:48:18.625
I would have more sats today,
1230
01:48:19.244 --> 01:48:20.545
than than I do.
1231
01:48:22.360 --> 01:48:23.340
And that's painful.
1232
01:48:24.200 --> 01:48:24.700
But
1233
01:48:25.720 --> 01:48:34.255
it's gonna be worse for for some people. You know, like, I I got out in a way that it I didn't lose that much through that whole journey.
1234
01:48:35.115 --> 01:48:43.330
But I, you know, I almost got wrecked by a tax burden along the way, and there are all these other potential pitfalls that that could have destroyed me.
1235
01:48:43.950 --> 01:48:48.450
And it and that has happened and will happen for so many people because
1236
01:48:48.954 --> 01:48:50.335
Ethereum is this this,
1237
01:48:51.355 --> 01:48:53.135
fraud, this attractive
1238
01:48:53.675 --> 01:48:58.175
illusion It's a siren song. Exactly. It's a siren song that's wrecking people on the rocks,
1239
01:48:58.860 --> 01:49:04.160
and and will wreck more people on the rocks so long as it it continues to be around.
1240
01:49:04.620 --> 01:49:06.480
Well, Chris, if you'll let me also,
1241
01:49:07.020 --> 01:49:08.000
show your article.
1242
01:49:09.305 --> 01:49:15.085
I really love the one you did in January. Am I too late for Bitcoin? I highly recommend everybody read it.
1243
01:49:16.390 --> 01:49:30.415
It's extremely bullish, but it it's, like, it's helpful for, like, the long term view of, like, what's happening here. Like, this is an incredibly entertaining week to do this show and to talk about these issues. And all of a sudden, it looks like we're gonna have this, like, environment kinda
1244
01:49:30.715 --> 01:49:35.670
FUD, like, war, like, you know, like, before we even get to the privacy war, etcetera.
1245
01:49:36.690 --> 01:49:48.360
But, like, long long term, just thinking about, like, this thing as this gen this, like, historic story of value technology and just what it's gonna eat in the next coming decades. Like, you just gotta keep your eye on the prize. So thank you for writing that.
1246
01:49:48.920 --> 01:49:58.060
Thank you. Yeah. And and people, it is so damn early still. Yeah. It's so early. I've been talking about how, on other podcasts recently, I've been saying
1247
01:49:58.985 --> 01:50:04.685
if you take if you take all the Bitcoin, 21,000,000 divided by 8,000,000,000 people, there's 250,000
1248
01:50:05.385 --> 01:50:07.190
sats per person on earth.
1249
01:50:08.390 --> 01:50:11.290
And recently that cost, a $150.
1250
01:50:12.150 --> 01:50:13.690
So you for every $150
1251
01:50:14.070 --> 01:50:26.245
of sat stacking you do, you are you are stashing away one person's worth of digital gold for the digital future. It's incredible. Buying 1 human being. One human being's worth of life energy.
1252
01:50:27.010 --> 01:50:29.590
And that price just dropped. It's no longer a $150
1253
01:50:29.890 --> 01:50:30.710
for 250,000
1254
01:50:31.170 --> 01:50:34.705
sats. That's that's something like $100 now, maybe less.
1255
01:50:35.405 --> 01:50:35.905
So
1256
01:50:36.285 --> 01:50:38.785
you have this unreal opportunity to
1257
01:50:39.245 --> 01:50:43.585
to stack Sats before the rest of the world has figured out what's happening here
1258
01:50:43.950 --> 01:50:45.810
and secured, like, potentially
1259
01:50:46.270 --> 01:50:46.770
generational
1260
01:50:47.790 --> 01:50:48.850
financial security,
1261
01:50:49.469 --> 01:50:51.010
if not outright wealth,
1262
01:50:52.185 --> 01:50:57.405
just by being here early and leaning into the opportunity that you have while everybody is
1263
01:50:57.705 --> 01:50:58.205
scared
1264
01:50:58.840 --> 01:51:00.380
or listening to Elon.
1265
01:51:01.160 --> 01:51:05.340
I I want to tag on to that if I may, because I was really surprised,
1266
01:51:06.040 --> 01:51:06.540
how
1267
01:51:07.895 --> 01:51:09.035
how many Bitcoiners
1268
01:51:09.415 --> 01:51:17.550
had their jimmies rustled by the recent flood and the price drop. And I think if if you are disturbed by those kind of things, you still have
1269
01:51:18.489 --> 01:51:38.969
a a a long way to go in terms of getting your auto DCA right. Because I think once you realize how early we are, like, just trying to time the market and and trying to kind of trade, it it's it's a it's a losing game. Like, I think the only winning game you can play is just stack as much as you can, provide value to your community,
1270
01:51:39.430 --> 01:51:51.735
earn Bitcoin or earn fiat and do auto DCA, and just stack daily, stack weekly, stack monthly, whatever you can afford, and just play the long game. Just do that for the next 10 years, and you're gonna be fine. You'll Yeah. You'll outback everyone else.
1271
01:51:52.275 --> 01:52:11.765
Be sure. I mean super early. Bitcoiners, a lot a lot of a lot of Bitcoiners were, like, not worried and were, like, this is awesome. I get, like, cheaper sets, but, there were a lot of people freaking out and and Ray Dalio is out there stacking, you know, taking advantage of some Bitcoiners kinda worrying, you know. So, like, let's just remember
1272
01:52:12.110 --> 01:52:15.810
that there's a lot of, sharks in the water. Can I interject term?
1273
01:52:16.190 --> 01:52:20.690
Can I interject to tell a little a little story, like, you know, that the
1274
01:52:21.715 --> 01:52:23.655
the Yuppie finance world is
1275
01:52:24.195 --> 01:52:25.475
sort of where I come from?
1276
01:52:26.675 --> 01:52:33.030
And let's look at, you know, a little story through the the the recent timeline here. Ray Dalio, like, 4
1277
01:52:33.490 --> 01:52:33.990
maybe
1278
01:52:34.530 --> 01:52:35.990
about 4 months ago said,
1279
01:52:36.370 --> 01:52:37.830
maybe I'm missing something
1280
01:52:38.535 --> 01:52:39.915
with with regards to Bitcoin.
1281
01:52:41.015 --> 01:52:47.675
Then his firm, Bridgewater, behind the scenes, you know, that that basically says he's about to go do his diligence.
1282
01:52:48.920 --> 01:52:55.660
4 months later, what has happened? His CFO, CFO of Bridgewater, the CFO of the largest hedge fund in the world,
1283
01:52:56.825 --> 01:53:03.465
just quit his job to go join NYDIG, a Bitcoin only company that's focused on institutional buying for,
1284
01:53:04.105 --> 01:53:04.765
a Bitcoin.
1285
01:53:06.230 --> 01:53:09.610
So he lost his, I don't know, number 2, number 3 guy,
1286
01:53:09.989 --> 01:53:12.650
in his in his company because Bitcoin,
1287
01:53:12.985 --> 01:53:28.790
after doing the diligence, Bitcoin was so promising to that guy that he left to go focus on Bitcoin. And Dalio bought some Bitcoin at the same time. So that's a 4 month 4 month process that that Dalio and and everybody at Bridgewater just went through of doing their diligence.
1288
01:53:29.170 --> 01:53:29.830
And then
1289
01:53:30.195 --> 01:53:38.375
not just buying some, but being so bullish that he'd lost, you know, one of his key people because Bitcoin is bigger than anything that's happening anywhere else,
1290
01:53:39.469 --> 01:53:40.610
especially at Bridgewater.
1291
01:53:45.389 --> 01:53:47.409
One other thing I just wanted to add is
1292
01:53:49.195 --> 01:53:50.015
we got
1293
01:53:50.875 --> 01:53:53.215
a lot of people coming into the space now who
1294
01:53:53.675 --> 01:54:00.360
who don't understand, like, the the monetary policy piece and the predictability piece and the sort of safe haven that Bitcoin is.
1295
01:54:00.820 --> 01:54:01.640
And therefore,
1296
01:54:02.580 --> 01:54:09.695
they're like, they too easily jump the shark and go to other technologies. And it's kinda like what we were saying with Elon before, but it's happening to
1297
01:54:10.475 --> 01:54:10.975
to
1298
01:54:11.594 --> 01:54:14.260
a lot of people here. So just to give you some numbers,
1299
01:54:15.360 --> 01:54:17.380
let's see. Just in the last month,
1300
01:54:18.960 --> 01:54:19.860
we've got,
1301
01:54:20.755 --> 01:54:26.035
2 really people that I I respect a lot or, you know, yeah, continue to respect a lot, but,
1302
01:54:26.595 --> 01:54:35.310
more relevant maybe to this crowd than than Elon. But we've got, like, Moxie Marlinspike, and we've got Snowden, you know, both going to bat for, like, these privacy coins.
1303
01:54:36.010 --> 01:54:46.305
And I guess what they, like, they discount the the monetary policy piece and the the the money piece, and and they overrate the technology piece. And what happens is you get stuck in the situation
1304
01:54:46.980 --> 01:54:54.760
where, Moxie's coin is down 80 over 80% from from a few weeks ago, and Snowden's coin is down 75%.
1305
01:54:55.300 --> 01:54:55.800
Okay?
1306
01:54:56.195 --> 01:55:02.375
So and and and that those swings are gonna be, like, a lot more wild in the coming year in in different directions.
1307
01:55:02.755 --> 01:55:08.940
And I just think it's it's interesting to see that they, know, they obviously haven't grasped that piece yet. I think they they probably will eventually,
1308
01:55:09.800 --> 01:55:12.620
and it it's sort of in retrospect, it'll have been inevitable.
1309
01:55:13.985 --> 01:55:17.925
But it it is, you know, something that we're just gonna see more of. Right?
1310
01:55:18.705 --> 01:55:27.430
People coming in and, like, oh, well, you know, Bitcoin's broken. Let me, like, fix it and and use this other thing. And even, like, our you know, even the heroes are are susceptible.
1311
01:55:28.130 --> 01:55:30.950
Yeah. Absolutely. And, I I was really disappointed
1312
01:55:32.355 --> 01:55:40.000
by both of these events actually because, I consider both of these people heroes of mine. I think Moxie did great great things with signal and,
1313
01:55:40.560 --> 01:55:42.180
the OpenWhisper Systems protocol
1314
01:55:42.640 --> 01:55:46.660
and, of course, known the great things as well. I think if you're a technologist,
1315
01:55:47.295 --> 01:55:53.775
it's very difficult to understand that Bitcoin is not only a technology. It's also, like, you know, in in large
1316
01:55:54.655 --> 01:55:56.594
in a in a very large part also,
1317
01:55:57.000 --> 01:55:57.500
like,
1318
01:55:58.119 --> 01:56:03.820
this almost biological system. Like, it's this this social system. It it, like, it needs
1319
01:56:04.360 --> 01:56:04.860
this
1320
01:56:05.365 --> 01:56:14.800
economical part to work, and all systems like Bitcoin need this economical part to work. And that's really hard to understand if you look at it from a purely engineering
1321
01:56:15.340 --> 01:56:15.840
technology
1322
01:56:16.219 --> 01:56:17.119
side of things.
1323
01:56:17.420 --> 01:56:24.755
And I think it takes a very long time and also a lot of humility to accept that
1324
01:56:25.215 --> 01:56:30.595
Bitcoin just is the way it is, and we kind of have to take it as this
1325
01:56:31.380 --> 01:56:40.905
gift from the gods, if you will, because it had this immaculate conception and fought all its battles and survived everything and grew organically and was dispersed organically.
1326
01:56:41.285 --> 01:57:22.210
And now we we like, it's it's not only this informational construct. It also has all this infrastructure. By infrastructure, I mean, not only the mining side, but also who holds it, who accepts it, and who is on the Bitcoin standard already. And you cannot replicate that. You cannot you cannot replicate that organically in the 1st place, and you also can't duplicate it. Like, I I truly believe it's this one time path dependent invention slash discovery, and we have to deal with it. I think all Bitcoiners kind of know that Bitcoin isn't perfect. You know? Like, there there there are some things that that aren't perfect in Bitcoin, but it's the best thing we have. And building trying to trying to reinvent the the wheel, so to speak, it's just a losing proposition because you have these
1327
01:57:22.690 --> 01:57:35.415
economic forces that kind of tend to 1, and you will like, if you if you're if you're trying to fix the issues that Bitcoin has by launching your own shitcoin, you've already lost. And it doesn't matter if you know it or not. It's it's just it's just
1328
01:57:35.795 --> 01:57:42.380
a effect of nature, and it it really pains me to to to see those kind of people that I hold
1329
01:57:42.840 --> 01:58:04.240
in high regards in all other areas fail this kind this kind of, like, intelligence test, if you will, because they they truly try to, you know, like, I just learned about Bitcoin. I'm I'm here to fix it and launch our own Bitcoin. And it's it's really sad to see, but I think it's something that everyone kind of has to go through, and I think it will sort itself out over time. Yeah. Gigi,
1330
01:58:04.940 --> 01:58:06.160
extremely well said.
1331
01:58:07.835 --> 01:58:13.455
I love you, dude. It it makes me miss you a lot hearing you speak. I'm looking forward to seeing you in Miami,
1332
01:58:14.155 --> 01:58:14.895
very soon.
1333
01:58:15.300 --> 01:58:19.720
I I a 100% agree with everything you just said. I'm curious while I have you here.
1334
01:58:20.100 --> 01:58:21.960
Do you think we'll ever see
1335
01:58:23.415 --> 01:58:26.155
a successful Bitcoin hard fork in our future?
1336
01:58:27.255 --> 01:58:32.690
I I think only if the alternative means death, and I think that's really hard to know,
1337
01:58:33.710 --> 01:58:35.250
from the start. You know? Like, it's
1338
01:58:35.630 --> 01:58:36.530
trying to
1339
01:58:36.990 --> 01:58:40.275
figure out like, if there is a problem that Bitcoin needs to overcome,
1340
01:58:40.735 --> 01:58:45.875
it's very hard to tell, like, will it kill Bitcoin in the future? And I think the only,
1341
01:58:46.850 --> 01:58:52.390
like, the only reason to do a hard fork is if it if the alternative means the death of the network.
1342
01:58:53.010 --> 01:58:53.510
And
1343
01:58:54.105 --> 01:58:54.605
so
1344
01:58:55.945 --> 01:59:02.950
I actually don't really see it unless it's crystal clear. Like, if if we, I don't know, have
1345
01:59:03.990 --> 01:59:12.890
if we have a new mathematical discovery, if we find a flaw in one of the algorithms where we kind of know, okay, like, if we throw more compute at that and,
1346
01:59:13.895 --> 01:59:18.635
we we have reasons to believe that motivated attackers could actually, you know,
1347
01:59:19.255 --> 01:59:21.595
break something in in a serious way,
1348
01:59:21.910 --> 01:59:28.490
then I think we could come to some agreement to do a hard fork. I don't think we will do a hard fork for,
1349
01:59:29.405 --> 01:59:31.665
any other reason. And Well, to be clear,
1350
01:59:32.205 --> 01:59:43.659
there would never be an agreement. Right? You would have Yeah. Anyone can hard fork whenever they want a hard fork. Of course. Right? And then By agreement, the hard fork. Chain would win, right, in that situation. If there was, like, a motivated
1351
01:59:45.095 --> 01:59:53.515
if there's if there's some kind of if the overwhelming majority of users were motivated for some apparent reason. If if something would break the old chain.
1352
01:59:54.329 --> 01:59:59.389
Yeah. By by by agreement, I mean something like, you know, like, Taproot really isn't that controversial, and
1353
01:59:59.769 --> 02:00:06.645
we now some somewhat have an agreement of how to activate it and stuff like that. That's what I mean by, like, agreement, rough consensus.
1354
02:00:07.264 --> 02:00:09.205
Of course, you know, like, if there is ever
1355
02:00:10.280 --> 02:00:16.540
a reason to do a hard fork, it it will be a a huge mess. Like The reason the reason why I bring it up is because,
1356
02:00:18.295 --> 02:00:29.090
you know, you kinda channeled what I believe, which is that, like, the there there's something that's it's hard to quantify, but the ledger itself, like, the ledger balances the history
1357
02:00:29.630 --> 02:00:30.210
of Bitcoin
1358
02:00:31.310 --> 02:00:36.035
has has a value, a value that can never be replicated by a shitcoin.
1359
02:00:37.295 --> 02:00:40.995
But that ledger would carry over in a hard fork, which is why I asked.
1360
02:00:41.940 --> 02:00:45.080
Yeah. I mean, you know, like, you can you can go
1361
02:00:45.460 --> 02:00:51.865
really deep into these kind of topics, and it becomes nuanced the longer you more nuanced the longer you think about it. Because,
1362
02:00:52.485 --> 02:00:52.985
like,
1363
02:00:53.365 --> 02:00:54.745
if if there is a mathematical,
1364
02:00:55.925 --> 02:00:56.425
cryptographic
1365
02:00:56.965 --> 02:00:57.465
breakthrough
1366
02:00:57.925 --> 02:00:59.385
where you could, for example,
1367
02:01:00.680 --> 02:01:03.340
you could be in a situation where it's not clear cut anymore,
1368
02:01:04.760 --> 02:01:19.590
what kind of private keys unlock which coins, and then you're in a huge mess because then even, like, bootstrapping from the current UTXO set wouldn't really save you anymore. So, but, you know, like, it's it's it's it's not that people aren't thinking about it, and it's also,
1369
02:01:20.450 --> 02:01:21.510
not that, like,
1370
02:01:22.770 --> 02:01:27.685
I I like what Chuck Mueller is saying all the time. You know? Like, don't don't bet against engineers.
1371
02:01:28.225 --> 02:01:37.740
Like, they're thinking about this shit, and we can definitely do something about those kind of scenarios. But we have bigger fish to fry right now, you know, like, just getting Taproot activated
1372
02:01:38.200 --> 02:01:42.140
and getting all those things that we are currently working on activated and just,
1373
02:01:42.715 --> 02:01:44.094
working on minor decentralization
1374
02:01:44.395 --> 02:01:44.895
and,
1375
02:01:45.355 --> 02:01:45.855
working
1376
02:01:46.395 --> 02:01:48.655
on on privacy tech and working on fungibility.
1377
02:01:49.034 --> 02:01:59.230
Those are the priorities. Like, quantum computation is not a priority right now and won't be for the next 10 years, for example. Well and for the great majority of people, the usability piece. I just wanted to give a shout out to
1378
02:02:00.115 --> 02:02:01.795
how incredible it was to,
1379
02:02:02.835 --> 02:02:04.535
tip some stats to to
1380
02:02:04.915 --> 02:02:06.615
to strikes kind of like indie,
1381
02:02:08.000 --> 02:02:15.380
initiative, indie car initiative using the Moon Wallet. I mean, it was, like, I've been showing it to, like, a bunch of people just sending, like, a tiny amount using it.
1382
02:02:16.705 --> 02:02:20.485
It just blows people away. I mean, it's just, like, yeah. That was, like, final settlement,
1383
02:02:21.345 --> 02:02:32.460
you know, took literally a second. We took 2 swipes, and that was that. And that's done, and then that those funds are in somebody else's possession now. And it's, like, once you get your usability here, it's, like,
1384
02:02:32.815 --> 02:02:35.715
really starts to get interesting. That's that's Moonwal
1385
02:02:36.255 --> 02:02:44.390
that's Moonwal with 2 u's, m u u n Yeah. And the the site he's talking about is strike dot me slash racing,
1386
02:02:44.770 --> 02:02:47.030
which is the Indy 5 100 car.
1387
02:02:47.650 --> 02:02:51.445
It supports the Indy 5 100 car that we have racing this Sunday
1388
02:02:53.985 --> 02:02:54.805
that is
1389
02:02:55.985 --> 02:02:57.185
raising funds for,
1390
02:02:57.505 --> 02:03:07.110
Bitcoin development. So if you if you donate to strike dot me slash racing, it'll go to open source Bitcoin development. Okay. Carry on. Sorry. Yeah. So, you know, I'm in the restaurant with some guy who,
1391
02:03:07.650 --> 02:03:10.755
I got to know recently, and he was in Bitcoin a while ago.
1392
02:03:11.475 --> 02:03:19.335
And he, you know, he hasn't been aware of, like, the the upgrades, let's say, and how it all works. And I'm like, alright. So I just go to that website that Matt just mentioned,
1393
02:03:21.580 --> 02:03:37.225
strike dot me slash racing, and it just creates an invoice that expires in a in 60 seconds and just copy it, and then I go to Moon Wallet. So that's, like, one click, and then I paste the address in the send, and it's done and it's gone. And it's just like, I just moved to Bitcoin.
1394
02:03:37.710 --> 02:03:43.330
And, that kind of blows people away, and, like, that's kinda where we're we're getting closer to that, which is really exciting.
1395
02:03:43.790 --> 02:03:56.760
Yeah. Absolutely. And just to tag on to that, that's also something that's not priced in, like, not not even a little bit. Because what this enables and what Stripe is actually doing right now is this infrastructure inversion that not not a lot of Bitcoiners
1396
02:03:57.060 --> 02:04:26.755
are talking about. But we saw this with the Internet. You know? Like, I I mentioned this all the time that we had this both voice over IP moment where suddenly every every single telephone call went over the Internet, and nobody kind of noticed. Everything was kind of the same. And I think the same will happen with Bitcoin. You know? We will have this infrastructure inversion because it it just makes a lot of sense. It's cheaper, and then the economic incentives are allowed. And we have, like, instant final settlement. Like, if you're running a bank, switching to the Bitcoin standard, like switching to the Bitcoin network for doing your settlement
1397
02:04:27.090 --> 02:04:50.590
is, like, the smart thing to do, and I think I believe everyone is kind of working on it. And if you're not working on it, you'll be made obsolete in the next, like, 5 years because people are working on it. And just flipping that switch, and it doesn't matter what's coming out at the end. You know? It might be US dollars. It might be euros. It it doesn't matter if it's Fiat currency. But just doing the exact same thing that Stripe is currently doing using these payment rails, that's, like, the smart thing to do, and that's the like, you you
1398
02:04:51.530 --> 02:04:53.775
you you will be cheaper than your competition
1399
02:04:54.235 --> 02:05:09.215
instantly, and that's just why it's going to happen. And it's it's gonna happen soon. Everyone has a fucking smartphone. Everyone has an Internet connection. We're gonna have Starlink online soon and everywhere, and it just it it's it it will start in in, like, 3rd world countries or where you,
1400
02:05:09.614 --> 02:05:21.690
like, actually benefit from circular economies where you don't have regular banking, but there is no reason why we can't have this, like, next year in the western world where you just use an app and just everyone uses it. And,
1401
02:05:22.090 --> 02:05:32.915
like, just like Stripe, you know, underneath it it uses Bitcoin and the Lightning Network. Right. Well, Matt, what is to prevent, like like, let's say, an activist or anyone from just, like, doing what Strike does and just just having that,
1402
02:05:33.780 --> 02:05:36.760
kind of just refreshing invoice every time you visit the page,
1403
02:05:38.340 --> 02:05:44.565
and just being able to just immediately donate and to share that with people? Like, what what is the stumbling block there? I mean, I think,
1404
02:05:46.405 --> 02:05:47.625
you know, we we
1405
02:05:47.925 --> 02:05:50.665
we have BTC pay server, but it's a bit heavy.
1406
02:05:51.030 --> 02:05:56.310
Correct. This is way a lot more lightweight. And and the the the main issue is hosting. Right?
1407
02:05:56.790 --> 02:05:59.210
You know, especially if you're in a country,
1408
02:06:00.065 --> 02:06:02.005
that you're in a heavy adversarial environment
1409
02:06:02.545 --> 02:06:04.005
and you're worried about,
1410
02:06:04.945 --> 02:06:06.965
dictator or some other kind of authoritarian
1411
02:06:08.120 --> 02:06:08.620
military
1412
02:06:09.160 --> 02:06:10.300
coming after you.
1413
02:06:10.920 --> 02:06:14.220
It's hard to reliably host something on the Internet privately.
1414
02:06:14.600 --> 02:06:17.685
We have Tor, but then all your dones need to use Tor.
1415
02:06:18.705 --> 02:06:20.324
One thing that is interesting,
1416
02:06:21.105 --> 02:06:23.445
that we have going for us is this lnurl
1417
02:06:24.110 --> 02:06:27.969
that I have in the bottom left hand corner of the screen, which is a fixed QR code.
1418
02:06:28.989 --> 02:06:30.350
It doesn't even need
1419
02:06:30.670 --> 02:06:32.235
Moon doesn't support it yet,
1420
02:06:32.795 --> 02:06:35.695
but Phoenix does. I think while the Satoshi does,
1421
02:06:37.114 --> 02:06:42.014
there's a there's a couple wallets that do and and they're adding more every day. I think Zeus supports it,
1422
02:06:43.790 --> 02:06:46.449
and that's fixed, so you don't need to host.
1423
02:06:46.989 --> 02:06:48.290
We also have PubKey.
1424
02:06:49.150 --> 02:06:49.969
What is it?
1425
02:06:50.735 --> 02:06:53.555
Pubkey payments. What are they calling? Key send payments,
1426
02:06:54.255 --> 02:06:56.835
which is a similar idea. Right? Is it this fixed
1427
02:06:57.375 --> 02:07:01.970
this this fixed text characters that you can use instead of having to host something?
1428
02:07:02.670 --> 02:07:06.290
So I I think we'll either go in that direction. I think that's probably ideal,
1429
02:07:08.284 --> 02:07:18.659
or, you know, like a lightweight alternative to BTC pay server. Right? Yep. I forget who that I forgot what that project is, but I think he's at coin joiner on Twitter. He has,
1430
02:07:19.280 --> 02:07:22.900
I think it's called BTC payment, but he has, like, a lightweight Python
1431
02:07:24.945 --> 02:07:36.740
alternative to BTC pay servers. Something like that could be really useful, I think. Yeah. I I just want to point out how insanely early we are because this is all just emerging, like, right in front of our eyes, and it's it's easy to,
1432
02:07:37.280 --> 02:07:52.700
to kind of dismiss and not see how insanely early we are. Like, the the the Lightning Network didn't exist not too long ago, you know. Like, it was Yeah. It was a nice task not too long ago. The Lightning Labs folks, just on that note, like, you know, what can we do to have, like, a static,
1433
02:07:53.180 --> 02:08:03.385
sort of address type thing? And apparently, that's, like, being worked on and, like, is being rolled out soon, but but it will reuse your public key. So the question is how do we get like a passive address
1434
02:08:03.844 --> 02:08:05.385
that that can recycle through
1435
02:08:05.764 --> 02:08:06.164
and,
1436
02:08:06.790 --> 02:08:50.934
you know, that's gonna come at some point. Someone's gonna figure that out. And, like, we're just as just just to support what you're saying. We're just insanely early here. All all of that is emerging as we speak. And Matt mentioned lnurl, and lnurl is a very lightweight standard that supports multiple things. Like, like, it it tries to solve multiple problems that we are currently having on lightning. And you can you can also like, there's even ln URL auth where you can just scan a QR code to log into a service, for example. And most people are not aware of that. You know? Like, this already works and this already exists, and you can already use it, and you can already log into services, and you can build services that make use of these kind of emerging standards. And this is just, like, you know, the the very obvious next steps that we need to to build, like, the
1437
02:08:51.574 --> 02:08:54.235
that we need to to make, and and,
1438
02:08:55.014 --> 02:09:15.660
I I can't, like, I can't even tell you how bullish I am because what's most exciting to me is all the things that people, engineers, builders will come up with for the next 1 or 2 or 3 years that we can't even think of yet. I think all these problems will be solved. Like, all all the the petty problems that we have now with, you know, address reuse and, like doxing our,
1439
02:09:16.120 --> 02:09:25.195
the public addresses and stuff like that. It it will be solved in no time. I'm sure of that. I just I just wanna echo some MS. I just wanna add in that we have Cortic in the chat mentioning BIP 47,
1440
02:09:26.614 --> 02:09:34.469
most notably known as, reasonable payment codes, but most notably known as the only implementation I know of is in Samura Wallet. It's called PayNIMS,
1441
02:09:35.330 --> 02:09:38.949
which solves a similar goal, but is on chain rather than Lightning.
1442
02:09:39.955 --> 02:09:46.295
Yeah. I would just say, like, I think, you know, you know, Pay NIMs are fantastic if you if you wanna use them today.
1443
02:09:46.820 --> 02:09:50.679
If you need something that you wanna use today and, you know, your your have,
1444
02:09:52.659 --> 02:10:00.035
an Android phone with samurai wallet on it, Ideally, it'd be nice to see other wallets at it. But I think, ultimately, like, if we're looking low time preference,
1445
02:10:01.055 --> 02:10:04.035
I really do feel like the overwhelming majority of people
1446
02:10:04.420 --> 02:10:07.320
long term will not be hitting the chain. And I think
1447
02:10:09.540 --> 02:10:23.830
whether that's lightning, which I I think it will be lightning, but whether it's lightning or some other type of layer 2, will be where the majority of payments happen. Just because once you start using lightning, you really see it's not even I mean, I expect fees to rise on chain as well,
1448
02:10:24.210 --> 02:10:26.230
but the UX is just so much nicer.
1449
02:10:27.490 --> 02:10:34.465
The the the channel balances is difficult. I and there's ways of you know, people are trying to hide it,
1450
02:10:35.565 --> 02:10:48.765
from the user and make it a little bit easier UX wise. But once you get past the channel balance hurdle, and especially for payments, when you're paying people rather than receiving because if you're paying people, all you need is, you know, 1 or 2 channels to routing nodes,
1451
02:10:49.705 --> 02:10:52.720
and that's it. You don't have any channel management besides that.
1452
02:10:53.280 --> 02:10:59.300
The UX is just so much better. Like, I I I think we get stuck in our bubble. Even simple concepts like
1453
02:10:59.680 --> 02:11:01.620
confirmation time to us
1454
02:11:02.445 --> 02:11:09.265
is a very it's a very hard concept for New Corners to wrap their head around. Yeah. Absolutely. And I'm, like,
1455
02:11:09.590 --> 02:11:14.250
amen to everything you said because I I think, like, PayNIMs are great and,
1456
02:11:14.710 --> 02:11:15.210
like,
1457
02:11:15.750 --> 02:11:24.875
hats off to everyone who is working on privacy tech on the base layer. But if you think, like, in a couple of years from now, everyone will be using PayNIMs, you're just not bullish enough because
1458
02:11:25.255 --> 02:11:27.195
lock space is insanely limited,
1459
02:11:27.540 --> 02:11:36.760
and you will not be able to afford on chain payments for regular day to day transactions. We're already at that point, basically, so we need something like Lightning. And I say
1460
02:11:37.155 --> 02:12:12.100
something like lightning because lightning is just one layer 2 solution, and we like, there's no reason why we can't have multiple ones. Lightning is the most promising one. And, of course, there's also liquid, and you can also do lightning on top of liquid and and stuff like that. But I think lightning in in itself, it's insanely bullish. And, yes, it it has its problems, but these problems are all being worked on. And we have so many great engineers that are thinking through all these kind of problems. And, for example, we we have the inbound liquidity problem, but this is being solved on a marketplace basis, and I think that's just beautiful to see. And I don't think, like, 5 years from now, I don't think it will be a problem anymore. And I think I think we will just
1461
02:12:12.415 --> 02:12:12.915
solve
1462
02:12:13.375 --> 02:12:32.264
all all these problems in succession as as we bump into them. You know? Like, 5 years ago, we didn't even know that this was a potential problem. There's, like, tens of millions of people who are kinda come on board to Bitcoin in the next couple of years who who need to send 5 to $10 payments using it Yeah. Because they their banking system doesn't work, their currency doesn't work.
1463
02:12:32.565 --> 02:12:38.425
And, you know, this is this is from conversations I've had with people from countries like Sudan, like like, these countries have
1464
02:12:39.410 --> 02:12:53.225
a surprising amount of phone smartphone penetration already and it, you know, it's basically gone from 5% to 25% in the last 5 years, and it's gonna go from 25% to 50% in the next 5 years. You're gonna have half these countries with smartphones
1465
02:12:53.605 --> 02:12:57.920
and then eat you know, there's tons of uncle Jims, you know, plus, you know, 50% penetration.
1466
02:12:58.540 --> 02:13:16.060
And all these people need to send small amounts. So they're not gonna be using the main chain. So, you know, this is why lightning is such like an interesting idea for emerging markets and it's probably one of the reasons why why you see the moon with 2 u's team working on it. So focused I mean, they're from Argentina. I mean, they they understand the need for it.
1467
02:13:16.780 --> 02:13:19.360
And if it's not gonna be lightning, it's gonna be custodians,
1468
02:13:19.845 --> 02:13:23.945
which, you know, sucks, but it's the reality. So if it's not gonna be something like a lightning,
1469
02:13:24.805 --> 02:13:40.635
might be the steps. And I I think what what what makes me so insanely bullish is that we can already see the next, like, 5 to 10 steps. We know we know what we kind of need on the base layer, and we know what we need on lightning. Are you guys still there?
1470
02:13:41.175 --> 02:13:42.235
Yeah. We're still there.
1471
02:13:42.695 --> 02:13:45.355
I don't know what happened there, but we just had a
1472
02:13:46.030 --> 02:13:46.929
equipment failure.
1473
02:13:48.030 --> 02:13:54.370
Alright. I think we were here all day. Did you guys break up? We've been humming along the whole time. Yeah. I think we're good.
1474
02:13:55.825 --> 02:14:00.005
Maybe it's just you that reconnected, Matt. It looks like the chat did stop, though.
1475
02:14:00.465 --> 02:14:04.965
Okay. Can anyone hear me? Yeah. Yeah. I can hear you. We can all hear you. Okay.
1476
02:14:05.889 --> 02:14:07.729
I guess we lost Gigi. I don't
1477
02:14:08.290 --> 02:14:10.389
Crypto Graffiti heard everything. That's good.
1478
02:14:12.865 --> 02:14:20.005
Yes. Just a few of the live scene here. Chris, is you still here? Can someone hear me? Hello? Hello? Test test? Matt, hello? Yep. Chris, can someone hear
1479
02:14:20.760 --> 02:14:28.540
I can hear all you guys. I'm here. We're good. Right? I think I think Matt doesn't mean I can't okay. I guess it was just me. Dope. We Gucci still. Continue.
1480
02:14:29.445 --> 02:14:33.785
Continue. Apologize to the freaks that, you know, we we're running on this this
1481
02:14:34.325 --> 02:14:35.065
I'm completely
1482
02:14:35.765 --> 02:14:37.685
beholden to this company Restream,
1483
02:14:38.130 --> 02:14:39.590
because their platform's dope.
1484
02:14:40.130 --> 02:14:45.910
So we're kind of beta testing everything for them as we do Citadel Dispatch. So I appreciate all your patience.
1485
02:14:48.195 --> 02:14:50.215
And just just to let the freaks know,
1486
02:14:50.675 --> 02:14:57.655
I I I'm in Mexico currently running on a mobile hotspot, and I topped up my data plan to the maximum just to make this happen. So
1487
02:14:58.220 --> 02:14:59.200
just That's awesome.
1488
02:14:59.820 --> 02:15:01.840
Not not rely on shitty Wi
1489
02:15:02.220 --> 02:15:08.705
Fi. But to continue my rant at why I'm so insanely bullish on on Bitcoin and Lightning and just in general is that,
1490
02:15:09.245 --> 02:15:11.825
as Alex mentioned, so many people are
1491
02:15:12.205 --> 02:15:39.370
going to come in and are already coming in and are already solving these problems, and we kind of know what we have to do. We know already the next 5 to 10 steps that we need to take, and we're gonna activate Taproot, and we're gonna activate other things on the base layer. And we're gonna have dual dual funnel funded channels on lightning, and we're gonna have multipath payments, and we're gonna solve the liquidity issues, and we're gonna we're gonna like, we we we we will have just like with the Internet protocols, you know, we we will have smart algorithms that that, like,
1492
02:15:39.910 --> 02:16:05.075
automate all the UX problems away, kind of, and your your node will be able to spin up channels and so on and so forth. And we will build higher layers, and we will do whatever is necessary to make this fucking thing work because that's why why we are here. You You know? That's what we are here for. Well And that's what engineers do. It's interesting, Matt. You know, he's saying stackers set the floor. We're about to have a lot more stackers. We're about to have, like, 100 of millions of stackers.
1493
02:16:05.535 --> 02:16:06.355
So so,
1494
02:16:07.375 --> 02:16:11.270
you know, they're gonna be involved, but they probably aren't gonna be getting in on the main chain. You
1495
02:16:11.570 --> 02:16:12.390
know? Like, so
1496
02:16:12.690 --> 02:16:16.230
they're gonna be born onto a custodian or to maybe Lightning, hopefully.
1497
02:16:16.610 --> 02:16:20.364
So, I mean, that's just the reality of the next 5 to 10 years as we onboard
1498
02:16:20.744 --> 02:16:21.724
a 1000000000 people.
1499
02:16:22.585 --> 02:16:27.800
Yeah. And and and also to to go back to the actionable advice of Citadel dispatch,
1500
02:16:28.260 --> 02:16:31.239
you don't need to do much. Provide some value,
1501
02:16:31.540 --> 02:16:41.565
stack sets. That's basically what you have to do. And I really like the saying, you know, like, don't just do something. Sit there. Fiat currencies will collapse on their own. Like, we will win
1502
02:16:41.945 --> 02:16:52.670
without having to fight much, I believe. Like, Bitcoin is insanely resilient, and the world is a big place. Bitcoin the the whole narratives around Bitcoin, they are very US centric.
1503
02:16:53.056 --> 02:17:17.154
And Right. I'm from Europe. So for for me, it's a very different picture, and I'm, you know, like, I'm embedded in Bitcoin Twitter. Like, I'm that's where I'm living currently. And so I see and read all these narratives. But if I go outside the door in Europe, it's it's a very different world, and I I'm I'm not too concerned. You know? Like, I'm not too concerned about all the fun because the world is a really big place, and there are a lot of Bitcoiners everywhere, and and there are gonna be more very soon.
1504
02:17:19.370 --> 02:17:25.950
Yeah. And, you know, I I don't know. I just wanted to clarify. I think there's a there's been a lot of, like, Trojan horse talk lately. Like,
1505
02:17:26.564 --> 02:17:33.785
I just wanted to clarify what I what I kinda mean when I say Trojan horse theory. I mean, to to Gigi's point, like, that people get involved,
1506
02:17:34.930 --> 02:17:38.550
for self interest, and to improve themselves and their fortunes,
1507
02:17:38.930 --> 02:17:52.136
not to help anyone else. I mean, you know, there's a small percentage of us maybe that are into it for, like, you know, broader reasons, but, like, that's completely irrelevant to Bitcoin's success and its mission to replace central banking. Like, it's,
1508
02:17:53.000 --> 02:17:53.500
essentially,
1509
02:17:53.960 --> 02:17:54.540
you know,
1510
02:17:55.080 --> 02:18:07.025
that point is that that it lures people in by providing them something that they can't get anywhere else. And whether you're a corporation or a government or an individual, you're gonna wanna get involved. And the very act of you getting involved,
1511
02:18:07.405 --> 02:18:14.200
whether you're stacking stats or whatever is helping all the other users. And and that that's kinda what I mean by by the Trojan horse theory.
1512
02:18:14.660 --> 02:18:16.280
I just think it got, like, really,
1513
02:18:16.595 --> 02:18:20.774
really messy out there the last few days, but that's that's what I mean by it.
1514
02:18:21.395 --> 02:18:23.335
And I think we we should also,
1515
02:18:23.990 --> 02:18:33.854
like, highlight the fact that Bitcoin kind of has its own way of changing the individual and lowering your own time preference and really highlighting what is important.
1516
02:18:34.234 --> 02:18:36.015
And, like, I'm bullish on Bitcoin,
1517
02:18:36.475 --> 02:18:36.975
like,
1518
02:18:37.435 --> 02:18:40.750
you wouldn't believe, but I'm even more bullish on Bitcoiners. And just
1519
02:18:41.230 --> 02:18:46.370
meeting Bitcoiners in real life and talking to Bitcoiners in real life, it's the best thing ever because, like,
1520
02:18:46.750 --> 02:18:54.154
this this bullishness and this, like, principled thinking is contagious, and there are so many people that are in it for the right reasons.
1521
02:18:54.694 --> 02:18:56.715
And I I don't see how
1522
02:18:57.095 --> 02:19:02.120
you can kind of, you know, put this genie back into the bottle because,
1523
02:19:02.660 --> 02:19:03.160
like,
1524
02:19:03.620 --> 02:19:05.880
there are people all over the world that
1525
02:19:06.420 --> 02:19:07.880
are working on Bitcoin
1526
02:19:08.285 --> 02:19:09.025
just, like,
1527
02:19:10.045 --> 02:19:11.825
they they don't have any other incentives,
1528
02:19:12.525 --> 02:19:14.065
but to see it succeed.
1529
02:19:14.525 --> 02:19:24.680
And they're like they have soul in the game, and that's why I'm here as well. You know? Like, I really want to see this through and do whatever it takes to help Bitcoin kind of
1530
02:19:25.025 --> 02:19:36.780
make make its impact on on the world. And I think it's it's gonna be a a good and beautiful thing. And as Alex has said recently, you know, like, it's about the freedom go up technology and not necessarily about the number go up technology, but they go hand in hand.
1531
02:19:37.160 --> 02:19:40.780
Yeah. Can't kill an idea. Can't kill an idea. Absolutely.
1532
02:19:45.535 --> 02:19:46.035
Yeah.
1533
02:19:48.575 --> 02:19:54.070
I think is Matt is Matt gone again? Or Matt help you on our own? Go for it, Matt.
1534
02:19:57.525 --> 02:19:58.745
May maybe Matt disappeared.
1535
02:19:59.125 --> 02:19:59.625
Yeah.
1536
02:20:01.045 --> 02:20:01.365
Well
1537
02:20:01.926 --> 02:20:05.990
Yeah. I think I think we're wrapping here. Chrisus, what do you got to to end us on?
1538
02:20:06.391 --> 02:20:07.370
I mean, I guess,
1539
02:20:08.070 --> 02:20:10.650
when when Gigi was making that point,
1540
02:20:11.190 --> 02:20:15.195
I just kept thinking about how, like, you know, we we're in the we're in this
1541
02:20:15.676 --> 02:20:16.335
this evolution
1542
02:20:16.636 --> 02:20:20.255
of this asset from nothing, bootstrapping from just code,
1543
02:20:20.556 --> 02:20:21.295
0 value
1544
02:20:22.155 --> 02:20:23.375
into being a collectible,
1545
02:20:23.940 --> 02:20:27.240
into being a store value. We're in that store value stage now.
1546
02:20:27.700 --> 02:20:29.400
We're accumulating value.
1547
02:20:29.860 --> 02:20:37.784
The medium of exchange infrastructure is being built right now by people like Gigi who know way more about the tech stuff than I ever could dream of.
1548
02:20:39.080 --> 02:20:46.700
And, you know, we're in the early stages of that development, but it's happening and at a great pace. And it's going to be ready for the world
1549
02:20:47.045 --> 02:20:49.145
to have a digital medium and exchange
1550
02:20:50.085 --> 02:20:52.024
based on a digital store value
1551
02:20:52.564 --> 02:20:58.100
that is 10 x or a 100 x or a 1000 x better than the status quo alternative
1552
02:20:58.560 --> 02:21:06.580
for for each individual out there choosing between do I choose between sensor, you know, money that can be censored
1553
02:21:07.265 --> 02:21:07.765
and
1554
02:21:08.785 --> 02:21:09.285
debased?
1555
02:21:09.665 --> 02:21:10.565
Or do I
1556
02:21:11.105 --> 02:21:12.945
take, you know, the the
1557
02:21:13.585 --> 02:21:15.445
my own value into my own
1558
02:21:16.820 --> 02:21:22.280
responsibility and ownership and self determination and own Bitcoin instead.
1559
02:21:22.740 --> 02:21:30.585
That's all happening in our lifetimes as we watch, as we participate, and our job is to contribute to that in whatever way we can.
1560
02:21:31.285 --> 02:21:35.439
And maybe that's just stacking or maybe that's writing code or maybe that's
1561
02:21:36.140 --> 02:21:38.400
educating people in our communities,
1562
02:21:38.939 --> 02:21:46.814
in our friend groups about Bitcoin and its benefits and its benefits to each individual to adopt and start saving in Bitcoin.
1563
02:21:47.595 --> 02:21:52.811
And it's a beautiful thing to watch playing out right now, and we just have to participate.
1564
02:21:53.670 --> 02:21:59.265
Amen to that. Well, Matt, what do you what do you got to wrap this up? Thanks, Gladstein. Appreciate you giving me,
1565
02:21:59.665 --> 02:22:02.725
the heads up there. I'm the only one who could speak to our master.
1566
02:22:03.425 --> 02:22:05.665
I unfortunately, I cannot hear,
1567
02:22:06.145 --> 02:22:14.190
Gigi or Croesus the last 10 minutes or so. There was some kind of issue with Restream. I'm glad that the audience and the freaks out there
1568
02:22:14.625 --> 02:22:22.320
were able to get it, and I do look forward to listening to it after I end this stream and going back and listening to the end. I'm sure it was bullish as fuck.
1569
02:22:23.360 --> 02:22:26.980
This was a great conversation before I got cut off from it.
1570
02:22:27.601 --> 02:22:29.780
I just wanted to do a quick shout out to
1571
02:22:30.405 --> 02:22:38.505
our 3 great guests that have joined us, Gigi, Creases, and Gladstein. I look forward to seeing Gigi and Gladstein in Miami very soon.
1572
02:22:40.630 --> 02:22:43.210
I also look forward to this Indy 500
1573
02:22:43.590 --> 02:22:44.811
on this weekend.
1574
02:22:45.990 --> 02:22:50.436
Consider going to strike dot me slash racing to support it. It's a very great
1575
02:22:51.936 --> 02:22:53.635
initiative they're doing over there.
1576
02:22:54.815 --> 02:22:59.440
I may be attending the race myself, which I'm very excited about. Let's go win this fucking thing.
1577
02:23:01.601 --> 02:23:03.061
Yeah. All that said,
1578
02:23:03.520 --> 02:23:06.341
I I love you all, and, thanks for joining, guys.
1579
02:23:11.875 --> 02:23:13.415
Yeah. Thanks for having us.
1580
02:27:33.115 --> 02:27:36.814
Enjoy your Bitcoin Tuesday, freaks. Sorry again about the technical difficulties.
1581
02:27:38.710 --> 02:27:39.510
Just a quick,
1582
02:27:39.990 --> 02:27:43.850
I don't know if you guys realize, but Ron Paul is, the legend.
1583
02:27:44.470 --> 02:27:47.290
The man himself is gonna be opening up
1584
02:27:48.085 --> 02:27:50.665
Bitcoin Miami, Bitcoin 2021 in Miami.
1585
02:27:51.125 --> 02:27:54.885
Had to sit on that one for a while. That's fucking hype as hell. So,
1586
02:27:55.685 --> 02:27:57.064
we also have Cyclops,
1587
02:27:58.300 --> 02:28:00.400
Freak who won a GA ticket,
1588
02:28:01.260 --> 02:28:06.240
through a giveaway on dispatch. Ride or die Freak. He can't go to the conference.
1589
02:28:07.114 --> 02:28:10.015
So if you don't have a ticket and you're trying to go to the conference,
1590
02:28:11.995 --> 02:28:16.640
go into the Sphinx tribe, the Citadel Dispatch Sphinx tribe, first one to put Indy 500,
1591
02:28:17.740 --> 02:28:18.720
in there gets
1592
02:28:19.180 --> 02:28:19.660
gets,
1593
02:28:20.140 --> 02:28:22.080
that ticket. So go do that.
1594
02:28:23.095 --> 02:28:25.595
Love you all. I'll see you for RHR
1595
02:28:26.215 --> 02:28:26.955
on Thursday,
1596
02:28:27.335 --> 02:28:30.314
and dispatch next week is gonna be live from Miami
1597
02:28:31.520 --> 02:28:40.705
with Wiz and Kaludis and some other surprise guests. So make sure you tune in for that, and, hopefully, I'll see a bunch of you freaks over Miami. Cheers, guys. Stay humble. Stack
NOTE
Transcription provided by Podhome.fm
Created: 3/17/2024 4:32:32 PM
Duration: 8925.179
Channels: 1
1
00:00:00.080 --> 00:00:01.699
2
00:00:02.000 --> 00:00:04.660
Kathy. Do you think we go much lower from here?
3
00:00:06.399 --> 00:00:09.780
You never know how low is low when a market gets very emotional.
4
00:00:10.545 --> 00:00:12.644
A lot of traders see Bitcoin,
5
00:00:13.264 --> 00:00:15.684
dropping below the 200 day moving average,
6
00:00:16.384 --> 00:00:17.925
which is which was at 40,000.
7
00:00:19.010 --> 00:00:23.750
So traders, once that happened, they just dumped. Some just, dump and run.
8
00:00:24.290 --> 00:00:25.750
I think we're in a capitulation
9
00:00:26.050 --> 00:00:27.910
phase. Yacine has
10
00:00:28.395 --> 00:00:33.295
a dashboard. We were looking at all the indicators this morning. They are all suggesting
11
00:00:33.755 --> 00:00:35.055
that we are in the capitulation
12
00:00:35.755 --> 00:00:38.390
phase, which is a really great time
13
00:00:39.329 --> 00:00:39.989
to buy,
14
00:00:40.610 --> 00:00:46.070
no matter what the asset is. A capitulation phase is buy. It's on sale.
15
00:00:46.385 --> 00:00:48.405
Now am I saying 35,000
16
00:00:48.705 --> 00:00:50.725
is the low? You know, if traders,
17
00:00:51.025 --> 00:00:54.785
and there are a lot of speculators in in Bitcoin. If they are,
18
00:00:55.810 --> 00:00:57.570
running for the hills just because,
19
00:00:57.970 --> 00:01:06.275
Bitcoin has broken through a moving average that is important to them, it could continue. But, all of our indicators are saying this is capitulation right now.
20
00:01:06.895 --> 00:01:09.315
Do you have a low point on your model for Bitcoin?
21
00:01:10.630 --> 00:01:11.930
No. These metrics,
22
00:01:12.390 --> 00:01:13.290
are are more
23
00:01:13.910 --> 00:01:14.650
a measure.
24
00:01:15.110 --> 00:01:17.770
Are we in a truly capitulation
25
00:01:18.390 --> 00:01:18.890
phase?
26
00:01:19.195 --> 00:01:23.135
Okay. And it's very detailed. Yacine uses on chain analysis,
27
00:01:23.675 --> 00:01:28.735
which this is the only asset where you can see exactly who's doing what, when, why, and how.
28
00:01:29.259 --> 00:01:30.799
And all of those metrics
29
00:01:31.259 --> 00:01:33.119
are saying this is a capitulation.
30
00:01:33.500 --> 00:01:37.039
This is as as bad as it got during the coronavirus
31
00:01:37.420 --> 00:01:37.920
crisis.
32
00:02:15.965 --> 00:02:17.745
33
00:02:18.125 --> 00:02:22.305
It's your boy, Matt Odell, here for Citadel Dispatch 23,
34
00:02:22.990 --> 00:02:28.050
the interactive live show about Bitcoin distributed systems, privacy, and open source software.
35
00:02:28.990 --> 00:02:32.235
Holy shit. It has been an insane week,
36
00:02:32.855 --> 00:02:34.075
in Bitcoin land.
37
00:02:34.935 --> 00:02:38.235
To all the freaks joining us via our audio streams,
38
00:02:38.600 --> 00:02:40.060
that was Cathy Wood
39
00:02:40.360 --> 00:02:42.220
and Carol Massar on
40
00:02:42.600 --> 00:02:45.980
on Bloomberg on May 19th, Wednesday, May 19th,
41
00:02:46.975 --> 00:02:52.755
where Kathy was obviously trying to hit everyone's bingo boards by saying capitulation as many times as possible.
42
00:02:53.935 --> 00:02:57.090
I think that was the feeling that a lot of people had,
43
00:02:57.710 --> 00:03:04.864
that day. I mean, there was blood in the streets. You should I you should've seen all the clips I could've used for this intro. I had, I had CNBC
44
00:03:05.245 --> 00:03:05.745
panicking.
45
00:03:06.444 --> 00:03:10.944
I had boomers, boomers blaming Bitcoin for causing stock market collapse.
46
00:03:11.819 --> 00:03:12.620
It was just,
47
00:03:13.659 --> 00:03:15.260
you know, for for a lot of these,
48
00:03:15.819 --> 00:03:18.480
new corners, that's what I'm gonna call the boomers on CNBC.
49
00:03:19.340 --> 00:03:20.959
This was their first real
50
00:03:21.395 --> 00:03:24.775
dump in the middle of a bull market, so it's pretty crazy to watch unfold.
51
00:03:26.115 --> 00:03:31.750
Before we get started here, I just wanna do a quick shout out as always to the ride or die here in the live chat,
52
00:03:32.450 --> 00:03:34.550
that that make it for these live shows.
53
00:03:34.930 --> 00:03:39.834
This show is, you know, dispatch is all about the live audience and interacting with you guys, so thank you for joining.
54
00:03:40.215 --> 00:03:45.355
And a big shout out to the ride or die that constantly support this show with Sats.
55
00:03:46.295 --> 00:03:50.590
You guys make it so that so that I can keep this show ad free and sponsor free,
56
00:03:51.930 --> 00:03:55.390
and keep the incentives aligned. So it's just it's just me and you guys.
57
00:03:55.985 --> 00:03:59.445
So fuck yes on that, especially if you're in the sphinx tribe.
58
00:04:00.785 --> 00:04:04.305
We have a lot of fun conversations over there. If you do not know what I'm talking about,
59
00:04:05.110 --> 00:04:06.489
you can go to citadel dispatch.com,
60
00:04:06.870 --> 00:04:09.209
and there's links there to join that tribe.
61
00:04:11.269 --> 00:04:15.785
With all that said, I got a great group of guys joining us today.
62
00:04:16.485 --> 00:04:21.545
This is the first time on dispatch that we will be doing it with 4 people rather than 3.
63
00:04:21.949 --> 00:04:25.710
But like I said, I mean, it's been a crazy couple of weeks. So I I feel like,
64
00:04:26.830 --> 00:04:29.650
it's it's fitting here for for that to be the case.
65
00:04:30.575 --> 00:04:31.955
We have first time
66
00:04:32.415 --> 00:04:33.555
first time guest,
67
00:04:34.095 --> 00:04:37.235
and good friend, Alex Gladstein, chief strategy officer
68
00:04:38.070 --> 00:04:41.690
chief strategy officer of the Human Rights Foundation. How's it going, Alex?
69
00:04:42.310 --> 00:04:45.210
70
00:04:45.735 --> 00:04:46.715
react with y'all.
71
00:04:47.175 --> 00:04:50.235
And then we have Croesus and Gigi,
72
00:04:50.535 --> 00:04:52.155
73
00:04:52.830 --> 00:04:55.090
the 3rd episode. So if you go to citadel dispatch.com/cd3,
74
00:04:57.310 --> 00:05:01.625
you can see their episode after this, obviously. Don't don't leave us right now.
75
00:05:02.025 --> 00:05:10.125
And it's kind of fitting because we were around the same price. You know? We're you it was it was 20 episodes ago. It was 20 dispatches ago, 20 weeks ago,
76
00:05:10.560 --> 00:05:14.020
and we were trading around 34 k, and we were bullish as fuck.
77
00:05:14.640 --> 00:05:18.660
So I'm I'm hoping to get that same kind of vibe here today, boys. How's it going, Kreuz?
78
00:05:19.195 --> 00:05:25.535
79
00:05:26.199 --> 00:05:28.780
80
00:05:29.320 --> 00:05:33.660
81
00:05:34.145 --> 00:05:35.605
82
00:05:36.465 --> 00:05:38.485
So, gentlemen, I mean, we have,
83
00:05:40.465 --> 00:05:42.885
we have a lot of places we can go here.
84
00:05:44.000 --> 00:05:48.100
I don't know where I wanna start. I guess I guess we should start with,
85
00:05:48.960 --> 00:05:54.115
is the bull market over? Is the top end? Will Bitcoin ever pass the all time high again?
86
00:05:56.735 --> 00:05:57.235
87
00:05:59.350 --> 00:06:03.130
88
00:06:03.590 --> 00:06:11.105
89
00:06:11.885 --> 00:06:13.025
that tells you everything.
90
00:06:13.620 --> 00:06:23.445
91
00:06:23.985 --> 00:06:26.405
Like, as you log in to your Charles Schwab account.
92
00:06:27.905 --> 00:06:46.074
93
00:06:46.375 --> 00:06:48.715
and David Faber over at on CNBC.
94
00:06:50.200 --> 00:06:57.340
They were literally blaming the stock the they were they kept saying crypto. I mean, I hate that term, but they kept saying crypto, and they were blaming
95
00:06:57.905 --> 00:07:03.525
the fall of Bitcoin. They were they were blaming the stock market on it. They were saying that the stock market,
96
00:07:04.865 --> 00:07:15.120
no. That they were blaming the fall of the stock market on the fall of Bitcoin, but I can't help but think that there's gotta be some macro connection there that in reverse. You know, it's almost like Bitcoin is just so
97
00:07:15.475 --> 00:07:16.535
showing some of
98
00:07:16.915 --> 00:07:18.855
the insecurities of the broader market.
99
00:07:19.235 --> 00:07:21.955
But, at the same time, I mean, I I was
100
00:07:22.870 --> 00:07:26.410
I guess all of us except for Croesus were were here last run. Right?
101
00:07:27.430 --> 00:07:34.275
102
00:07:34.815 --> 00:07:36.575
and, you know, watching the,
103
00:07:37.135 --> 00:07:38.195
the hard fork
104
00:07:38.699 --> 00:07:40.000
in, in in
105
00:07:40.380 --> 00:07:42.080
disbelief and and,
106
00:07:42.620 --> 00:07:43.120
fear,
107
00:07:43.660 --> 00:07:47.280
as somebody who didn't understand what was going on in Bitcoin land yet.
108
00:07:48.745 --> 00:07:51.805
109
00:07:52.505 --> 00:07:57.380
110
00:07:58.100 --> 00:07:59.240
This is also what
111
00:07:59.940 --> 00:08:03.240
the mid 2013 bull market low looked like.
112
00:08:03.860 --> 00:08:08.475
It seems to be that there's there's something about human psychology in this market where
113
00:08:08.855 --> 00:08:12.700
after a year a 1 year post having, which is where we're at,
114
00:08:13.340 --> 00:08:15.600
you can't sustain bullishness forever,
115
00:08:15.900 --> 00:08:18.080
and there's some sort of major fear
116
00:08:18.540 --> 00:08:19.040
resurgence
117
00:08:19.740 --> 00:08:21.920
and shakeout that causes a dip.
118
00:08:22.495 --> 00:08:25.475
Let's call it, like, 2 thirds of the way through the bull market.
119
00:08:26.095 --> 00:08:30.470
It's just what what we're doing right now. If you line up the the chart of the 2017
120
00:08:31.010 --> 00:08:32.390
bull market with
121
00:08:32.770 --> 00:08:33.510
right now,
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the the dip that we experienced in in summer 2017
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is, like, within a week of the exact time frame of of the dip we've just gone through,
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in terms of its relation to to the halving date.
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we just saw all kinds of insanity. I mean, just from leverage trading to, you know, everything that had a dog face on it, shooting up 10,000,000 percent. So I think some some spring cleaning, so to speak, was in order and this was this spring cleaning, but I think it's nothing to be worried about really.
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we have this catalyst for price growth with the having, and then and then, you know, price drifts upwards
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as,
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as the shortage of supply,
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you know, causes demand to drive price up.
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And and and that's inherently so bullish, and people get overly excited
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and take on too much risk,
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add leverage.
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And the the market
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the the market has a way of reestablishing
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equilibrium
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by punishing that risk.
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And it's it feels like it's
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in a free market, you know, and this is really the only example of a truly free market in the world today.
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This sort
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of volatility is necessary to keep everything on a level keel.
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And and that's especially necessary when you have these structural reasons why the price will keep going up, and yet you have to shake off,
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speculators and and the overleveraged
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during that process.
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just overcome
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with emotion,
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you know, around January 2nd or 3rd when we, like,
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broke 30 k, which was so shocking, I think, to a lot of people including me, just that moment. And then, you know, that's we're we're higher than that now, but people are, like,
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they're, like, so psychologically damaged. It's really crazy to see The normalization of
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the of the progress of the price is is something that,
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it it it's just it the world changes and people don't realize it. And then, you know, this whole thing has happened in the last few years where it's become probably not realistic for, like, the average American to
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probably have a full Bitcoin.
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That has happened, like, relatively quickly and, like, no one really notices. It it's really truly stunning. Absolutely stunning. As someone who,
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was, like, kind of loosely paying attention to Bitcoin at the end of the previous bear market
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was along for the certainly, you know, as an observer of the ride
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up in 2017,
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but but then really started diving in, like, let's say philosophically, politically, economically
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to the system
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in the previous bear market. It's amazing because, like, all the stuff that I was blown away by and had my mind blown by, you know, it was that the price was at rock bottom and I was just, like, this is the coolest thing ever. And and now it's now we're in a different situation,
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like,
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we were crashing to
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like, the COVID crash was to 3,800,
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filter bubble is still as excited as ever when the price dips because,
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I mean, like, everyone, when we hit 60 k, everyone was, like, dreaming of these prices. You know? I wish I could go back when it was 30 k and just buy more, and and now we fell back to to 30 k or something. I like how we had to pass through the,
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It is pretty much Bitcoin phase. Like, that was really important to pass through, narrative wise.
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Yeah.
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Yeah. Like, leading journalists in America's top financial publications
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fighting about like the soul of Bitcoin and how it is different from those coin. And we have Billionaires
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you know, part of me is just really,
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you know, acknowledging of the fact that he's going through what I went through and what most people went through, but just live in front of 50,000,000 people. Yes. Everybody's going through. I went through the same, like, oh, these all coins look cool. Like, I mean,
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you know, didn't we all? Like, it's just crazy that he's going through it live with no filter
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in front of 50,000,000 people. Yep. Yeah. Because everybody goes through 1,000,000 of dollars to to spend to spend. Yeah. Right. And toss around and and and move markets with his tweets. In retrospect, it was inevitable that that that would happen, though. Right? That that Yeah. The world's most powerful people would go through the same phase we all went through. Right. And pick and pick, flavor of the month altcoins to
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try to use these moments to educate the onlookers because those are valid questions. Like, why is Bitcoin so different? Then what is the soul of Bitcoin? And what is it about? And and how
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like, why is Bitcoin different than Dogecoin, for example? Why is proof of work necessary? Why is it necessary to why does it take so much energy to do something like Bitcoin? And I think I think we,
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I I think we would do the the future coiners, disservice if we don't at least try to
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to educate from time to time why these things are important. And we actually you know, like, the last 10 years, a lot of people thought about those things very deeply.
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So we went through this before. We just have to kind of summarize it and and, preach it to the masses if you want. It was kinda funny to read the block size war and have,
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like, completely insane.
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But also perfect, like, educational moment for people where, hopefully, those who are paying attention could see the Bitcoiners arguments of, like, you know,
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how ridiculous this was. And I think we're just well much better positioned now than we were maybe 4 or 5 years ago on that front.
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So Elon again has to go through the big block phase because he's an engineer, of course, and he's here to fix Bitcoin.
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And, you know, he got kind of repelled properly, hopefully.
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to just look at the parameters that you
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can change kind of, like the knobs that you can twist and think, yeah, why not, like,
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I don't know, increase block size by 10 x? Why not try to increase throughput by 10 x? And and, like, what do you have to lose? You know? I can't just build a better system just like you can build a better rocket maybe. And,
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he he just, I think, lacks the
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necessary history and understanding that we went through that all that already.
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And it's it's a very nuanced problem, and it's not necessarily easy to understand even if you are a smart engineer.
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there's this this problem that narcissists face
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when they when they come into Bitcoin
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of,
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I think Max Kaiser put this well that there there's no room for narcissism in Bitcoin because
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narcissism is about is about me. It's about the individual, the ego, and Bitcoin rejects that. It doesn't it doesn't allow for that because
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you can't change Bitcoin. Bitcoin changes you, and that's fundamentally at odds with the
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the the, you know, internal
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story that narcissists are are constantly, you know, guiding their lives based on. And and that's Elon Musk. Like, you you don't become the the
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richest person in the world and, you know, the person that Iron Man's character is loosely based on,
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without developing a god delusion of some kind. And so, of course,
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somebody like that is going to,
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run
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head into this
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this
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problem with Bitcoin of I can't do anything to change it, but I want to. I want I want to feel like I have that power.
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Michael Saylor, I think, is trying to do with this
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mining council of
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potentially teeing up like
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a way to save face
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for Elon of, like, you know what, Elon? Here, you can have some sort
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of input and a say, and you can you can
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influence how Bitcoin is, approaching, you know, energy,
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by being by being on this council and feeling important even though it it's not gonna change anything. And in fact,
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if anything, that council stands
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to celebrate the the organic wins that are already happening in terms of Bitcoin leveraging,
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stranded fossil fuels,
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and,
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excess renewable energy. That that's already happening, and here's here's a way for Elon to feel like he can, you know,
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he he can say that I was a part of making this happen even though it was gonna happen already.
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on this.
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fighting over Bitcoin? This is extremely bullish. You know, I've I've,
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And instead of taking a break,
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at the end of last year, I decided to lean into it, and I added a second show to my roster dispatch.
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So here I am again
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talking about the newest the the newest,
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development in Bitcoin. I'll tell you, these types of weeks
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are the types of weeks in past cycles
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where really the most prudent move
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is to just go outside, enjoy life,
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and, you know, just keep stacking and just ignore everything and just not pay attention to any of this shit,
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is is is
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is probably the best for your wallet and your mental health.
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But,
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the 4 of us and a lot of the the freaks of this live chat
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have chosen to be completely obsessed with Bitcoin, so we're not gonna opt for that path. So,
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with all that said, first of all, before we leave the bullish thing, I just wanna say, because I because you guys were having a great conversation there. I didn't get to jump in. It's just pretty ridiculous to me that I have,
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like, my normie friends from college and stuff, like, reaching out, making sure I'm all right because they're like, oh, Bitcoin dumped. Like, are you okay? And I respond back. I was like, Bitcoin's at $40,000.
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It it was it was at 10 k in November, and it's at $40,000.
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I'm doing alright. You should buy some.
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But for this okay. So let's jump into this. So I have, on on my spreadsheet here, I have a couple things that I want to hit, and the 2 big things
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is American miners
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and Chinese miners.
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I think,
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you know, that distills what this last week has been.
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On the American Mining side, this mining council now I don't think anyone should be surprised
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that Saylor is
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who he is. I think Saylor has been extremely consistent.
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I think he's been
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amazingly consistent.
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I have never once thought that he was gonna protect the
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the interests of self sovereign Bitcoiners,
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And and that's okay. I think for a
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a a regulated type of dude, for a for a billionaire type of dude,
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He's, like, a pretty great Bitcoin advocate. They're they're he's extremely consistent.
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He speaks really well.
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He cleans up nicely.
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You know, the guys on CNBC and shit love him. You know, the the he gets along with the Ross Stevens of the world. They're, like, in a whole different ballgame than us. Right? They're playing they're playing a different game.
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What's cool about Bitcoin is, you know, Bitcoins are enemies and for friends. Right? So,
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we can play our game, they can play their game, and for the most part, we can benefit each other.
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But I think it's important that people and and and it's kind of nice that this happened when it happened, because I think it's important for people to take
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a step back and not just, you know, idolize all these guys, including myself. Like, you shouldn't idolize me. You shouldn't idolize Gladstein. You shouldn't idolize Gigi.
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You shouldn't idolize Croesus. Like, don't idolize people.
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Think for yourself, you know, be critical. Because on Bitcoin Twitter, especially, people tend to just,
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you know, just go with whatever the prevailing narrative is for whatever particular time, and they're too scared to speak out, and they're, you know, they're afraid they're gonna get called out by other people, and, you know, block culture is, like, really high in in Bitcoin land. So think for yourself. I want people to think for themselves.
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So back to that. The American mining thing
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is something that I've been concerned with for a long time, and it's really interesting to me because,
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you know,
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we I've maybe we're surrounded I'm surrounded more by American Bitcorners. I think it's a time zone thing on Twitter,
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but also, obviously, like, I'm in America. Right?
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And on the American Bitcoin side, there's, like, this really easy,
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hole to fall into where you demonize Chinese miners.
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And, you know, I love Marty,
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but, you know, the name of their company is the same idea. Right? Great American Mining. Right? It's this idea that we're gonna bring mining back, bring mining to America and Bitcoin is gonna be better for it because America's the best country in the world.
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And I love this country. Like, I I'm not saying I don't love this country. I'm very grateful that I live in this country, especially with this whole corona bullshit that happened. We've seen that, you know, the freedoms we have in America are way stronger than most parts of the world.
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But I have always been concerned
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that
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if,
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you know, if if we have a large contingent of mining in America,
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it it it presents an existential threat to Bitcoin,
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and and a threat that is almost
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more to me than a threat from Chinese miners. And you can you know, the the biggest issue with Chinese miners is that they did have a large portion of the hash for a long time. They still do. It is decreasing,
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and the positive note is I don't think that, you know,
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even if, you know, in best case scenarios for for American miners,
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they probably can't come anywhere near 50% of the hash rate, so that's, like, a good saving grace.
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But America is the country that imposes all this k y c a m l crap on everyone. America is a country that goes after BitMax. America is a country that shuts down one broker.
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All this FUD about Chinese miners and the first miner to start doing this blacklisting
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clean block bullshit was the 1st large American miner. Right? It's like they, like, finally hit the scene, and then the first thing they fucking do is decide that they wanna do OFAC mining.
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And my issue is,
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you know, I could give 2 shits about the environmental whatever bullshit. I think that, you know, if if people wanna fight that fight, they can fight that fight. But the when it comes down to this whitelist, blacklist shit,
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what I expect to happen and I see a lot of people, you know, talking real cocky on Twitter, like, oh, American miners are just gonna choose to go to a different pool that isn't doing the the the blacklist, white list stuff,
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because they'll make more money. Yeah. They would make more money if they go to a different pool, But the thing is, it's gonna be the same ideas chain analysis where they're gonna lobby government to make their them a requirement. Right? They're gonna basically
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they're they're gonna do a regular regulatory moat kind of bullshit where they where they force any large minor in America
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to follow this practice. Otherwise, they'll be pariahs. And that that is to me has been a a major threat. This is one of the reasons why I've been advocating for CoinJoin.
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You know, I had Adam back on the show
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couple episodes back.
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He made a really good point. Like, when it comes to minor censorship,
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like, if you have on chain privacy, minor censorship is harder to do because they don't know what your transactions are. Like, if if Marathon
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wants to or anyone they're working with wants to censor my transactions, they're gonna have to censor all CoinJoin users. They can't just censor me. And if we have more CoinJoin users,
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then, you know, they're gonna have to censor a large portion of the user base if they wanna censor me. And I I think,
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we should be thinking more in in that kind of vein, like, how do we,
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you know, actively use this tech to to make it untenable?
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80 different countries to prevent the rise of potentially American hegemony over Bitcoin mining. Would that be, like, a cool woke billionaire?
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And and then also on top of that, right, is stuff like,
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Stratum V2, Better Hash. Right? Things that try and take
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power out of the mining pool's hands. Right? Because right now, mining pool operator is the one who constructs the blocks, which is a is a is a major issue in in terms of centralization.
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I think it's it's something that has
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natural
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decentralizing
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effect. I think it just needs time, and I think we are at the kind of a peculiar
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place in time right now where we have, like, a chip shortage, for example, and just all kinds of things going on that,
331
00:28:18.275 --> 00:28:19.015
kind of
332
00:28:19.490 --> 00:28:35.335
hinder the the progress on that front, I would say. And I think just give it another couple of years and, like, get the ASIC production ramped up, and I think the the incentives are aligned in such a way that this is bound to happen. And I I think we're just early.
333
00:28:36.330 --> 00:28:42.750
334
00:28:43.130 --> 00:28:55.259
you know, there's no I mean, it's almost unrelated. Like, obviously, the reason why there's there grew to be such a mining presence in China was because of all this infrastructure build up the CCP did, and they had all this curtailed energy.
335
00:28:55.799 --> 00:28:57.820
You know, they're they're they're basically curtailing,
336
00:28:58.759 --> 00:28:59.500
you know,
337
00:28:59.880 --> 00:29:02.139
more energy than other countries even use,
338
00:29:03.105 --> 00:29:04.164
you know, at times.
339
00:29:04.705 --> 00:29:08.485
And miners are smart and they're like, okay, you know, I'll I'll go take that.
340
00:29:09.520 --> 00:29:12.580
And, you know, if that era is ending, that's gonna disperse.
341
00:29:12.960 --> 00:29:18.179
But if the if the opposite had been true, if mining had been concentrated in the United States
342
00:29:18.905 --> 00:29:19.965
at more than 50%
343
00:29:20.345 --> 00:29:21.565
for its 1st decade,
344
00:29:22.025 --> 00:29:27.645
you're right, Matt. Like, maybe that would have been a worse outcome. And I say that as someone who's, like, obviously very anti CCP,
345
00:29:28.059 --> 00:29:31.840
but, like, they just don't really seem to have their shit together here. So I think it's a little bit different.
346
00:29:33.900 --> 00:29:41.095
347
00:29:42.115 --> 00:29:51.620
348
00:29:52.885 --> 00:29:53.385
economic
349
00:29:53.845 --> 00:29:57.385
forces at at play here and and kind of the longer timeline
350
00:29:57.845 --> 00:29:58.664
of mining,
351
00:29:59.125 --> 00:30:03.460
I think most people probably in in this in this chat have a,
352
00:30:04.880 --> 00:30:08.980
a strong sense for it. But for people listening to the podcast later or whatever,
353
00:30:11.725 --> 00:30:16.625
the the largest input cost to mining is electricity, is energy.
354
00:30:16.980 --> 00:30:17.480
And
355
00:30:18.659 --> 00:30:19.639
that means that
356
00:30:20.019 --> 00:30:23.799
globally, miners are competing to find the cheapest source of energy
357
00:30:24.259 --> 00:30:26.440
in order to maximize their profits.
358
00:30:27.045 --> 00:30:27.545
And
359
00:30:28.005 --> 00:30:29.305
so long as you're profitable,
360
00:30:29.685 --> 00:30:30.505
you're incentivized
361
00:30:30.885 --> 00:30:32.105
to to add,
362
00:30:33.205 --> 00:30:36.505
computing power to the network. Right? To increase
363
00:30:37.640 --> 00:30:40.220
the the amount of of profits you're getting,
364
00:30:40.680 --> 00:30:42.360
until you can't find any any,
365
00:30:42.840 --> 00:30:44.300
until the the marginal
366
00:30:44.795 --> 00:30:46.335
energy that you would be using,
367
00:30:46.795 --> 00:30:51.695
makes it so that you're, you know, no longer you're destroying profits rather than creating profits.
368
00:30:52.520 --> 00:30:55.659
And and that is playing out on an individual basis
369
00:30:56.200 --> 00:30:56.700
globally,
370
00:30:57.720 --> 00:30:58.220
constantly.
371
00:30:59.080 --> 00:31:00.860
And as Gigi alluded to, like,
372
00:31:01.195 --> 00:31:04.495
right now, mining is especially profitable because of a chip shortage.
373
00:31:05.034 --> 00:31:06.815
And so there's this lag between
374
00:31:07.515 --> 00:31:11.100
Bitcoin's price action and the ability of miners to
375
00:31:11.720 --> 00:31:16.460
to spin up additional hardware to drive down the profitability of mining
376
00:31:16.965 --> 00:31:20.345
to the to what's in business called the hurdle rate,
377
00:31:21.525 --> 00:31:23.145
meaning the required
378
00:31:23.525 --> 00:31:24.424
rate of return
379
00:31:25.080 --> 00:31:27.660
for investing capital into a project.
380
00:31:28.600 --> 00:31:29.100
And,
381
00:31:29.640 --> 00:31:32.300
you know, so if you if you zoom out and you think about those
382
00:31:33.115 --> 00:31:34.895
theoretical economic forces
383
00:31:35.515 --> 00:31:38.095
playing out, what we're gonna see inevitably
384
00:31:39.275 --> 00:31:41.295
is Bitcoin mining over time
385
00:31:41.640 --> 00:31:42.540
shifting to,
386
00:31:43.880 --> 00:31:52.185
energy sources that have no other use case, no other bidder, and therefore can be bought for purchase by miners for next to nothing.
387
00:31:53.045 --> 00:31:59.225
And and that can be that means that's going to happen wherever there's excess. Wherever there's excess specifically for
388
00:32:00.400 --> 00:32:01.860
low variable cost
389
00:32:02.480 --> 00:32:05.299
energy. And I'd make that distinction between because,
390
00:32:06.240 --> 00:32:13.225
like, if you think about, like, a coal fired power plant, their primary input cost is coal. Right? They they they have a
391
00:32:13.765 --> 00:32:17.785
high variable cost for producing energy because they're they're burning something.
392
00:32:18.560 --> 00:32:20.820
But if you think about, like, a a solar farm
393
00:32:21.200 --> 00:32:23.540
or or even a nuclear power plant,
394
00:32:24.080 --> 00:32:25.860
their variable costs are
395
00:32:26.160 --> 00:32:28.165
less, a lot less because they're not
396
00:32:28.645 --> 00:32:35.065
oh, it's you know, with nuclear, they are using some resource, but it's not the same as burning
397
00:32:35.470 --> 00:32:35.970
coal.
398
00:32:37.390 --> 00:32:42.450
Anyway, so so those are the energy sources that are going to be the cheapest,
399
00:32:43.425 --> 00:32:45.605
that that when there's excess,
400
00:32:46.625 --> 00:32:50.405
producers are willing to part with it for the least amount of revenue
401
00:32:50.840 --> 00:32:51.340
because
402
00:32:51.799 --> 00:32:55.400
they don't need that much to cover their variable costs that the that,
403
00:32:56.120 --> 00:32:57.580
is the contribution margin
404
00:32:58.685 --> 00:33:03.185
is so much higher when you have low variable costs in your in your operations.
405
00:33:03.805 --> 00:33:04.785
So, like,
406
00:33:05.780 --> 00:33:13.080
just in a free market, this plays out over the next 10 years. Mining is go Bitcoin mining will gravitate towards the cheapest
407
00:33:13.655 --> 00:33:15.195
energy sources on the planet
408
00:33:16.375 --> 00:33:17.435
almost exclusively,
409
00:33:17.815 --> 00:33:26.780
and that's going to mean excess renewables or completely stranded energy that has no other use case. Or government subsidy or government subsidy. Yeah. Right. Absolutely.
410
00:33:27.240 --> 00:33:29.260
411
00:33:29.560 --> 00:33:33.385
we were Alex, we were both on the exact same page on that one.
412
00:33:34.425 --> 00:33:41.485
Chris says, you make a really good point there, and and this is this is, you know, a key aspect of Bitcoin. Right? These financial incentives.
413
00:33:42.990 --> 00:33:44.289
But there
414
00:33:44.830 --> 00:33:48.610
and and and specifically when it comes to censorship, this idea that,
415
00:33:49.549 --> 00:34:01.480
if a large amount of pools are censoring your transaction, you can keep raising your transaction fees, and someone some minor somewhere is gonna have the financial incentive to include it because he's gonna get paid more because your transaction fees are higher.
416
00:34:01.960 --> 00:34:10.140
Mhmm. My concern a bit is that there's these out of band incentives as well that are going on at the same time that people tend to ignore,
417
00:34:11.255 --> 00:34:12.315
mostly because,
418
00:34:13.335 --> 00:34:14.795
Bitcoiners don't like
419
00:34:15.174 --> 00:34:15.915
to vocally,
420
00:34:16.855 --> 00:34:20.530
think critically because they're afraid that they're gonna be called a bear.
421
00:34:20.990 --> 00:34:28.050
422
00:34:28.915 --> 00:34:31.975
423
00:34:32.515 --> 00:34:42.770
completely separate of the Bitcoin Blockchain. You can pay them, you know, with a credit card or PayPal or something or a cash in a briefcase, and they'll confirm your transaction for you. Alternatively,
424
00:34:43.470 --> 00:34:46.210
I kind of feel like we're entering this new geopolitical
425
00:34:47.035 --> 00:34:48.015
era of Bitcoin
426
00:34:48.555 --> 00:34:49.055
where
427
00:34:49.355 --> 00:34:50.175
large governments
428
00:34:50.795 --> 00:35:09.375
and countries are gonna start to realize it's in their national security interest to have Bitcoin miners within their borders. And this is what I wanted to dive into because I don't think I think this Chinese mining ban thing is bullshit. I think it's complete bullshit, and I'm not gonna believe any of this shit until I actually see some tangible shit. I can verify
429
00:35:09.755 --> 00:35:12.895
that Hash is leaving in droves out of out of that country,
430
00:35:13.779 --> 00:35:16.839
because it's in their financial best interest as a government,
431
00:35:17.539 --> 00:35:21.160
to control the mining there. They they want to have miners there.
432
00:35:22.115 --> 00:35:22.515
You know,
433
00:35:23.395 --> 00:35:32.110
they they they they wanna have miners that they can that they can push to confirm their transactions. They wanna have miners that can protect their interest in terms of other miners
434
00:35:32.650 --> 00:35:34.190
not confirming their transactions,
435
00:35:35.855 --> 00:35:39.474
and they want to be able to have access to this global neutral network.
436
00:35:40.174 --> 00:35:43.875
So so there's all these other incentives that are at play on the outside,
437
00:35:44.970 --> 00:35:47.470
that I feel like we kind of ignore. Right, Alex?
438
00:35:48.010 --> 00:35:52.829
439
00:35:54.005 --> 00:35:55.785
in the last couple weeks months
440
00:35:56.164 --> 00:36:07.319
is that even if there's, like, strong incentives to change, the the sort of logistical environment is just not that easy to change. So stuff happens slowly. So even if there's, like, this freak out in China,
441
00:36:08.525 --> 00:36:18.960
well, guess what? Like, there there's not that much rack space available in the United States right now. There's very little. I mean, there's just minor sitting, thousands of ASICs just sitting. They can't be plugged in.
442
00:36:19.740 --> 00:36:20.240
There's,
443
00:36:21.420 --> 00:36:22.540
issues with, like,
444
00:36:22.940 --> 00:36:27.464
like, getting the the equipment out. I mean, there will be a lot of equipment from what I understand.
445
00:36:28.005 --> 00:36:29.145
If this is true,
446
00:36:29.765 --> 00:36:32.345
moving by truck to Kazakhstan and Russia,
447
00:36:33.525 --> 00:36:38.369
but, you know, getting that equipment to America or elsewhere or maybe to Africa is is non trivial,
448
00:36:39.150 --> 00:36:41.650
and it takes time and you have this sort of,
449
00:36:42.109 --> 00:36:43.890
you know, chip crunch. So
450
00:36:44.270 --> 00:36:46.369
it's kind of an amazing moment where,
451
00:36:46.975 --> 00:36:54.675
you know, we're almost insulated from massive change because we can't just snap our fingers and make more chips and make more miners. We're kinda stuck with what we have.
452
00:36:55.460 --> 00:36:57.720
And the world is in such a kind of weird,
453
00:36:58.180 --> 00:36:59.160
dynamic where,
454
00:36:59.539 --> 00:37:03.400
you know, you know, there's still sort of majority hash rate in China, but it's dwindling.
455
00:37:03.885 --> 00:37:06.865
But America's too you know, you know, I would say, thankfully,
456
00:37:07.165 --> 00:37:16.480
America doesn't have, like, 40% yet. I mean, we're still probably in the I don't know what you guys think, but from what I understand, like, anywhere from 8 to 12% maybe in America.
457
00:37:16.860 --> 00:37:22.960
So, you know, things just takes take time to to to shift in this environment. It's not so easy.
458
00:37:23.315 --> 00:37:26.615
So, I just would be, I'm interested to watch what happens.
459
00:37:27.715 --> 00:37:43.325
But, I agree with Matt, like, some of your comments about, like, you know, if all the miners, like, stopped right away in China, we would we would figure that out pretty quickly. Right? Like, that's not it's not hard to, to see. I just feel like when the CCP wants to, like, truly ban something, like, they do it.
460
00:37:43.705 --> 00:37:47.244
461
00:37:48.090 --> 00:37:50.590
do do they like do they like half band shit?
462
00:37:50.970 --> 00:37:52.670
463
00:37:52.970 --> 00:37:57.355
even the this this was so everything's blown out of proportion. Of course, it's like the China FUD stuff,
464
00:37:57.915 --> 00:38:06.015
but this was like a warning to certain people in certain industries. It was not like some sorta, like, you know, blanket ban or anything like that. So
465
00:38:06.329 --> 00:38:20.325
466
00:38:20.785 --> 00:38:32.700
467
00:38:33.095 --> 00:38:46.210
That's true. So the question is is it related to the market, or is it related to the crackdown? And, you know. Like, my college my college friend sold. Like, that wasn't related to the CCP banning their mining operation.
468
00:38:46.750 --> 00:38:49.570
469
00:38:51.055 --> 00:38:59.210
470
00:38:59.690 --> 00:39:12.425
The sort of, like, inner Mongolia and Xinjiang over to, like, the the Yunnan and Sichuan kinda, like, hydro provinces. So you're there's already gonna be a drop off in hash rate as they, like, disconnect equipment and move it. Which, by the way, is a new narrative
471
00:39:13.125 --> 00:39:16.265
472
00:39:16.645 --> 00:39:23.420
after a hash dropped, and, like, we've been normalized into that normal like, normalized into that concept. Like, we never
473
00:39:24.040 --> 00:39:24.360
I
474
00:39:24.895 --> 00:39:36.340
as as a Bitcoiner, I never heard that narrative before. And then all of a sudden now it's just, like, common knowledge. It's like, oh, if the difficulty drops by, like, 18%, it's because the miners are moving from wet to dry season or vice versa.
475
00:39:38.000 --> 00:39:40.980
476
00:39:42.154 --> 00:39:56.359
I want to point out one thing what which I think is insanely bullish. Like, it it doesn't even matter kind of what is true and what isn't. The fact that Bitcoin mining is as mobile potentially as it is is insanely bullish because even
477
00:39:56.660 --> 00:39:57.720
like, imagine
478
00:39:59.065 --> 00:40:01.325
China banning gold mining. Like, there's
479
00:40:01.785 --> 00:40:31.180
you can't move a gold mine. You know? And it's it's just I I think the property of the Bitcoin network that the only thing you need is a a power source and a communication link to mine is so insanely beautiful, and you can actually take the ASICs and move them somewhere else and just continue mining. It like, it's it's literally it's it's not that big of a hassle. Of course, you know, there are some things involved and so on and so forth, but but but still, there is no other industry where you can do that that easily. And, again, like, you need nothing except for an energy source
480
00:40:31.640 --> 00:40:32.140
and
481
00:40:32.464 --> 00:40:33.765
a communications link.
482
00:40:34.065 --> 00:40:36.165
And I think even, like, considering
483
00:40:36.625 --> 00:40:37.125
a,
484
00:40:37.905 --> 00:40:53.485
a broadband on mining, it's really difficult to do because if you are motivated for for the for whatever reasons, like, even if you're a a very small player, you can still mine, and it's very easy to kind of hide your footprint because you don't have Right. Like, a big signature. And it's I I think this is underappreciated
485
00:40:53.865 --> 00:41:02.990
and not often talked about. Like, it's you you can take your shipping container and move it somewhere else. Like, cool. Yeah. It's And I think I think long term, the incentives favor smaller miners.
486
00:41:03.370 --> 00:41:13.005
487
00:41:13.545 --> 00:41:21.130
and stuff like, you know, like, heating a home, for instance, once ASIC start to level out in terms of, life cycles. Look at the s nine. The s nines lasted forever.
488
00:41:21.830 --> 00:41:28.595
You get one of those, you're heating your home with it. You're all of a sudden, you're able to cut costs more than a an industrial miner that has them all in the warehouse.
489
00:41:29.695 --> 00:41:35.900
And and I do agree with you, Gigi, that I think one of the most bullish things we have with us is that it is it can be highly mobile.
490
00:41:36.360 --> 00:41:51.235
But that's also one of the reasons why I'm less concerned about actual bans, specifically bans that are, like, so loose that they're a ban, that they allow you to move your minors out of the country or sell them, which is like, okay. Like, you're gonna ban weed, but you're gonna let me move my weed out of the country.
491
00:41:52.320 --> 00:41:54.820
I'm more concerned about seizure and capture.
492
00:41:55.520 --> 00:42:01.300
And seizure is obvious. Right? You know, people busting down your doors and taking control of your mining operations.
493
00:42:02.085 --> 00:42:03.865
But capture is way less
494
00:42:04.245 --> 00:42:11.625
obvious and happens slowly over time, and that's kind of what we're seeing with this American Mining Council. Right? That's the fear of something like the American Mining Council,
495
00:42:12.230 --> 00:42:16.170
where you have, like, regulatory capture and then they're all playing and reporting,
496
00:42:16.549 --> 00:42:28.735
you know, reporting all their information and playing by certain rules and stuff. Kind of like what we've seen with the exchanges. Right? Just just to dwell on this, like, really interesting geopolitical moment for a second. There's a really good, interview,
497
00:42:29.630 --> 00:42:33.029
498
00:42:33.470 --> 00:42:36.289
on Bitcoin and energy and electricity is excellent.
499
00:42:37.115 --> 00:42:38.474
But they bring up a good point that, like,
500
00:42:39.595 --> 00:42:43.694
this chip shortage is not gonna last forever. Like, by 2025 or so,
501
00:42:44.610 --> 00:42:57.035
all these big fabs are gonna be up and running, and and there will be a lot more chips available. And and there are, like, key industrial use cases of Bitcoin mining that are gonna be, like, brought into the fold. Like like, they were talking about how,
502
00:42:57.575 --> 00:42:59.275
I think Friar said that, like,
503
00:42:59.790 --> 00:43:03.810
like, methane waste alone is enough to take Bitcoin to, like, $50,000,000,000,000.
504
00:43:04.430 --> 00:43:14.665
That's it. It just there's not enough chips, and the companies that are doing it are ignorant. But once they figure it out, it's gonna happen. And, you know, he thinks that by, like, maybe 2025, 26,
505
00:43:14.965 --> 00:43:38.099
maybe you have a quarter of all Bitcoin mining is is done through straight up just sort of waste from an existing industrial sites. But it can't get there until we have more chips. So it's like, we're in this weird geo geopolitical moment where we can start making, we can start seeing the future a little bit, but it it there's, like, a lag time because just can't make a 6 fast enough. I mean, the a 6 that were made, what, a year, the s nines or whatever were a $100
506
00:43:38.400 --> 00:43:40.820
or something like that a year ago. Now they're $1,000.
507
00:43:41.440 --> 00:43:44.415
Like like, this is old equipment. So there's, like, 3
508
00:43:44.955 --> 00:43:56.070
509
00:43:56.770 --> 00:43:58.230
Yeah. Now they're, like, $900
510
00:43:58.530 --> 00:43:59.590
or something. Each.
511
00:44:00.050 --> 00:44:12.520
512
00:44:12.820 --> 00:44:15.480
513
00:44:19.305 --> 00:44:25.085
514
00:44:25.545 --> 00:44:31.680
are stuck. Like, at the it takes what? How long would it take? Like, 18 months right now to get, like, a big shipment
515
00:44:32.059 --> 00:44:33.520
if you place the order today?
516
00:44:34.895 --> 00:44:41.155
517
00:44:41.615 --> 00:44:43.235
knowledge shop right there.
518
00:44:44.650 --> 00:44:53.515
519
00:44:54.234 --> 00:44:57.135
So it's kind of a supply chain is distributed a little bit.
520
00:44:58.394 --> 00:45:16.615
But anyway, to to just cap to cap that off, in 3 or 4 years, it'll be a very different environment. Like, I I I believe pretty firmly that there'll be a lot more chips available and that'll really diversify mining. Like, that will help decentralize it in a massive way. So that's where we're going. We have people in the comments. Yeah. A lot of it's done in Taiwan as well. Mhmm.
521
00:45:17.235 --> 00:45:24.250
By the way, Taiwan is a country. We fucking love Taiwan. Yeah. Seriously. Am Ra John Cena. Yeah. Here here at Dispatch, we,
522
00:45:25.190 --> 00:45:27.610
523
00:45:29.845 --> 00:45:56.125
524
00:45:56.460 --> 00:46:08.645
to settle on Mars, he is like he can start his own proof of work chain there and call it whatever he wants and put a dog logo on that. So I think that's fair game to build a side chain on Mars, but
525
00:46:10.065 --> 00:46:11.905
I I just think everyone should,
526
00:46:12.464 --> 00:46:20.960
who, who's interested in that should read, Dhruv Bansal's piece, Bitcoin Astronomy, where he talks about that at length. I think it's, very interesting.
527
00:46:23.585 --> 00:46:24.565
Yeah. I mean,
528
00:46:25.665 --> 00:46:26.165
maybe.
529
00:46:26.705 --> 00:46:33.369
I I haven't thought about all the attack factors that might be possible because of the time lag, but, it might be possible.
530
00:46:34.950 --> 00:46:36.410
531
00:46:37.165 --> 00:46:51.200
first of all that that that that I think it was multiple pieces, it's very good. Yeah. I mean, I just like sci fi. I I just wanna be clear, like, Elon, like, if you try and launch a Mars shit coin, like, I'm still against it. Like, I'm not giving you the the pass that Gigi is giving you.
532
00:46:51.500 --> 00:46:59.984
533
00:47:00.444 --> 00:47:04.740
534
00:47:05.280 --> 00:47:09.220
I love this when conflict happens. You know? I love the adversarial shit.
535
00:47:10.465 --> 00:47:12.565
Gladstein, you made an interesting point
536
00:47:15.185 --> 00:47:18.485
on I think it was a a a tweet today where you said,
537
00:47:20.640 --> 00:47:28.915
like, who basically, who is the bigger concern. Right? Chinese miners versus American miners. I'm not paraphrasing you well. Yeah. Yeah. Yeah. No. I was like, basically,
538
00:47:29.775 --> 00:47:32.515
539
00:47:32.815 --> 00:47:37.609
it has really kinda crystallized that we could be in this moment and it it may take a couple years,
540
00:47:37.990 --> 00:47:41.050
but we're we're all worried about, like, China centralizing
541
00:47:41.830 --> 00:47:45.770
the hash rate and then all of a sudden we're starting to worry about America centralizing the hash rate.
542
00:47:50.445 --> 00:47:52.145
543
00:47:54.190 --> 00:48:00.609
But then, yeah, I think I think you just, like, kind of corrected yourself in the same tweet. You're, like, but I don't think, like, American can actually get
544
00:48:01.125 --> 00:48:10.025
545
00:48:10.350 --> 00:48:11.250
The the counterpoint
546
00:48:11.630 --> 00:48:12.130
being,
547
00:48:12.670 --> 00:48:21.455
it may be impossible for any other nation to to gain the 50% that that China once had due to the general, like, trends in the market and lack of chips available right now.
548
00:48:22.635 --> 00:48:24.815
And and and the game theory of,
549
00:48:25.995 --> 00:48:31.690
individual countries starting to realize that that they have an opportunity to perhaps generate the world's reserve currency,
550
00:48:32.470 --> 00:48:35.610
from their own resources. This has not been possible before,
551
00:48:36.305 --> 00:48:37.285
in the same way.
552
00:48:38.465 --> 00:48:41.605
You know, normally, resources have to be sort of purchased with dollars,
553
00:48:42.065 --> 00:48:48.079
you know, in today's in today's world. So here's an opportunity for folks to turn their own resources straight into Bitcoin.
554
00:48:48.779 --> 00:48:52.640
So I I I think that there's a a kind of a point counterpoint.
555
00:48:53.975 --> 00:48:56.635
556
00:48:56.935 --> 00:48:57.755
like, alliances
557
00:48:58.135 --> 00:49:04.530
unfold where, like, minor but, like, different countries, like, pool their hash rate with each other to have a favorable position?
558
00:49:04.910 --> 00:49:08.290
559
00:49:09.195 --> 00:49:10.975
with the US and the EU,
560
00:49:11.355 --> 00:49:12.815
kind of trying to,
561
00:49:14.795 --> 00:49:17.190
create an alliance and then sort of China, Russia,
562
00:49:17.650 --> 00:49:19.029
and some of the other states
563
00:49:19.410 --> 00:49:24.150
creating an alliance. And then and then there's, like, the nonaligned countries. I thought this was very interesting. Someone
564
00:49:24.825 --> 00:49:35.040
commented today that, I guess, Malaysia is gonna try to absorb a bunch of this mining, and maybe Malaysia is like a a a a non aligned country. You know, maybe they're, like, in the middle between China and America.
565
00:49:35.500 --> 00:49:38.620
So these, like, non aligned countries could be very powerful and important,
566
00:49:39.500 --> 00:49:44.575
I think, if we start to have this kind of, you know, new sort of China versus US thing.
567
00:49:46.635 --> 00:49:50.300
568
00:49:51.160 --> 00:49:55.320
we're asking the wrong like, if we're focused on the wrong part of this story,
569
00:49:56.595 --> 00:49:59.494
because, like, the glad scene is born here. This this mirrors
570
00:50:00.115 --> 00:50:03.734
what happens on the geopolitical stage right now. Like, countries
571
00:50:04.275 --> 00:50:05.174
vie for
572
00:50:05.590 --> 00:50:06.250
for greater
573
00:50:06.790 --> 00:50:11.610
influence over money. And that's that's just an inevitable outcome of
574
00:50:12.070 --> 00:50:13.530
of human nature.
575
00:50:14.915 --> 00:50:19.655
And so, like, that just might be that might be what happens with with Bitcoin as,
576
00:50:20.435 --> 00:50:22.214
as as nation states
577
00:50:22.869 --> 00:50:23.369
accept
578
00:50:23.990 --> 00:50:27.289
the economic reality that Bitcoin imposes upon the world
579
00:50:27.750 --> 00:50:29.450
and buy into this
580
00:50:29.910 --> 00:50:31.369
new future of
581
00:50:31.744 --> 00:50:35.924
trying to generate the reserve currency of the world using their own resources,
582
00:50:37.265 --> 00:50:42.770
that this is the the how the game will shift, you know, away from trying to influence,
583
00:50:44.270 --> 00:50:45.170
fiat currency
584
00:50:46.030 --> 00:50:46.530
policies
585
00:50:47.550 --> 00:50:48.290
and power,
586
00:50:48.910 --> 00:50:50.290
and trying to
587
00:50:50.825 --> 00:50:51.645
trying to
588
00:50:52.185 --> 00:50:53.085
have power
589
00:50:53.625 --> 00:50:54.445
over Bitcoin,
590
00:50:55.225 --> 00:50:55.725
which
591
00:50:56.505 --> 00:50:58.970
they may achieve to some extent, but
592
00:50:59.530 --> 00:51:04.830
to a much less great extent than than they ever could when they controlled the money themselves.
593
00:51:05.290 --> 00:51:09.925
So I don't know. I guess I'm sort of celebrating. I'm, like, taking stock of what's happening,
594
00:51:11.185 --> 00:51:17.720
and how the narrative is shifting and how there seems to be things going on behind the scenes with really big players
595
00:51:18.099 --> 00:51:21.400
starting to make moves and trying not to make ripples on the surface.
596
00:51:22.500 --> 00:51:30.415
And it looks like Bitcoin is winning Even though people are starting to fight and try to drive wedges into Bitcoin in the Bitcoin community,
597
00:51:30.715 --> 00:51:33.615
it's because it's winning. I don't know if that makes sense.
598
00:51:34.829 --> 00:51:44.275
599
00:51:45.455 --> 00:51:48.595
in, like, aid community, which is massive. It's like a $20,000,000,000
600
00:51:49.215 --> 00:51:50.115
a year industry.
601
00:51:50.560 --> 00:51:55.460
And then foreign direct investment is, like, 1,000,000,000,000 of dollars a year from, like, you know, rich countries to poor countries.
602
00:51:56.000 --> 00:52:00.694
If we could, like, incept this idea that, like, a really noble way of doing humanitarianism
603
00:52:01.075 --> 00:52:05.734
would be to pay for and set up mining operations in emerging market countries,
604
00:52:06.440 --> 00:52:14.220
you know, if if rich Americans and Europeans would be willing to do that, you know, to help these countries become energy independent, become financially sovereign,
605
00:52:14.805 --> 00:52:19.465
that really helps. Not only does it help those countries, but it helps prevent against this kind of very
606
00:52:19.765 --> 00:52:21.865
kinda, like, based risk or, like,
607
00:52:22.270 --> 00:52:26.610
kind of deep seated fear that that maybe America becomes too centralized in its control.
608
00:52:26.990 --> 00:52:29.965
So that's one way of fighting back would be to try and
609
00:52:30.445 --> 00:52:30.945
convince,
610
00:52:32.365 --> 00:52:33.185
people who,
611
00:52:33.645 --> 00:52:36.145
you know, spend all this money in international development
612
00:52:36.685 --> 00:52:39.745
to consider the, like, humanitarian and environmental upsides,
613
00:52:40.510 --> 00:52:49.410
of Bitcoin and of of countries running Bitcoin mining off of their, like, massively stranded renewable energy. So that that's something I've been become very interested in lately.
614
00:52:52.735 --> 00:52:57.235
615
00:52:57.700 --> 00:53:00.040
piece on on the hidden cost of the petrodollar,
616
00:53:00.660 --> 00:53:04.040
it is a tour de force. It's awesome. It's in Bitcoin Magazine.
617
00:53:04.579 --> 00:53:05.060
And it
618
00:53:05.645 --> 00:53:09.105
I think it it better than anything else I've read highlights
619
00:53:09.805 --> 00:53:11.905
that the system that we have today
620
00:53:12.365 --> 00:53:14.385
has very, very high costs,
621
00:53:15.039 --> 00:53:17.460
and we take that for granted. And Bitcoin
622
00:53:17.920 --> 00:53:18.740
has costs,
623
00:53:19.519 --> 00:53:23.700
but how do they stack up? And it it creates quite an an amazing contrast.
624
00:53:24.135 --> 00:53:31.194
625
00:53:32.160 --> 00:53:39.300
And then, you know, we forced the world to be dependent on the dollar, which didn't make any sense either in a free market. So none of these things were like free market phenomena.
626
00:53:39.995 --> 00:53:47.695
So here's an opportunity to kind of have a different kind of future where it's not, like, 4% of the world's population dictating terms to everybody else. But,
627
00:53:48.090 --> 00:53:49.550
you know, these countries,
628
00:53:50.890 --> 00:53:52.190
you know, aren't gonna
629
00:53:53.130 --> 00:53:58.654
you know, there's an opportunity here to make a difference in the next 5 to 10 years where, like, they they could,
630
00:53:59.595 --> 00:54:04.174
again, both help Bitcoin's long term network security, but also help themselves, like, kind of bootstrap,
631
00:54:05.035 --> 00:54:12.380
more economic activity. And I I don't know if we'll ever see this opportunity again. So it's it's really interesting to and and worth thinking about.
632
00:54:16.440 --> 00:54:22.845
633
00:54:25.680 --> 00:54:29.700
environmental stuff, but, really, I think the battle is gonna be sanctions.
634
00:54:30.400 --> 00:54:30.900
And
635
00:54:33.225 --> 00:54:33.965
I don't
636
00:54:34.905 --> 00:54:40.205
I don't think sanctions can be enforced in a post Bitcoin world, but I think governments will try.
637
00:54:42.360 --> 00:54:43.660
You know, what does that entail?
638
00:54:44.840 --> 00:54:50.380
639
00:54:50.744 --> 00:54:53.005
about how the US weaponizes the dollar.
640
00:54:53.785 --> 00:54:55.805
It it has nothing to do with Bitcoin, but
641
00:54:56.345 --> 00:54:59.885
it's written a couple years ago and it's it it just details, like, how,
642
00:55:00.540 --> 00:55:08.480
the US uses its control over Swift and, like, all these other networks to ensure that any government that it doesn't like, like, we're just basically has a really hard time.
643
00:55:08.955 --> 00:55:11.855
So those governments are the ones now turning to Bitcoin.
644
00:55:12.315 --> 00:55:17.615
I'm not supporting those governments. In fact, in my day job, I try to, like, expose them because they're often terrible.
645
00:55:17.970 --> 00:55:21.590
But the reality is that, like, what are they gonna do? These are, like, rational choices.
646
00:55:22.290 --> 00:55:28.654
And they're gonna be they they're led to Bitcoin, and they're gonna use it. I don't know exactly how you would how you would stop,
647
00:55:29.595 --> 00:55:33.855
you know, this this network from functioning in that way. I think it's this this just sort of natural
648
00:55:34.720 --> 00:55:37.140
evolution of a new system that's a little harder to,
649
00:55:38.080 --> 00:55:41.460
to to control in that way. But but on the ESG piece,
650
00:55:42.640 --> 00:55:43.220
I think
651
00:55:43.775 --> 00:55:46.115
that is really interesting to also dive into.
652
00:55:46.655 --> 00:55:48.275
Again, yeah, we have, like,
653
00:55:48.655 --> 00:55:50.115
the very, like,
654
00:55:51.099 --> 00:56:04.135
ignorant public about the ESG impact of the dollar, which, of course, as as as, you know, you just mentioned or alluded to is has been over the last few decades, the fact that it it funds this huge warfare state.
655
00:56:05.815 --> 00:56:08.869
It has led America to spend, like, profligately
656
00:56:09.170 --> 00:56:13.270
and and extravagantly in terms of social programs that that don't work very well,
657
00:56:13.570 --> 00:56:17.430
has hollowed out the middle class, increased inequality to, you know,
658
00:56:17.865 --> 00:56:21.085
ratios we haven't haven't seen in a really long time,
659
00:56:21.545 --> 00:56:23.165
many many many many decades.
660
00:56:23.705 --> 00:56:28.960
And then, you know, props up all these dictators and and and the fossil fuel industry gets a subsidy.
661
00:56:29.819 --> 00:56:31.680
So that those are the cost of the dollar.
662
00:56:32.220 --> 00:56:32.720
So,
663
00:56:33.475 --> 00:56:38.055
you know, where where do we go from here? And the irony is, like, the ESG people,
664
00:56:39.315 --> 00:56:46.130
if they allowed us to debate them on ESG terms, Bitcoin wins. I mean, Bitcoin is easily the most ESG compliant,
665
00:56:46.910 --> 00:56:50.450
like, investment you could make. I mean, it's tremendous financial liberation,
666
00:56:51.005 --> 00:56:52.625
bootstrapping of renewable energy,
667
00:56:53.484 --> 00:56:55.665
transparent governance process that's uncorruptible.
668
00:56:56.525 --> 00:57:06.400
The problem is that's not what they're interested in. ESG people are not interested in, like, the truth or, like, in actually achieving those things. They're interested in control. So that's kinda where we are now.
669
00:57:06.805 --> 00:57:12.725
670
00:57:14.010 --> 00:57:16.430
and maybe that's what the the mining council
671
00:57:16.970 --> 00:57:19.390
in in theory wants to to do.
672
00:57:20.170 --> 00:57:23.815
But, you know, Bitcoin is the most the single most ESG
673
00:57:24.755 --> 00:57:25.255
positive
674
00:57:26.835 --> 00:57:31.494
force on Earth today. As far as I can tell, this is the the single greatest
675
00:57:31.860 --> 00:57:33.640
tailwind for all of those
676
00:57:34.100 --> 00:57:36.600
aspirations that, you know, liberal
677
00:57:36.900 --> 00:57:40.280
western society has decided it wants to champion.
678
00:57:40.775 --> 00:57:48.395
And and Bitcoin does all of those things. It's it it it is, you know, fueling the adoption of renewable energies,
679
00:57:48.930 --> 00:57:49.910
and then there's also
680
00:57:50.210 --> 00:57:51.430
liberating people
681
00:57:51.730 --> 00:58:00.185
from from the tyranny of of inflation or or, you know, sovereign control over their money in more extreme examples.
682
00:58:00.965 --> 00:58:06.265
This is the thing, and we need to own that narrative more than than we have in the past.
683
00:58:08.440 --> 00:58:10.060
684
00:58:11.480 --> 00:58:12.440
685
00:58:13.800 --> 00:58:14.765
we we've said it before. You know? Bitcoin because you're because you're working with CT. I mean, CT CT must be
686
00:58:23.540 --> 00:58:32.505
Yep. Yeah. Absolutely. I think, you know, again, I think it all comes down to incentives and just what makes the most sense also economically speaking. And,
687
00:58:32.945 --> 00:58:34.085
if you have
688
00:58:34.704 --> 00:58:39.045
in Bitcoin in Bitcoin, you have the buyer of last resort
689
00:58:39.380 --> 00:58:41.960
for whatever energy is produced and just
690
00:58:42.260 --> 00:58:43.319
it that it's
691
00:58:43.779 --> 00:58:56.260
it is perfect for renewables just for that reason alone. And the the problem with the energy fund, I believe, is that first of all, people don't understand Bitcoin and proof of work, like, not at
692
00:58:56.560 --> 00:59:06.795
all. And second of all, it's just a very easy argument to make. You know? Like, it's just bad. It uses up a lot of energy, and, we kind of have to battle that problem.
693
00:59:07.175 --> 00:59:12.119
Flipping that argument on its head and making people understand that it's not actually
694
00:59:12.420 --> 00:59:17.720
a problem in the first place and that every kilowatt hour that the Bitcoin network
695
00:59:18.964 --> 00:59:23.145
uses is put to good use because it secures the best soundest,
696
00:59:23.685 --> 00:59:25.945
more most available, freest money
697
00:59:26.260 --> 00:59:40.415
that humanity has ever seen. That's something that I think only exposure to Bitcoin and education can fix. And I think I think once you realize that all all the points that are made in the mainstream media that are currently,
698
00:59:40.795 --> 00:59:44.170
like, packaged together in this energy thought narrative,
699
00:59:44.470 --> 00:59:47.610
they they will become mute because we don't, like,
700
00:59:48.150 --> 00:59:48.890
we don't
701
00:59:49.475 --> 00:59:52.695
we don't harp on about how how much energy,
702
00:59:53.555 --> 01:00:00.839
fridges consume, for example. You know? I it it's it all comes down to the question, is the energy use worth it? And I think as Bitcoiners,
703
01:00:01.460 --> 01:00:04.040
we, like, we we have internalized
704
01:00:04.980 --> 01:00:06.839
for a very long time that
705
01:00:07.635 --> 01:00:12.615
it's it's worth it. Every, like, every ounce of it is worth it. And I think just,
706
01:00:14.194 --> 01:00:16.454
making more people understand what's
707
01:00:17.119 --> 01:00:18.819
what's at stake here and what
708
01:00:19.200 --> 01:00:30.045
sound money entails and what, like, moving the world to a Bitcoin standard entails and that it is actually a good thing. And it's not only number go up, but it's also freedom go up massively.
709
01:00:30.424 --> 01:00:35.404
I think that's that's what it's all about, and I think that's what we as Bitcoiners can kind of,
710
01:00:36.550 --> 01:00:42.410
work on to talk to family and friends and other people about it. I I also think that those of us who aren't minors, like,
711
01:00:43.095 --> 01:00:51.995
712
01:00:52.610 --> 01:00:55.830
did I start to get a understanding of the, like, energy market,
713
01:00:56.530 --> 01:00:59.110
and the reason why that Bitcoin does not,
714
01:00:59.810 --> 01:01:12.220
use energy that would be otherwise used. It it doesn't because because of the price. And, like, I didn't again, I didn't know this. I put this in my article, so it'll be out tomorrow. But, like, you know, Bitcoin miners kinda need to be in the 2 to 5¢ kilowatt,
715
01:01:13.400 --> 01:01:17.420
range. Right? Otherwise, it's unprofitable and they're gonna turn off their machines. And,
716
01:01:17.964 --> 01:01:18.785
you know, industrial,
717
01:01:19.724 --> 01:01:21.184
energy in the,
718
01:01:21.724 --> 01:01:25.184
you know, developing developed world is, like, 5 to 6¢
719
01:01:25.484 --> 01:01:26.224
per kilowatt.
720
01:01:28.620 --> 01:01:34.560
And, you know, residential use is, like, 10 to 15¢. So there's never gonna be a case where, like, a residential customer.
721
01:01:35.185 --> 01:02:03.700
If there's residential customers around, there's not gonna be any Bitcoin mining. They will outcompete them by far. And in Africa, it's 20 to 40¢ a kilowatt. So anywhere in Africa where there's, like, anyone else who who is is a customer of that grid, there can't be any Bitcoin miners. They can't make any money. So this idea that, like, Bitcoin, like like, you know, eats energy that would have otherwise gone to something else literally make makes no economic sense. And I feel like these are things that people need to actually talk more about. No? Yeah. Absolutely.
722
01:02:04.000 --> 01:02:05.620
723
01:02:06.400 --> 01:02:07.460
Lawrence Livermore,
724
01:02:08.080 --> 01:02:11.060
flowchart of energy produced in the US? And and
725
01:02:11.585 --> 01:02:17.845
the takeaway from it is that 2 thirds according to them, 2 thirds of the energy produced in the US
726
01:02:18.305 --> 01:02:20.109
every year goes unutilized,
727
01:02:20.890 --> 01:02:21.390
unused,
728
01:02:22.410 --> 01:02:34.355
729
01:02:34.735 --> 01:02:35.475
is decommissioning
730
01:02:35.935 --> 01:02:49.174
this year enough nuclear power to run the whole Bitcoin network. So I just don't wanna hear it with the whole the ESG thing is just such bullshit because it's not like I mean, as someone who actually cares about the environment and and probably has different views than a lot of Bitcoiners on this stuff,
731
01:02:49.474 --> 01:02:49.974
like,
732
01:02:50.355 --> 01:02:53.974
it it it should be we should be able to argue this in different ways according to our own
733
01:02:58.020 --> 01:03:09.345
734
01:03:10.065 --> 01:03:13.960
735
01:03:14.340 --> 01:03:15.640
coal uses like
736
01:03:15.940 --> 01:03:21.320
a like a like a, you know, puts like a ton of carbon in the air for Mhmm. For a particular denomination and,
737
01:03:22.115 --> 01:03:47.654
you know, natural gas does about half that and then, you know, clean coal maybe does, like, a third of that and then renewables do, like, way less. So, I mean, it is some I'd I would like to see less coal. I mean, that's what I'd like to see. And guess what? Bitcoin is the fucking subsidy that makes it possible to do renewables and hydro and and nuclear in places where you don't have a grid built out yet. Because it just boosts that revenue just just enough to make it tip the scales.
738
01:03:47.980 --> 01:04:11.390
No. It's it's like I did I profiled this operation in the Congo. It's incredible, like, because all these, like, outside investors are trying to get hydropower for the Congolese people. Only 9% of Congolese people have electricity. How fucking crazy is that? Wow. So what they do to this is we're talking about, like, a country of 90,000,000. So they they cook, they cut down the trees, which of course is horrible for the environment, releases all the carbon, it kills the gorillas, like nobody wants that.
739
01:04:11.710 --> 01:04:14.075
And then they they make charcoal and they cook
740
01:04:14.555 --> 01:04:22.415
with with that because they don't have a grid. Okay? So if they can harness these incredible rivers that are literally running through the jungles, which they live in,
741
01:04:23.120 --> 01:04:31.540
You know, they could have a robust grid and they could produce agriculture and contribute and and lift themselves out of, you know, what the legacy of colonialism,
742
01:04:31.995 --> 01:04:33.615
But they need they need the power,
743
01:04:33.915 --> 01:04:52.125
and no one wants to come in because the hydro plants take too long to hook up to the grid, and they're either not sustainable or if it's an investor, they're not profitable. Well, guess what? Now there's Bitcoin miners moving in, and they could be immediately generating revenue. So it completely bootstraps the process. It's it's a really, really crazy thing to think about.
744
01:04:52.745 --> 01:04:56.380
745
01:04:57.660 --> 01:05:01.599
all already to Friar Haas and his most recent episode,
746
01:05:02.145 --> 01:05:12.470
with Nick Carden on the brink. And I would urge everyone to listen to that who wants to have an informed opinion on on this debate because he also like, he repeatedly makes the point that,
747
01:05:12.850 --> 01:05:21.190
as Alex also mentioned just like 5 minutes ago, Bitcoin doesn't need to steal away anything from the electricity grid. You know? Bitcoin only needs energy,
748
01:05:21.535 --> 01:05:30.434
and that's all you need to mine Bitcoin. It's an energy source and a communications link. And it could be, you know, like, it could be a satellite link. So it can be everywhere, and you don't need to
749
01:05:30.770 --> 01:05:35.910
steal anything away from the electricity grid. Like, it doesn't need electricity literally run Bitcoin
750
01:05:36.370 --> 01:05:38.150
751
01:05:38.755 --> 01:05:40.935
and from the existing kind of, like, flaring.
752
01:05:41.315 --> 01:05:56.110
753
01:05:57.265 --> 01:06:00.885
754
01:06:01.905 --> 01:06:03.605
I think there's people who are like,
755
01:06:04.225 --> 01:06:04.945
obviously like,
756
01:06:06.570 --> 01:06:12.590
I I get a vibe here that some of us here at least in this chat are, like, excited about Bitcoin as a technology that can, like,
757
01:06:14.010 --> 01:06:15.390
you know, bring us to,
758
01:06:15.984 --> 01:06:24.244
maybe like a more fossil free world. But then there's, like, Bitcoiners who are really pro fossils. So I think there's gonna be a really interesting debate on this over the next couple years for sure.
759
01:06:25.220 --> 01:06:32.360
760
01:06:32.694 --> 01:06:39.355
because they're in constant competition with other bit Bitcoin miners all over the world, they will seek the cheapest source of energy.
761
01:06:39.734 --> 01:06:40.234
And
762
01:06:40.535 --> 01:06:40.855
and,
763
01:06:41.990 --> 01:06:44.410
for maybe that's fossil fuels, particularly
764
01:06:44.710 --> 01:06:48.090
when it's, like, stranded methane, you know, flared gas.
765
01:06:49.270 --> 01:06:49.770
But
766
01:06:50.070 --> 01:06:51.425
long term, you know,
767
01:06:53.185 --> 01:07:00.830
768
01:07:01.130 --> 01:07:01.930
told me that,
769
01:07:02.970 --> 01:07:05.790
basically, the only reason that there's so much coal mining done in China
770
01:07:06.410 --> 01:07:09.465
is because essentially it's like quote unquote, like, free electricity
771
01:07:10.005 --> 01:07:17.305
through corruption. And that in a free market, there's no way that they could use that coal. Mhmm. I don't know what your thoughts are on that, but, I mean, that I found that very interesting.
772
01:07:19.060 --> 01:07:23.400
773
01:07:24.420 --> 01:07:27.080
the free market forces that I was describing earlier
774
01:07:27.725 --> 01:07:28.865
are true insofar
775
01:07:29.165 --> 01:07:32.705
as there is not subsidies or government intervention or some sort of
776
01:07:33.005 --> 01:07:46.885
777
01:07:47.825 --> 01:07:52.245
to create it and sustain it, and it killed other competitors. Like, it killed the SDR,
778
01:07:52.830 --> 01:07:55.890
which OPEC wanted to use as the world reserve currency in the seventies.
779
01:07:56.190 --> 01:08:11.529
We did a deal with the Saudis to bring them into the IMF. And then in exchange, the Saudis agreed to not push the SDR as a reserve currency and not to nominate their oil in it. And then the euro came along in the late nineties, early 2000, and, you know, we killed that off too. I mean, I would argue largely through,
780
01:08:12.230 --> 01:08:23.745
you know, flustering Saddam's efforts to create a Petro Euro. So, I mean, we we, you know, we can't assume the global free market is gonna work this out, I guess, is what I'm saying based on, you know, economic history of the world.
781
01:08:24.650 --> 01:08:40.250
782
01:08:40.710 --> 01:08:42.650
which so so the entry cost
783
01:08:42.950 --> 01:08:47.210
the the the entry cost is is significantly lower than pretty much any other
784
01:08:47.555 --> 01:08:49.175
global network we've ever seen.
785
01:08:49.555 --> 01:08:50.055
Yeah.
786
01:08:50.675 --> 01:08:54.915
So so so that that should increase competition and help foster a
787
01:08:55.700 --> 01:08:59.080
like, as far as I'm concerned, Chris has said earlier that Bitcoin is the
788
01:08:59.460 --> 01:09:04.120
the closest thing we've ever seen to a truly free market. I'd go further than that. I would say,
789
01:09:05.235 --> 01:09:07.335
specifically distributed proof of work is.
790
01:09:08.114 --> 01:09:19.340
It's it's not you know, it's great that we have global exchanges, and we have all these different exchanges that compete off of each other, but, really, the the true global free market exchange is that conversion of energy into Bitcoin.
791
01:09:20.440 --> 01:09:22.860
I just I'll let you guys continue, but
792
01:09:23.425 --> 01:09:24.645
I I'm just I mean,
793
01:09:25.985 --> 01:09:35.110
your your conversation that you just had triggered a lot of Bitcoiners on different sides and maybe both sides or Yeah. Probably both sides. Even know how many sides there are.
794
01:09:36.050 --> 01:09:36.790
To me,
795
01:09:38.025 --> 01:09:49.070
I don't think it matters at all. I I think this discussion is like mental masturbation. I think it's just, you know, something that big corners wanna talk about while we're going sideways, and we have nothing better to do.
796
01:09:50.250 --> 01:09:52.910
Why why does this conversation matter at all?
797
01:09:54.515 --> 01:10:01.015
What why does well, because no. Because, like Whether it's environmentally friendly or not. You know, this idea did you see, like, these,
798
01:10:03.480 --> 01:10:06.220
these articles that people dig up about, like, Amazon?
799
01:10:06.680 --> 01:10:11.705
Like, there's, like, butthurt people that were, like, Amazon, when they sell a book, it, like, takes a couple lumps of coal,
800
01:10:12.185 --> 01:10:20.605
and, like, no one should use Amazon. Well, Amazon's one of the largest companies in the world now. Like, that article didn't matter. And there was some guy who was arguing with him on the Internet about that article,
801
01:10:21.040 --> 01:10:38.660
802
01:10:39.440 --> 01:10:39.940
700,000,000
803
01:10:40.560 --> 01:10:41.060
people
804
01:10:41.520 --> 01:10:43.460
who don't have access to electricity,
805
01:10:44.885 --> 01:10:46.905
and they they burn, like, biofuels
806
01:10:47.285 --> 01:10:56.070
to to do stuff. And that creates, like, enormous not only pollution, but this, like, indoor air kinda sickness that that actually ends up killing, like, tons of children every year.
807
01:10:56.770 --> 01:10:59.990
Like, 5,000,000, I think, children or something every year.
808
01:11:00.370 --> 01:11:01.670
And, you know, like,
809
01:11:02.095 --> 01:11:02.835
you know,
810
01:11:03.695 --> 01:11:06.115
it it is manifestly better for them to use hydro,
811
01:11:07.055 --> 01:11:13.520
than than to burn coal. I I just, you know, like, to burn coal, you you have to do a lot more, like, damage to the environment around you.
812
01:11:13.980 --> 01:11:22.535
It's just, like, obviously, having some foreign investor pay for a dam and that just churns out like like a like solid energy for you.
813
01:11:22.915 --> 01:11:33.730
I just don't see why this who would want the cold side? I don't really understand that. And and then the other piece would be the sovereign individual thesis. So if if Bitcoiners really care about being sovereign individuals,
814
01:11:34.670 --> 01:11:41.195
what's more fucking sovereign individual than me running my own solar panels, running everything in my house, having solar cars,
815
01:11:41.575 --> 01:11:49.659
electric cars, and not having to deal with the grid and not having to deal with the government and being able to mine the solar. I mean, that's a very strong possibility for many Americans.
816
01:11:49.960 --> 01:11:53.340
817
01:11:53.719 --> 01:12:02.344
818
01:12:02.724 --> 01:12:03.945
That's a one time deal.
819
01:12:04.650 --> 01:12:10.110
And you have to maintain them and stuff. Right? It's the last 20 years. I mean, I think it's just a disingenuous comparison.
820
01:12:10.570 --> 01:12:11.070
Like,
821
01:12:11.775 --> 01:12:16.594
Both at the individual and geopolitical level. Like, all these countries are reliant on importing oil
822
01:12:16.895 --> 01:12:23.659
when they could be harnessing the renewables in their countries. I think this is a very important and strong position, and
823
01:12:23.960 --> 01:12:26.060
I'll go I'll debate that one for sure.
824
01:12:27.400 --> 01:12:30.554
825
01:12:30.935 --> 01:12:34.715
Alex's first point there. Like, why this matters to me
826
01:12:35.500 --> 01:12:40.880
in terms of like, why is it an important thing to talk about and and focus on with Bitcoin?
827
01:12:41.260 --> 01:12:41.920
Is that
828
01:12:43.455 --> 01:12:50.915
I like to I I often take it back to, like, the the classic bell curve of technology adopters. Right?
829
01:12:51.409 --> 01:12:54.550
We're still in the very early stages. We're still in the innovator's
830
01:12:55.090 --> 01:12:56.869
stage of Bitcoin adoption.
831
01:12:57.650 --> 01:13:00.630
And the mainstream is still ahead of us.
832
01:13:01.135 --> 01:13:01.635
And,
833
01:13:02.655 --> 01:13:04.835
you know, Bitcoin doesn't need marketing.
834
01:13:06.335 --> 01:13:12.350
I think it's an economic reality that everybody is forced to to come to terms with and figure out eventually,
835
01:13:12.970 --> 01:13:15.630
but it doesn't hurt for people to
836
01:13:16.090 --> 01:13:18.990
to realize the benefits of it through
837
01:13:19.594 --> 01:13:22.175
through word-of-mouth or or, you know,
838
01:13:22.475 --> 01:13:24.175
insightful articles or whatever,
839
01:13:25.114 --> 01:13:26.815
and embrace it,
840
01:13:27.710 --> 01:13:31.410
you know, rather than resisting it and trying to fight it and all that.
841
01:13:31.950 --> 01:13:40.505
And what does the mainstream care about? Well, it seems like a good chunk of them at least actually or think they care about ESG.
842
01:13:40.965 --> 01:13:41.625
You know,
843
01:13:42.405 --> 01:13:44.025
the environment, global warming,
844
01:13:44.710 --> 01:13:45.690
whatever it is
845
01:13:46.150 --> 01:13:48.410
about ESG that gets them going,
846
01:13:49.110 --> 01:13:49.610
individually.
847
01:13:50.390 --> 01:13:54.765
And Bitcoin is the thing that is the best for those goals
848
01:13:55.385 --> 01:13:56.685
and talking about,
849
01:13:57.864 --> 01:14:01.565
the mechanics underneath Bitcoin mining and how,
850
01:14:02.265 --> 01:14:03.324
you know, this
851
01:14:03.740 --> 01:14:07.360
this, creating a a alternative minimum to,
852
01:14:08.540 --> 01:14:10.560
to unused energy.
853
01:14:11.355 --> 01:14:16.495
It how that has this positive flywheel effect of of lifting people out of poverty
854
01:14:16.875 --> 01:14:22.160
or, you know, shifting the mix of energy production to renewable energy and therefore reducing,
855
01:14:23.100 --> 01:14:24.640
you know, greenhouse gases.
856
01:14:25.260 --> 01:14:27.360
That's all going to be popular
857
01:14:27.925 --> 01:14:28.985
with the mainstream
858
01:14:29.364 --> 01:14:32.025
that I would like to see embrace Bitcoin
859
01:14:32.405 --> 01:14:33.625
rather than fight it,
860
01:14:34.245 --> 01:14:36.025
you know, and then and then eventually
861
01:14:36.490 --> 01:14:54.765
862
01:14:55.210 --> 01:15:10.565
And this is all, like, imported diesel. So they're, like, completely reliant on foreign powers for everything. And that this is the case for so many, not only countries, but communities and individuals. So if we wanna think about being more sovereign and then, you know, I just it strikes me that
863
01:15:11.185 --> 01:15:12.645
a lot of these renewable tech,
864
01:15:13.185 --> 01:15:14.725
or even nuclear ventures,
865
01:15:15.400 --> 01:15:17.980
could be could be really helpful from that perspective.
866
01:15:18.520 --> 01:15:30.264
867
01:15:30.885 --> 01:15:38.440
I just I just don't I I don't think it's necessary, and I I think at the end of the day, the value prop is censorship resistance.
868
01:15:38.895 --> 01:15:39.875
And the overwhelming
869
01:15:40.255 --> 01:15:42.195
majority of people, not just the mainstream,
870
01:15:43.055 --> 01:15:50.110
overwhelming majority of the people on the planet do not understand that it's about censorship resistance yet. And that's mostly because
871
01:15:50.810 --> 01:15:51.550
our competitors,
872
01:15:51.930 --> 01:15:53.710
the competitor chains and whatnot,
873
01:15:54.170 --> 01:15:56.985
have not really faced censorship yet. And a lot of this
874
01:15:57.465 --> 01:16:01.885
bullshit environmental FUD that we hear is coming from proof of stake
875
01:16:02.264 --> 01:16:02.764
promoters,
876
01:16:03.385 --> 01:16:05.965
and and those those those promoters,
877
01:16:07.400 --> 01:16:07.560
are
878
01:16:08.760 --> 01:16:14.540
they're they're ignoring the trade off of censorship resistance, and until those chains actually get attacked
879
01:16:15.105 --> 01:16:15.685
and sanctioned
880
01:16:16.385 --> 01:16:17.125
and censored,
881
01:16:17.985 --> 01:16:24.710
people will be blind to it. So as, you know, as far as I'm concerned, we keep our heads down, keep moving forward, keep improving Bitcoin,
882
01:16:25.570 --> 01:16:38.595
and and sooner or later, you know, the powers that be can't help themselves. They censor everything. It's not like people don't realize, like, PayPal would prefer if everyone could just send their transactions to whoever. They don't wanna censor transactions. They're forced to censor transactions.
883
01:16:39.770 --> 01:16:40.730
And and there
884
01:16:41.770 --> 01:16:42.830
all these different
885
01:16:43.690 --> 01:16:49.815
chains are gonna gonna be censored if they're not sufficiently censorship resistant, and that's where proof of work matters.
886
01:16:51.315 --> 01:16:53.255
887
01:16:53.555 --> 01:16:54.455
read or,
888
01:16:54.835 --> 01:16:56.115
and discuss the,
889
01:16:56.595 --> 01:16:57.095
minors,
890
01:16:58.020 --> 01:17:00.360
counsel's response. Have you guys seen it?
891
01:17:01.140 --> 01:17:05.780
The the CoinDesk article that went out? No. No. No. It's a thread that Michael Shale Sailor just shared.
892
01:17:06.420 --> 01:17:11.515
No. I'll just it's not it's not that long. If it's okay, Matt, I can just read it for the Go for it. Everybody.
893
01:17:12.375 --> 01:17:18.699
Bitcoin's energy consumption is transparent, making it an easy target for criticism. But what critics can't see is the breakdown of energy sources.
894
01:17:19.160 --> 01:17:43.815
Bitcoin is more carbon free than most industries, but we need better data. Instead of standing by and continuing to write pieces on the topic and hope that the issue goes away, a group of miners came together to say, look, we need to be transparent and we should encourage others to be transparent too. Maybe the word council was too strong. Bitcoin's fungibility matters. Bitcoin's decentralization matters. No one's arguing that. I believe in transparency and I believe in moving towards a carbon free future, but the fundamentals of Bitcoin are nonnegotiable.
895
01:17:44.355 --> 01:17:50.695
We at Galaxy mine with Slush Pool and eagerly await the data Stratum V2 has enacted to further protect Bitcoin's fungibility.
896
01:17:51.150 --> 01:17:51.969
The mining council's goal
897
01:17:52.270 --> 01:17:59.409
is to provide energy transparency. It's that simple. We haven't signed anything for up for anything beyond that. So I'll let you guys react to that.
898
01:18:02.185 --> 01:18:08.110
899
01:18:08.490 --> 01:18:10.190
and, you know, being part of the establishment.
900
01:18:11.450 --> 01:18:16.375
But I don't know. I I I want to believe that Michael Sailor is doing,
901
01:18:17.075 --> 01:18:19.415
you know, is is doing the PR campaign
902
01:18:19.795 --> 01:18:21.895
that he sees as valuable,
903
01:18:22.730 --> 01:18:26.670
as a CEO who's, you know, very familiar with the politicking of
904
01:18:27.050 --> 01:18:28.510
of, image management.
905
01:18:28.810 --> 01:18:32.595
906
01:18:32.975 --> 01:18:36.995
907
01:18:37.375 --> 01:18:40.675
some hand in in this initiative overall.
908
01:18:41.159 --> 01:18:45.580
909
01:18:48.199 --> 01:18:49.099
910
01:18:49.585 --> 01:18:54.804
911
01:18:55.264 --> 01:19:07.395
912
01:19:08.835 --> 01:19:11.415
you know, trumpeting the winds of
913
01:19:11.875 --> 01:19:12.375
of,
914
01:19:13.155 --> 01:19:14.375
you know, how renewable,
915
01:19:16.040 --> 01:19:19.100
Bitcoin mining already is and how this natural shift
916
01:19:19.560 --> 01:19:20.060
towards
917
01:19:21.000 --> 01:19:21.500
stranded
918
01:19:22.120 --> 01:19:23.820
fossil fuels and and renewables
919
01:19:24.375 --> 01:19:29.914
is is taking place. I wanna believe that there is a there is a slippery slope
920
01:19:30.295 --> 01:19:32.534
that gets really bad really quick,
921
01:19:33.600 --> 01:19:36.900
if this group of miners believes that they have
922
01:19:37.200 --> 01:19:38.420
some power to,
923
01:19:39.440 --> 01:19:42.985
you know, be an arbiter about what kind of blocks are acceptable
924
01:19:43.365 --> 01:19:57.289
925
01:19:57.750 --> 01:20:06.185
The real threat is is is is agreements between American miners or any miners on on which transactions get included in the block.
926
01:20:07.045 --> 01:20:13.700
927
01:20:14.400 --> 01:20:22.075
But I I wouldn't say we were talking about environmental concerns. I would say we were describing how there are, like, factors in the world that will,
928
01:20:22.455 --> 01:20:23.275
like, basically
929
01:20:23.975 --> 01:20:25.275
take advantage of Bitcoin,
930
01:20:26.120 --> 01:20:28.620
and that Bitcoin mining will spread in a certain direction
931
01:20:29.160 --> 01:20:40.385
because of, like, stranded and otherwise, like, unusable energy resources. I I don't think we're I'm not trying to make, like, a judgment here. I'm just trying to sort of describe what's happening and what will probably likely continue to happen.
932
01:20:41.250 --> 01:20:46.710
But, yeah, we don't have to pander to to anybody. I just think it's kinda cool that that's happening. Yeah. Agreed.
933
01:20:48.449 --> 01:20:48.949
934
01:20:50.225 --> 01:20:51.925
no. Yeah. I I didn't mean to,
935
01:20:55.505 --> 01:20:59.890
yeah, I mean, I I I agree with that. I I I didn't I didn't mean to to say otherwise.
936
01:21:01.470 --> 01:21:05.235
The but my point is is that it's it's coming from an
937
01:21:06.514 --> 01:21:11.335
from a perspective of response, basically, like like that there needs to be a response here.
938
01:21:12.960 --> 01:21:15.139
And I I really do think it's a distraction.
939
01:21:15.440 --> 01:21:16.500
We have 6102
940
01:21:17.040 --> 01:21:17.860
in the comments.
941
01:21:19.600 --> 01:21:27.735
I a lot of times, I talk about this being, the 61 02 show because he refuses to dox his voice except for that one episode on Stefan Lavera,
942
01:21:28.755 --> 01:21:37.190
and he's kind of upset with me. He woke up on the wrong side of the bed today, but he's kind of upset with me because this is supposed to be a show about actionable Bitcoin discussion.
943
01:21:37.810 --> 01:21:39.510
It's something I pride myself in,
944
01:21:40.425 --> 01:21:43.485
that we talk about real steps that Bitcoiners can take today,
945
01:21:44.425 --> 01:21:45.645
to improve their
946
01:21:47.630 --> 01:21:49.170
current situation or
947
01:21:50.030 --> 01:21:51.010
or threat model,
948
01:21:52.830 --> 01:21:54.130
and how they use Bitcoin.
949
01:21:54.830 --> 01:21:56.450
I do think that
950
01:21:56.835 --> 01:21:58.295
this is very topical,
951
01:21:59.635 --> 01:22:00.455
and I think
952
01:22:00.755 --> 01:22:02.775
the conversations we've had so far
953
01:22:03.155 --> 01:22:03.655
are
954
01:22:04.300 --> 01:22:08.240
questions that a lot of Bitcoiners, especially new corners, are asking themselves
955
01:22:08.620 --> 01:22:09.120
about.
956
01:22:09.980 --> 01:22:12.560
So I would push back a little bit that it's not actionable,
957
01:22:13.085 --> 01:22:15.265
but he does have a good point.
958
01:22:16.285 --> 01:22:17.425
In terms of
959
01:22:18.845 --> 01:22:19.345
censorship,
960
01:22:19.725 --> 01:22:21.265
if we start to see
961
01:22:22.340 --> 01:22:22.840
miners,
962
01:22:25.059 --> 01:22:27.960
if we if we start well, we we're already seeing miners,
963
01:22:28.579 --> 01:22:30.679
censor transactions. Right? We're seeing
964
01:22:31.355 --> 01:22:32.415
Marathon Pool,
965
01:22:33.275 --> 01:22:34.815
doing this OFAC thing.
966
01:22:35.835 --> 01:22:36.815
In that situation,
967
01:22:38.350 --> 01:22:42.210
you know, what can a user do? Right? And I think
968
01:22:42.910 --> 01:22:43.570
I mean,
969
01:22:44.510 --> 01:22:48.635
they can basically do all the privacy techniques that we've discussed on this show
970
01:22:49.095 --> 01:22:50.795
in the other 22 episodes.
971
01:22:51.735 --> 01:22:54.795
A big one to me, I think, is CoinJoin, and I think
972
01:22:55.780 --> 01:22:58.119
one of the aspects of CoinJoin that is
973
01:22:59.460 --> 01:23:03.480
and no KYC. Right? So I I I think one of the big
974
01:23:10.475 --> 01:23:10.975
is
975
01:23:11.550 --> 01:23:16.930
that a lot of Bitcoiners seem to prefer the pay join model. This idea that you could have,
976
01:23:18.405 --> 01:23:29.280
a privacy gain in Bitcoin without it being obviously apparent on chain, because CoinJoin is completely apparent on chain. PayJoin, under certain circumstances, can look like normal transaction. You can't tell it's PayJoin.
977
01:23:29.980 --> 01:23:35.119
I think CoinJoin is kind of really useful here because it's obvious on chain, because
978
01:23:36.015 --> 01:23:40.595
if miners want to start censoring coin join transactions, it's gonna be immediately obvious,
979
01:23:41.295 --> 01:23:43.955
and it's gonna affect every single coin join user.
980
01:23:44.600 --> 01:23:47.860
So to me, I think the single biggest thing that
981
01:23:48.360 --> 01:23:52.140
and 6102, I mean, you could correct me if you disagree here in the comments.
982
01:23:52.885 --> 01:24:02.310
I think the single biggest thing a user can do to protest this kind of OFAC block list type of thing is to just coin join everything and constantly coin join.
983
01:24:03.350 --> 01:24:09.610
984
01:24:10.455 --> 01:24:17.275
speaks to the actionable advice of Citadel Dispatch. I would also say just coinjoin and also learn about coinjoin. Learn about,
985
01:24:18.110 --> 01:24:30.304
how Bitcoin works, also learn about proof of work to push back against, like, the narratives that are spun up. But I I would still say even though you're saying that coin joints are obvious on chain, that's kind of true, but still,
986
01:24:30.685 --> 01:24:32.945
paint is something that is external
987
01:24:33.540 --> 01:24:42.120
to Bitcoin. And you can only tell if a Bitcoin is like a bad Bitcoin, if UTXO is a bad UTXO by applying heuristics.
988
01:24:42.505 --> 01:24:45.485
And this will always be true. And the question remains,
989
01:24:45.864 --> 01:24:56.150
like, what do you need to do with a new UTXO so that it becomes clean again? Because if you go through the whole transaction graph, the it's it's very probable that your UTXO
990
01:24:56.690 --> 01:24:59.590
was in touch with a coin join in the past. So
991
01:24:59.915 --> 01:25:17.225
all these questions remain unanswered, and all these, like, OFAC compliance like, all all this bullshit, it doesn't really take it into account because how many hops are enough hops until the Bitcoin is back into normal circulation again and is clean again. And it's it's it's not it's it's also
992
01:25:17.844 --> 01:25:18.665
like Bitcoiners
993
01:25:19.045 --> 01:25:27.450
know of these problems, and I think, you know, we talk about Taproot a lot. And I think Taproot truly solves this problem in a sense that you can't differentiate
994
01:25:27.830 --> 01:25:35.675
between coin joints and normal transactions anymore. And once once we have that, the heuristics kind of fly out of the window. And, again, I repeat,
995
01:25:36.554 --> 01:25:40.175
a tainted Bitcoin is always an external property. It's nothing
996
01:25:40.635 --> 01:25:45.010
it's nothing that you can definitely say intrinsically that this is, like,
997
01:25:45.550 --> 01:25:50.290
a a a bad Bitcoin, so to speak. And I think regulators should kind of
998
01:25:50.910 --> 01:25:52.130
I I don't think currently
999
01:25:52.510 --> 01:25:54.344
this is taking into consideration.
1000
01:25:54.804 --> 01:25:59.065
1001
01:26:00.244 --> 01:26:01.385
why would that change?
1002
01:26:02.000 --> 01:26:08.820
1003
01:26:10.085 --> 01:26:10.585
1004
01:26:11.525 --> 01:26:19.250
1005
01:26:20.110 --> 01:26:25.250
still that like, you you've also the the ownership is also a heuristic. You know? Like,
1006
01:26:26.135 --> 01:26:30.315
even even putting identities onto UTXO is is it's,
1007
01:26:30.775 --> 01:26:41.500
like, it's it's not a done deal. That's what I'm trying to say. You know? Your heuristics can always be wrong. Yeah. I I can pass on an open dime and your all all your heuristics are destroyed. You know? Like, I can do
1008
01:26:42.195 --> 01:26:44.855
I I can pass on UTXOs without doing a transaction.
1009
01:26:47.715 --> 01:26:55.870
1010
01:26:57.050 --> 01:26:59.230
and, like, this potential trend of mining
1011
01:26:59.715 --> 01:27:00.215
decentralization,
1012
01:27:02.275 --> 01:27:11.219
is, you know, at the end of the day, like, if you're worried about sensorius miners, like, they have they have to as you said, Matt, they have to know who you are. Like, they have to know what transactions are yours. Right?
1013
01:27:11.679 --> 01:27:14.420
And that's what you wanna defend yourself, you know, from.
1014
01:27:15.040 --> 01:27:16.000
1015
01:27:16.615 --> 01:27:19.435
so in a lot of ways, you know, to me,
1016
01:27:20.135 --> 01:27:25.115
you know, my miner based censorship is something that's been discussed in Bitcoin land for a long time,
1017
01:27:25.650 --> 01:27:36.534
and it's always been considered, especially on the tech side, has always been considered, like, the the ultimate threat, right, to to get past this threshold where, you know, mining is distributed enough that you don't have,
1018
01:27:37.395 --> 01:27:38.455
this kind of censorship.
1019
01:27:38.995 --> 01:27:45.010
And as we mentioned earlier in the show and 60102 pointed out in here, a key aspect, right, is that
1020
01:27:45.710 --> 01:27:52.165
if if you don't have all minors playing ball, especially as transaction fees become a larger and larger part of their reward,
1021
01:27:53.105 --> 01:27:59.045
if one miner tries to censor you, you can just raise your fee and and get into a block by by a different miner.
1022
01:28:01.300 --> 01:28:05.080
Part of me thinks that a lot of this is also mental masturbation
1023
01:28:05.380 --> 01:28:05.880
because
1024
01:28:06.260 --> 01:28:07.800
it's not even really necessary.
1025
01:28:10.235 --> 01:28:13.135
Most Bitcoiners are coming in through KYC exchanges.
1026
01:28:14.635 --> 01:28:16.094
You can make it prohibitively
1027
01:28:16.395 --> 01:28:18.880
difficult to withdraw from those KYC exchanges.
1028
01:28:19.260 --> 01:28:26.719
You can just, you know, keep them on Robinhood. They don't even withdraw they're not even allowed to withdraw if they use Robinhood or PayPal or Venmo or or
1029
01:28:27.165 --> 01:28:29.665
any Revolut, I think, still doesn't allow withdrawals.
1030
01:28:31.485 --> 01:28:33.505
So there's a lot of ways to attack.
1031
01:28:33.965 --> 01:28:36.225
You know, there's a lot of ways to censor Bitcoin,
1032
01:28:37.730 --> 01:28:39.510
especially the low hanging fruit
1033
01:28:40.130 --> 01:28:40.630
for,
1034
01:28:41.489 --> 01:28:48.885
you know, the overwhelming majority of the mainstream as Chris has said earlier. Right? It's it's relatively easy to censor them just via these KYC
1035
01:28:50.225 --> 01:28:54.610
elements of of the exchanges and the on ramps and the off ramps and the wallets and and whatnot.
1036
01:28:55.330 --> 01:28:57.350
What what does concern me though,
1037
01:28:58.610 --> 01:29:00.469
I guess, is, like, kind of like an endgame.
1038
01:29:01.090 --> 01:29:08.215
I don't think it's really conceivable that it happens, but the fear to me on the minor censorship side is less a blacklist
1039
01:29:09.155 --> 01:29:11.735
mentality and more a whitelist mentality
1040
01:29:12.435 --> 01:29:12.935
Mhmm.
1041
01:29:13.885 --> 01:29:14.385
Where
1042
01:29:14.730 --> 01:29:15.950
they have basically
1043
01:29:16.650 --> 01:29:20.110
a list of known actors that they're only confirming transactions of them.
1044
01:29:20.570 --> 01:29:27.675
Right? And that's that is, you know, there's no there's no doubt in that. Like, with chain analysis, there's doubt as Gigi said,
1045
01:29:29.850 --> 01:29:38.510
and and we have people talking shit about proof of stake. It'd be more likely we see it in a proof of stake chain. Yeah. And, hopefully, we will see it in these weaker chains first before
1046
01:29:40.285 --> 01:29:41.085
Bitcoin. But,
1047
01:29:41.805 --> 01:29:52.130
this idea that, like, imagine if if Coinbase just submitted their xpubs to Foundry and Marathon. Right? And said that any transactions that come from these xpubs are ours,
1048
01:29:52.510 --> 01:30:00.045
and, you know, we'll pay you a certain flat rate for the year to to mine those transactions for us. Something like that.
1049
01:30:01.145 --> 01:30:07.750
1050
01:30:09.409 --> 01:30:10.630
to effectively censor.
1051
01:30:11.010 --> 01:30:14.309
Right? Right. So, I mean, it is not, it is not
1052
01:30:15.235 --> 01:30:20.295
not actionable to be talking about how, you know, we could act potentially make an impact in terms of,
1053
01:30:21.715 --> 01:30:22.695
you know, encouraging
1054
01:30:24.449 --> 01:30:34.335
many jurisdictions to do mining. Like, I think that that is one clear way to to proceed here. I mean, it may not be Cypherpunks right code, but I mean, Bitcoin is is
1055
01:30:34.955 --> 01:30:44.130
a little bit more than that. I mean, now we're out there in the manufacturing world. We have physical hardware that that is, you know, an important part of the nervous system of this network.
1056
01:30:44.670 --> 01:30:47.890
And, it may seem like an impossible task, but
1057
01:30:48.965 --> 01:31:02.560
weird shit's gonna happen in the next 5 years and we're at a very impressionable moment. You have people like Elon Musk who are, like, they don't know what the hell is going on and they're, like, learning about it now, And they're they're gonna learn some bad stuff. I mean, he's pretty clear he's getting very into proof of stake in Ethereum,
1058
01:31:03.020 --> 01:31:07.165
but they're they're also gonna learn more, you know, opportunity to teach about Bitcoin. So
1059
01:31:07.725 --> 01:31:11.665
I think it is a time when we can be actionable about trying to think about,
1060
01:31:12.125 --> 01:31:16.785
paving a way for a future where where the mining is is more decentralized in terms of operations.
1061
01:31:19.070 --> 01:31:19.570
1062
01:31:19.870 --> 01:31:21.570
To piggyback on on
1063
01:31:22.270 --> 01:31:26.685
that idea of, like, what is actionable and and how does what can we do to reduce,
1064
01:31:27.005 --> 01:31:27.665
you know,
1065
01:31:28.605 --> 01:31:29.745
improve our threat models
1066
01:31:30.125 --> 01:31:33.425
as Bitcoiners here. I guess that's that's why I
1067
01:31:33.885 --> 01:31:35.265
feel strongly about
1068
01:31:37.410 --> 01:31:40.070
pointing out the the environmental
1069
01:31:40.610 --> 01:31:41.110
benefits,
1070
01:31:41.490 --> 01:31:44.150
the energy renewable energy benefits
1071
01:31:44.525 --> 01:31:46.545
of of Bitcoin and Bitcoin mining,
1072
01:31:47.885 --> 01:31:51.985
is because one of our one I think as Bitcoin is one of our big threats
1073
01:31:52.530 --> 01:31:53.990
in the 10 plus
1074
01:31:54.530 --> 01:31:57.590
year horizon is the persecution by the mob.
1075
01:31:58.530 --> 01:31:59.830
You know, and and
1076
01:32:00.290 --> 01:32:01.990
to the extent that we can
1077
01:32:02.835 --> 01:32:09.574
take the narrative that is being stirred up for them by the media of Bitcoin is bad for the environment
1078
01:32:10.920 --> 01:32:11.320
and,
1079
01:32:11.960 --> 01:32:14.860
point out through education, through whatever sort of,
1080
01:32:16.280 --> 01:32:16.940
you know,
1081
01:32:17.480 --> 01:32:19.820
information we can generate as a community
1082
01:32:20.265 --> 01:32:21.324
that no, actually,
1083
01:32:21.705 --> 01:32:25.005
it's very much the opposite. In fact, this is the best thing,
1084
01:32:25.625 --> 01:32:26.125
for
1085
01:32:27.120 --> 01:32:30.660
for the environmental goals that you have, as the mainstream.
1086
01:32:31.440 --> 01:32:33.460
That I think can reduce
1087
01:32:33.760 --> 01:32:37.244
the likelihood of us being persecuted as a as a group,
1088
01:32:37.625 --> 01:32:42.764
and individually. And I think that's that's one of the big concerns I have as a as a Bitcoiners.
1089
01:32:43.640 --> 01:32:46.380
You know? At what point does the mob turn on me?
1090
01:32:47.000 --> 01:32:50.940
And I think this is currently the the single biggest narrative
1091
01:32:51.425 --> 01:32:55.125
for generating animosity towards Bitcorners as an out group,
1092
01:32:56.385 --> 01:32:58.325
when it doesn't need to be that way.
1093
01:33:01.540 --> 01:33:04.280
1094
01:33:04.980 --> 01:33:07.080
ways that this can be mitigated.
1095
01:33:07.515 --> 01:33:25.820
Increase the numbers the number of Bitcoiners drastically. So urge everyone to stay humble and slack, and I think that kind of works. You know, once you once you dip your toe into the water, it seems to be a one way street. And on the other side, I think education is just key. And I just want to go on a
1096
01:33:26.425 --> 01:33:32.685
a a little proof of stake rant there because the chat is still talking about proof of stake. And I just Thank you.
1097
01:33:33.065 --> 01:33:42.550
I just want to point out that if you think that proof of stake is a good idea, you don't understand proof of work in the first place. And I I I truly believe that
1098
01:33:42.945 --> 01:33:44.165
the main misunderstanding
1099
01:33:45.185 --> 01:33:48.405
of of just the general population and also of of shitcoiners,
1100
01:33:48.705 --> 01:34:04.815
for that matter, is around proof of work. Proof of work solves all the problems that proof of stake has, and proof of stake is actually a non solution. Like, it's it's it's like talking to physicists and and explaining to physicists that, like, wouldn't it be nice if we could build a a perpetual
1101
01:34:05.115 --> 01:34:14.380
motion machine? You know? Yeah. That would be awesome. It would be great. It would be great if proof of stake could work, but it doesn't work. Like, it's it's literally against the laws of physics. Like, it's
1102
01:34:15.260 --> 01:34:24.630
if you understand proof of work well enough, this kind of becomes obvious. You know? And in proof of stake, you don't have an objective truth, and that's the whole problem. Proof of work builds up
1103
01:34:25.429 --> 01:34:34.330
and a time line that you can't argue with, and you have an objective truth. If you have 2 proof of work chains that that map onto 10 years of reality, you can look at them objectively
1104
01:34:34.695 --> 01:34:36.395
and determine without a doubt
1105
01:34:36.775 --> 01:34:40.635
which one is true by definition, and that's what we have with Nakamoto Consensus.
1106
01:34:41.255 --> 01:35:11.295
The the chain that has the most work embedded in it is true by definition. You don't have this with proof of stake. If I present to you from the same Genesys plot with the same validators, 10 years of history of 2 proof of j stake chains that had a split somewhere in the past, you cannot tell which one is the accurate one and which one isn't. So you always have to rely on trust of of some external trust, and it's proof of stake is like like the electric plug that plugs into itself. And that's the whole problem. And you have you you will always have timing problems
1107
01:35:11.675 --> 01:35:14.815
in proof of stake because you have no way to tell the time accurately,
1108
01:35:15.275 --> 01:35:16.175
in an adversarial
1109
01:35:16.950 --> 01:35:26.835
environment. That's a really deep problem. You have random selection problems, like who is gonna be the next validator. You have no outside cost. You have no operational cost. This leads to massive centralization.
1110
01:35:27.215 --> 01:35:37.620
Like, if you think proof of stake is a good idea, you have no idea what kind of problems proof of work solves, and you you need to study proof of work more if you think proof of stake is a genius idea.
1111
01:35:38.000 --> 01:35:38.160
1112
01:35:39.120 --> 01:35:50.420
a question for you, Gigi. I I I agree, obviously, and I I went on Lex Freeman a month ago. I guess that's gonna come out soon, and I I wanted to address that with him in terms of, like, the fact that Bitcoin,
1113
01:35:51.600 --> 01:36:02.215
you know, doesn't have a bureaucracy that runs the monetary policy and every other cryptocurrency has, like, essentially a currency board, like a small group of people that get to decide the monetary policy. And that even in the 2nd largest cryptocurrency,
1114
01:36:02.860 --> 01:36:15.094
we don't even know what the monetary policy is gonna be in 2 years. No one has any freaking clue how much ETH is gonna be minted in 2022 or 2023. It's like, I I talked I talked to a bunch of ETH engineers very politely, and I was just trying to get, like, a sense of what they had in mind. And
1115
01:36:15.395 --> 01:36:25.600
the answer is they're gonna figure it out, and they're gonna do their best. And and that is, you know, not a recipe for success in this world in terms of currencies. Like, a handful of currencies have done pretty well, but most of them have totally shit the bed.
1116
01:36:25.980 --> 01:36:32.735
So good luck to them. I mean, they have no experience doing that, like, out there in the real central bank world. So we'll see what happens.
1117
01:36:33.594 --> 01:36:37.695
But I will say this is very interesting. I wanted to bring this up with you guys. Did did all these see Vitalik's
1118
01:36:38.449 --> 01:36:39.190
latest post?
1119
01:36:40.849 --> 01:36:47.270
Can't say I did. Nope. I think what I've observed is this trend and a lot of, like, the, I would say,
1120
01:36:47.735 --> 01:36:48.475
more savvy
1121
01:36:49.015 --> 01:36:55.995
ETH people are are are, I think, hinting at this narrative shift where they're basically saying, we needed proof of work to bootstrap.
1122
01:36:57.480 --> 01:37:17.829
But really what what preserves Bitcoin's freedom is the full notes, not the proof of work. And we're gonna go to proof of stake, and we're gonna have full nodes and proof of stake, and we're not gonna have proof of work and fuck you guys. And this is what I I I I started to, like, get this vibe, when I was, again, talking to these ETH engineers and they're like, no. No. No. Bitcoin is special because of full notes, not because of proof of work.
1123
01:37:18.449 --> 01:37:28.695
And they really push on this. And Vitalik's latest post was about how important full notes were. I swear to God this is happening. So this is their theory is that they're gonna say, you need proof of work to bootstrap,
1124
01:37:29.070 --> 01:37:30.690
then you can go to proof of stake,
1125
01:37:31.470 --> 01:37:32.690
after the quote, unquote,
1126
01:37:33.390 --> 01:37:35.170
fair distribution. Okay? Right.
1127
01:37:35.870 --> 01:37:45.780
But then it's all about full nodes. And now Vitalik's gonna put on the show about how he wants to make full nodes more doable in Ethereum. So I don't know what your reactions to that are, but that that's what I'm sensing here.
1128
01:37:46.420 --> 01:37:48.760
1129
01:37:49.139 --> 01:37:56.735
if I'm not mistaken, the the calculations for for what a full node has to be able to handle is
1130
01:37:57.035 --> 01:38:00.015
3 petabytes a year, I think, of of data,
1131
01:38:00.395 --> 01:38:02.175
just just to keep synced
1132
01:38:04.340 --> 01:38:07.480
under the the new proof of stake model they're shifting to. Owners,
1133
01:38:08.980 --> 01:38:18.325
owner is burden on anybody who's trying to to run a full node. And it and it's beyond you know, it doesn't even matter because you're still talking about the fact that,
1134
01:38:19.410 --> 01:38:20.630
a group of insiders
1135
01:38:21.250 --> 01:38:23.750
with a 70% pre mine is
1136
01:38:24.450 --> 01:38:25.590
arbitrarily deciding
1137
01:38:26.375 --> 01:38:28.795
future changes in monetary policy and,
1138
01:38:29.494 --> 01:38:30.954
has the ability to revoke
1139
01:38:31.414 --> 01:38:33.175
transactions like with the DAO,
1140
01:38:33.750 --> 01:38:35.110
at any point. It it
1141
01:38:36.070 --> 01:38:38.250
so frustrating how, they they
1142
01:38:39.110 --> 01:38:40.410
distract you with,
1143
01:38:40.790 --> 01:38:42.090
arguing about details
1144
01:38:42.455 --> 01:38:43.415
when the bigger picture,
1145
01:38:45.335 --> 01:38:46.315
is so stark.
1146
01:38:47.975 --> 01:38:53.969
1147
01:38:54.349 --> 01:38:57.969
energy narrative, which I know we've beat the horse to death here, but,
1148
01:38:58.429 --> 01:39:06.550
it it's it works, folks. I mean, you you you know, we are sitting here. We all are long term Bitcoiners. Like, we know what's gonna happen, and it's unstoppable. But, like,
1149
01:39:07.030 --> 01:39:17.375
short term is important too and there's years here between now and then and fortunes are gonna be made and lost. And, like, them getting Elon and all these people to buy into the green stuff is,
1150
01:39:18.175 --> 01:39:26.760
is highly profitable for them. Highly profitable. I mean, look. I mean, if you guys think ETH is gonna disappear, you're wrong. It's not. It's gonna be around. It's gonna continue to make people
1151
01:39:27.060 --> 01:39:44.510
shitloads of money. I mean, they're just profiling the 3 arrows guys in the Wall Street Journal today. I mean, they've got a massive youth position. And, I mean and, you know, I think they know how to manipulate the markets. So So you know, they're they're they're set up here. I mean, I think Gigi hit the nail on the head, with his description.
1152
01:39:46.250 --> 01:39:49.310
1153
01:39:50.625 --> 01:39:57.525
I think it's insane that it almost seems like an overwhelming majority of people in the industry, including so called smart money,
1154
01:39:58.030 --> 01:40:03.409
think that proof of work is a problem that needs to be solved rather than the innovation itself. So early.
1155
01:40:03.790 --> 01:40:07.145
I think that's really bullish for us who realize it.
1156
01:40:07.945 --> 01:40:13.325
It's one of my most, you know, bullish fundamentals with Bitcoin, and I don't think that's priced in,
1157
01:40:14.105 --> 01:40:17.085
even if a lot of Bitcoiners disagree with me on that.
1158
01:40:17.850 --> 01:40:20.830
And one thing I was I would add there that Gigi missed,
1159
01:40:22.090 --> 01:40:26.350
is, you know, a proof of stake system is inherently permissioned. It's not permissionless.
1160
01:40:27.915 --> 01:40:29.615
You can't get into the system
1161
01:40:30.235 --> 01:40:44.080
without an existing holder selling you some of their coins, trading you some of their coins. With Bitcoin, you we existing holders can't block new entrants. They can get miners. They can plug in those miners. They can get coins automatically via the network.
1162
01:40:44.925 --> 01:40:49.025
But with proof of stake, that's not possible. And then just one thing I would add here,
1163
01:40:49.725 --> 01:40:52.465
I mean, they've been talking about proof of stake since before the ICO.
1164
01:40:52.790 --> 01:40:57.290
Yep. So once again, here we are, you know, arguing about something that doesn't exist yet.
1165
01:40:58.630 --> 01:41:00.489
And I feel like when
1166
01:41:01.114 --> 01:41:09.695
if they ever get it together and make it launch, I'm not gonna say they're never gonna move to proof of stake. We'll see if it happens, and I think there'll be a fight with miners if it does happen
1167
01:41:10.000 --> 01:41:13.139
because why would minors, you know, wanna lose all their revenue?
1168
01:41:14.560 --> 01:41:21.915
They're gonna have major issues, and they're gonna have major censorship issues, and they're gonna have major reliability and stability issues. They're gonna have
1169
01:41:22.295 --> 01:41:26.555
you know, there's so much complexity there. I'm I don't pretend to know all their different complex
1170
01:41:26.910 --> 01:41:43.635
bullshit they talk about, but, like, people are gonna get slashed that aren't supposed to get slashed. People are gonna lose money, and it's gonna prove to people, you know, why it's such a bad idea. So, like, people need to touch the stove, and the stove is being built. It's been built, you know, being built and hyped for, like, the last decade.
1171
01:41:44.060 --> 01:42:03.035
1172
01:42:03.360 --> 01:42:06.340
from timing attacks and from stake grinding attacks
1173
01:42:06.720 --> 01:42:45.620
and why all proof of stake systems had to add a little bit of proof of work to just make it work. You know, if you research that, it's it it becomes blatantly obvious the proof of stake just does not work and can never work. And if you understand proof of work deeply enough, it becomes obvious from first principles because what are we trying to do? We are trying to build up an internally consistent global construct that is made of pure information that nobody can cheat and that everyone can verify. And you cannot do that without proof of work Because without proof of work, you will always have to rely on external sources of truth. Only with proof of work can you embed the truth inside of the information,
1174
01:42:45.925 --> 01:43:18.190
And that is actually the innovation that Bitcoin brings with it, and that's why it works. And the difficulty adjustment is just like the the the genius cherry on the top that makes all of it kind of work beautifully and leads to a to a finite supply and all of it. And if you don't understand that, you just have no idea what you're talking about. And if you want to build, like, proof of stake castles in the sky, be my guest. Like, as Alex said, okay, it's gonna be profitable in the long run, and they're very good at marketing and so on and so forth, but make no mistake, all of it will collapse. Proof of stake can never can never work. It can never work, and it will collapse.
1175
01:43:18.730 --> 01:43:30.775
And and so it's be my guest. Like, build it and see it firsthand and burn your both burn both of your hands on the stove, and I'll be sitting here with my popcorn and just staying humble and sucking sense. That's also actionable advice.
1176
01:43:31.300 --> 01:43:37.835
1177
01:43:38.315 --> 01:43:40.655
fiat currencies are proof a proof of stake in a way.
1178
01:43:41.114 --> 01:43:45.055
And, they they have a rather aggressive lifespan, unfortunately,
1179
01:43:45.950 --> 01:44:06.140
1180
01:44:06.600 --> 01:44:14.425
1181
01:44:14.805 --> 01:44:19.305
plus full nodes, very important. There's a bunch of, shitcoin proof of work coins that that are meaningless.
1182
01:44:19.925 --> 01:44:22.630
You know, this this this you gotta have both of these things.
1183
01:44:23.270 --> 01:44:26.570
User control of a proof of work system, which is only possible in
1184
01:44:26.870 --> 01:44:29.645
Bitcoin. Like, once you have that, that's our ticket out of proof of stake.
1185
01:44:30.205 --> 01:44:33.665
Mhmm. And into a system where a small group of people do not control the monetary policy.
1186
01:44:34.125 --> 01:44:39.800
And and that's the key for me. So that's kinda it for the folks in the chat. That's the way I'm trying to explain it to people
1187
01:44:40.179 --> 01:44:56.440
who aren't very, very into this. Like, it's it's really our opportunity to get out of having, like, a currency board, a small group of people who are usually the elite, almost always the elite, who who get to make the decisions for everybody else. Well, guess what? In Bitcoin, we don't have that and, no one's making any decisions about 21,000,000.
1188
01:44:56.740 --> 01:45:02.600
So that's kind of the way I would put it. I think that's that's why Ethereum has staying power is
1189
01:45:02.945 --> 01:45:04.325
1190
01:45:05.505 --> 01:45:09.125
it's this local optimum of of variables
1191
01:45:09.505 --> 01:45:12.950
if you are determined to not break your worldview,
1192
01:45:13.890 --> 01:45:16.630
you know, to to continue to view the world as,
1193
01:45:17.010 --> 01:45:18.025
you know, as
1194
01:45:18.485 --> 01:45:26.665
necessarily working the way the fiat system today works of having insiders that control monetary policy and can can,
1195
01:45:27.610 --> 01:45:28.910
you know, be responsible,
1196
01:45:30.170 --> 01:45:33.950
stewards over the chain and decide what what
1197
01:45:34.735 --> 01:45:35.235
transactions
1198
01:45:36.014 --> 01:45:39.375
are allowed and and which ones get rolled back. Like, that's
1199
01:45:40.335 --> 01:45:47.290
if you if you want to view the world that way, which is how we've all been indoctrinated to to see the world, then Ethereum,
1200
01:45:48.790 --> 01:45:50.890
is in line with your worldview.
1201
01:45:51.345 --> 01:45:53.925
And getting to that deeper value of Bitcoin
1202
01:45:54.545 --> 01:45:55.045
requires,
1203
01:45:56.705 --> 01:46:05.710
facing your worldview head on and and, you know, casting out the elements that are that that have been indoctrinated into us and,
1204
01:46:06.030 --> 01:46:07.570
you know, seeing a deeper truth,
1205
01:46:08.425 --> 01:46:17.245
That's hard to do. Luckily, it's an economic reality that will be playing itself out, but I think that's why Ethereum has its staying power. Also, to to
1206
01:46:18.530 --> 01:46:20.630
talk up I talked up Alex's
1207
01:46:20.930 --> 01:46:21.830
recent article.
1208
01:46:22.850 --> 01:46:26.950
If if listeners were interested in in what Gigi was just talking about,
1209
01:46:27.585 --> 01:46:30.085
check out his, Bitcoin his time
1210
01:46:30.465 --> 01:46:37.240
piece, which I think was probably the the deepest article I've read about the nature of Bitcoin in the last year or so. So,
1211
01:46:37.780 --> 01:46:39.240
highly recommend that one.
1212
01:46:41.220 --> 01:46:42.980
1213
01:46:43.955 --> 01:46:51.415
Ethereum has staying power, I'm not so sure about that. Like, the the underlying technology of Ethereum is like rack pull technology. So,
1214
01:46:52.060 --> 01:46:58.720
like, it's it's a rock pull from the start because of the 70% pre mine, and they just enabled all the other rock pulls. Yep. And I think just
1215
01:46:59.105 --> 01:47:13.110
I I wouldn't be surprised if there is, like, one rug pull to end it all. And, of course, you know, like, as Matt likes to say, it will trend to 0 in Bitcoin terms as well everything else. So I wouldn't I wouldn't bet on Ethereum having staying power.
1216
01:47:13.970 --> 01:47:18.835
I I hope you're right. I I wouldn't be surprised if nobody talks about it 15 years from now.
1217
01:47:21.075 --> 01:47:25.975
1218
01:47:27.330 --> 01:47:29.270
1219
01:47:29.650 --> 01:47:37.355
1220
01:47:37.735 --> 01:47:43.034
That's what I got pulled into, the narrative of of what Ethereum could do that Bitcoin couldn't do.
1221
01:47:43.800 --> 01:47:46.220
And I and that caused me to stay
1222
01:47:46.840 --> 01:47:52.860
in altcoin land for until 2019. You know, it took a bear market and absolute bludgeoning
1223
01:47:53.994 --> 01:47:55.614
in terms of my sat value
1224
01:47:55.994 --> 01:47:58.415
to capitulate basically into Bitcoin.
1225
01:47:59.034 --> 01:48:02.494
And the stock to flow model was also important for me to to, like,
1226
01:48:02.980 --> 01:48:07.400
start to go down the rabbit hole of of the nature of stores of value
1227
01:48:07.780 --> 01:48:09.960
and realize what Bitcoin really is.
1228
01:48:11.645 --> 01:48:16.385
Yeah. But, like, the you know, that if I hadn't gotten pulled into Ethereum,
1229
01:48:16.685 --> 01:48:18.625
I would have more sats today,
1230
01:48:19.244 --> 01:48:20.545
than than I do.
1231
01:48:22.360 --> 01:48:23.340
And that's painful.
1232
01:48:24.200 --> 01:48:24.700
But
1233
01:48:25.720 --> 01:48:34.255
it's gonna be worse for for some people. You know, like, I I got out in a way that it I didn't lose that much through that whole journey.
1234
01:48:35.115 --> 01:48:43.330
But I, you know, I almost got wrecked by a tax burden along the way, and there are all these other potential pitfalls that that could have destroyed me.
1235
01:48:43.950 --> 01:48:48.450
And it and that has happened and will happen for so many people because
1236
01:48:48.954 --> 01:48:50.335
Ethereum is this this,
1237
01:48:51.355 --> 01:48:53.135
fraud, this attractive
1238
01:48:53.675 --> 01:48:58.175
illusion It's a siren song. Exactly. It's a siren song that's wrecking people on the rocks,
1239
01:48:58.860 --> 01:49:04.160
and and will wreck more people on the rocks so long as it it continues to be around.
1240
01:49:04.620 --> 01:49:06.480
1241
01:49:07.020 --> 01:49:08.000
show your article.
1242
01:49:09.305 --> 01:49:15.085
I really love the one you did in January. Am I too late for Bitcoin? I highly recommend everybody read it.
1243
01:49:16.390 --> 01:49:30.415
It's extremely bullish, but it it's, like, it's helpful for, like, the long term view of, like, what's happening here. Like, this is an incredibly entertaining week to do this show and to talk about these issues. And all of a sudden, it looks like we're gonna have this, like, environment kinda
1244
01:49:30.715 --> 01:49:35.670
FUD, like, war, like, you know, like, before we even get to the privacy war, etcetera.
1245
01:49:36.690 --> 01:49:48.360
But, like, long long term, just thinking about, like, this thing as this gen this, like, historic story of value technology and just what it's gonna eat in the next coming decades. Like, you just gotta keep your eye on the prize. So thank you for writing that.
1246
01:49:48.920 --> 01:49:58.060
1247
01:49:58.985 --> 01:50:04.685
if you take if you take all the Bitcoin, 21,000,000 divided by 8,000,000,000 people, there's 250,000
1248
01:50:05.385 --> 01:50:07.190
sats per person on earth.
1249
01:50:08.390 --> 01:50:11.290
And recently that cost, a $150.
1250
01:50:12.150 --> 01:50:13.690
So you for every $150
1251
01:50:14.070 --> 01:50:26.245
of sat stacking you do, you are you are stashing away one person's worth of digital gold for the digital future. It's incredible. Buying 1 human being. One human being's worth of life energy.
1252
01:50:27.010 --> 01:50:29.590
And that price just dropped. It's no longer a $150
1253
01:50:29.890 --> 01:50:30.710
for 250,000
1254
01:50:31.170 --> 01:50:34.705
sats. That's that's something like $100 now, maybe less.
1255
01:50:35.405 --> 01:50:35.905
So
1256
01:50:36.285 --> 01:50:38.785
you have this unreal opportunity to
1257
01:50:39.245 --> 01:50:43.585
to stack Sats before the rest of the world has figured out what's happening here
1258
01:50:43.950 --> 01:50:45.810
and secured, like, potentially
1259
01:50:46.270 --> 01:50:46.770
generational
1260
01:50:47.790 --> 01:50:48.850
financial security,
1261
01:50:49.469 --> 01:50:51.010
if not outright wealth,
1262
01:50:52.185 --> 01:50:57.405
just by being here early and leaning into the opportunity that you have while everybody is
1263
01:50:57.705 --> 01:50:58.205
scared
1264
01:50:58.840 --> 01:51:00.380
or listening to Elon.
1265
01:51:01.160 --> 01:51:05.340
1266
01:51:06.040 --> 01:51:06.540
how
1267
01:51:07.895 --> 01:51:09.035
how many Bitcoiners
1268
01:51:09.415 --> 01:51:17.550
had their jimmies rustled by the recent flood and the price drop. And I think if if you are disturbed by those kind of things, you still have
1269
01:51:18.489 --> 01:51:38.969
a a a long way to go in terms of getting your auto DCA right. Because I think once you realize how early we are, like, just trying to time the market and and trying to kind of trade, it it's it's a it's a losing game. Like, I think the only winning game you can play is just stack as much as you can, provide value to your community,
1270
01:51:39.430 --> 01:51:51.735
earn Bitcoin or earn fiat and do auto DCA, and just stack daily, stack weekly, stack monthly, whatever you can afford, and just play the long game. Just do that for the next 10 years, and you're gonna be fine. You'll Yeah. You'll outback everyone else.
1271
01:51:52.275 --> 01:52:11.765
1272
01:52:12.110 --> 01:52:15.810
that there's a lot of, sharks in the water. Can I interject term?
1273
01:52:16.190 --> 01:52:20.690
1274
01:52:21.715 --> 01:52:23.655
the Yuppie finance world is
1275
01:52:24.195 --> 01:52:25.475
sort of where I come from?
1276
01:52:26.675 --> 01:52:33.030
And let's look at, you know, a little story through the the the recent timeline here. Ray Dalio, like, 4
1277
01:52:33.490 --> 01:52:33.990
maybe
1278
01:52:34.530 --> 01:52:35.990
about 4 months ago said,
1279
01:52:36.370 --> 01:52:37.830
maybe I'm missing something
1280
01:52:38.535 --> 01:52:39.915
with with regards to Bitcoin.
1281
01:52:41.015 --> 01:52:47.675
Then his firm, Bridgewater, behind the scenes, you know, that that basically says he's about to go do his diligence.
1282
01:52:48.920 --> 01:52:55.660
4 months later, what has happened? His CFO, CFO of Bridgewater, the CFO of the largest hedge fund in the world,
1283
01:52:56.825 --> 01:53:03.465
just quit his job to go join NYDIG, a Bitcoin only company that's focused on institutional buying for,
1284
01:53:04.105 --> 01:53:04.765
a Bitcoin.
1285
01:53:06.230 --> 01:53:09.610
So he lost his, I don't know, number 2, number 3 guy,
1286
01:53:09.989 --> 01:53:12.650
in his in his company because Bitcoin,
1287
01:53:12.985 --> 01:53:28.790
after doing the diligence, Bitcoin was so promising to that guy that he left to go focus on Bitcoin. And Dalio bought some Bitcoin at the same time. So that's a 4 month 4 month process that that Dalio and and everybody at Bridgewater just went through of doing their diligence.
1288
01:53:29.170 --> 01:53:29.830
And then
1289
01:53:30.195 --> 01:53:38.375
not just buying some, but being so bullish that he'd lost, you know, one of his key people because Bitcoin is bigger than anything that's happening anywhere else,
1290
01:53:39.469 --> 01:53:40.610
especially at Bridgewater.
1291
01:53:45.389 --> 01:53:47.409
1292
01:53:49.195 --> 01:53:50.015
we got
1293
01:53:50.875 --> 01:53:53.215
a lot of people coming into the space now who
1294
01:53:53.675 --> 01:54:00.360
who don't understand, like, the the monetary policy piece and the predictability piece and the sort of safe haven that Bitcoin is.
1295
01:54:00.820 --> 01:54:01.640
And therefore,
1296
01:54:02.580 --> 01:54:09.695
they're like, they too easily jump the shark and go to other technologies. And it's kinda like what we were saying with Elon before, but it's happening to
1297
01:54:10.475 --> 01:54:10.975
to
1298
01:54:11.594 --> 01:54:14.260
a lot of people here. So just to give you some numbers,
1299
01:54:15.360 --> 01:54:17.380
let's see. Just in the last month,
1300
01:54:18.960 --> 01:54:19.860
we've got,
1301
01:54:20.755 --> 01:54:26.035
2 really people that I I respect a lot or, you know, yeah, continue to respect a lot, but,
1302
01:54:26.595 --> 01:54:35.310
more relevant maybe to this crowd than than Elon. But we've got, like, Moxie Marlinspike, and we've got Snowden, you know, both going to bat for, like, these privacy coins.
1303
01:54:36.010 --> 01:54:46.305
And I guess what they, like, they discount the the monetary policy piece and the the the money piece, and and they overrate the technology piece. And what happens is you get stuck in the situation
1304
01:54:46.980 --> 01:54:54.760
where, Moxie's coin is down 80 over 80% from from a few weeks ago, and Snowden's coin is down 75%.
1305
01:54:55.300 --> 01:54:55.800
Okay?
1306
01:54:56.195 --> 01:55:02.375
So and and and that those swings are gonna be, like, a lot more wild in the coming year in in different directions.
1307
01:55:02.755 --> 01:55:08.940
And I just think it's it's interesting to see that they, know, they obviously haven't grasped that piece yet. I think they they probably will eventually,
1308
01:55:09.800 --> 01:55:12.620
and it it's sort of in retrospect, it'll have been inevitable.
1309
01:55:13.985 --> 01:55:17.925
But it it is, you know, something that we're just gonna see more of. Right?
1310
01:55:18.705 --> 01:55:27.430
People coming in and, like, oh, well, you know, Bitcoin's broken. Let me, like, fix it and and use this other thing. And even, like, our you know, even the heroes are are susceptible.
1311
01:55:28.130 --> 01:55:30.950
1312
01:55:32.355 --> 01:55:40.000
by both of these events actually because, I consider both of these people heroes of mine. I think Moxie did great great things with signal and,
1313
01:55:40.560 --> 01:55:42.180
the OpenWhisper Systems protocol
1314
01:55:42.640 --> 01:55:46.660
and, of course, known the great things as well. I think if you're a technologist,
1315
01:55:47.295 --> 01:55:53.775
it's very difficult to understand that Bitcoin is not only a technology. It's also, like, you know, in in large
1316
01:55:54.655 --> 01:55:56.594
in a in a very large part also,
1317
01:55:57.000 --> 01:55:57.500
like,
1318
01:55:58.119 --> 01:56:03.820
this almost biological system. Like, it's this this social system. It it, like, it needs
1319
01:56:04.360 --> 01:56:04.860
this
1320
01:56:05.365 --> 01:56:14.800
economical part to work, and all systems like Bitcoin need this economical part to work. And that's really hard to understand if you look at it from a purely engineering
1321
01:56:15.340 --> 01:56:15.840
technology
1322
01:56:16.219 --> 01:56:17.119
side of things.
1323
01:56:17.420 --> 01:56:24.755
And I think it takes a very long time and also a lot of humility to accept that
1324
01:56:25.215 --> 01:56:30.595
Bitcoin just is the way it is, and we kind of have to take it as this
1325
01:56:31.380 --> 01:56:40.905
gift from the gods, if you will, because it had this immaculate conception and fought all its battles and survived everything and grew organically and was dispersed organically.
1326
01:56:41.285 --> 01:57:22.210
And now we we like, it's it's not only this informational construct. It also has all this infrastructure. By infrastructure, I mean, not only the mining side, but also who holds it, who accepts it, and who is on the Bitcoin standard already. And you cannot replicate that. You cannot you cannot replicate that organically in the 1st place, and you also can't duplicate it. Like, I I truly believe it's this one time path dependent invention slash discovery, and we have to deal with it. I think all Bitcoiners kind of know that Bitcoin isn't perfect. You know? Like, there there there are some things that that aren't perfect in Bitcoin, but it's the best thing we have. And building trying to trying to reinvent the the wheel, so to speak, it's just a losing proposition because you have these
1327
01:57:22.690 --> 01:57:35.415
economic forces that kind of tend to 1, and you will like, if you if you're if you're trying to fix the issues that Bitcoin has by launching your own shitcoin, you've already lost. And it doesn't matter if you know it or not. It's it's just it's just
1328
01:57:35.795 --> 01:57:42.380
a effect of nature, and it it really pains me to to to see those kind of people that I hold
1329
01:57:42.840 --> 01:58:04.240
in high regards in all other areas fail this kind this kind of, like, intelligence test, if you will, because they they truly try to, you know, like, I just learned about Bitcoin. I'm I'm here to fix it and launch our own Bitcoin. And it's it's really sad to see, but I think it's something that everyone kind of has to go through, and I think it will sort itself out over time. Yeah. Gigi,
1330
01:58:04.940 --> 01:58:06.160
1331
01:58:07.835 --> 01:58:13.455
I love you, dude. It it makes me miss you a lot hearing you speak. I'm looking forward to seeing you in Miami,
1332
01:58:14.155 --> 01:58:14.895
very soon.
1333
01:58:15.300 --> 01:58:19.720
I I a 100% agree with everything you just said. I'm curious while I have you here.
1334
01:58:20.100 --> 01:58:21.960
Do you think we'll ever see
1335
01:58:23.415 --> 01:58:26.155
a successful Bitcoin hard fork in our future?
1336
01:58:27.255 --> 01:58:32.690
1337
01:58:33.710 --> 01:58:35.250
from the start. You know? Like, it's
1338
01:58:35.630 --> 01:58:36.530
trying to
1339
01:58:36.990 --> 01:58:40.275
figure out like, if there is a problem that Bitcoin needs to overcome,
1340
01:58:40.735 --> 01:58:45.875
it's very hard to tell, like, will it kill Bitcoin in the future? And I think the only,
1341
01:58:46.850 --> 01:58:52.390
like, the only reason to do a hard fork is if it if the alternative means the death of the network.
1342
01:58:53.010 --> 01:58:53.510
And
1343
01:58:54.105 --> 01:58:54.605
so
1344
01:58:55.945 --> 01:59:02.950
I actually don't really see it unless it's crystal clear. Like, if if we, I don't know, have
1345
01:59:03.990 --> 01:59:12.890
if we have a new mathematical discovery, if we find a flaw in one of the algorithms where we kind of know, okay, like, if we throw more compute at that and,
1346
01:59:13.895 --> 01:59:18.635
we we have reasons to believe that motivated attackers could actually, you know,
1347
01:59:19.255 --> 01:59:21.595
break something in in a serious way,
1348
01:59:21.910 --> 01:59:28.490
then I think we could come to some agreement to do a hard fork. I don't think we will do a hard fork for,
1349
01:59:29.405 --> 01:59:31.665
any other reason. And Well, to be clear,
1350
01:59:32.205 --> 01:59:43.659
1351
01:59:45.095 --> 01:59:53.515
if there's if there's some kind of if the overwhelming majority of users were motivated for some apparent reason. If if something would break the old chain.
1352
01:59:54.329 --> 01:59:59.389
1353
01:59:59.769 --> 02:00:06.645
we now some somewhat have an agreement of how to activate it and stuff like that. That's what I mean by, like, agreement, rough consensus.
1354
02:00:07.264 --> 02:00:09.205
Of course, you know, like, if there is ever
1355
02:00:10.280 --> 02:00:16.540
a reason to do a hard fork, it it will be a a huge mess. Like The reason the reason why I bring it up is because,
1356
02:00:18.295 --> 02:00:29.090
1357
02:00:29.630 --> 02:00:30.210
of Bitcoin
1358
02:00:31.310 --> 02:00:36.035
has has a value, a value that can never be replicated by a shitcoin.
1359
02:00:37.295 --> 02:00:40.995
But that ledger would carry over in a hard fork, which is why I asked.
1360
02:00:41.940 --> 02:00:45.080
1361
02:00:45.460 --> 02:00:51.865
really deep into these kind of topics, and it becomes nuanced the longer you more nuanced the longer you think about it. Because,
1362
02:00:52.485 --> 02:00:52.985
like,
1363
02:00:53.365 --> 02:00:54.745
if if there is a mathematical,
1364
02:00:55.925 --> 02:00:56.425
cryptographic
1365
02:00:56.965 --> 02:00:57.465
breakthrough
1366
02:00:57.925 --> 02:00:59.385
where you could, for example,
1367
02:01:00.680 --> 02:01:03.340
you could be in a situation where it's not clear cut anymore,
1368
02:01:04.760 --> 02:01:19.590
what kind of private keys unlock which coins, and then you're in a huge mess because then even, like, bootstrapping from the current UTXO set wouldn't really save you anymore. So, but, you know, like, it's it's it's it's not that people aren't thinking about it, and it's also,
1369
02:01:20.450 --> 02:01:21.510
not that, like,
1370
02:01:22.770 --> 02:01:27.685
I I like what Chuck Mueller is saying all the time. You know? Like, don't don't bet against engineers.
1371
02:01:28.225 --> 02:01:37.740
Like, they're thinking about this shit, and we can definitely do something about those kind of scenarios. But we have bigger fish to fry right now, you know, like, just getting Taproot activated
1372
02:01:38.200 --> 02:01:42.140
and getting all those things that we are currently working on activated and just,
1373
02:01:42.715 --> 02:01:44.094
working on minor decentralization
1374
02:01:44.395 --> 02:01:44.895
and,
1375
02:01:45.355 --> 02:01:45.855
working
1376
02:01:46.395 --> 02:01:48.655
on on privacy tech and working on fungibility.
1377
02:01:49.034 --> 02:01:59.230
Those are the priorities. Like, quantum computation is not a priority right now and won't be for the next 10 years, for example. Well and for the great majority of people, the usability piece. I just wanted to give a shout out to
1378
02:02:00.115 --> 02:02:01.795
1379
02:02:02.835 --> 02:02:04.535
tip some stats to to
1380
02:02:04.915 --> 02:02:06.615
to strikes kind of like indie,
1381
02:02:08.000 --> 02:02:15.380
initiative, indie car initiative using the Moon Wallet. I mean, it was, like, I've been showing it to, like, a bunch of people just sending, like, a tiny amount using it.
1382
02:02:16.705 --> 02:02:20.485
It just blows people away. I mean, it's just, like, yeah. That was, like, final settlement,
1383
02:02:21.345 --> 02:02:32.460
you know, took literally a second. We took 2 swipes, and that was that. And that's done, and then that those funds are in somebody else's possession now. And it's, like, once you get your usability here, it's, like,
1384
02:02:32.815 --> 02:02:35.715
really starts to get interesting. That's that's Moonwal
1385
02:02:36.255 --> 02:02:44.390
1386
02:02:44.770 --> 02:02:47.030
which is the Indy 5 100 car.
1387
02:02:47.650 --> 02:02:51.445
It supports the Indy 5 100 car that we have racing this Sunday
1388
02:02:53.985 --> 02:02:54.805
that is
1389
02:02:55.985 --> 02:02:57.185
raising funds for,
1390
02:02:57.505 --> 02:03:07.110
Bitcoin development. So if you if you donate to strike dot me slash racing, it'll go to open source Bitcoin development. Okay. Carry on. Sorry. Yeah. So, you know, I'm in the restaurant with some guy who,
1391
02:03:07.650 --> 02:03:10.755
1392
02:03:11.475 --> 02:03:19.335
And he, you know, he hasn't been aware of, like, the the upgrades, let's say, and how it all works. And I'm like, alright. So I just go to that website that Matt just mentioned,
1393
02:03:21.580 --> 02:03:37.225
strike dot me slash racing, and it just creates an invoice that expires in a in 60 seconds and just copy it, and then I go to Moon Wallet. So that's, like, one click, and then I paste the address in the send, and it's done and it's gone. And it's just like, I just moved to Bitcoin.
1394
02:03:37.710 --> 02:03:43.330
And, that kind of blows people away, and, like, that's kinda where we're we're getting closer to that, which is really exciting.
1395
02:03:43.790 --> 02:03:56.760
1396
02:03:57.060 --> 02:04:26.755
are talking about. But we saw this with the Internet. You know? Like, I I mentioned this all the time that we had this both voice over IP moment where suddenly every every single telephone call went over the Internet, and nobody kind of noticed. Everything was kind of the same. And I think the same will happen with Bitcoin. You know? We will have this infrastructure inversion because it it just makes a lot of sense. It's cheaper, and then the economic incentives are allowed. And we have, like, instant final settlement. Like, if you're running a bank, switching to the Bitcoin standard, like switching to the Bitcoin network for doing your settlement
1397
02:04:27.090 --> 02:04:50.590
is, like, the smart thing to do, and I think I believe everyone is kind of working on it. And if you're not working on it, you'll be made obsolete in the next, like, 5 years because people are working on it. And just flipping that switch, and it doesn't matter what's coming out at the end. You know? It might be US dollars. It might be euros. It it doesn't matter if it's Fiat currency. But just doing the exact same thing that Stripe is currently doing using these payment rails, that's, like, the smart thing to do, and that's the like, you you
1398
02:04:51.530 --> 02:04:53.775
you you will be cheaper than your competition
1399
02:04:54.235 --> 02:05:09.215
instantly, and that's just why it's going to happen. And it's it's gonna happen soon. Everyone has a fucking smartphone. Everyone has an Internet connection. We're gonna have Starlink online soon and everywhere, and it just it it's it it will start in in, like, 3rd world countries or where you,
1400
02:05:09.614 --> 02:05:21.690
like, actually benefit from circular economies where you don't have regular banking, but there is no reason why we can't have this, like, next year in the western world where you just use an app and just everyone uses it. And,
1401
02:05:22.090 --> 02:05:32.915
1402
02:05:33.780 --> 02:05:36.760
kind of just refreshing invoice every time you visit the page,
1403
02:05:38.340 --> 02:05:44.565
and just being able to just immediately donate and to share that with people? Like, what what is the stumbling block there? I mean, I think,
1404
02:05:46.405 --> 02:05:47.625
1405
02:05:47.925 --> 02:05:50.665
we have BTC pay server, but it's a bit heavy.
1406
02:05:51.030 --> 02:05:56.310
Correct. This is way a lot more lightweight. And and the the the main issue is hosting. Right?
1407
02:05:56.790 --> 02:05:59.210
You know, especially if you're in a country,
1408
02:06:00.065 --> 02:06:02.005
that you're in a heavy adversarial environment
1409
02:06:02.545 --> 02:06:04.005
and you're worried about,
1410
02:06:04.945 --> 02:06:06.965
dictator or some other kind of authoritarian
1411
02:06:08.120 --> 02:06:08.620
military
1412
02:06:09.160 --> 02:06:10.300
coming after you.
1413
02:06:10.920 --> 02:06:14.220
It's hard to reliably host something on the Internet privately.
1414
02:06:14.600 --> 02:06:17.685
We have Tor, but then all your dones need to use Tor.
1415
02:06:18.705 --> 02:06:20.324
One thing that is interesting,
1416
02:06:21.105 --> 02:06:23.445
that we have going for us is this lnurl
1417
02:06:24.110 --> 02:06:27.969
that I have in the bottom left hand corner of the screen, which is a fixed QR code.
1418
02:06:28.989 --> 02:06:30.350
It doesn't even need
1419
02:06:30.670 --> 02:06:32.235
Moon doesn't support it yet,
1420
02:06:32.795 --> 02:06:35.695
but Phoenix does. I think while the Satoshi does,
1421
02:06:37.114 --> 02:06:42.014
there's a there's a couple wallets that do and and they're adding more every day. I think Zeus supports it,
1422
02:06:43.790 --> 02:06:46.449
and that's fixed, so you don't need to host.
1423
02:06:46.989 --> 02:06:48.290
We also have PubKey.
1424
02:06:49.150 --> 02:06:49.969
What is it?
1425
02:06:50.735 --> 02:06:53.555
Pubkey payments. What are they calling? Key send payments,
1426
02:06:54.255 --> 02:06:56.835
which is a similar idea. Right? Is it this fixed
1427
02:06:57.375 --> 02:07:01.970
this this fixed text characters that you can use instead of having to host something?
1428
02:07:02.670 --> 02:07:06.290
So I I think we'll either go in that direction. I think that's probably ideal,
1429
02:07:08.284 --> 02:07:18.659
or, you know, like a lightweight alternative to BTC pay server. Right? Yep. I forget who that I forgot what that project is, but I think he's at coin joiner on Twitter. He has,
1430
02:07:19.280 --> 02:07:22.900
I think it's called BTC payment, but he has, like, a lightweight Python
1431
02:07:24.945 --> 02:07:36.740
1432
02:07:37.280 --> 02:07:52.700
to kind of dismiss and not see how insanely early we are. Like, the the the Lightning Network didn't exist not too long ago, you know. Like, it was Yeah. It was a nice task not too long ago. The Lightning Labs folks, just on that note, like, you know, what can we do to have, like, a static,
1433
02:07:53.180 --> 02:08:03.385
1434
02:08:03.844 --> 02:08:05.385
that that can recycle through
1435
02:08:05.764 --> 02:08:06.164
and,
1436
02:08:06.790 --> 02:08:50.934
1437
02:08:51.574 --> 02:08:54.235
that we need to to make, and and,
1438
02:08:55.014 --> 02:09:15.660
I I can't, like, I can't even tell you how bullish I am because what's most exciting to me is all the things that people, engineers, builders will come up with for the next 1 or 2 or 3 years that we can't even think of yet. I think all these problems will be solved. Like, all all the the petty problems that we have now with, you know, address reuse and, like doxing our,
1439
02:09:16.120 --> 02:09:25.195
1440
02:09:26.614 --> 02:09:34.469
most notably known as, reasonable payment codes, but most notably known as the only implementation I know of is in Samura Wallet. It's called PayNIMS,
1441
02:09:35.330 --> 02:09:38.949
which solves a similar goal, but is on chain rather than Lightning.
1442
02:09:39.955 --> 02:09:46.295
Yeah. I would just say, like, I think, you know, you know, Pay NIMs are fantastic if you if you wanna use them today.
1443
02:09:46.820 --> 02:09:50.679
If you need something that you wanna use today and, you know, your your have,
1444
02:09:52.659 --> 02:10:00.035
an Android phone with samurai wallet on it, Ideally, it'd be nice to see other wallets at it. But I think, ultimately, like, if we're looking low time preference,
1445
02:10:01.055 --> 02:10:04.035
I really do feel like the overwhelming majority of people
1446
02:10:04.420 --> 02:10:07.320
long term will not be hitting the chain. And I think
1447
02:10:09.540 --> 02:10:23.830
whether that's lightning, which I I think it will be lightning, but whether it's lightning or some other type of layer 2, will be where the majority of payments happen. Just because once you start using lightning, you really see it's not even I mean, I expect fees to rise on chain as well,
1448
02:10:24.210 --> 02:10:26.230
but the UX is just so much nicer.
1449
02:10:27.490 --> 02:10:34.465
The the the channel balances is difficult. I and there's ways of you know, people are trying to hide it,
1450
02:10:35.565 --> 02:10:48.765
from the user and make it a little bit easier UX wise. But once you get past the channel balance hurdle, and especially for payments, when you're paying people rather than receiving because if you're paying people, all you need is, you know, 1 or 2 channels to routing nodes,
1451
02:10:49.705 --> 02:10:52.720
and that's it. You don't have any channel management besides that.
1452
02:10:53.280 --> 02:10:59.300
The UX is just so much better. Like, I I I think we get stuck in our bubble. Even simple concepts like
1453
02:10:59.680 --> 02:11:01.620
confirmation time to us
1454
02:11:02.445 --> 02:11:09.265
is a very it's a very hard concept for New Corners to wrap their head around. Yeah. Absolutely. And I'm, like,
1455
02:11:09.590 --> 02:11:14.250
1456
02:11:14.710 --> 02:11:15.210
like,
1457
02:11:15.750 --> 02:11:24.875
hats off to everyone who is working on privacy tech on the base layer. But if you think, like, in a couple of years from now, everyone will be using PayNIMs, you're just not bullish enough because
1458
02:11:25.255 --> 02:11:27.195
lock space is insanely limited,
1459
02:11:27.540 --> 02:11:36.760
and you will not be able to afford on chain payments for regular day to day transactions. We're already at that point, basically, so we need something like Lightning. And I say
1460
02:11:37.155 --> 02:12:12.100
something like lightning because lightning is just one layer 2 solution, and we like, there's no reason why we can't have multiple ones. Lightning is the most promising one. And, of course, there's also liquid, and you can also do lightning on top of liquid and and stuff like that. But I think lightning in in itself, it's insanely bullish. And, yes, it it has its problems, but these problems are all being worked on. And we have so many great engineers that are thinking through all these kind of problems. And, for example, we we have the inbound liquidity problem, but this is being solved on a marketplace basis, and I think that's just beautiful to see. And I don't think, like, 5 years from now, I don't think it will be a problem anymore. And I think I think we will just
1461
02:12:12.415 --> 02:12:12.915
solve
1462
02:12:13.375 --> 02:12:32.264
1463
02:12:32.565 --> 02:12:38.425
And, you know, this is this is from conversations I've had with people from countries like Sudan, like like, these countries have
1464
02:12:39.410 --> 02:12:53.225
a surprising amount of phone smartphone penetration already and it, you know, it's basically gone from 5% to 25% in the last 5 years, and it's gonna go from 25% to 50% in the next 5 years. You're gonna have half these countries with smartphones
1465
02:12:53.605 --> 02:12:57.920
and then eat you know, there's tons of uncle Jims, you know, plus, you know, 50% penetration.
1466
02:12:58.540 --> 02:13:16.060
And all these people need to send small amounts. So they're not gonna be using the main chain. So, you know, this is why lightning is such like an interesting idea for emerging markets and it's probably one of the reasons why why you see the moon with 2 u's team working on it. So focused I mean, they're from Argentina. I mean, they they understand the need for it.
1467
02:13:16.780 --> 02:13:19.360
And if it's not gonna be lightning, it's gonna be custodians,
1468
02:13:19.845 --> 02:13:23.945
which, you know, sucks, but it's the reality. So if it's not gonna be something like a lightning,
1469
02:13:24.805 --> 02:13:40.635
1470
02:13:41.175 --> 02:13:42.235
1471
02:13:42.695 --> 02:13:45.355
1472
02:13:46.030 --> 02:13:46.929
equipment failure.
1473
02:13:48.030 --> 02:13:54.370
1474
02:13:55.825 --> 02:14:00.005
Maybe it's just you that reconnected, Matt. It looks like the chat did stop, though.
1475
02:14:00.465 --> 02:14:04.965
Okay. Can anyone hear me? Yeah. Yeah. I can hear you. We can all hear you. Okay.
1476
02:14:05.889 --> 02:14:07.729
1477
02:14:08.290 --> 02:14:10.389
Crypto Graffiti heard everything. That's good.
1478
02:14:12.865 --> 02:14:20.005
1479
02:14:20.760 --> 02:14:28.540
I can hear all you guys. I'm here. We're good. Right? I think I think Matt doesn't mean I can't okay. I guess it was just me. Dope. We Gucci still. Continue.
1480
02:14:29.445 --> 02:14:33.785
1481
02:14:34.325 --> 02:14:35.065
I'm completely
1482
02:14:35.765 --> 02:14:37.685
beholden to this company Restream,
1483
02:14:38.130 --> 02:14:39.590
because their platform's dope.
1484
02:14:40.130 --> 02:14:45.910
So we're kind of beta testing everything for them as we do Citadel Dispatch. So I appreciate all your patience.
1485
02:14:48.195 --> 02:14:50.215
1486
02:14:50.675 --> 02:14:57.655
I I I'm in Mexico currently running on a mobile hotspot, and I topped up my data plan to the maximum just to make this happen. So
1487
02:14:58.220 --> 02:14:59.200
just That's awesome.
1488
02:14:59.820 --> 02:15:01.840
Not not rely on shitty Wi
1489
02:15:02.220 --> 02:15:08.705
Fi. But to continue my rant at why I'm so insanely bullish on on Bitcoin and Lightning and just in general is that,
1490
02:15:09.245 --> 02:15:11.825
as Alex mentioned, so many people are
1491
02:15:12.205 --> 02:15:39.370
going to come in and are already coming in and are already solving these problems, and we kind of know what we have to do. We know already the next 5 to 10 steps that we need to take, and we're gonna activate Taproot, and we're gonna activate other things on the base layer. And we're gonna have dual dual funnel funded channels on lightning, and we're gonna have multipath payments, and we're gonna solve the liquidity issues, and we're gonna we're gonna like, we we we we will have just like with the Internet protocols, you know, we we will have smart algorithms that that, like,
1492
02:15:39.910 --> 02:16:05.075
automate all the UX problems away, kind of, and your your node will be able to spin up channels and so on and so forth. And we will build higher layers, and we will do whatever is necessary to make this fucking thing work because that's why why we are here. You You know? That's what we are here for. Well And that's what engineers do. It's interesting, Matt. You know, he's saying stackers set the floor. We're about to have a lot more stackers. We're about to have, like, 100 of millions of stackers.
1493
02:16:05.535 --> 02:16:06.355
1494
02:16:07.375 --> 02:16:11.270
you know, they're gonna be involved, but they probably aren't gonna be getting in on the main chain. You
1495
02:16:11.570 --> 02:16:12.390
know? Like, so
1496
02:16:12.690 --> 02:16:16.230
they're gonna be born onto a custodian or to maybe Lightning, hopefully.
1497
02:16:16.610 --> 02:16:20.364
So, I mean, that's just the reality of the next 5 to 10 years as we onboard
1498
02:16:20.744 --> 02:16:21.724
a 1000000000 people.
1499
02:16:22.585 --> 02:16:27.800
1500
02:16:28.260 --> 02:16:31.239
you don't need to do much. Provide some value,
1501
02:16:31.540 --> 02:16:41.565
stack sets. That's basically what you have to do. And I really like the saying, you know, like, don't just do something. Sit there. Fiat currencies will collapse on their own. Like, we will win
1502
02:16:41.945 --> 02:16:52.670
without having to fight much, I believe. Like, Bitcoin is insanely resilient, and the world is a big place. Bitcoin the the whole narratives around Bitcoin, they are very US centric.
1503
02:16:53.056 --> 02:17:17.154
And Right. I'm from Europe. So for for me, it's a very different picture, and I'm, you know, like, I'm embedded in Bitcoin Twitter. Like, I'm that's where I'm living currently. And so I see and read all these narratives. But if I go outside the door in Europe, it's it's a very different world, and I I'm I'm not too concerned. You know? Like, I'm not too concerned about all the fun because the world is a really big place, and there are a lot of Bitcoiners everywhere, and and there are gonna be more very soon.
1504
02:17:19.370 --> 02:17:25.950
1505
02:17:26.564 --> 02:17:33.785
I just wanted to clarify what I what I kinda mean when I say Trojan horse theory. I mean, to to Gigi's point, like, that people get involved,
1506
02:17:34.930 --> 02:17:38.550
for self interest, and to improve themselves and their fortunes,
1507
02:17:38.930 --> 02:17:52.136
not to help anyone else. I mean, you know, there's a small percentage of us maybe that are into it for, like, you know, broader reasons, but, like, that's completely irrelevant to Bitcoin's success and its mission to replace central banking. Like, it's,
1508
02:17:53.000 --> 02:17:53.500
essentially,
1509
02:17:53.960 --> 02:17:54.540
you know,
1510
02:17:55.080 --> 02:18:07.025
that point is that that it lures people in by providing them something that they can't get anywhere else. And whether you're a corporation or a government or an individual, you're gonna wanna get involved. And the very act of you getting involved,
1511
02:18:07.405 --> 02:18:14.200
whether you're stacking stats or whatever is helping all the other users. And and that that's kinda what I mean by by the Trojan horse theory.
1512
02:18:14.660 --> 02:18:16.280
I just think it got, like, really,
1513
02:18:16.595 --> 02:18:20.774
really messy out there the last few days, but that's that's what I mean by it.
1514
02:18:21.395 --> 02:18:23.335
1515
02:18:23.990 --> 02:18:33.854
like, highlight the fact that Bitcoin kind of has its own way of changing the individual and lowering your own time preference and really highlighting what is important.
1516
02:18:34.234 --> 02:18:36.015
And, like, I'm bullish on Bitcoin,
1517
02:18:36.475 --> 02:18:36.975
like,
1518
02:18:37.435 --> 02:18:40.750
you wouldn't believe, but I'm even more bullish on Bitcoiners. And just
1519
02:18:41.230 --> 02:18:46.370
meeting Bitcoiners in real life and talking to Bitcoiners in real life, it's the best thing ever because, like,
1520
02:18:46.750 --> 02:18:54.154
this this bullishness and this, like, principled thinking is contagious, and there are so many people that are in it for the right reasons.
1521
02:18:54.694 --> 02:18:56.715
And I I don't see how
1522
02:18:57.095 --> 02:19:02.120
you can kind of, you know, put this genie back into the bottle because,
1523
02:19:02.660 --> 02:19:03.160
like,
1524
02:19:03.620 --> 02:19:05.880
there are people all over the world that
1525
02:19:06.420 --> 02:19:07.880
are working on Bitcoin
1526
02:19:08.285 --> 02:19:09.025
just, like,
1527
02:19:10.045 --> 02:19:11.825
they they don't have any other incentives,
1528
02:19:12.525 --> 02:19:14.065
but to see it succeed.
1529
02:19:14.525 --> 02:19:24.680
And they're like they have soul in the game, and that's why I'm here as well. You know? Like, I really want to see this through and do whatever it takes to help Bitcoin kind of
1530
02:19:25.025 --> 02:19:36.780
make make its impact on on the world. And I think it's it's gonna be a a good and beautiful thing. And as Alex has said recently, you know, like, it's about the freedom go up technology and not necessarily about the number go up technology, but they go hand in hand.
1531
02:19:37.160 --> 02:19:40.780
1532
02:19:45.535 --> 02:19:46.035
1533
02:19:48.575 --> 02:19:54.070
I think is Matt is Matt gone again? Or Matt help you on our own? Go for it, Matt.
1534
02:19:57.525 --> 02:19:58.745
May maybe Matt disappeared.
1535
02:19:59.125 --> 02:19:59.625
1536
02:20:01.045 --> 02:20:01.365
Well
1537
02:20:01.926 --> 02:20:05.990
1538
02:20:06.391 --> 02:20:07.370
1539
02:20:08.070 --> 02:20:10.650
when when Gigi was making that point,
1540
02:20:11.190 --> 02:20:15.195
I just kept thinking about how, like, you know, we we're in the we're in this
1541
02:20:15.676 --> 02:20:16.335
this evolution
1542
02:20:16.636 --> 02:20:20.255
of this asset from nothing, bootstrapping from just code,
1543
02:20:20.556 --> 02:20:21.295
0 value
1544
02:20:22.155 --> 02:20:23.375
into being a collectible,
1545
02:20:23.940 --> 02:20:27.240
into being a store value. We're in that store value stage now.
1546
02:20:27.700 --> 02:20:29.400
We're accumulating value.
1547
02:20:29.860 --> 02:20:37.784
The medium of exchange infrastructure is being built right now by people like Gigi who know way more about the tech stuff than I ever could dream of.
1548
02:20:39.080 --> 02:20:46.700
And, you know, we're in the early stages of that development, but it's happening and at a great pace. And it's going to be ready for the world
1549
02:20:47.045 --> 02:20:49.145
to have a digital medium and exchange
1550
02:20:50.085 --> 02:20:52.024
based on a digital store value
1551
02:20:52.564 --> 02:20:58.100
that is 10 x or a 100 x or a 1000 x better than the status quo alternative
1552
02:20:58.560 --> 02:21:06.580
for for each individual out there choosing between do I choose between sensor, you know, money that can be censored
1553
02:21:07.265 --> 02:21:07.765
and
1554
02:21:08.785 --> 02:21:09.285
debased?
1555
02:21:09.665 --> 02:21:10.565
Or do I
1556
02:21:11.105 --> 02:21:12.945
take, you know, the the
1557
02:21:13.585 --> 02:21:15.445
my own value into my own
1558
02:21:16.820 --> 02:21:22.280
responsibility and ownership and self determination and own Bitcoin instead.
1559
02:21:22.740 --> 02:21:30.585
That's all happening in our lifetimes as we watch, as we participate, and our job is to contribute to that in whatever way we can.
1560
02:21:31.285 --> 02:21:35.439
And maybe that's just stacking or maybe that's writing code or maybe that's
1561
02:21:36.140 --> 02:21:38.400
educating people in our communities,
1562
02:21:38.939 --> 02:21:46.814
in our friend groups about Bitcoin and its benefits and its benefits to each individual to adopt and start saving in Bitcoin.
1563
02:21:47.595 --> 02:21:52.811
And it's a beautiful thing to watch playing out right now, and we just have to participate.
1564
02:21:53.670 --> 02:21:59.265
1565
02:21:59.665 --> 02:22:02.725
the heads up there. I'm the only one who could speak to our master.
1566
02:22:03.425 --> 02:22:05.665
1567
02:22:06.145 --> 02:22:14.190
Gigi or Croesus the last 10 minutes or so. There was some kind of issue with Restream. I'm glad that the audience and the freaks out there
1568
02:22:14.625 --> 02:22:22.320
were able to get it, and I do look forward to listening to it after I end this stream and going back and listening to the end. I'm sure it was bullish as fuck.
1569
02:22:23.360 --> 02:22:26.980
This was a great conversation before I got cut off from it.
1570
02:22:27.601 --> 02:22:29.780
I just wanted to do a quick shout out to
1571
02:22:30.405 --> 02:22:38.505
our 3 great guests that have joined us, Gigi, Creases, and Gladstein. I look forward to seeing Gigi and Gladstein in Miami very soon.
1572
02:22:40.630 --> 02:22:43.210
I also look forward to this Indy 500
1573
02:22:43.590 --> 02:22:44.811
on this weekend.
1574
02:22:45.990 --> 02:22:50.436
Consider going to strike dot me slash racing to support it. It's a very great
1575
02:22:51.936 --> 02:22:53.635
initiative they're doing over there.
1576
02:22:54.815 --> 02:22:59.440
I may be attending the race myself, which I'm very excited about. Let's go win this fucking thing.
1577
02:23:01.601 --> 02:23:03.061
Yeah. All that said,
1578
02:23:03.520 --> 02:23:06.341
I I love you all, and, thanks for joining, guys.
1579
02:23:11.875 --> 02:23:13.415
1580
02:27:33.115 --> 02:27:36.814
1581
02:27:38.710 --> 02:27:39.510
Just a quick,
1582
02:27:39.990 --> 02:27:43.850
I don't know if you guys realize, but Ron Paul is, the legend.
1583
02:27:44.470 --> 02:27:47.290
The man himself is gonna be opening up
1584
02:27:48.085 --> 02:27:50.665
Bitcoin Miami, Bitcoin 2021 in Miami.
1585
02:27:51.125 --> 02:27:54.885
Had to sit on that one for a while. That's fucking hype as hell. So,
1586
02:27:55.685 --> 02:27:57.064
we also have Cyclops,
1587
02:27:58.300 --> 02:28:00.400
Freak who won a GA ticket,
1588
02:28:01.260 --> 02:28:06.240
through a giveaway on dispatch. Ride or die Freak. He can't go to the conference.
1589
02:28:07.114 --> 02:28:10.015
So if you don't have a ticket and you're trying to go to the conference,
1590
02:28:11.995 --> 02:28:16.640
go into the Sphinx tribe, the Citadel Dispatch Sphinx tribe, first one to put Indy 500,
1591
02:28:17.740 --> 02:28:18.720
in there gets
1592
02:28:19.180 --> 02:28:19.660
gets,
1593
02:28:20.140 --> 02:28:22.080
that ticket. So go do that.
1594
02:28:23.095 --> 02:28:25.595
Love you all. I'll see you for RHR
1595
02:28:26.215 --> 02:28:26.955
on Thursday,
1596
02:28:27.335 --> 02:28:30.314
and dispatch next week is gonna be live from Miami
1597
02:28:31.520 --> 02:28:40.705
with Wiz and Kaludis and some other surprise guests. So make sure you tune in for that, and, hopefully, I'll see a bunch of you freaks over Miami. Cheers, guys. Stay humble. Stack
