The following is a conversation with Anthony Pompliano, entrepreneur, technology

investor, prolific writer, podcaster, and Twitter user on topics of finance,

cryptocurrency, technology, and economics.

I highly recommend his popular podcast and daily letter called The Pump

Podcast and The Pump Letter.

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And those who are proponents of other cryptocurrency technologies, like Vitalik

Buterin, Charles Hoskinson, Richard Hart, Sergey Nazarov, Silvia

Macaulay, and many others as well.

I’m not framing this as a debate.

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could very well change human civilization and AGI civilization as well.

I appreciate that some communities are a bit more intense in their style

of communication and others, but I personally am only interested in open

minded, respectful collaboration in exploring ideas.

I personally try to like to approach conversations by considering that I may

be wrong about everything and I’m looking to learn.

I won’t engage in groupthink, social signaling, outrage mobs, mocking,

and derision. If you do, I understand, it’s just not my thing.

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good laughs, and a good conversation one day.

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This is the Lex Friedman podcast.

And here is my conversation with Anthony Pampliano.

You served in the US Army for six years and spent 13 months in Iraq in 2008 and

2009. Can you tell the story of why you joined the army and what were some of

the moving difficulties, maybe lasting experiences from the time you served?

Sure. I joined when I was 17 years old, needed my parents to basically sign in

order to join. And I graduated a semester early from high school and thought I was

going to go play football in college and kind of enroll in the spring semester.

And when that didn’t happen, basically was working at Chick Fil A and Quiznos.

And I had in my mind, look, this is probably not the path in life that I want.

And so I knew I was going to go to college.

I knew I was going to go play football in the fall, but I had this window of time

and so I walked into a recruiting office and just basically was like, I’m assuming

you guys need some help.

And, uh, you know, they gave me the whole pitch and, uh, you know, give you a signing

bonus, you can go jump out of planes and go do all this crazy stuff.

I just said, okay, let’s do it.

This was, this was close to the 9 11.

This was in 2006, about five years after.

So what impact, I mean, do you remember 9 11?

What impact did that have on your thinking about this?

So I was, uh, in eighth grade, um, if I remember correctly.

And, uh, I remember, uh, being in school when it happened and, uh, I walked into a

classroom and the entire class, uh, somebody else’s class, they were all talking to the

teacher about something.

The second that me and a couple other kids walked in and we got real quiet and the

teacher was like, Hey, go back to your like, homeroom.

And so it was just kind of a weird, like what’s going on.

Uh, and then next thing I know, they called all the students into the cafeteria.

And this is back before, you know, every classroom really had a television in it and,

you know, cable and all that kind of stuff.

And so when we were there, they basically just said, listen, there’s been this, uh,

event that’s occurred.

All of your parents are going to come pick you guys up and, uh, they’ll explain it to

you.

And so to, you know, a kid in eighth grade, you’re basically like, what happened?

And so I got home and, uh, and I remember talking to my dad about it and my dad

basically gave me, you know, the, uh, the core American kind of talking points.

Right. Look, somebody from another country came here and tried to kill Americans and

was successful in doing that.

Um, and to some extent he just said, and I’m willing to bet, you know, we’re going

to go back after them.

Did that wake you up a little bit to the idea that there’s evil out there that, you

know, even just the idea of terrorism for many people that was, um, when it hits you

on your own land, it’s a, it really shakes up your mind in some sense, world war two.

That’s why world war two was fundamentally different for Americans than it is for the

people like in Russia and England and France and, uh, in Europe in general is

there’s something about when there’s a families, women, children dying on your own

land, that’s different.

And that was one of the first times in America where like on your, uh, of course

it’s Pearl Harbor, but like, this is like in recent history, it’s like, they hit us

here, that was like a profound idea.

I think America was very, very good at exporting the violence

elsewhere for a long time.

And, uh, there was this element of, uh, complacency, but also this element of,

uh, um, you know, really just American superiority that doesn’t happen here.

Right.

And, uh, I think that that woke people up, not only to, uh, you know, to the

idea that other places around the world may not like the American ideals, may not

like democracy and capitalism and, and that, but also, uh, maybe we aren’t as

big, tough and secure as we thought we were.

Right.

And so obviously I think you see the kind of the over rotation with a lot of the

kind of security theater that came after that of almost psychologically, let’s

make our citizens feel like they’re safe, even if the things that we’re doing

don’t necessarily, you know, kind of change that apparatus.

Uh, but on top of that, I think it’s, it’s, it’s, it’s, it’s, it’s, it’s, it’s

I think that it really woke people up to, uh, extremism around the world.

And, uh, I don’t know if necessarily there was a change in the extremism as

much as it just was an awareness thing, right.

How, how many people, you know, kind of drew a line from, was it 92 or 93 with

the world trade center bombing to, you know, deep levels of extremism and hatred

of, uh, kind of the American industrial complex, probably not that many, 2001,

a lot of people.

And so I think that was, you know, again, as a, as a young kid, you don’t

understand a lot of this stuff.

You basically just, Hey, somebody came here and tried to kill Americans.

And so, you know, we should go fight back, right.

Was kind of the, uh, the, the response I think that I had.

What role did that have psychologically for you when you then in 2006 join the

army, I mean, this is a very different joining the army than in the time when

like it’s more peaceful here, you’re essentially facing, I mean, I don’t

know if you see it that way, but you know, there is a war on terror.

And I know that people kind of, uh, criticize that whole formulation

framework of thinking, but nevertheless, you are going to Iraq.

You are going to Afghanistan, you’re going to these places and are

fighting these complicated, like, I mean, it’s not even clear what you’re fighting.

Yeah.

Well, I think that there’s a couple of key pieces, right?

So one, like what the actual most impactful data points, if you were, or

kind of stories for me, uh, was the Pat Tillman story.

So I played football, uh, in high school and it was going to go play in college.

Um, and seeing, you know, this NFL player who basically just one day said, Hey, I’m

going to go and do this instead, uh, and walk away.

I don’t know necessarily if it was a, uh, I want to pursue the same story right now.

So he ended up dying.

And so not exactly the, uh, the end result that you want, but I think it

was almost like, uh, he made it okay.

If you were on a certain trajectory in life to go take this detour and,

and to go do it.

Um, but the second thing is I was 17.

You’re pretty stupid when you’re 17, you’re pretty naive when you’re 17.

Right.

And so, uh, I almost, um, kind of backed into the deployment because

I signed up, uh, as a, uh, a reserve member.

And so basically the plan was to sign up for the reserves.

I was going to go to basic training, get all the, you know, kind of education

and qualification, I was going to go to college and then after college,

you know, maybe there’s a chance that you will go and serve or do whatever.

For me, I ended up getting deployed when I was a junior in college

and we got pulled out of school.

And so at 20 years old, uh, it’s not exactly what you thought you were

signing up for, right.

Especially to kind of leave school to go do it.

And then on top of that, uh, I probably had an advantage over most people, both

on the entry to combat and the exit to, uh, kind of a combat situation, which

that was football.

So I always explain that, um, in hindsight, you’re in a male dominated

testosterone driven kind of combative sport where it’s us first them.

And, and, uh, there’s training and, and, uh, you know, injuries and just kind of

all of the things that go into playing a combat sport like football to now they

give you guns, but you still have a uniform on still male dominated.

It’s just a little bit, you know, more serious in terms of the injuries and,

and, uh, potential deaths and things like that, but also on the exit from that

deployment, most guys I was there with, they’re going back to being, you know,

prison guards, police officers working at the lumber yard, you know, just kind

of every day Americans.

And so I had the fortunate ability to go back into, uh, kind of that combative

environment, go back to play football.

And so it was almost this like deescalation on the way out, uh, where

they take your guns away.

We still got a uniform, still male dominated, uh, still combative.

And then eventually you’re just a normal citizen.

And so I think that in some weird way, I was, you know, very fortunate

to kind of on the entry and exit, have that experience where other guys did.

So what you were deployed to Iraq, were there any memories, experiences

that changed you or in general, like you’re probably a different

man on the other side of it?

How did that time change you?

I think there, there was two main takeaways that I took, right?

So one was, um, not a specific moment, but on multiple occasions, uh, I remember

we were driving down the road and I would look and there would be a 10, 12,

14 year old kid.

And if you’ve never seen somebody who literally has hate and disdain in their

eyes, just not necessarily to you personally, just to the uniform, to what

you stand for, it’s all this stuff.

When you see it, you see it right.

And I always think of, um, if you’ve ever, uh, watched the movie, uh, 12 strong and

in it, uh, they’ve got this Afghan, uh, Afghanistan warlord, and he’s talking

to a bunch of soldiers and he says, you know, you don’t have killer eyes.

You do, you do.

And he’s just like, he can just tell, right?

He’s, he’s seen so many soldiers.

And so I think that that was a, a memory on a number of occasions where I just saw

young kids and I just said, they hate us.

Right.

And, and it’s not you personally, it’s what you stand for.

But the really big event was, um, when you first get to these combat zones, a lot of

times what will happen is, uh, you basically, your unit teams up with a unit

that’s leaving and there’s a handoff and happens over a couple of weeks.

And so you can imagine almost, you know, 1% of our team goes out with 99% of their

team, then five, 95, 10, 90, all the way till it’s 50, 50.

And then eventually it rotates.

And then it’s majority of our team and a small number of their team.

And so what a lot of people will explain is the two most dangerous times in war

are actually the first two or three weeks and the last two or three weeks.

When you first get there, you don’t know who the people are.

You don’t know the terrain, you don’t know, you know, kind of the local cultures

and, and, uh, who to look out for, what signs, all that kind of stuff.

And the last two or three weeks is you basically think you survived the

deployment, you’re looking forward to going home.

So you become complacent, things like that.

And so we made it through that transition period with no issues.

Uh, but the literally the very first mission, uh, that we went out as a team,

ourselves, a hundred percent, um, there was two separate incidents.

Uh, one was we were driving in the middle of the night and, uh, what we think was a

sniper shot at a truck that I was in, I was standing up outside of it, uh, along

with a, uh, another guy.

And that was kind of just a wake up call again of never been shot at before.

Right.

And so I’ll never forget, uh, you kind of heard this whiz go by and the guy next to

me was from a rural Pennsylvania.

And he just said, you know, look, I’ve never been shot at before either, but

I’ve done a lot of hunting, get the fuck down.

Okay.

And so, uh, we kept driving that night.

Um, and, uh, later on in the night, uh, an IED went off, a guy ran over an IED,

uh, who was at the front of the convoy.

And when that IED went off, uh, again, I had never been in a convoy that had been

blown up before, but the training kicks in.

And so immediately every single person starts screaming out IED, IED, and they

started looking and trying to figure it out.

And you realize the United States military did a fantastic job training us before we

went, because in that moment, nobody thought about anything.

You just did what you had been programmed to do.

Um, and so ultimately kind of through the end of that event, uh, there was a US

soldier that ended up dying.

He was, uh, shot in the head.

And, um, when we got back to the base, uh, kind of after that entire event,

I think it just hit us.

We are at war.

And if we make mistakes here, that is the cost of, you know, kind of those mistakes.

And this was somebody who I didn’t know.

Uh, it was somebody who literally showed up, uh, kind of as secondary

support, uh, for our unit and basically, uh, was there to help us.

Right.

And so it was one of those weird situations where, uh, you have this emotional connection

because it’s somebody who, uh, shared an event with you, but you didn’t know them.

Right.

And you learn their name later and you understand that they have a family and

they have young kids and all this stuff.

And so again, as a 20 year old kid, you’re kind of processing all this and

you just realize like the gun I have in my arm, my hands, it’s real for a reason.

Right.

And we better take this seriously.

This is not, you know, let’s joking around in kind of the barracks and, you

know, all the things that you would expect, you know, guys you’re doing in the army.

So I think that was like the moment where I said, Hey, I’m going to learn a lot here.

Uh, and I got to make sure I get home.

And you snap it into the training, but nevertheless, I mean, you’re somebody

who thinks philosophically about this world now, right?

You’re, uh, very intelligent and things deeply about the world.

So looking back, you mentioned hatred in the 14 year old kids eyes, there’s death.

So the way you kind of described this whole story is like training kicks in.

This, this shit is serious.

Like this is, uh, you know, there’s a reason there’s a gun in, in your hand.

So there’s a strategic element.

There’s like, you have to get the job done.

There’s a task at hand, but at the same time, if you zoom out, there’s a kid who

has hate for you, uh, some of those kids would probably, if they could, would kill

you for the thing you stand for in the uniform.

And then there’s bullets flying at you.

And then there’s people that some of them you might already care for deeply are dying.

What the hell do you make of that?

Do you think about that?

Does any of that haunt you?

How do you think about the world having witnessed that?

Yeah.

A lot of times when we would talk about it, we were there.

If I was that kid, I would want to kill that person too.

Right.

I would have hatred as well.

Right.

Imagine if in the United States tomorrow, you and I woke up and there was tanks

rolling down the street from another country and they were basically imposing

their rules on us, whether they thought it was the right thing to do or not, the

soldiers were there and they were doing this, we would probably feel not so great

about it, right.

At kind of a minimum and at a maximum, we’d be really, really pissed off.

We would fight back.

And so what you don’t understand when you’re in the heat of the moment is why

does this person feel this way?

And so what’s very weird is, well, what happens if a year ago, US soldiers came

through, they got shot at, they returned fire and they killed that kid’s uncle.

You’d be pissed off.

Right.

And so you just start to understand, like we look at war very black and white.

We look at it very much from a clinical perspective.

We’re going to go, we’re going to go kind of invade somewhere.

We are the most dominant military in the world.

We’re very good at invading.

And we will crush wherever we invade, but when you’re actually on the ground, what

you understand is the humanity of it all.

Right.

And so what becomes very interesting is pretty much every veteran I know that

comes back, they’re some of the largest pacifists in the world.

And I always revert back to Marcus Luttrell, who was a famous Navy SEAL, and

there’s a movie made about him and his story.

He gave a speech one time that I saw and he basically said, listen, if you’re a

politician, your job is to be the diplomat, do everything you possibly can, not to

send me and my friends anywhere, because when you send us, we’re going to bring

hell with us, right.

And understand that is the business that we are in, but every single other person

up until we get sent has a job to do to prevent having to send us.

And I think that ultimately that’s where you see a lot of kind of this generation

that has fought in Iraq and Afghanistan that says, listen, maybe we shouldn’t be

running around the world being the police, maybe we shouldn’t be going and invading

all these different countries, because when you actually get to see firsthand

what happens, it’s just something that we should avoid at all costs.

But if we have to go, or we have to actually send soldiers somewhere, understand

what happens when that occurs.

And you know, the United States is the best in the world at doing it.

Do you think, I’m thinking about that kid with the hatred.

Do you think there will always be hatred in the world?

Do you think there will always be hatred?

In the world, do you think, uh, from another perspective, do you think there’ll

be war always, is that a fundamental aspect of human nature or is that

something we can escape?

Yeah.

So war, I think has like very negative connotations in terms of bullets and

bombs and death and kind of just very morbid type, um, um, understanding.

Conflict on the other hand, I think people look at and say, of course

there will always be conflict, right.

You just can’t have billions of people all on the same planet without some

level of disagreement, whether that’s a disagreement of ideas, disagreement

over physical, you know, geography, uh, or something else.

And so I think conflict will always exist.

The question is what form does war take moving forward?

And so in my mind, you know, it’s starting to look a lot more clinical,

right?

A lot more drones, a lot less soldiers on the ground, a lot more use of special

forces and kind of these small, highly specialized teams rather than kind of big

mechanical armies.

Um, and then you get into like the information warfare and kind of cyber

warfare and you start to understand that we’re at war with a lot of people right

now, right?

Doesn’t mean we’re necessarily dropping bombs, uh, on their countries.

Doesn’t necessarily mean we’re sending soldiers there, but on a daily basis, we

are engaged in these kind of, you know, cyber battlefields.

And so if that’s where war starts to play out, um, it, one changes the tools

and tactics and techniques that, uh, we need to arm our country and other

countries will arm themselves with.

But it also changes the way that we think about war, right?

It seems, it sounds a lot less worrisome if I say, Hey, we’re going to go to war

with a country, but by the way, there’s going to be no death.

Right?

Okay.

Like that doesn’t sound nearly as bad as, Hey, we’re going to go send 10,000

soldiers and you know, some percentage of them are going to die on the battlefield.

And then we’re going to, you know, basically pipe back videos and articles

saying that American soldiers are dying.

Yeah.

It does seem to be a fundamental difference between the, the Genghis Khan

style, like if I would feel differently if somebody like hand to hand with a knife

murdered my family versus cyber security, why I stole all their data, stole all

their money, stole everything they own, falsified their identity, all that kind

of stuff that those are both traumatic events, but they do seem to be

fundamentally different, but maybe that’s actually very narrow style thinking,

because ultimately you have to think about what is life and what’s happiness.

And, um, it’s like the samurai thinking, I’m not sure what’s more painful.

If I take it to myself, like, I’m not sure what I would rather live through

being stabbed, like to death, or having my identity stolen, all my money stolen,

or maybe reputation destroyed, like with lies or something like that.

That that’s very interesting to think about.

If you think about quality of life and all those kinds of things,

well, one’s finite, right?

One’s the pain ends and the other is kind of a long prolonged, almost torture.

So it’s physical pain versus psychological pain.

It’s really interesting to, it’s really interesting to think about.

And I think another key piece to this, which I don’t have answers to, but,

but there is an element of emotion and rage in the physical violence versus

again, more of that clinical, you know, information warfare.

And so, um, it’s really easy to show a battlefield where there’s death on both

sides and bombs being dropped and buildings destroyed, um, it fits very

well into propaganda for everyone involved, right, regardless of what side

they’re on, when you start talking about cyber warfare, how many times have

we seen a big company get data hacked or information hacked and we all, you

know, read the headlines, maybe throw a tweet out and then move on with our day

and don’t remember it anymore.

And so it’s just very, very different.

I think, uh, in, in the, uh, motion and response that it invokes and people

when they hear about it as well.

Given the conflict, do you think people are fundamentally good?

Are we all sort of like blank slates that could be evil given the environment

or good given the environment, or can we kind of, is there some base that we can

rely on that people, if left to their own devices will be good and trustworthy and

honest, I think you have to separate out intention from action.

So if you talk to some of the most heinous criminals in the world, they’ve

rationalized their actions, and so you’ve got to ask yourself, what is the level

of which they understood what they were doing, that they intended to be malicious,

nefarious, um, and kind of do bad things versus the actual actions themselves.

And so, um, even as a society, you know, if let’s say, for example, you were to

walk down the street and you were to murder somebody on the sidewalk, completely

unprovoked, we would look at you and say, you are a, you know, a sociopath, uh, you

have everything wrong with you and that is somebody that we do not want in our

society, and therefore we will levy, you know, the extent of rule of law against

you in order to protect society from you, right?

And you become that monster, that beast, if in the same situation, somebody walks

in your house with a knife and you murder them or you kill them, now we put you up

on a pedestal as a hero, and those are two very, very different responses.

They may be just as morbid, they may be just as violent, uh, in terms of the

actual actions, the intentions, the way it’s perceived is very, very different.

And so I think that, uh, as a world, we like a very black and white, clean cut,

you know, good, bad, uh, I think the world’s a lot more messy than that.

And I think that, uh, a lot of times when you look at intention, it’s hard for us

to tell what somebody’s intention is, but I’ve looked at a lot of, you know, people

who are both considered very good and also a lot of people are considered very

bad and they sound very similar in terms of the motivations for their actions.

And so I think that it’s just a really hard problem that probably doesn’t

have a perfect solution or an answer.

Do you give much value to the intention or do you think it’s better to look at

the results of the behavior, uh, as opposed to the, the underlying ideology?

Underlying ideology, the underlying intention of, of the behavior.

I think that intention gets at the question of like, are people inherently

good or bad, right?

Is I think that they’re generally inherently good and the intention is

driving towards the thing that they believe is the best outcome or the best

thing for them to pursue the action.

I think is where we spend most of our time focused on.

Um, and frankly, we actually may be a better society or, uh, kind of kinder

as a humanity to each other if we spent more time looking at

intention rather than action.

Um, but again, you know, if somebody walks down the street and murders

somebody, uh, it’s really hard to have a conversation and it may be inappropriate

for us to have a conversation about intention versus, uh, any level of,

of action, right?

So you’re one of the prominent, I would say even the faces of the, the world

of cryptocurrency, Bitcoin, that whole entire world was dive straight in and

ask, uh, do you think, do you consider yourself a Bitcoin maximalist?

I think that the way I really look at it is, uh, I work backwards off of what

is the maximalism that I believe in and the world that I believe in is, uh, kind

of an automated world that is run on these open decentralized protocols.

Uh, and what we ultimately do is we return sovereignty and individualism

and, and kind of, uh, personal responsibility and liberty, uh,

to people over institutions.

And what we end up doing is we end up, uh, kind of taking what has historically

been a very analog or physical world economy and, uh, geographic rule.

And we then kind of put it in the cloud and this digital economy becomes the

prevalent way that we all, uh, conduct commerce, communicate, uh, et cetera.

And so it’s less about any one single technology to me, right?

I think that it’s pretty stupid for people to, um, almost in a way, uh, put

an inanimate object up for, uh, you know, some sort of obsession, uh, to me,

it’s much more about the ideals, the ethos, uh, and the most rational, uh,

and likely path to that kind of end result or that world that I think, you

know, is at this point, just a foregone conclusion.

So the distinction there, and maybe people don’t know the terminology,

maximalism is basically saying, I really think this is a good idea.

Like, uh, you know, if you prefer a certain kind of diet, it could be a

keto maximalist saying like, this is probably, maybe it’s not a hundred

percent, but probably the diet that’s healthiest for humans kind of thing.

In the same sense, Bitcoin maximalism is saying, you know, of course we

don’t know, there’s a lot of uncertainty, but this particular technology seems

to be the best representations of some set of ideals that defines progress

in the future, but you’re drawing a distinction between sort of, um, cult

like obsession about an object of any kind, whether it’s keto, uh, or, uh,

Bitcoin, and just sort of believing that a technology is the best representation

of a particular set of ideals.

And you believe that sort of, uh, this moving into the cloud, uh, both

the distributed nature of it, but also just the digital nature of it is

something that’s going to, uh, be a positive step for humanity.

Yeah.

I would even take maximalism a step further, and it’s not just the kind

of singular viewpoint of this is the best, it’s also, uh, an element

of it’s anti everything else.

Right.

So, you know, take keto, for example, uh, the keto diet is not only the best diet.

All the other diets are bad.

Yeah.

Right.

And so it’s, it’s a very binary view of the world.

Um, I think that what’s probably most misunderstood about, uh, let’s take

Bitcoin, uh, as a specific example, is that most of the people who are labeled

Bitcoin maximalist, they would be open minded if they believe that something

else came along that was a superior technology or had a, a better, um, kind

of probability of achieving again, that ultimate vision, I think where, uh,

there’s this controversy and kind of clashing of, uh, ideas is that the

Bitcoin community believes Bitcoin is the best way to do that and has very

specific arguments as to why the other things are not right.

And so what ultimately ends up happening, which is very weird in the investing

world, right, it’s unlikely that you and I are going to sit down and you’re

going to like Apple stock is the best stock and there’s no other stock.

That’s worth anything.

Yeah.

Right.

And, uh, and then also it’s very weird if you said to me, um, you know, this

stock is worth zero and that’s where everything that I own, I’ve put on a

short on one single company, right?

There’s diversification.

There’s a much more kind of probabilistic thinking in finance in general.

Uh, when it comes to this specific world of cryptocurrency and kind of digital

assets, if you will, uh, is there’s two main groups of people who are trying to

build two very, very different things at the onset, but when you unpack it and you

start to spend more and more time on it, you rise, they’re actually trying to

accomplish the same thing in two different ways.

So Bitcoin is seen, I think, as a, uh, a digital currency, right?

Kind of the idea that this is going to ascend to become the next global

reserve currency, it’s a programmatic kind of digital currency, but it’s

also a programmatic kind of transparent, um, money.

And, uh, it’s essentially just 180 degrees difference than the inflationary,

you know, non transparent, uh, fiat currencies that exist in the world.

You then look at kind of everything else, right?

And you have a lot of smart contract platforms and various things that

they’re all going after at Ethereum with kind of the world computer

approach, and you can kind of go down the line with all their other

arguments as to what they’re trying to build.

I think the big difference just comes down to, uh, innovation versus security.

And when you simplistically look at it via that lens, you actually understand

where both people are coming from.

When you say security, sorry to interrupt, do you mean financial

security or do you mean like literally the, the, the security of the,

of the particular cryptocurrency?

The, the technical security of a blockchain.

So when you look at, let’s say, um, Bitcoin versus Ethereum, right?

Bitcoin has decided in that community has decided security is the number

one thing that you have to optimize for.

So decentralization, um, over everything else in terms of transaction

speeds, uh, cost, anything that you could come up with, that is, uh, something

that would be important for a currency.

The number one thing to optimize for is security.

And as we have seen, uh, with a lot of technologies, right?

Facebook’s, uh, Libra or now what’s known as DiEM is a great example.

Uh, not having decentralization is susceptible to the nation state.

And so a lot of these other platforms and blockchains, uh, they say security

is important, but it’s not the most important thing we believe there’s a

trade off between, you know, a little less security and transaction speed or

composability or whatever it is.

And so take a theorem as kind of the second, uh, largest, uh, community

and blockchain by market cap.

It was created because somebody wanted to, or a group of people

wanted to do something on Bitcoin.

They felt like they couldn’t do it.

And so they said, Hey, we’re going to go create something that has the smart

contracts that we can then go do here.

Again, this is technology, right?

And so the tribalism of like, you’re right, you’re wrong to me is a little

childish, just in the sense of like the market is going to decide what is most

valuable.

And then when you go inside of that community, like there’s a lot of dumb

ideas, people are trying to build around Bitcoin, but there’s also a lot of really,

really great ideas that people are trying to build around Bitcoin, same thing in

the Ethereum world. And so what you end up getting, I think, is the tribalism

really comes out of the idea that there’s a ticker price that is attached

to all of this, right?

If you go back in history of technology, venture capitalists didn’t sit around

the table and yell and scream at each other in this like religious zealot way,

right? Because you bet on one type of cloud computing platform.

And I bet on another one, right?

It’s just the market’s going to decide, we’re both going to work on and try to

make our successful, uh, here in the world.

I think that the sensitivity and mainly it comes out of the Bitcoin community is

that a lot of this is being funded, not only by venture capitalists and kind of

professional money managers and asset allocators.

There’s also this element of including the retail investor and the public.

And so it, whether it’s through ICOs or some other forms of capital raising,

um, there’s arguments for it saying, Hey, look, uh, this now gives kind of the

little guy, some sort of access and an ability to do it.

But there’s also arguments against it. Some people say, Hey, it’s easier to dupe

them and it’s easier to run scams and kind of all this stuff.

And so ultimately I think that, uh, crypto is this like arena of ideas.

It is literally the war of attrition and, uh, what will end up happening is 10

years from now, you and I will talk and we’re going to say, well, the market said

X was valuable and Y wasn’t.

And so all of the tribalism from between, you know, here and there, uh, it’s fun.

It’s, you know, engaging.

Whatever, but ultimately it doesn’t really matter because the public is involved.

There’s a lot of personalities.

And so a lot of times we focus on the extreme personalities that do a lot of

maybe, uh, pardon the French shit talking.

And, and so we kind of focus on that, but that’s not necessarily a representative

of the communities involved.

Let’s talk about Bitcoin first, and then it’ll help us use as a kind of comparison

to Ethereum or whatever else.

So when you think about what is money, right?

That’s kind of the first question.

People really kind of go down the rabbit hole on, and ultimately today,

it’s a belief system, right?

And you may believe that one currency has more value over another because

it’s backed by a certain military or a certain government has a monetary policy

that you believe in or don’t believe in.

Um, but ultimately it’s a belief system that there’s nothing backing this, uh,

other than, uh, a government asks you to pay your taxes in it, right?

And they can have a monopoly on violence, uh, in terms of they can put you in jail.

If you don’t pay your taxes, uh, they can, uh, they can, uh, they can

go to other countries and they can invade and do all this stuff.

It wasn’t always like that, right?

It was historically a layer one technology was gold.

And so gold was a fantastic store of value.

You knew that if you held gold, it wasn’t going to be inflated away.

It was sound money was outside the system and no one could create more of it.

And the reason why that’s important is because that optimization for store

of value served as the bedrock of the entire stack of, uh, money.

Uh, for 5,000 years. And so the problem with that though, again, trade off between

store of value is it was really hard to transact with, right?

If I came in here and I, and you said, Hey, I want a couple of ounces of gold and I

had a whole bar, I’d have to literally shave off the ounces of gold.

Uh, it’s heavy to carry around.

If you said to me, Hey, you’re in one city, mail it to me, really expensive.

You know, there’s all these issues with it.

And so ultimately what people said was, well, let’s create a second layer on top

of that gold in order to make it easier to transact with it.

That gold in order to make it easier to transact.

And so we created paper claims on the gold.

So, Hey, don’t carry around the gold in your pocket anymore.

Put it in a vault or a bank.

They’re going to issue a paper claim.

Now you and I can trade these paper claims around.

And at any point, if you want the gold, you just show up and you say, Hey, give

me three ounces of gold or two bars or whatever.

And so that actually made the store of value.

It was allowed that to be the anchor and kind of the most important part, the

security of your, of your purchasing power, but now it became easier to transact.

And then eventually we built layers even on top of that.

So everything from electronic money, uh, kind of electronic UCIPS, all the way

to credit and other systems on top of that gold 1971 comes around and obviously

we D peg from that gold, right?

And it was a temporary measure at the time.

We ended up not going back to it.

And so what you moved or transitioned from was sound money, which was outside

the system, no one could create more to now the government had full control.

They could create as much as they wanted to.

They tried to be responsible and disciplined, but obviously hard to do.

Sometimes we’ve been really good at it.

Sometimes we’ve been less good at it.

And then you go around the world and some countries have absolutely sucked

at it and some have been good at it.

And so when you look into the Bitcoin world, I think that when you look at

this optimization for security, similar to gold store value, people hold it.

Purchasing power has gone up a lot year over year.

It’s like a 200% year over year compound annual growth for over a decade.

Right?

And so you measure this in kind of the us dollar exchange price, et cetera.

But there’s still a lot of people who will yell and scream about it’s slow.

It’s costly, right?

All the things around those transactions that are obstacles or challenges.

And so there’s basically two schools of thought, and this is where we

kind of get into the bifurcation.

Some people just said, Hey, this technology is antiquated.

We can’t use it.

It doesn’t make sense.

Uh, and so what we’re going to do is we’re going to go build something new.

And so you go get, you know, kind of all of the various versions there.

The Bitcoin community says, no, just like gold had paper claims and other

things built on top and layer two, three, four, five, we’re going to do that here.

And so they’ve already started to build kind of this layer two where

it’s easier to transact.

It’s cheaper, it’s faster, et cetera.

And so I actually think that both of those worlds are going

to coexist in the future.

The big question is just which one has more importance, right?

So again, get out of binary.

It’s just probabilistically.

And so my personal belief is that the security that the store of value

component as the bedrock for a monetary system is essential, right?

Like that is the most important thing because you can always improve

the other components, but you can’t go back and fix that kind of core piece.

So money, money’s a, an idea that we all it’s like an emergent

idea that we believe in.

You’re saying that security is one of the most fundamental catalysts or fuels

for that idea to sort of take hold and be stable and sort of take over the world.

The other stuff is really nice to have, but if you don’t have the security,

you’re not going to, like, it’s not going to spread in the viral

sense in, in our human brains.

Well, and especially in light of the kind of the macro economy, right?

So like, what’s so fascinating about the last 12 months is, um, in

investing in general, the best returns, right?

I kind of put that in air quotes a little bit is something that is different

than everything else and right.

So being different and wrong just means you’re an idiot, right?

Being different and right means that that’s where kind of the outsize returns

are. And so if you look around the world at currencies today, they’re all the same.

They’re all inflationary, unlimited supply controlled by a government done and

decisions made in a very non transparent process.

And what we’ve watched is the manipulation of all of those currencies

over the last 12 months in direct contrast to that is this thing, Bitcoin,

which is outside of the system, has a finite supply, transparent and programmatic

monetary policy. And so when you see those two systems kind of, um, in comparison

to each other in the United States, there’s a lot of people who say the dollar

works great for me. I can go to the ATM, I can get out physical cash.

If I want to swipe a card, I could do that.

My money in my bank doesn’t lose 50% of its value in a day in terms of

purchasing power. Like the dollar’s pretty good.

When you go to other countries, that might not be the case.

And so I do think that there’s a kind of a relative analysis that goes on here.

If you compare Bitcoin to the dollar, there’s all kinds of arguments to make

that the dollar is better as a medium of exchange today.

But if I go and I tell you, well, what about in these kind of extreme examples

of Venezuela, Zimbabwe, Turkey, et cetera.

And so I think that that’s kind of one perspective to view this through is

security versus all of the innovative components of a medium of exchange, et

cetera. The second thing, though, that I think is really important is

around censorship.

And so when you look at, again, every currency in the world today, every

single financial service, they’re highly susceptible to censorship.

And actually, I would argue the United States is in the business of

censorship in terms of how many countries around the world do we sanction

and cut them off in either a minimal or a very material way from the global

financial system. So when you define it, when you talk about censorship,

do you mean just the censoring your ability to operate freely in the world?

Well, look at it a little bit differently, which is that the United

States has kind of the American superiority because we have the bombs,

the bullets, the soldiers and that military might.

We basically impose our will around the world.

And so there’s a very strong argument to be made that there are certain

countries around the world that are being sanctioned, that the people

of those countries did nothing wrong. Now, the governments are bad, right?

In terms of the way that you and I would look at democratic rule or

communism or whatever it is, but the people are being hurt as well.

So there’s a whole group of people who would just argue, listen, we

shouldn’t hurt anyone at the expense of punishing one person or a group

of people. There’s other people argue against that. But I do think that

if you really kind of zoom out and you say, I’m going to take myself out

of the Western worldview, and I’m simply going to look at this as we’re

all part of the human race, it’s censorship. And there might be an

argument for censorship, but there also might be an argument against

the censorship. And so what Bitcoin does, as that specific kind of

payment network is it says anyone in the world with an internet connection,

I don’t care where you were born, what language you speak, what

religion you are, your wealth status, your education status, none of it

matters. If you have an internet connection, you’re not going to

care. If you have an internet connection, you can plug into this

monetary system. And you can move value around the world to anyone

else without asking for permission. And in the United States, we

basically have that ability in the US dollar kind of traditional

banking system, I can pretty much send money to almost anyone I want

unless they’re a really bad person that’s on some list or something.

Most people in the world don’t have that capability. And so what

you’re essentially doing is you’re democratizing access to a true store

value, and a medium of exchange, right. And so what you see in many

of these countries is that when their currency starts to fail, the

first thing that a government or a group of people in power and

influence do is they lock the citizens into the currency with

capital controls. Why? Because if you let them out, it exasperates

the problem. And so now what we’re seeing is we basically are giving

a tool to billions of people around the world that is a peaceful

protest. Right? You and I had no say at all. When not only the

Federal Reserve and elected officials here in the United

States, but central banks around the world over the last 12 months

decided to create trillions of dollars and injected into the

monetary system. Right? They have arguments, and some of them are

very good arguments as to why they should do that. They’re

trying to mitigate short term pain. Long term, they’ll figure

out the other issues, right? They have very kind of elaborate and

well articulated kind of viewpoint as to why they’re

doing it. But you and I had no say. And so when you start to

look at, we have a very small group of people in this world,

both in our country and in countries around the world that

make these decisions that have very, very far reaching kind of

impact. And on top of that, in many cases, there’s actually not

that much kind of accountability. Because usually

these are not elected officials who are making some of these

decisions, these are appointed. And you can argue that, hey, we

elected somebody who appointed them. But at the same time, that

accountability isn’t quite there. And so I think ultimately,

when you just back out, you say, you know, what is Bitcoin? Why

is it important to the world? It is giving access to anyone in

the world with an internet connection to a store of value

and a monitoring network that allows them to peacefully

protest and to opt out of a system that pretty much is not

working for majority of people in the world.

So it’s moving the power from these centralized places,

sometimes unelected to the individuals and to the people.

So the dollar does seem to work for Americans and for many

people in the world. But you kind of have a vision, you paint

a picture of a future where potentially we move to

cryptocurrency. So what kind of trajectory do you see where

Bitcoin can become the main currency in the world, or at

least cryptocurrency become the main way of storing value in the

world and basically overtake the dollar?

Yeah, so I always go first to we don’t need to have competition

like in terms of like a direct competition between the dollar

and Bitcoin, right? If you look at most technologies in the

world, the really valuable ones are actually market expanding

technologies, rather than simply just market share stealing

technologies, right. So if you look at Uber, for example, Uber

didn’t just say, Hey, I’m gonna go take out all the taxis,

right? It actually drastically expanded the market for people

now there’s literally millions of people in the United States

who don’t have cars because they use Uber, right. And so I think

that Bitcoin is very similar in that, yes, there is a component

of medium of exchange, in terms of the dollar. But also there is

this component of just store value assets in general. And so

when you start to look at Bitcoin, specifically, I think

that what you’re seeing is you’re seeing a generational gap,

where young people say, I grew up with a phone in my hand, I’m

digitally native, the whole idea of going to the bank and

sending a wire, or going to an ATM and getting physical cash is

an antiquated idea in their mind, right? I one time asked my

brother, he’s 24 years old. And I said, Hey, how do you send

money to your friends? And he gave me one answer, which I

expected, which was Venmo. And the second answer, I didn’t

expect he said Uber. I said, How do you send money via Uber? He

said, Well, we get in a car together. And at the end, we

split the ride. And so again, you and I have probably both

done that. But I never thought of it as a way to send money to

each other. And so it is a psychological difference between

even me, who’s only, you know, a decade older than him or so,

and his peer group. And so I think as we’re watching kind of

Bitcoin continue this ascent, ultimately, what we’re seeing is

an entire generation of kids are saying, Listen, if I look at

financial assets across the board, I have stocks, I have

bonds, I have currencies, and I have commodities, I know that

bonds, from a real rate return perspective, is flat to

negative, right? I’m gonna make no money on this, because I have

a belief that my dollar is being devalued. And actually, what

we’re starting to see is, again, the internet has broken down

these walled gardens and kind of these centralized hubs of

information, in that if you were to look at, let’s say the stock

market, from 1971 to today, in dollar terms, it’s a 45 degree

angle right up into the right, right, you know, it’s kind of

seven, 810% growth, every year, it’s amazing, just get invested

in the stock market, and you’ll make money over a long period of

time, regardless of the dips along the way. If you do not

make that same stock market in gold, the stock market is down

since 1971. And so is it so much that the stock market is accruing

true value? Or is it that the underlying currency in which it

is denominated in is being devalued? Right? And I was being

devalued in a very disciplined way, right, in terms of it’s not

like it went 50% devaluation in a short period of time, but it’s

still being devalued. And so I think that people are waking up

to this idea that a traditional 6040 type global portfolio

doesn’t work anymore, right? 40% of it in bonds is just not going

to get it done. And so when you start to look at this, people

first look at Bitcoin via two main ways, in my opinion, they

look at it one as a store value, should I actually go and put

some of my wealth there use it as a savings technology, right?

We ask people in the traditional world, if you’re a teacher, a

fireman, an accounting, you know, mid level manager, we say,

hey, go do your job, be best in class as a fireman or as a

teacher. And then Oh, by the way, you have to be a

professional investor as well. Because if you just put your

dollars in your bank account, you’re literally going to have

your wealth devalued away over time. So you can’t just save you

have to invest. That is a really tall task for people, they have

a hard enough time just doing their job, right? Taking care of

their family, right? Now they got to go be an investor. So I

think savings technology for Bitcoin standpoint is, if you

buy satoshis or Bitcoin, over time, it will increase from a

purchasing power standpoint, because there’s a fixed supply

and demand continues to rise. But then you start to look at

well, what other assets do people put in their portfolios,

whether it’s art, it’s real estate, precious metals, or

something else. Most of those assets are not because people

actually think that they’re going to go up in value over

time, they’re using the store of value. Right? The reason why

somebody buys gold is because the store of value, right

historically, that’s a narrative driven type asset, though,

right? We tell people it’s scarce, we tell people that it

is a store of value. When you look at it, though, we don’t

know how much gold exists in the world, we have a good estimate,

right? But we don’t actually we can’t prove how much there is.

We don’t know how much is coming out of the ground every day.

Again, great, fantastic estimate. But we can’t prove it.

And we don’t know what the total supply and that’s what you mean

by narrative driven, we can’t really prove it, like

mathematically, we you I and everyone else in the world has

lived in a narrative driven world for the last couple of

decades, right? And what the internet and digital technologies

have done is it opened up the possibility and the desire from

people to have a world now where I can validate things. So when I

see that headline, I want to see you say whatever happened to the

news, if you’re the subject of the news, rather than have

somebody else tell me the story. If I see that you say something

is scarce, prove to me that it is scarce. And so I think that’s

kind of a psychological shift, the younger generation is

starting to understand because ultimately, you and I probably

grew up in a world where parents could tell us the story. And we

just believed it. You know, dad or mom says it must be true. If

my brother heard a story, what does he do? He goes to Google

and he looks it up. Randy comes back and usually tells my

parents, oh, you got the story wrong, right. And so I think

that that that provability or that that validation ends up

becoming really, really important. And so, you know,

look at something like gold, I think that people are

drastically underestimating the shift that’s underway right now.

Gold is one down in value since April, or I’m sorry, August of

2020. And so in a timeframe where central banks have had

historic quantitative using literally $6 trillion in the

United States, the one asset that historically has been the

best store of value and has, you know, in 2008 financial crisis

hit an all time high based on the government response has

actually suffered for a main part of this financial crisis.

You then look at central banks around the world who have been

very large holders of gold for a long time and net buyers on a

monthly basis. For multiple months, over the last six

months, they’ve been net sellers of gold. And then you

start to look at jewelry demand. So the actual non

monetary value of gold, and that demand for gold jewelry peaked

in 2013, and has continued to fall since. And so what you

start to say to yourself is take just the asset of gold, which

about $10 trillion market cap, and you say, Okay, well,

jewelry demand continues to fall, even if it’s at a slight

rate, but it’s continues to contract. You have central

banks that now at some times are net sellers and sometimes net

buyers, right? So okay, again, contraction there. And then from

the investment standpoint, the actual price, the daily price of

this continues to fall, which is a signal that there’s a

contracting demand from an investment perspective. That’s

93% of all use of gold, only 7% of it’s used for actual

technology and metal conduction and things like that. And so

you have a $10 trillion asset that it appears and again, maybe

data changes, and I’ll change my mind and other people change

their mind, but it appears is on the decline. And so if that

happens, you’re going to get the contraction of a $10 trillion

asset, where’s all that value go. And what you’re seeing is at

the same time that that asset is contracting, you’re also seeing

a massive influx from not only retail investors, not only kind

of the wealthy and the elite, but also from financial

institutions, corporations, pension funds, etc. into this

kind of digital sound money.

So you’re saying that there’s a kind of shift from gold to

Bitcoin, because they have a lot of the same properties, except

one is in the physical space, the other is in the digital

space. So do you see like central banks, quietly

potentially switching out from sort of gold to Bitcoin, like

naturally just doing is seeing a pattern that you’re referring

to now, but more drastically into the future, where there’s

a complete shift,

if you line up the gold community and the Bitcoin

community next to each other, they’ll agree on all the

problems that they that they see in the world, right? They’ll

actually agree on the solution that sound money is the solution

where they differentiate is the gold communities believes that

it’s the analog application of sound money, right? The physical

gold, that is the solution. The Bitcoin community believes the

digital application of sound money, Bitcoin, can you define

sound money, by the way, someone is just outside the system, and

no one can create more of it. So nobody controls it. This is

scarcity is fundamental. Exactly why scarcity important in money?

I think scarcity just has this very high correlation to value

across all assets, not just money, right? Money happens to

be the unit of account that we use in terms of daily commerce.

But whether it is, you know, as we’re seeing now, sneakers, or

you know, whatever it is, scarcity, ultimately, is that

signal of value, I think, and that’s just been the way that

humans derive value for literally, you know, thousands

and thousands of years. Yeah, I gotta say, that’s my view on

life and love in general, is scarcity is what makes it

valuable. People talk about immortality.

You know, I would like to be immortal, but it does, it does

seem that when you let go of the finiteness of life, I feel like

that meals and the experiences you have get devalued

significantly, like, the longer you live, the less value there

are in infinity, if you live forever, I worry that all the

meaning will dissipate. And the same thing with love, I think

criticism of sort of dating culture and all that kind of

stuff. Like I haven’t had shocking revelation that I’ve

never been on a tinder date or any of those things. I believe

that scarcity in dating and interaction is like, intensifies

the value of when the interactions do happen. So, when

they like when love does happen. And so in that sense, there’s

something magical about scarcity in the more subjective

psychological social world, as well. And perhaps money is just

another version of that, right? It’s just it’s all about the

stories and ideas we tell ourselves.

I think they’re actually more interconnected than you’re

giving it credit for, right? Which is, what is money? Money

is time, ultimately, right? The pursuit of the acquisition of

money, right, of whether it’s a currency or true money, is

because that should give you more time, right? And that’s

what would give you more time. And so one of my favorite

movies ever is, and it’s funny, because Justin Timberlake is in

it, is this movie in a lot of me, I lose most people at that

point, in time, in time. And basically, the premise of the

movie is that everyone has a clock that is embedded into

their arm. And so if you go to work, you basically put your

arm underneath when you leave, and there’s time that’s

deposited into your clock. And if your clock ever hits all

the arrows, you’re dead, you die on the spot. And so there’s

a number of scenes where people are basically running, you know,

to get to you, and I give you a little bit more time so that

you can get to work on Monday, and then you work to acquire

time. And so basically, time becomes this currency. But what

becomes very fascinating about it is there are sections in

society, where literally, there’s physical places, if you

only have, let’s say, 72 hours or less, you’re allowed to go to

Section One. Section Five, though, is because you have

years and years and years on your clock. And in this movie,

everyone at the age of 25 freezes from a biological aging

standpoint. So everyone stays the same, but you may have lived

for 1000 years. And so what becomes so fascinating about it

is that rich people have time, poor people do not have time.

And so in it, Justin Timberlake, the main character at one

point, essentially acquires a bunch of time, and he’s able to

go to one of the higher levels. And now he’s attending all these

galas and, you know, poker nights and all this stuff. And

one of the first things that he learns is that in the lower end

of society, everyone is running everywhere at all times in the

movie, because time is so finite, and it is so scarce.

And so therefore, why would I walk down the street, I must run

down the street. In the highest level of society, no one runs

anywhere. And in fact, if you run, you are seen as lower

class. Yeah, because wealth is time. And so that movie is, you

know, it’s got a ton of kind of things that you can pull out of

it, but to me is the perfect epitome of money is time. And so

when you start to think about the acquisition of money, right,

it goes to this whole idea of time billionaire. And I know

that there’s probably a lot of people who’ve heard about this

already. But if you think of a million seconds, it’s about 11

days, a billion seconds is 31 years. And so if I said to

somebody, you have to switch lives with Warren Buffett,

would you do it? Some people would say, Sure, that’d be

their initial reaction. But you got have to be you know, 92

years old, is the money worth the lack of time? Most people

would say no, right? And there’s this guy, Graham Duncan, who

really articulated this well. And ultimately, what ends up

happening is you rest time is more valuable than the money.

But the you acquire the money to gain more time. And the reason

is valuable is because of the scarcity of time. We currently

have the by the biology, the physics means that this is not

just the narrative we tell ourselves, maybe it is, I don’t

know, but it feels like pretty sure we’re mortal. And in that

sense, the scarcity there gives value to time, it’s fascinating

to think about all the thought experiments here of if that

could actually be on the economy, if you can actually

convert time in a frictionless way to money.

Well, and if you start to pull on this a little bit and say,

okay, a young person today, let’s say somebody in their

20s, has about 2 billion seconds left in their life, right, kind

of 60 years, give or take, based on life expectancy. They

usually, until they start to understand this concept, think

of wealth in dollar terms. But dollars are being devalued. And

so you know, a million dollars doesn’t get you what it used to

get, right is kind of an old adage. And so what you’re doing

is you’re pursuing something that ends up losing value. And

so it’s the constant rat race, it’s how do I constantly try to

get more? How do I get more dollars? How do I get more

dollars? Because even if I say to myself, you know, I’m going

to retire when I get $100,000. When I get the $100,000, the

$100,000 five years from now doesn’t buy me what I thought it

did. So now I need 500,000 or 200,000 or a million or whatever

the number is. And so ultimately, what ends up

occurring is that the Bitcoin community and many people in

kind of this idea of sound money is you want to be able to

acquire an asset that not only will hold the value, right, the

store of value over time, but it will actually appreciate over

time. And so when you look at something like Bitcoin against

the dollar against other types of assets, all of these assets

are down compared to Bitcoin, right? Now, some of that’s just

in the early days of kind of the pricing of an asset, you go from

very small to something much larger. But now what you start

to look at is well, if you have a finite supply of something,

what ends up happening is people begin to value it more. And so

in a world where dollars are infinite, and other fiat

currencies are infinite, Bitcoin becomes very, very interesting,

very special, and something that is very aspirational. And so I

think that’s where you’re starting to see people say,

wait a second, this is something where that finite, secure store

of value is essential to wealth generation and preservation over

a long period of time.

And if Sam Harris is right, that free will is an illusion. This

is really interesting to think about. Maybe time is a kind of

blockchain, because you can’t change anything. And then the

physical space time of the universe is a ledger. So maybe

it won’t be Bitcoin that replaces gold, maybe it’ll be

time, once we crack open that, in fact, the universe is fully

deterministic. So maybe that’s what like Eric Weinstein is

afraid of, once you figure out the theories of everything of

physics, we’ll be able to then start trading, create a market

out of like the very fabric of reality. And that way break it.

Well, if you look at infinite inflationary type currencies,

you can’t do that, right? Because it constantly is losing

value. When you look at a finite asset, again, that has the

provability of the actual finite element to it. Ultimately, the

wealth is that marketplace. Yeah. And so, you know, I always

kind of try to highlight for people, the top 55% of Americans

understand something that the bottom 45% don’t, they invest,

right, the bottom 45% consume the top 55% invest. And that’s

why we have a wealth inequality gap. And it continues to get

wider and wider and wider is because the people who are

holding the devaluing assets, and saving are watching their

wealth be devalued away. And there’s arguments and

controversy over how fast that’s happening, but it’s

happening. The people who are holding the assets that have any

level of scarcity, right, real estate may not be finite, but

it’s scarce, right? Art may not be finite, but it’s scarce. Gold

may not be finite, but it’s scarce. Those assets continue to

appreciate against the devaluing currency. And so when

you then say, No, I have complete finite supply, with

provability, and this transparency around it, where

everyone knows how much is there and what where it’s going. And

now all of a sudden, you and I can transact back and forth that

value. And it is a representation of time. Because

what I can essentially do is if I gather or acquire more of

that wealth, I then can apply leverage to my life. I can use

machines, humans, or some other resources. And basically now

free up my time.

Yeah, and it’s not fun about the way you are trading time.

Maybe it’s a little bit indirect, but maybe not. So just

because I brought up Eric and you’re on Twitter, I’d love to

hear your opinions. I talk to him a lot. He seems to have

stepped into the beautiful dance of human communication and the

social dynamics that is the Bitcoin cryptocurrency

community. Do you have thoughts on gauge, theoretic concepts,

conceptualization of the world, or just Eric in general? He’s

got a lot of love in his heart, and he’s got a grace in the way

he communicates. But he’s also loves to play with ideas and

seems to have touched a sensitive point with the Bitcoin

community. Is there anything you could say that’s hopeful,

inspiring about that whole dynamic that went down?

So I don’t know all the details. But what I will say is I’ve

listened to a number of his podcasts, and him and there’s a

whole bunch of people like him. I basically put them in the

bucket of they’re an independent thinker who are courageous

enough to speak their truth, whatever that may be. They are

humble enough to revisit their ideas and say, I got this right,

I got this wrong information change, I’ll change my mind.

Obviously, a sign of intelligence to be able to do

that type of stuff. And I actually think that one of the

most scarce things in our society are those independent

thinkers who are able to do all this. Right? Speaking of

scarcity. Yeah. And so to me, I put Eric and the whole host of

other people kind of, if you look at like the intellectual

dark web is kind of a label that’s been used. They’re

actually some of the most important people in our society,

because they’re the people who are willing to stand up against

the mass kind of thought process. They’re willing to talk

about things that others may think are taboo, right? They’re

willing to change their mind, which all of a sudden has become

a bad thing rather than a good thing. And so when I see the

exploration of ideas in public, I actually think that those are

the people who are most open to the kind of VM it blowback as

well. Right? Because that’s part of what they’re doing is that

they’re eliciting, hey, I’m going to throw an idea into the

arena. If it doesn’t get attacked, they actually may be

more nervous than if there is some level of, you know, kind of

war of attrition, if you will. And so what I’ve seen with a

number of the people who have done this, everyone from some of

the best, you know, hedge fund managers and kind of money

managers in the world, all the way to what I’ll consider some

of the most intellectual people in the world is they play with

these ideas. And they play with the ideas and they play with

them and they put them and they all arrive at the same

conclusion. And sometimes it takes a month, sometimes it

takes years, but they arrive at this Bitcoin thesis. And what’s

so interesting about it is it highlights something that many

people view as a bug. But I think people in the Bitcoin

community view as a feature, which is that community. And so

what ends up happening is when you have something that is as

ambitious as creating a global reserve currency doesn’t mean

needs to unseat any of the existing ones, but become the

global reserve currency of the internet, right, this digital

economy, you need shepherds of it. And so just like a

technology company wants to find those loyal fans that are

willing to go out and market and word of mouth and, and kind of

not only promote it, but also protect it. This technology

that is this decentralized thing, which uses a financial

incentive in order to elicit the buy in, not from a financial

perspective, but from a mental energy standpoint, has built one

of the most rabid, powerful and engaged communities on the

internet. And what ends up happening is those people have

thought more about these ideas, and actually challenged those

ideas more than anyone else in the world. And so I’ve got a lot

of folks who will just say, there’s this guy Marty Bent, who

will talk all the time about the Bitcoin critics haven’t done

their homework in a lot of cases. So they show up and

sometimes it’s super intellectual, lazy arguments,

sometimes actually very well thought out arguments, you know,

on the counter to the Bitcoin thesis. But ultimately, what

ends up happening is you’re talking to somebody who’s an

expert, they’ve been thinking about for five, seven, eight, 10

years, right? They’ve gone through every simulation you

possibly can. And they show up with data, examples, and

responses. Now, they’re not always right. But they’ve just

done the work. And so what I actually like about folks like

Eric and others is as they’re kind of going through this

journey, they’re incredibly smart, right? And they provide,

or they apply a lot of intellectual rigor to some of

these arguments. And so what it does is what does it do? It’s a

marketplace. It keeps people honest. Let me sort of make a

few comments. It’s kind of interesting. So you’re exactly

right. Maybe the blowback is part of the mechanism that

actually develops these ideas and so on. I do want to kind of

speak to a little bit of the toxicity that I’ve experienced

in the Bitcoin community. I kind of see it, the Bitcoin

community, I think you paint a really nice picture, which I

kind of see it as an immune system that protects against

sort of the viruses that are bad ideas. That said, the immune

system can destroy a body, right? And the thing you

mentioned about Eric and maybe about myself, and in general,

just people exploring ideas, is there is a Dunning Kruger

effect, which is when you first start exploring ideas deeply,

you have an overblown level of confidence about like how much

you understand. And that’s actually the process about

learning, then you realize you don’t understand much. What

I’ve noticed with the Bitcoin community is they’re not as

patient with the basics of the Dunning Kruger effect. Like if

I step in and make declarative statements about Bitcoin, like

I, you know, I read a long time ago, the white paper, like at

the cursory level, I felt that I understand the technology,

this is basic intuitions. You know, I didn’t think about the

social dynamics. I didn’t think about any like financial

implications and a lot of the deep, actually the ongoing

innovations and all that kind of stuff. But I thought I

understood that technology. And so I step in and make

declarative statements. I think those are the first time you

say, okay, what’s the role of Bitcoin in the world? You start

thinking about it deeply. And then you make statements. The

toxicity that you get in those first few statements is really

off putting to me. I’m somebody that tries to communicate love

and live that with everything I do. And there is a level of

disrespect that I’ve experienced, not directly just

observing others, people have been mostly kind to me. And I

appreciate that. But if you’re going to criticize me about my

exploration of ideas in Bitcoin, you have to also

acknowledge that I’m a human being that got like a PhD in

stuff. Like I did some hard shit that it could be in farming or

it could be in whatever. Like I’ve lived life and I’ve

really thought deeply and I really care. Like I know a lot

of shit. And it’s possible that I actually have a lot of ideas

that you can learn from. Now, if it’s agriculture, fine. Or if

it’s artificial intelligence, fine. Like I know what I’m

talking about, about certain things. And I could be wrong

about a lot of things. And there’s like an exchange of

ideas that makes that mechanism that you talked about more

efficient. Sometimes when the blowback is too strong too

early on, the development of ideas is just inefficient. And

I’m not sure if there’s a, you know, the way it was explained

to me is that for so long, that community was like bombarded

with just like bad ideas, like criticisms. They’re just overly

sensitive now to bullshit. They’re like triggered by

statements. They’ve heard it all before and they’re like,

oh, there they go again with the same old arguments. But

that doesn’t mean that you have to sort of, I guess, develop

patience and so on. Especially when you feel like in my case

that the person is coming from a good place, right? I don’t

know if there’s something you could say that’s positive about

the future of this kind of overcoming this toxicity.

I think there’s a couple of trends that are all kind of

coalescing here in these types of experiences. So one is when

you look at a community, there’s always a spectrum in

terms of there’s some people who over index on kindness and

stupidity. And there’s some people who over index on

intelligence and basically just being an asshole. And then you

get everyone in between. And so naturally, as we know, the

extremist ends of any community end up being the loudest

usually. The second thing is there is from the outsider

view, like at the beginning of the exploration of ideas, it’s

very much a learning process. I don’t know if I understand

this or not, but here’s ideas A, B, and C. From the internal

perspective, there’s a trillion dollars of value at stake and

we must protect it with our lives. The truth is probably

somewhere in between there. And again, the world’s not black

and white. There’s this kind of more gray area that I think

actually is where most people exist. The other thing that’s

at play here is I think the Bitcoin community understands

the internet and internet culture and narratives better

than almost anyone. And so you see this with kind of the just

complete destruction of narratives with memes and just

the visceral reaction and the use of things like Reddit and

Twitter and YouTube, podcasts, just areas where I think a lot

about if you are an upstart and you are going to go challenge

the most well respected elite kind of establishment

institutions in the world, if you walk in in a suit and tie

and you say, I’m here to debate you with ideas, you’re going to

get your clock cleaned because they’re going to trot out their

lawyers, their regulators, their lobbyists, right? Like all this

stuff. If you instead say, I’m going to meme you to death on

the internet and I’m going to control the public narrative.

You’ve shifted the power. The asymmetry of power is more

symmetrical now. It’s the ultimate insurgency, right? If

you bring it back to the the conflict. Yes. And so when you

think about this, you have to lean into the advantage that

you have. And so what ends up happening is you and I would

absolutely lose it if we saw JP Morgan or Goldman Sachs or the

Federal Reserve start tweeting memes. Yeah, right. It it would

almost the the validation that would give to the medium and

the even playing field that it would provide would pull these

establishments down to the level of what is this upstart?

But now what you’re starting to see is that the Bitcoin

community, even though there’s some level of toxicity at

times, even though there’s this visceral reaction, sometimes

there’s even what I would call bullying or or or kind of

outward projection of things, right? Even though it may be a

small percentage, it’ll happen every once in a while. What

they do understand, though, is that these establishments are

made up of humans. And what you can actually do, one of the

best ways to pick apart an institution is to recruit from

inside of them one by one. Yes. And so what you’re starting

to see now is I mean, I get the messages on Twitter and

LinkedIn all the time. Hey, I’m a banker by trade, but I’m a

bitcoiner at heart, right? And so what you’re doing is you’re

essentially infiltrating the organizations, not in in

physical, you know, population. Yeah. But with the ideas and

with the philosophies, banker in the streets, bitcoiner in the

sheets. Yeah. Okay. I like it. With that said, in terms of

shitposting and memes, I gotta say like bring it on because I

believe in terms of asymmetry of power, I believe in that

love will save the world, not memes. Or at least good vibe

memes as opposed to shitposting. It’s an interesting

battleground, though. It’s an interesting battleground to

think about. The other thing I would say, too, is one of the

elements that’s always kind of funny to me is how much of the

entertainment is love, right? So, when you start to think

about how many of the memes that are posted, for example,

are for outsiders versus insiders. Yes. Laser eyes,

right? Which seems absolutely ridiculous, elementary, and

frankly, beneath anyone in any level of power or influence in

the world somehow has congressmen and senators who

have done it. Yeah. They’re not trying to convince their

colleagues in elected positions to become bitcoiners. Yeah.

They’re speaking directly internally to the Bitcoin

community. Yeah, there’s some sense in which, yes, memes is

love. Even I keep hearing Bitcoin is love. They’re trying

to convert me. The one that you have to laugh at, right?

Probably my favorite one out of all of it is I’ve seen on

multiple occasions, you know, Mark Cuban a couple of years

ago, Kevin O Leary, whoever, you know, wealthy people,

billionaires, etcetera, and you have people on anonymous

accounts who who knows who they are telling them have fun

staying poor, right? It’s just, you know, it’s just, again,

part of a community and I think it’s a feature, not a bug.

There’s bad aspects to it at times but I do think it’s a net

positive. Yeah, just like the immune system. It does a lot of

crappy stuff but overall, it’s a major net positive. Maybe

this is a bit of a personal question for me. It just added

my own curiosity but I’ve talked to Ray Dalio a few

times. So, Ray Dalio, I think was one of those people that

took that journey, the Bitcoin journey. Do you have thoughts

about him specifically about that whole world and about the

journey maybe of others that are going through the same

process because Ray is, at least from my perspective, I’m a

bit of an outsider. He’s one of the most insightful and deep

thinkers about investment, about finance, about economics

in general. Actually, about life. So, it’s interesting to

see him go on that journey. Do you have something to comment

about Ray or just those kinds of people in general? So, if we

look at what I’ll just consider the legends of Wall Street in

general. Yeah. Right? There’s no denying that they’re

incredibly intelligent. There’s no denying that actually,

especially in the hedge fund world, they’re some of the most

open minded people in terms of they’re willing to change their

mind when they get new information. There’s no doubt

that they are historians in the sense of having studied

financial markets and cycles over time. And also, one of the

things that I really respect about all those guys is almost

all of them are willing to put ideas out via various writings

that they do and accept the public criticism, right?

Whether it’s Howard Marks, Ray or others, they will put this

stuff out in public. And sure, there’s a lot of people who are

supportive and kind of are part of a fan base, if you will. But

there’s a lot of people who also think that sometimes they

say stupid things. And so, putting that out takes kind of

courage, right? I think Ray’s actually the most fascinating

though out of all of these kind of legends of Wall Street in

that he understands debt cycles. He understands

currencies. He, for a while now, has been all over and

famously said, you know, cash is trash, investible assets,

right? He kind of like just knew all of it. And for a long

time, Bitcoiners have said, Ray, you understand the Bitcoin

argument, you’re just missing the last part, which is Bitcoin

is the solution, right? And so, he was gold and some other

ideas. But I think that he’s a perfect example of when you are

part of the establishment, people view you in a very

static way as the leader of a part of establishment. But

whether it’s Bill Gates, Ray Dalio, or somebody else, each

one of these people were innovators and challengers to a

system. They were upstarts at one point. And so, it’s kind of

this idea that like if you live long enough, you eventually

become the man, right? And so, you know, Gates is a good

example, right? Warren Buffett is a good example. Ray Dalio is

a good example, etc. And so, you have to give credit, I think,

to Dalio in the sense of he kept an open mind about all of

this and more so than many of his peers has continued to do

the work and come around to this idea. And now, I don’t

want to know if I wanted to say that he’s a Bitcoin

proponent as much as he believes it is one of a portion

of assets that can be a solution. And so, to me, when

you start to convince those types of people, when it’s

Paul Tudor Jones, a Stanley Druckenmiller, Ray Dalio,

Howard Marks now even writing about it saying, hey, I was

anti Bitcoin and put a ton of intellectual rigor into it.

But thank God my son bought a bunch for our family, right?

And kind of we’ve had exposure to it. I think what it does is

more than anything, it’s not going to convince somebody to

go and take it seriously or go ahead and make an allocation.

It reduces career risk. And so, if all of a sudden when Paul

Tudor Jones and Stanley Druckenmiller come out and

say, hey, I own Bitcoin and here’s why, every other

investor on Wall Street now can say to an investment

committee, well, it’s good enough for Paul Tudor Jones,

it’s good enough for Stanley Druckenmiller. And so, I think

that it’s very interesting because Ray doesn’t just

represent Wall Street. I think Ray in some weird way

represents this like macro economic investor. And so,

some of those are in hedge funds and some of those people

would be like CIOs at organizations. Some of them

would be at corporations and some of them are just kind of

retail investors. And so, you can see this kind of inflection

point throughout the adoption of Bitcoin, right? There was

infrastructure that got built. Okay, that kind of led to more

adoption. There was certain individuals, right? Usually

they were kind of technology oriented, entrepreneurial

billionaires. They would buy it and come out and say it. Okay,

that led to inflection points. You started to have some of

these kind of Wall Street legends come out, sort of

financial institutions started. And now, you’re seeing

corporations start to do it, right? Eventually, there’s

going to be a central bank that does it. And so, you kind of

walk through that line and what you understand is like, it’s

the same thing every time. It’s just somebody new, right? That

path, right? That Bitcoiners journey, if you will. And I

think that that is almost the beauty of it is if you

short circuit the journey, it’s almost like somebody doesn’t

appreciate it, right? If you take, let’s say, somebody who’s

a young kid and you just give them a bunch of money and they

didn’t have to work hard for it. They don’t really

appreciate it. Well, and Ray actually has a book

principles, right? And he talks about the hero’s journey. So,

he’s like living it in some sense in terms of, you know,

thinking about digital currency in general, like digital

finance. It’s one of the big transitions, transformations of

our world in some sense. It’s not just about money. Or you

could argue that money is everything. I mean, it’s like

money isn’t just the narrow definition of money. Money is

really everything. And so, where you could argue that sort

of cryptocurrency is like the base layer of this

transformation to the digital space and everything else would

just be built on top of it. I use a different word that I

think is kind of closer to your world, which is it’s ultimately

automation. And what I mean by that is, you know, before 1970

or 1980, all the assets were analog. And so, when you have

analog assets, physical stock certificates, physical bonds,

right, physical deed to a home, you have to physically exchange

them. When we wanted to increase transactions and

increase kind of global finance and access, we took those

physical assets and we created electronic QCIP assets. So, now

we have in centralized databases kind of a file, represents the

asset that’s sitting somewhere in custody. And you and I can

transact them a little bit easier, but still centralized.

There’s still some bureaucracy and, you know, maybe it takes

two days to transact rather than actually mailing it across

the world. Now, what we’re seeing is a transition from

those electronic QCIPs to these digital assets. And so, if you

look at, again, just let’s say money or currency, every

currency in the world is going to be digital. You’re going to

have a digital dollar, a digital euro, yen, RMB. You’re

going to have decentralized kind of open source money like

Bitcoin. You’re also going to have private currencies like

Facebook’s attempt at DiEM and there will be others that will

try to do this. And so, when you get everything digital, right,

and I think that’s the kind of the first step that everyone

focuses on, the competition at the technology layer

essentially goes away. You get some level of feature parity

and sure, there’s bells and whistles on each kind of

implementation of a digital currency, but at the end of the

day, the technology is relatively the same. And

ultimately, what it will do is it will facilitate the adoption

of digital wallets. So, you have to have a digital wallet

regardless of what digital currency you have. Same with me,

same with everybody else in the world. But what it does do is

when you kind of push away and reduce the friction of

competition at the technology layer, it moves the competition

to the monetary policy layer. And so, when you get to that

layer, now it becomes interesting because all of the

currencies are the same except for this one right now and maybe

there will be others in the future. But for sure, Bitcoin

today and people may try to replicate in a private manner

or something, but Bitcoin is kind of the only finite scarce

digital somebody. And so, when you then have that pretty big

difference in that competition at the monetary policy layer,

it’s actually not going to matter where you get paid.

Right? And what I mean by that is like you and I both live in

a single currency environment. I get paid in dollars. I

historically have saved in dollars. All of the assets in

my life are denominated in dollars and I owe my debts in

dollars, whether it’s taxes or in the private market. And I

don’t have to worry about foreign currencies. I don’t

exchange anything. The only time I would ever think about

another currency is if I’m going to another country in

their single currency environment. And in order to

change or exchange my currency, I go to the bank or I go get

ripped off at the airport. Right? Those are my two options.

So, it’s high friction to change between currencies. When

the competition of technology is kind of innovated away, now

I can get paid in dollars, these digital dollars, and with

a click of a button, switch into any other currency in the

world. And so, what ultimately happens is value and liquidity

is going to coalesce around the best monetary policy. And so,

you get in this very weird world where even if the United

States says, hey, you’re going to get paid in dollars, you have

to pay your taxes in dollars. You’re going to start to see

people operate in a multi currency environment where they

say, okay, I got paid in my digital dollar, click a button,

I save in Bitcoin. It stays there or grows my purchasing

power. Oh, I need to pay my taxes. Let me switch back into

dollars with click of a button and pay. When you go to a

multi currency world, it’s not just about currency. It’s now

multi asset world. Because not only is the currency

digitized, but that same technology is used to digitize

stocks, bonds, and commodities as well. And so, today we live

in a very fragmented financial world where basically I have a

brokerage account, I have a bank account, I may have an

alternative asset account, etc. When I can put all those assets

in a single digital wallet, and I can then go from asset to

asset without having to go back to a single unit of account.

Like frictionless going from asset to asset. Yeah. So now

what you end up doing is you start to open up the

possibility for machine to machine transactions. Yeah. So

today, if you and I write software code for two machines

to transact with each other, they can’t transact physical

currency. And in many cases, they can’t actually transact

the electronic QCIP currencies or assets either because

there’s too long of a settlement time. So you can’t

get true automation, right? So the whole idea of the car’s

going to drive over a strip in the road and it’s going to

pay the toll, right? Well, that can’t happen right now

because literally the transaction won’t go through,

right? And so I always joke that in an automated world,

it’s like a CD ROM, but we’re trying to take cassette tape

player assets and put it in the CD ROM. It’s just incompatible

technology. Reference is nobody understands at this point.

By the way, you need to update your reference. I probably

do. It’s like taking a CD ROM and trying to put an MP3

player into a streaming. But I think that the reason why

that becomes really interesting is when you start to create

these digital assets, now you open up the world of

possibilities. So when new technology is created, you can

do two things. You can either create new things the world’s

never seen before, or you can use it to improve the old

world. Most people, because it’s the easiest thing to

think about, want to improve the old world. So an equivalent

of this would be when the internet came along, a media

company that had newspapers would say, hey, we should take

a PDF of the newspaper and we should put it on a website. And

now anyone in the world can go to this website and they can

read the newspaper today. That was valuable, but it missed out

on the ability to change headlines, to test, to put

multimedia, to distribute it differently, to do all kinds of

things that today we understand the internet really empowered.

And so what I think we’re about to watch happen is we’re going

to digitize the assets. We’re going to put them all into

these digital wallets. You’re going to get automated

technologies where machines can now transact with each other.

And we’re going to do simple things like why do we pay

people once every two weeks? Why don’t we just pay them at

the end of every day? Or why don’t I literally stream

payments to you on an hour by hour basis based on the work

you do? It would solve incredible economic issues in

our country and in countries around the world. But

historically businesses can’t do this because of the

technology problem. They can’t keep track of it all. How do

they pay everyone every day? How do they pay everyone every

hour? You just can’t do it.

Yeah, it’s funny. The vision of the future you’re painting,

it’s kind of an exciting one. And it almost makes me sad

looking into the future when we’ll look back at this time.

It’s like how incredibly inefficient financial

transactions were. Like the transaction of value of any

kind. Like how to pay each other. Like there has to be

processes. There’s like payroll and all this kind of just the

entirety of the transactions is just like painful. Almost

all transactions are painful. And the companies that

innovate to make the transactions a little bit more

frictionless like Amazon with the one click purchase button

like went out huge. But even that’s really painful. It’s

actually really interesting especially when you start to

move that into the space of data. There’s a lot of people

thinking about privacy and data and like can we put, can

we like convert data into like money so that you can pay for

how much you reveal to the companies about your own

private data that can then be used to assign value to you so

you can use the service for free if you hand over the data

but there’s like explicit transaction going on. So you

can empower all those kinds of things that will just like

fundamentally change our world. That’s really, really,

really exciting.

One of the most interesting things to me is I invested in

a company called Bridget and what they told me was they said

$8 billion was paid to the top four banks last year on

overdraft fees. So literally they took $8 billion from

people who didn’t have money in their bank account, right?

And so when you dig into why is that a lot of times it’s not

that the people don’t have the money. It’s actually a

mismatch of the payments. So what ends up happening is you

get paid on the 1st and the 15th but on the 12th your

Netflix bill hits, on the 13th you went grocery shopping, and

on the 14th your car payments hit, you overdraft, and then

on the 15th you actually get the check and then you’re able

to pay not only the overdraft but for the expenses that you

have. And so something as simple as just getting paid at

the end of every day immediately would eliminate

some big percentage of those $8 billion of value that flows

to large institutions on overdraft fees.

Yeah and also I mean this whole process with overdraft fees

and just many of the financial transactions we have to live

through today forces many of us to be like accountants, like

to understand the different mechanism of financial like

the movement of money as opposed to you which is what we

want to do as human beings operating in high layers of

like providing services for others, of like following your

passions and like working for others, like doing cool shit

or you know basically providing value, exchanging value

in the world and not thinking about the money. The money

takes care of itself and then you see the results of it.

So you’re able to think in terms of money but not have to

know how like the accounting works.

Automation simply frees humans up to do more creative

work.

Yeah.

Right?

Yeah.

Like that’s it.

Yeah.

And what we

Which is why you use the term automation which I think is

kind of brilliant reframing of all of this.

Yeah because ultimately digital technologies are merely

the conduit to ushers into that world and I think the most

fascinating part of this entire industry is people who are

trying to figure out now that we’re going to have these

digital technologies how do we usher in that automated world

faster and so there’s people who are building all kinds of

incredible things right there’s literally some technologies

where you can stream for paying for consumption of content.

Yeah.

Right there’s I saw somebody recently who they basically

said hey I have created something but it’s not going to

be released until everyone and almost like a GoFundMe type

situation pays for it in combination then it gets

unlocked and so when you start to think about this it’s not

only innovation on the technology front it’s innovation

around the way that we form capital it’s the way that we

organize resources it’s the way that we build companies it’s

the business models right it’s the application of those

technologies all that stuff starts to change and go back to

a 2007 that’s when the iPhone came out Uber wasn’t possible

right I’m just going to lie like all these companies that

weren’t possible before when the digital technologies are

kind of adopted on a global scale I think that we all myself

included drastically underestimate how fast and how

big innovation can be because it’s just hard right like like

we like to think linearly and that’s not how the world works.

Yeah I do find it kind of interesting it is NFT based but

I don’t think it has to be this this idea of I think big clout

it’s called or whatever the idea of sort of investing in

individuals it makes me immediately think about

investing in ideas so even just the words you speak having

value and sort of if you have a frictionless like automated

financial system then you could do a bunch of interesting

things about what it means to add value to the world I mean

I don’t know if big cloud is currently an efficient

representation of that but I am truly happy that however that

thing works I’m just one notch above Vladimir Putin which is

one of the that’s like one of the bucket list items for me to

to have a list where I’m one notch above Putin well what I

think you’re talking about here is important because there’s

historical examples you could invest in a patent in some

situations you could invest in an organization that has an

idea right so these are super inefficient given kind of the

vision that you’re painting in terms of like investing directly

in an idea in a super efficient automated fashion yeah but

that’s how the technology evolution works right is it’s

really hard to do at first and then slowly kind of becomes

easier and easier as technology is more prevalent the other

thing that I think is interesting is this whole idea

of investing in people if you really think about the

origination of that is I would hire somebody right I pay you

money and then you’re going to create production but I take

the lion’s share and you don’t now there’s things like these

ISAs these income sharing agreements where basically I

will educate you on something train you on something I’ll put

up capital right and then over time you’ll pay me back plus

profits as some version eventually I don’t know what it

looks like but being able to get upside in somebody’s success

for having risk capital early on doesn’t seem that far off

see it in professional sports you see it in you know a lot of

these things and so I just think that a lot of the focus

right now is on the technology but ultimately these are ideas

that are very old and have had lots of success and traction

and we’re just merely standing in the way of the evolution of

these ideas with new technology and so it’s easy to get caught

up in the technology but when you really zoom out and look at

it from the ideological standpoint and kind of the

progress of humanity it’s a foregone conclusion this stuff’s

going to happen it’s just how I think the world is waiting and

some of us are trying to create that future world which is like

what are the applications of this technology that will

transform the world and then you know I hate the term but

killer apps like cool ideas that are implemented effectively at

scale that transform the world and there’s been a there’s been

a lot of different ideas popping up like the there’s a

lot of ideas about social networks that are built on top

of the technology and all that kind of stuff so but let me

actually drag this back down to something basic if a person

wanted to buy Bitcoin store Bitcoin how do they actually do

it yeah so there’s a couple of different ways to kind of

acquire Bitcoin and in every way you’ve got to exchange

some form of value for Bitcoin right which is part of why it

has values because you’re giving up value so in one way is

to exchange energy and computational power for Bitcoin

so you can mine it you can literally take computer power

that you have you can rent it to the network and run that

software and then it will pay you a portion of the kind of

daily revenue off that system and you can acquire Bitcoin in

exchange for your power and your computational kind of

contribution and that’s the fundamental principle behind

Bitcoin is the proof of work so I got a hundred bucks like I

use cash app the you know they there’s Coinbase there’s all

these exchanges like how do I convert my $100 to Bitcoin is

there something disclaimer this is not financial advice and

this is just us talking and just your opinions this do not

use this to invest or take as financial expertise that said

like is there something you recommend that’s an easy entry

point for somebody that’s like hmm I wonder if I can convert

this hundred dollars into whatever amount of Bitcoin what

do you recommend what are the options so there’s a lot of

options I’m heavily biased I went out and I scoured the

market looked at all of them I’ve invested a lot of money in

a company called BlockFi that basically basically has

financial products for crypto investors so you can go you can

take dollars or other currency you have you can convert it

through an exchange you can leave it on these interest

bearing accounts you can earn interest just like you would

earn in a traditional account but higher levels of interest

because it’s this new thing or you can withdraw it and you can

put it into cold storage on a hardware device you can leave

it in a software wallet there’s kind of all these storage

options so BlockFi is you know kind of the one that I’m biased

towards because I’m sorry to interrupt so BlockFi is Bitcoin

only or is it an exchange with other crypto it’s got a bunch

of different ones yeah they basically are agnostic to what

it is but they provide kind of financial you know products to

crypto investors okay so you mentioned a few interesting

ideas that’d be nice for people who would not be familiar with

it cold storage hot storage what does that mean so like I go to

a website and I convert dollars to Bitcoin that’s a kind of

storage that’s like online banking right what else is

there so there’s a couple of different things that you can

do right and let’s use the legacy system as kind of an

example so if I want to get currency and I put in my bank

account it sits there I have to trust that the bank doesn’t go

under nobody steals it all this kind of stuff there’s insurance

for it right there’s all these kind of benefits in the legacy

system to make sure that as long as I don’t have you know

millions and millions of dollars there I’m going to be

protected pretty much if anything happens through FDIC

insurance if I want to do that I’m taking that counterparty

risk though so it’s mitigated but there’s still counterparty

risk I’m counting on that bank but it is easier to move it

around right if all of a sudden you call me up and say hey send

me some money I can press a couple buttons on my computer

and it’ll send it to you if I want deeper level of security I

can go and I can get the physical dollars and I can go

and I can you know put under my mattress right and I can say

you know what it’s not gonna be as easy to send it to you

immediately but if I really want to I can go underneath my

mattress pretty quickly I can grab it I can get it back to

the bank and then I can send you the money the third thing I

could do is I could basically take those physical dollars out

of the bank and I could go and I could go put it literally you

know in a vault somewhere that I don’t have control over that’s

behind 10 passwords and biometric scanning and like it’s

really difficult to even get to it right so if you can almost

look at it it’s like there’s three stages of security that

you could have in the traditional world the same thing

is true in Bitcoin so you could buy Bitcoin on any exchange you

can do it on BlockFi but you also can do it on places like

Coinbase, Gemini, Kraken, etc. Also Cash App. Cash App. You can

do it on Cash App. I think I think they’re still sponsoring

this podcast. I’m not biased at all. So once you get Bitcoin

on any of these venues you can leave it there on that venue.

Now the trade off is you’re taking counterparty risk so

somebody else is responsible for the security and the

protection of it in many cases big well known companies who

have billions of billions of dollars of assets they have

higher levels of security that’s why they’re well known

that’s why people trust them whatever but you are taking

counterparty risk it is easier to quickly send to somebody so

that so the trade off of like ease of use but counterparty

risk is big and in the Bitcoin community specifically there’s

a huge thing of they really really have a keep for not

leaving the Bitcoin there right for the obvious counterparty

the second thing you can do is you can basically get it off of

an exchange and you can put it in some level of kind of what

I’ll call a second layer of storage that second layer

storage could be a hardware device that you can quickly

just you know grab off your desk and plug into your

computer and immediately use that’s what they call like a

hardware wallet or you can have some sort of software wallet

right where it’s not on an exchange but there is some

level of in between between the hardware wallet and the

exchange and the software wallet but the software wallet

is connected to the internet yeah and so if you kind of

think of it as like the exchange software wallet

hardware wallet and then there’s something called deep

storage right or cold storage and this is you know

literally there was a company called Zappo that would put

things in deep cold storage and it was literally buried in

a mountain right so like the odds that somebody’s

physically going to go there there’s armed guards there’s

you know kind of all this type of stuff but again you’re

taking some level of counterparty risk because they

have your Bitcoin and so the saying or the phrase is not

your keys not your coins whereas my buddy Isaiah Jackson

came up with he said not your keys not your cheese right in

terms of sovereignty is important right and ultimately

this goes back to kind of the beginning of our conversation

around Bitcoin’s ethos sovereignty right giving the

power back to people you don’t have to rely on this

infrastructure in order to be able to participate in this

monetary kind of economy what you are now able to do is

you’re able to use digital sound money you’re able to

keep control of it you and you alone are responsible for it

so the idea of personal responsibility and then also

you and you alone make the decisions as to whether you

hold on to it or you use it without censorship right no

one can tell you what you can do with it or can’t do with it

and so the purchase and the storage what I find is

depending on who you are there’s varying degrees of kind

of concern or decisions that get made there and a lot of it

comes down to personal preference the Bitcoin

community though absolutely will over optimize for

sovereignty and kind of hardware or cold storage I

wonder if you can sort of comment on that because you

have both sort of cash app and the BlockFi and Coinbase like

you can store it that you can purchase and trade it there

and store it there and so on but ultimately they’re saying

you wanna you know keep some of it there but you wanna move

it to the hardware wallet and the cold storage of the

hardware wallet is like you can disconnect this from the

computer because ultimately stuff that’s connected to the

internet can be compromised can be controlled by governments

and other parties and so on what are your thoughts about

sort of practically speaking for maybe like a regular

citizen what’s what should be the role of the hardware wallet

in their lives yeah so at the highest level I just think

that like learning about it is important right so even if you

only have five dollars equivalent of Bitcoin going and

understanding here’s how it works here’s why it’s important

here’s how I would actually withdraw from an exchange under

the hardware wall like that alone just as an intellectual

exercise is a worthwhile pursuit I think people should

go do that actually go through the process of the steps so

you feel like you can you can do it yeah yeah it’s kind of

like if I said to you you know hey we’re gonna go buy an

asset and you never went and you looked at it you never went

and you know made a decision like sure maybe I did it or I

didn’t do it but like you didn’t actually experience it

right and so I think that that’s important part the

second thing is each person is different from a how they view

this asset so there are some people who are speculating

right there’s three use cases for Bitcoin their store value

medium of exchange and speculation and the people who

are speculating they can’t put it in deep cold storage because

they need to be able to trade it right so what ends up

happening is they fall in the bucket of like high risk high

reward they’re trying to trade they’re trying to do all these

things and sure maybe there are profits that they can generate

if they’re good at it but also they’re introducing a lot of

risk and so that person is very different than the person who

says hey you know I bought one Bitcoin and I’m gonna save it

for my child right and I’m gonna give it to them on their

18th birthday yeah and so when you start to look at this what

you end up saying is what are you actually purchasing this

for kind of like why are you doing it and then what’s your

time horizon and what ends up happening is more and more

people in the Bitcoin community have longer time horizons one

of the advantages to this community right if you look at

the on chain metrics 60% of Bitcoin haven’t moved from the

digital wallet in which they sit in the last 12 months so

even though it’s appreciated hundreds of percent on the

upside there’s been lots of volatility a 50% drop in a

single day in terms of US dollar price still doesn’t move

and so these are the kind of long term holders right these

are the the iron fist or or as recently has become popular the

diamond hands right they just they’re not going anywhere and

so I think that those people are much more likely to not have

their Bitcoin on exchanges or in software walls they’ve got it

in some sort of like highly secure environment and what and

one in which they have deep sovereignty or kind of prevalent

sovereignty and the reason for that is because they have that

long time horizon they don’t want to be kind of convicted

around Bitcoin sound money macro environment all stuff and

then they make a mistake because they trusted you know

ABCD company and that counterparty risk ends up

actually being you know fatal or or detrimental so again this

is not financial advice disclaimer but let me ask so

in terms of investment advice on Bitcoin so you see Bitcoin

potentially not just the thing that you speculate over like

buy and sell buy and sell buy and sell but it’s something

that you can just buy only and I believe I’ve heard that you

own quite a large percentage of of your wealth in in Bitcoin

and you’re basically buying only and storing long term so

that’s something that’s a legitimate way to approach

Bitcoin in your recommendation go to other cultures so if we

remove ourselves from the Western world culture of

investing in gamification of financial markets and the

financialization of everything let’s say we go to the culture

of India for hundreds if not thousands of years families

basically saved their wealth in gold and in jewelry and in

these hard assets with the expectation to pass it on to

the next generation and so it would be blasphemous to sell

the family’s gold in that culture right you know your

great grandfather gave to your grandfather your grandfather

gave to your father your father gave it to you right and

so in that culture the long term kind of holding is the

default I think that what Bitcoin has presented again is

a digital application of the exact same thing which is that

while everything else in the world is being devalued that is

denominated in a currency that is being inflated away whether

it’s quickly or not this finite supply this scarce asset ends

up accruing more and more value over time right and so I think

that for me personally I’ve got you know over 95% of my net

worth that’s in this 90 over 95% of your net worth there’s

two important caveats to this one is I didn’t you know buy

some Bitcoin in 2011 or 12 right and then all of a sudden it

appreciated a bunch and it grew into that but from a cost

basis perspective you know put $100 and now it’s a ton of

money instead what I did was I basically in 2018 saw Bitcoin

from a US dollar price standpoint was falling and

falling and falling and in December 2018 as I take about

50% of my net worth and convert it from dollar denominated

assets into Bitcoin so it’s a very kind of intentional

decision with a very specific view on the world as to like

why I was doing it I then essentially just let it sit

there grow whatever until the spring of 2020 and when I saw

the government step in and start to say hey we’re going to

really be aggressive in terms of interest rate manipulation

and quantitative easing I then decided to go ahead and take

basically the remainder and start to convert it as well so

became very aggressive in doing that and so the way that I look

at it is that’s actually my savings right and so in some

weird way if I said to you know what’s the dollar worth you’d

say well a one dollar bill is worth one dollar right Bitcoin

to me I denominate my wealth in Bitcoin so I think of one

Bitcoin is worth one Bitcoin not one Bitcoin is worth 60,000

or 55,000 or 70,000 right I denominated everything in

Bitcoin when I make a purchase in my head I’m calculating how

much Bitcoin am I spending right now right well guess what

happens when you have a devaluing currency as the

denominator doesn’t matter right like your financial

incentivize to spend or invest right to consume when you have

an appreciating currency all of a sudden you become much less

consumptive in your behavior yeah because you’re actually

trading off future purchasing power for the consumption today

it’s fascinating to think that if if when you move about this

world you think in Bitcoin you behave differently is if you

think in dollars that’s really fascinating people but here’s

the thing is the last 50 years or so is actually the outlier

in history most people used to think this way yeah it’s only

when a fiat currency got introduced that one argument the

positive argument or perspective is there was an

explosion in growth but really it’s because there was a

financial incentive to consume yeah right and there’s nobody

better in the world than the United States at consuming and

we consume anything and everything and if you want to

see a great example look at how big the coca colas are at

McDonald’s right you know you go to other places they don’t

serve them that big and so the other example though or the

negative argument is we have to consume because if not you end

up being the bottom 45% of Americans that help no

investable assets and actually are just having their wealth

devalued away so holding the dollars end up being a very bad

economic decision and so when you then switch to this sound

money you say wait a second why would I if today I can trade

one Bitcoin you know back in October of last year one Bitcoin

for 10 thousand US dollars why would I spend that if at some

point in the future whether it’s a month from now or 10

years from now I could trade it for something much much more

than that you just become much more of a anti consumer and

much more of a long term thinker yeah from the individual

perspective that’s pretty powerful I wonder I mean I

think that’s a interesting debate what’s better for the

long term economy no better for the growth of the civilization

because capitalism is fascinating it seems to it seems

to work pretty well there’s this kind of like Eric Weinstein

says that one of the problems is for the past several decades

this whole economy society is built on the idea that we have

to keep growing like it depends on that idea and it’s a

good question whether that’s going to result in huge

problems or if like a college student on a deadline the

the dependence on growth will mean that we’ll have to grow

like the fear of death will force us to grow but I think

there’s a false equivalency between we’re dependent on

growth and then if the world was denominated in sound money

we don’t grow what I think ends up happening is we remove a

lot of the society’s bullshit yeah because right now when the

money is free or the currency is free you come with all kinds

of crazy stuff and people will give it to you right when all

of a sudden it’s really really valued by the population the

decisions are better yeah you you have to provide real value

in the goods and services you provide in order to get them to

give it to you there’s less room for corruption less room

for manipulation that’s and like that’s not actually

productive yeah definitely so you said you moved a lot of

your investment into bitcoin is there when you look so you’re

a special human being in many ways so you’re like a strategic

thinker but you’re also like a deep thinker about this whole

thing but when you look at a regular club like me in terms

of just investing and moving into thinking about

cryptocurrency is there a strategy that you recommend

what are the different options about investing into bitcoin

yeah so i think that there’s just uh kind of timeless advice

when it comes to uh investing or or acquiring an asset in

general uh dollar cost averaging is usually the the

best way to think about it and what i mean by that is um most

people don’t just have a pile of uh currency sitting there

right it’s not like they have a million dollars sitting in

their bank like what do i do with it uh that situation aside

what happens is they trade their hours and their effort for

currency and so as they get paid every two weeks let’s say

um the best way to acquire bitcoin without having to worry about timing

markets and being a professional trader is to simply take whatever the

percentages that you want and to buy bitcoin when you get your

paycheck so if you get paid on the first and 15th of every month

on that day you should go take you know let’s say it’s three percent of your

paycheck take three percent go buy bitcoin don’t

worry about what the price is you should do that over time and the

reason why that’s important is um if in december of 2017 when bitcoin

is at twenty thousand dollars it was the height of kind of this last

uh big upwards movement you had taken all of your money

and you had put it into bitcoin you would have had to wait almost three

years just to get back to quote unquote break even

in us dollar terms if at the same time you had simply bought then and over the

next three years bought every two weeks you would have been up hundreds of

percent three years later because what ended up

happening was you bought a bunch of bitcoin when it was at

15 12 10 9 8 3 4 5 5 5 you know all the way back up on the

other side and so dollar cost averaging is one of

these weird things that uh it almost sounds too easy but what we

find is in america we have a lack of financial education

and so rather than try to be smarter than markets what most people are better

off doing is just saying hey set your what’s called an asset

allocation plan i want 30 in stocks i want 10 in real

estate i want this this whatever and every time you get your paycheck

just think of it as a savings account right just put it in

based on those percentages and don’t think about it

and over a long enough period of time what we find is

almost anyone in the united states right there’s exceptions but almost anyone in

the united states can become a millionaire in their

lifetime if they follow these plans and have that long term view and they allow

compounding to work for them and so don’t look at the price of

bitcoin and all that kind of stuff just pick a

specific time specific day that you just buy

and you just keep buying that’s probably good investment advice across any kind

of assets it’s like if you don’t believe in

bitcoin and you just want to let’s say you just want to do the s&p 500

yeah you shouldn’t try to time the market of the s&p 500 either right you

should just every two weeks you should just buy some

and over a 20 year period you’re gonna end up buying it at all kinds

of different prices but you’re gonna get kind of a blended average

and the more important thing is the compounding and the time in the market

then did you buy it at you know two percent higher or lower than where you

bought it doesn’t really matter and buying often makes you i guess

uh resistant robust to the uh to the volatility of the market or the

volatility of bitcoin price and so on that said uh you know bitcoin price

is volatile and you know again the argument i’ve heard

is like everything that’s going to be a lot more valuable in the future

like if you look at the history like companies like apple like teslas

now i mean but let’s look at companies that

have now stabilized right uh apple is a good example

it’s like volatile in the beginning and so the argument for bitcoin is like

yeah this is the early stages because it’s going to be a lot more valuable

right now it’s volatile and this is why you have to have these kinds of

strategies to ride out the volatility of course everything that goes to zero is

also volatile like the early days are volatile uh

do you see like this volatility as like a feature or a bug

or is this just like a way of life so amazon is the one that i know the

numbers on in terms of early volatility uh every year since it has gone public

it’s had a double digit drawdown in that year uh the average

is over 30 percent and one time it drew down over 95 percent

sounds a lot like bitcoin right like oh wow this is crazy

but it’s one of the best performing stocks in the last 20 years if not the

best performing stock and so volatility is not positive or

negative it’s positive or negative compared to the

position you’re in so if you’re long and it’s volatile to the

upside it’s positive if you’re long holding something and

it’s volatile to the downside you see it as a negative it’s all about

perspective with that said um another way that i

look at this is every asset priced in bitcoin

is down significantly so over the last one

three five years the dollar priced in bitcoin

has crashed 99 percent if you denominate stocks it’s down like

80 85 if you denominate gold if you

denominate bonds if you just go down the line real estate etc

it’s all down massively against bitcoin now you could argue that that’s because

bitcoin is appreciating in us dollar terms

or you could actually argue that the world is

repricing this asset it’s doing price discovery on this asset

and it’s essentially comparing it’s saying hey bitcoin verse

this stock or bitcoin verse this ounce of gold or bitcoin verse

you know this dollar which is more valuable and it continues to move up in

the rankings in terms of the value that the world

ascribes to this some of that’s based on lindy effect just

the longer it persists the more likely it is to survive some of that’s based on

like the underlying fundamentals of how much computing power the usage

transaction volume things like that but some of it also is that as more

and more people wake up to the fact that it’s a finite supply asset that has a

place in the world and demand increases people just naturally

compete and ascribe more value to it and so the

volatility i think all comes back to like what do you

price your life in for majority people that’s dollars

and so you look at the us dollar price you get all this volatility

the beauty of this is that 60 that doesn’t move regardless of

price upward or downward and movement those people aren’t looking at the day

to day price what they’ve basically said is i’ve

acquired x amount of bitcoin and i’m just going to hold it for years

and every time somebody’s done that right if if uh you bought bitcoin at any point

in the last 12 years and you held it till today you are up in us dollar terms

now if we had this conversation 18 months ago couldn’t say that

so it’s all about not only the acquisition

price if you will it’s also when are you looking at it

right because there was a point in 2017 you could have said the same thing but

in 18 you couldn’t and so i tend to think a lot about um

humans are really really bad at short term

uh decision making because we’re so emotional

especially when something has a price tied to it and so it’s in terms of our

strategies and decision making we should be long term and have like a

regular almost think like an algorithm that

in that in that kind of way so i think you’ve tweeted that

you believe that bitcoin has a chance of reaching 1 million i don’t know what it

is currently i think it’s five the 60s which is incredible

i think i remember when it was at least in the double digits i think i remember

it was in the signal digits of a dollar so the fact that it’s cross 50 is crazy

uh but uh you’re even crazier apparently thinking that it can reach a million

so do you think it’s possible for it to reach a million is there some kind of

transformative effects we have to see first

when might it reach a million like what are the signs that we would look for

what’s required for it to reach a million so let’s just look at it from a macro

perspective uh gold is a 10 trillion dollar asset

and when you compare the technology of gold to the technology of bitcoin

bitcoin is superior in every single way right it’s more portable it’s more

divisible uh it’s more verifiable it’s more

scarce on everything and so some people would argue it’s a

10x improvement some people argue it’s 100x improvement from a technology

standpoint and so we don’t need bitcoin to

actually kind of um capture the full 10x or 100x

improvement from a market cap standpoint if bitcoin simply captures

2x the value be a 20 trillion dollar market cap

which would put bitcoin at about a million dollars

right so kind of just from a macro perspective if you have a 10x or 100x

improvement from a technology standpoint and you directionally get some value

capture in that direction you’re hitting around a million or more

uh dollar price point can ask a quick question which is uh

what’s the current market cap for bitcoin uh the current market cap is

right around a trillion just over a trillion dollars and you’re saying gold

is 10 trillion and uh sorry where did you get the 20

trillion 20 trillion would just be 2x gold market cap

got it right so if it’s a 10x technology improvement let’s just say it only

captures 2x the market cap got it right and so again if it was to

capture just gold market cap kind of the equivalent

puts you around 500 000 right so you can kind of see there’s bitcoin

so if you capture the entirety of the gold market

uh then it would be value of a single bitcoin uh the price of a single bitcoin

would be five hundred thousand dollars okay

to reach a million it would be double that that’s what the 20 trillion comes

from correct got it so if you then say to yourself

okay how does the uh the pricing um kind of cycles work right or the

boom and bust cycles gold is a very um

kind of linear type supply schedule meaning that

uh there is a certain amount of gold that comes out of the ground each year

the interyear variation in that incoming supply is not much

right maybe there’s an extra mining company that gets set up or a couple of

them maybe one goes out of business but for the

most part the kind of inflationary uh increase to the supply of gold

is pretty stagnant uh year over year bitcoin has a very unique feature which

every four years there is a programmatic supply shock

meaning that uh in the beginning 50 bitcoin every 10 minutes was introduced

into the supply after four years of that happening every

10 minutes it was cut in half so on a in a single

moment it went from 50 to now it was 25 four years every 10 minutes 25 got cut

in half again to 12 and a half and then recently in may 2020 got cut to 6.25

when you have an asset that is determined the price

based on supply and demand you normally have

two inputs to the equation what is the supply and what is the demand

in an asset like gold or a stock or anything else

we have to do our best guess at the supply

both the existing supply and the incoming supply and do our best guess at

the demand and we’re actually pretty good at this a lot of times in terms of

directionally saying it’s going to go up or down and here’s kind of some price

point milestones bitcoin’s unique in that there’s 100

verifiable proof of the existing supply

the total supply and the incoming daily supply

so we know 100 i can show you on the actual blockchain

or in the code that there’s 21 million bitcoin and that’s all there will ever

be i can show you that there’s 18.6 million

give or take bitcoin that actually are in circulation

today right and i can go all the way back to every single transaction that’s ever

occurred since january 2009 and then i can show you on a daily

basis that 900 bitcoin a day are coming into the circulating supply

and so when you have 100 confidence because you can prove

the supply side of this equation you can hold it constant

i know with 100 accuracy the supply side so now i’ve reduced the mathematical

equation that i need to do to determine price movements

to a 50 reduction i only have to worry about demand i don’t have to worry about

supply and so when i look at demand i can do

all kinds of things i can take the demand over the last 10 years and

the growth and just extrapolate it out i can increase it i can decrease it

whatever but what you find is that these supply

shocks lead to significant price appreciation

as the asset gets repriced because there there’s a supply shock to

and so probably the best thing that i’ve done over the last couple of years

was in 2019 i started to talk about the idea that we were going to have both a

supply shock and the demand shock in 2021

or i’m sorry in 2020 i didn’t know when this bull market that we were in was

going to end nobody knows right it’s impossible to time

these things but you could tell that we were kind of at late stages of a cycle

there was inverted yield curves there was rep uh gyrations in the repo markets

a lot of ceos leaving their jobs you know all this kind of stuff

and all i said was at some point when the market turns over

the government’s gonna have to step in we were addicted to stimulus they’re

gonna have to manipulate interest rates down and they’re gonna have to print

money i had no clue that there was going to be a global

pandemic that they were going to have to step in

in such an aggressive way and move rates not down but down to zero

and that they not only were going to print hundreds of billions but they could

print trillions of dollars but the framework that i used to think

about this was when they do that everyone is going to

run to store value assets they’re going to run the gold they’re going to run the

bitcoin etc and right as they do that it appears at

the same time there’s going to be this supply shock

so you’re gonna get a supply shock and a demand shock that are both positive for

the the price i called it rocket fuel for bitcoin

well it happened and here we are i now look forward and i say okay we are

likely going to see a hundred thousand bitcoin

a hundred thousand dollar bitcoin this year or at some point i don’t know when

it happens but we’re moving in that so you think in 2021 we’ll see a hundred

thousand that would be uh my most conservative

view uh i i’ve said a hundred thousand dollars

since 2019 and people thought that was insane and

crazy and all stuff now i’m the conservative guy in the room

because i stick with a hundred thousand dollars and people are saying

you know multiples of that number here uh so we’ll see what happens but

but i think that there’s still a lot of room kind of to run from a us dollar

price standpoint what is on the horizon is in 2024 we

will have another supply shock and so that’s what i think will carry

us to the million dollar bitcoin from 6 to 5 to whatever 50 reduction yeah

yeah and so that’s what i think uh well

basically when we get that that next supply shock that’ll carry us up over a

hundred or over a one million dollar bitcoin price which if historical

examples persist and again sometimes it’s hard to use historical examples to

look at future events um but if that happens we would see

a million dollars of bitcoin by the end of 2026

after that wave so 2024 basically is the supply shock and within

you know 18 to 24 months you would see the uh

the kind of top of the next market hopefully without a coupling to the net

to another pandemic yes we we would like to do all of this without a

public health crisis so that would take it to

20 trillion you don’t have to compare it to the dollar

essentially in some sense that the dollar could also lose value i mean

there’s a lot of kind of dynamics at play here

now but like fundamentally there’s going to be a huge

move uh in your prediction of uh value into into bitcoin

i mean that’s a fascinating world uh to think about

uh i mean but i do have to kind of ask you about the whole space of

technology there because we’re talking about the value of security we’re

talking about the the future which bitcoin will be at the

center of but from my perspective of

thinking how like i and others can build technologies on top of

this kind of decentralized world i’m thinking about different

different technologies out there different cryptocurrencies out there

ethereum being one but there’s a lot of others

so i’d love to get your sort of ideas about some of these but

so first let me ask you about what the hell is shit coin

is this connected to uh to our previous discussion of the meme

uh this shit coin cover basically all coins that are not

bitcoin is it uh uh mean is it a beautiful is it’s a mixture of

both as with most things in life uh depends

who you ask um the uh most um

kind of enthusiastic and uh uh parts of the bitcoin community shit

coin is anything else right kind of if you ascribe to kind

of a maximalistic view of the world shit crime be anything if you look at

people who i would say are bitcoin proponents uh yet

see value in other things shit coin may be the bottom half

of the other things right so i think again it’s really important kind of who

you ask is how you’ll get that answer so

there’s tiers and the way you divide those tiers might be different depending

who you ask ultimately what it is is it’s a meme yeah

and it’s used to uh articulate the idea that whatever you want to put in

that bucket has no value so shit coin right are coins that have

no value yeah uh what is fascinating about it and i

think that again speaks to the power of the bitcoin community

is uh there was congressional hearings a couple years ago

oh no and at one point uh a congressman from ohio warren davidson who uh

who’s definitely uh open minded and excited about bitcoin

asked a an individual on the congress floor

uh during testimony to uh talk about these other coins and at one point

basically read into the record the terminology of shit coin

he said the word shit coin uh i can’t remember if he said it first

somebody else did or if uh the other person did and then he uh um

you know repeated it that’s awesome but he definitely he was trying to get that

read into the record yes uh for sure and so uh you know you

can imagine one again the meme speaking insolently to

the bitcoin community was you know made him very uh very well

liked uh but also too was um it does go back to this idea almost of

uh if you and i sat down with 10 ceos and we interviewed each one of them and

then we went in a room and we deliberated and we said we have to pick

the person who’s going to be the most successful

one of the inputs not all the inputs but one of the inputs would be

who’s the person who we believe has the best ability to

raise capital recruit people and tell a story

to the world that will get them to follow and so somebody like elon would

probably be the best example of this when you have decentralized products you

have no kind of leader right in the sense of somebody who is

financially ascribed to be that leader and kind of the

executive decision maker so what you have to do is you have to

look at these technologies in these communities and say

well which volunteer teams or which technologies have been able to coalesce

these groups around it and in some way build the same level of

engagement and protection and things like that and so

you actually get tribalism but you also get things like

shitcoin because what it does is it’s not only a um

kind of verbal attack towards uh others it’s a rallying cry for

internal what’s so funny is that it was started with the bitcoin community

talking about everybody but now you’ve seen adoption in other communities who

use it you know basically say well we’re not a

shitcoin it’s the it’s the next guy yeah i mean the meaning to be honest

it’s it’s one it’s off it’s sometimes

misused i think like with anything it’s like

people adopt memes that used to be brilliant or still brilliant

and they’re just not good at using them so they become

mean uh but when you do with with grace it can tear down an

argument and at the same time have like love and

respect underneath it i mean it’s a beautiful dance they have to be good at

like you know people just can suck at communication and even

uh like even a powerful weapon like a meme in the wrong hands

just uh fires in a way that doesn’t get anything done but this is like a war

of humor and memes it’s kind of fascinating exactly like you formulated

that there’s a symmetry of power so you have to

have guerrilla warfare in this internet game especially when there’s no leader

like you said in a distributed culture i would say here that is um

is really important i think is from a society standpoint

we’ve become very soft and very kind of coddling and not in um

not in a way that’s like i think people take this argument like too far

sometimes but what i mean by that is um it’s almost like if you’re the person

who holds somebody accountable you become the bad person right if you’re

the person who um says hey you know that’s wrong you’re

the bad person right and so in a world where i think in um

this kind of influencery you know all positive if you have any negative

you know feedback or constructive criticism like you’re the bad person

uh it’s the ultimate echo chamber right and so i think that what the bitcoin

world does in in some crazy crazy way to look

at it is bitcoin is ultimately about truth

not about narrative not about feelings or emotion it’s math yeah

you look at a blockchain and you can prove something

or you can’t and so naturally people who are attracted to that

have a very similar approach in life yeah right they say hey

you made x claim prove it and as you can imagine

you know a great example is like the financial media meets bitcoiners

and it’s a bloodbath right in kind of the the arena of ideas because

what do they do the financial media is used to the soft

you know opinion pieces etc and bitcoiners show up and they’re like

uh here’s data point a b and c here’s example one two and three

and you’re wrong and then all they yell and scream about is like

uh i’m wrong i’m wrong i’m wrong like you can’t say i’m wrong and they’re like

nerd like disprove what i just said and so you get in this like very very weird

it’s fascinating it’s a fascinating battlefield but

i i do want to say it’s i’ve been watching this

it’s kind of interesting i think that the pursuit of truth

like tearing down bad ideas can be done with grace and to do it with

grace requires a lot of skill like what people

don’t realize about disagreement they think that disagreement is easy

like they they see the the the lies or the inaccuracies in the

statement and and they just think they can say

wrong uh yes you can say that but if you want

to be effective it requires great skill like you look at

i don’t know um a beautiful uh verbal shit poster which is Christopher

Hitchens right it requires a lot of skill

through your words to tear down an argument

to criticize and to take a step towards truth

what i’m disheartened by internet culture like the negative side

is people don’t put a lot of effort in their tear downs

like into your shit posting into your memes

you should put effort and see it as a skill that you want to if you want to be

a part of this culture you want to uh get good at it

like any skill it’s the 10 000 hours like get improve deliberate practice

self criticism all of those things uh just because you’re anonymous

doesn’t mean you won’t get deep joy and actually have an impact on the world if

you get good at shitposting but but i think this is really really

important right because you’re right in that

uh it’s all about intention versus action if your intention is to

uh tell somebody that they are wrong in an effort to get them to

see the truth yes that’s very different than if your intention is to tell

someone they’re wrong and hurt their feelings yes

right and so when you can unpack intention and action

you really quickly can tell what somebody ultimately is trying to

accomplish i also think that one of the craziest

things that i’ve seen play out is uh memes when i use that term i’m not

just talking about like a static photo right when i’m talking about these

elaborate uh kind of edited videos and kind of

all this stuff um when done right it is

uh the most articulate way to deliver a blunt message and it’s

done in such a way that is humorous and entertaining

yet really hammers the point home and so it’s a skill set that many people don’t

have i don’t make those i’m assuming you don’t make them either

right i see them i share the ones that i like right

uh but it does take practice and you can tell

look there’s people who are fantastic meme lords right and there are

people who absolutely suck at it and it’s like anything it’s just

how good are you at communicating and uh i’ve heard the idea a bunch of times so

i don’t know who to kind of credit for it but uh whether it’s emojis

it’s gifs it’s memes whatever this is the extension and evolution of

just hieroglyphics right yeah like like we have been doing

this for literally centuries it’s just that now we’re doing it on

the internet you can press a button and go to

millions and millions of people immediately uh but speaking of memes

what the heck do you think is up with elon musk talking about dogecoin a lot

sort of uh from the cryptocurrency community i

from i’ve been talking to a lot of sort of technologists i guess

and reading papers on cryptocurrency it’s like

nobody really sees dogecoin as a revolutionary

crypto technology a lot of people talk about it’s security issues there’s a

bunch of issues it has nevertheless you did say that money is the

kind of social construct right and uh elon musk’s

combination of humor and brilliant engineering in the various

companies he runs combines to create a kind of value

and excitement behind dogecoin it’s like

um what is it he says uh that the most amusing outcome is the most likely

kind of idea which sounds silly but there could be like profound truth to it

it’s like what do you make of dogecoin philosophically or technically is is it

possible that dogecoin will overtake bitcoin and run the

run the entire world i can’t even because it could happen

it could happen but what uh if there’s any serious way to answer that question

well we have to start with uh techno king of tesla yeah and master of coin

as they are so articulately called in the latest scc filing

he officially changed his title techno king yes no king of tesla

and the cfo’s new uh title is a master of coin

and so uh when you have a sense of humor yeah and frankly uh a level of uh

self confidence and uh an element of uh an appreciation for irony in the world

dogecoin is actually one of the least crazy things that you could talk about

when you’re willing to go to techno king of tesla master of coin

uh and all this stuff and so i think that

elon uh doesn’t get enough credit frankly for his understanding of internet

culture understanding of memes and understanding

of frankly human psychology and marketing and so

in some crazy way every time he talks about dogecoin

it’s a rallying cry for an entire generation of kids

it’s a rallying cry for an entire industry uh in terms of cryptocurrencies

and digital technologies but this is the flag yeah

and this is the thing that he can yell and scream about

and tweet about without worry of punishment

so he could be talking about bitcoin he could be talking about cryptocurrency

but that’s not going to be uh as beautifully

humorous and whatever the hell internet culture is as dogecoin

he’s finding the right language he’s speaking the language of the people

of the of the in the digital age if you want to reach weird people

yeah you can’t be serious and most people are weird

the masses are weird so he’s speaking to the masses

yeah and the techno king and even further than that i think is

he essentially is um he’s using dogecoin as a way to say

i’m doing this because i can yeah he couldn’t do it

with securities he couldn’t do it with certain types of other assets right

like i almost look at it as like a venn diagram what’s the thing that a bunch of

people know about care about thinkers funny whatever and

also overlay that with the things that like he

could actually talk about they won’t get in trouble for

that’s a big f you to the sec i could see the

the people just freaking out i i mean i love it

but um i i don’t know if i would have the guts to do it myself

but i i think he’s an inspiration to a lot of us

to be like well maybe you should grow the guts

when you’re the techno king you can do whatever you want right

and i mean that’s something to aspire to is to be the techno king in your own

little world if you also think about it in the sense

of uh when you’re somebody on a mission to create interplanetary

life yeah when you’re trying to solve a or put a dent in the climate crisis

or create electric vehicles and be the first american company and you know

however long frankly the sec

or other things in your life that just don’t

you don’t ascribe that much importance to compared to those things

they’re almost uh nuisances and that’s scary i think for shareholders

of a company when the person that you’re trusting to lead

you to the promised land and create shareholder value

doesn’t put value on certain things but at the same time

i always look at it as a tug of war how much of the actions of what he’s doing

and calling attention to actually change the way

that regulators lawmakers politicians countries whatever act he may not be

able to say do acts i’m the techno king and they go do it

but with every step he makes he changes some of their behavior and so i

think that it’s um a really kind of game of like 3d chess

that frankly i’m not privy to right i’m kind of watching from the sidelines and

uh figuring out alongside everybody else but i also don’t think that it’s just

elon uh bought a bunch of dogecoin and tweets about it because he thinks he’s

going to a dollar and he’s gonna you know make money right like i don’t think

i don’t think it’s an economic argument as to why he’s so

interested in i think it’s much more uh it’s almost like meta message

for a lot of other stuff yeah he’s kind of

trying to break apart internet communication from first principles like

it does so many other problems it’s kind of fascinating to watch i know he’s been

uh he’s he’s taught me quite a bit about communication

and uh at least for me it’s been liberating to not give a fuck

about the old school way of things i’ve been always bothered by

a place i deeply admire which is mit but there’s

problems the bureaucracies and hierarchies that hold back innovation

brilliant minds and in that sense doge is a kind of fu to

the system that’s kind of positive but also

uh kind of uh but it was also an fu so in that sense i think

elon has a perspective on the world that’s similar to bitcoin folks

which i really like which is like thinking long term

it’s how visionaries think is like how will if i take these ideas

what and the ideas hold true what will the world look like in 20 30

50 years and think about everything in that way

yeah i like uh bezos’s view which is uh is essentially how do you minimize

regret how do you accelerate your life mentally

and go to 80 90 100 150 years whatever we end up

being you know fortunate enough to live to and then look backwards

yes and say this decision that i’m going to make i have two

options which one is going to be the one that i least regret

and if you continue to make decisions that way

one you have that long term view kind of built in because you’re working

backwards uh two you are ultimately going to optimize

for uh minimal regret but also three is

even if you only look forward 10 years that’s much much further than most

people do and so it gives you a significant

advantage and i think that um bitcoin has kind of this like um

you know proxy for time as we talked about uh

interplant uh planetary travel where there’s multiple steps from creating a

reusable rocket to landing it to you know all this stuff all the way

to simple things just like if you’re simply trying to figure out

where the world’s going to be 30 years from now

you know bill gates says that we overestimate what we can do in one year

underestimate what we can do in 10 well to me it’s a um kind of degree of

uh mistake if you will 10 years maybe you’re off by 10 percent

well if that line of progress continues 20 years you may be off by

100 and 30 years you may be off by a thousand percent

right like almost the further you go out the more inaccurate you become

and so i think that people who want to iterate their way to success right

that’s a common thing in like the startup world

end up actually following kind of the breadcrumbs to where the

world is taking them but people like an elon musk a jeff

bezos a jack dorsey all the way down the line all these

innovators they actually say to themselves there is

a point in time in the future where there’s a world i want to

construct and then they go and they construct it

regardless of the short term iterations and incentives

it is just they’re driving towards that point and i think that it’s this whole

idea of having this like you know kind of set vision and this

uh refusal to kind of move or budge off of that

that’s what makes them special one of the

things that garnered a lot of excitement in the crypto

community is nfts i i have no idea really the depths the

fundamental technological philosophical depths of the second of this technology

whether this is just like a little bit of a fad or there’s some deep lessons to

learn whether it’s bitcoin or cryptocurrency in general about it

do you have thoughts about like the long lasting fundamental aspects of nfts

i think there’s probably both things happening fad

and things to learn right and um if we just start with like what is an

nft it’s a non fungible token meaning that um there’s no fungibility

and fungibility is a fancy word um i always describe it as

if i took a hundred dollar bill and i put it on the table with a bunch of the

hundred dollar bills and we mixed them up and i just grabbed a hundred dollar

bill and left i’m no worse as long as they’re all you

know uh official hundred dollar bills because as long as i have a hundred

dollars i have hundred dollars i don’t need that exact same bill back

so that means that those hundred dollar bills are fungible

non fungible would be like art if i took a picasso and i put it down on the table

and you brought three artists that no one’s ever heard of before and we mixed

them up and i just took any random piece of art

it wasn’t the picasso i lose because the picasso is really

important there right so non fungibility is important in art

what these non fungible tokens essentially are doing is they are uh

creating scarcity and originality in a digital environment and what i mean by

that is um take a music file if i had a music

file and you wanted it you said send it to me

i press send it essentially creates a copy and you get one music file i get

another we don’t care you can listen to music i

can listen to music we’re super happy if i instead though have a digital file

that entire premise is based on scarcity and i hit send and you get a copy and i

keep the original or you get the original i get a copy

there’s a problem and so ultimately what i think is playing out with nfts is

it’s a technology regardless of where it plays out from

blockchains or uh what in communities or environments

that just brings true digital scarcity to the internet and so naturally what

people do they look at the legacy world and they

say well what’s scarce there that has value

how do we bring that to the digital world so art is a perfect example right

and you know frankly last year i started to

look at this because it felt like this was going to be really really big

and the conclusion i came to was just as bitcoin is going to be bigger

than gold right the digital application of

something is going to be bigger than the analog application

the same thing’s going to be true in art the digital art world is going to be

bigger than the traditional art world people think that sounds crazy at first

until you start to realize it’s very very similar the art is more

portable it can be divisible right it’s got a

larger demand market in terms of the internet rather than an auction right

all this kind of stuff when you display it it can have motion

and music and all of these aspects to it that are better than the traditional

art what the traditional art market has that

the digital art market has not had is the narrative narrative based world

scarcity kind of in digital sense and so what i think the entire world is

going through right now is an exploration of how do we use this

technology to create new things frankly

we’re not going to be good at it for a while

and so the only place i’ve really focused on is

digital art itself and i’ve always been interested in art but i wasn’t going to

go buy a painting and hang it on the wall

right in the sense of uh that’s how i was going to store value

what i find fascinating though is that i now can take

that concept which most of the wealthiest people in the world

have a significant portion some you know some people have 20 percent in terms of

you know number of billionaires 20 percent of their wealth is in art

and you can bring to this digital realm which is much more um

kind of natural to a digital native and so the best way to describe the

importance is imagine a serial number being placed on

something take the eiffel tower the only eiffel

tower that has value is the first one every replica of it regardless of size

location you know who made it where they sent it

they have no value eiffel tower 001 is the most important

and so i think that’s ultimately what we’re starting to see here

and what we’re looking at is probably one percent of what it’s going to grow

into so you’re you’re bullish you’re saying

it could grow into something for one percent it could grow into something

significant like all the kinds of different applications

strip away all the applications right now and just think about

is digital scarcity going to be important on the internet moving all the things

that are scarce in the physical world into digital space

us trying to figure out which things can be moved and not

and also there’s things in the digital space just like you’re saying that

don’t exist in the physical world that might also

benefit from gaining scarcity like you know people are i guess creating

nfts out of like tweets or whatever so like you’re you have you

have a fun twitter account you know you could say like you

could put value to a single tweet and then be

able to invest in it and trade it and buy parts of it and all those kinds of

things you know you can invest in people you

can invest in you know art can be defined broadly as

any kind of creation right and in some sense

this whole idea of scarcity can overtake the entirety

of the digital world it can like consume the

all of the markets we see as financial markets and just turn

everything into a market well so if i take you on like a i don’t know

10 year fast forward yeah and i paint a picture of uh something today that seems

absolutely insane but there’s early signs that people are

building this and let’s just give them the benefit of the doubt that

some of the early iterations will work and some of or most of them won’t

there’s a world where you and i are participating in a digital economy

in a virtual world where uh whether it is a piece of art

it is a digital sculpture it is a digital

skin from a video game it is a digital good that we purchased somewhere online

and we bring it and we display it in a digital museum or a virtual museum

and so now all of a sudden you can charge people for entry

you can consign digital goods it’s the replication of what happens in the

analog world now just in digital and when you do that

what you do is you take the addressable markets

of these assets or these mechanisms and they explode

in the digital realm and so now all of a sudden

how fast does the human race accelerate when it comes to human

production intelligence learning all in the digital

output it’s just if i said to you 20 years ago i’m going to give you a

global education that means i’m going to take you and i’m

going to physically move you to geography after geography after

geography it’s going to take time it’s going to

take resources and ultimately it’s going to take lots of effort

if i now said to you hey i’m going to transport you

in this virtual world to multiple geographies

but you’re going to experience it in this virtual

world and you’re going to have digital goods that you can take

from economy to economy or from location to location

all of a sudden you may get maybe you get 90 of the value you don’t get 100

of the same value we get 90 of the value but you can

do it at a much faster pace and so in the six month period

you’ve actually made three times the progress

than you would have if you had to do in the physical world so that’s where i

think we’re heading so there’s digital art being displayed

in the digital museum and people are being charged for access

and perhaps we plug in our senses which means we start to operate more and more

in a virtual reality augmented reality virtual reality way

with this digital world and increasingly going to this world

basically lived most of our productive and uh

social lives in this digital world uh and increasingly essentially create a

simulation where the biological basis is just there

to say sustain the brain that’s used to operate in the in the virtual world

uh taking us back to the original when we started talking about war

i wonder what conflict looks like in that world

that uh the people who are born today maybe will be fighting wars

in the space in in that museum world in that digital world remember what i said

we’re moving from a world of conflict surrounded

and determined by bombs bullets and soldiers

to a battlefield that is determined by war of information

and cyber capabilities and so in that virtual world

is it about death and destruction of human life in the physical analog world

or will it become more important to attack or defend

virtual property and virtual life and you know some level of virtual

sovereignty in my opinion the latter is more likely

and so what you start to understand is well

what do you truly value in your life is it the physical analog materialistic

consumptive goods or is it virtual

and in many cases something as simple as the ability to connect

with somebody it’s really important and so one of the most disruptive

combative violent things that a country may do to another country in the future

simply take down the internet

and put people in isolation yeah i don’t need to physically harm you if i can

psychologically harm you i don’t need to it’s terrifying yeah i

don’t need to uh actually convince you

through a monopoly on violence on physical violence

what if i can psychologically change the way you see the world

through misinformation through all sorts of

nefarious activities and i think that you know the united states has been

struggling with this idea over the last couple of years in the political arena

but what happens when it starts to come to other aspects of our life

and i think it’s very likely it’s almost obviously likely that we’re moving into

the digital world

the one of the features of the digital world

is that artificial intelligence systems can operate with much more power in a

in a frictionless way in that world currently as we understand it it’s hard

it’s hard to build robots that operate at scale and do like

arbitrary large amount of impact damage or positive

in the physical world it’s much easier to do in the digital world

do you have do you ever think about ai systems

just swimming about uh doing extraordinarily powerful destructive

things in the digital world is that something of a concern to you

or is this something into a very distant future

i think a lot of artificial intelligence is

uh in the name it’s simply the replication of human intelligence

at scale automated and program uh programmatic meaning

that in the analog world you could go hire a

thousand employees or in you know an amazon case hire

millions of employees and set a mission or a goal and push

them to go do that that requires recruiting retention

training resources all that stuff in the virtual world or in this digital

economy what if you can just program the resources

and gain the same leverage and do it at scale and do it in a very

programmatic way and then have them actually make decisions

in a way that doesn’t require you to have thought of every single

potential scenario or edge case that’s ultimately what we’re talking about when

we talk about artificial intelligence right

and so when you look at that when technology is created

everyone uses it for good or bad but both get used

right and so whether we’re talking about cell phones beepers the internet

uh guns whatever it’s always used for good and bad

the big question is and i think that you know yourself and many other people have

rightfully said this is the question really becomes

is the negative and nefarious uses of this inadvertent potentially

or does it actually come from a malicious person it’s the intention

malicious and to me that’s what i i don’t know

enough you know much more about this and there’s plenty of other people who do as

well but i do think that there will be

nefarious actors and malicious people but we’re going to treat them the same

way we’ve always treated people who use technology poorly right we’re going to

understand it we’re going to identify it we’re going to control it and then we’re

going to end up reversing it or preventing that from doing them it’s the

inadvertent things that i think are actually the most dangerous

because when you have something that can think for itself

and there is no way to leverage a monopoly on violence

for control it’s a very scary thing and it can i mean the the thing that’s

scary to me is this it can scale arbitrarily so it can outnumber humans

very quickly even if it’s dumber than humans and so

i don’t know if we’re able to reason about a world

like let’s look at the physical analog where all of a sudden

uh let’s talk about something kind of like humans but dumber than humans like

chimps okay imagine that all of a sudden chimps

could multiply arbitrarily quickly and you could have

like a trillion chimps the next day when you

when you only had maybe a million the day before

like how does that world look different where the fuck all these chimps come

from and they like and then we can we can

pretend to be like well let’s hope the chimps like don’t get violent because

they don’t seem to get violent when the resources aren’t constrained

but like we don’t know and the problem is

it all starts by building that first chip multiplier

device and everyone’s like okay yeah there’s a lot of good applications you

want you know uh you can make all kinds of

arguments for why you have more chimps maybe they can help you out around the

house or something like that in the physical space uh but

ultimately it’s the unintended consequences that you’re referring to is

you don’t know what’s going to happen i’m really worried about

dumb ai agents uh like having impact when they’re multiplied

to a million to a billion and are allowed to operate in the digital space

especially as we clearly are moving more and more

of our lives into the digital space so it’s kind of terrifying because we you

know a lot of people are terrified or like concerned about super

intelligence systems i think i’m definitely much more

concerned about super dumb systems at scale that

that’s terrifying i always think about um the inadvertent

but as you were talking what it made me think of is

also the irreversible irreversible that’s right so it’s one thing if there’s

your inadvertent negative impact but we have

reversibility built into a system and we can fix our mistakes yeah i think

the really scary part is when you overlay inadvertent mistakes with the

irreversible aspect of it and therefore humans have no control

yeah if you if you have the trillion chimps you can’t

they’re not gonna like it when you try to start killing them off

uh all right but back to bitcoin those chimps in the bitcoin community

anytime you bring up chimps some people say joe rogan entered the chat

can i ask you about sort of learning about bitcoin books and resources you

have an amazing podcast that’s not just about

bitcoin or cryptocurrency it’s about everything including life but you do

have a lot of really amazing conversations about this whole

digital world but you obviously you also have a newsletter

that’s incredible on substack and and um

but do you have recommendations maybe it would be great if you could talk about

first of all your podcast and the newsletter but also other

resources that you recommend people should check out in order to learn

about bitcoin yeah so the podcast and uh email are like the two most selfish

things i do because the podcast is a way for me to

learn from other people so i get them to come on and tell me all

the things they’re thinking about and i could ask some questions what’s it

called by the way uh just the pomp podcast

and so in doing that um it really is informative for me and i think that my

whole goal is just like if i’m learning other people will be learning

and then the email uh i read it every morning because it forces me to

collect my thoughts and actually articulate them in somewhat of a

coherent way and so it’s just something that um is

like a practice that i probably would do even if no one read it

and then by being able to publish it uh what does it do it elicits you know

both the good and bad responses and so people will let me know if they think

i’m an idiot and they’ll usually not respond if they think that

it’s something smart and so um those two things are really um

educational for me and i think kind of forced me to uh to be able to

articulate a lot of ideas but a lot of what i share or learn on

those things come from these other resources

so i’m definitely subscribing people should subscribe but

what are bitcoin resources books that you recommend

i think you got to start with bitcoin standard uh that one to me feels like

uh it really lays out the picture nicely um

there is uh bitcoin uh money you can’t fuck with

i was written by our friend jason williams uh as you can imagine it’s

basically what it talks about uh there’s another book layered money

um it’s written by nick who uh who’s done a great uh great job

kind of laying it out um there’s a book uh called bitcoin in black america

written by a guy isaiah jackson and he basically lays out the argument for

why the black community um can benefit in a

asymmetric way from something like bitcoin um and there’s a whole bunch

more i’m gonna forget them all um there’s the uh i think it’s called the

cost of tomorrow a guy jeff booth uh jeff booth wrote it

um and just if you get on twitter basically you’re gonna see all these

books flying around um but i do have to say that uh from a

psychological concept uh or philosophical

concept the number one book that i’ve ever read uh that aligns with bitcoin

ethos but doesn’t say a word about bitcoin

is a book called the dow of capital by mark spitznagel

and so what he essentially does is he just reiterates over and over and over

again long term thinking outliers disruption

all the stuff and so he’s a guy who he runs a fund

uh that essentially they just do uh tail risk hedging

and so in you know march or february of 2020

they’re up like four thousand percent right

by the way they pretty much lose money you know

for eight nine years then that happens and so

uh but they’re still one of the best performing funds if you look at it over

you know years and years and so it’s just this mindset of

uh everyone is so short term focused and so i think it’s just a great reminder

to long term thinking uh and also i mean i’ve gotten quite a

bit of value just reading the papers and that’s perhaps more

like for technical folks there’s quite an active research community

and also going back to the original white paper and just

original documents old school old school is still

what uh like what a few years ago still really interesting

to think about to look at what people were thinking about

because the the principles are carried through

with uh other cryptocurrencies as well like it’s it’s all

it’s all there even in the early documents so

that’s kind of fascinating to see that whole history from if you’re more

like tech savvy and like you said twitter is actually an interesting place

if you can look past all the shit coin talk

it’s a it’s a fascinating place for news and resources

is there books outside of all this cryptocurrency sort of

technical fiction philosophical that impact on your life

because you’ve you have interests that are all over the place is there

something that um you would recommend to others so

doubt capital is definitely probably my favorite book

um books that have been impactful i read uh when i was 20 actually sitting in the

desert of iraq um rich dad poor dad thinking grow rich

and the richest man in babble on and i don’t think i took a single thing

and like implemented it from like an execution

standpoint uh but it was a complete shift in mentality

and understanding a relationship with money and um

just kind of what i wanted to do with my life and stuff like that so i think

those three books i read them in succession

were really impactful um and then i think one of the best books probably

ever written is uh i think it’s called uh when breath becomes air

um or air becomes breath i can’t remember uh but it’s basically a

doctor or a medical professional who’s dying

and he essentially writes about the experience and thoughts and kind of all

the stuff and i think that it’s just uh one of these

things where if you said to me you know what’s the number one thing i took out

of my experience in iraq that’s a book like that also gives you is

we’re all gonna die right and you and i can want to be as

immortal as we want but at some point we’re gonna die

and so it really does kind of focus you on

time being that scarce asset and use it for

enjoyment and happiness uh more so than anything else and i think that’s part of

your message and it’s a great one do you think do you like literally

meditate on your own mortality i necessarily think i uh meditate on it

as much as um are you afraid of death were you afraid of

death when you’re in iraq i mean if you’re coming face to face with it

are you afraid of death today no i i think that it was just one of these

things where like if you fixate on something and you

worry about it then at least to me like you become

uneasy about it and so after an experience like going to war

i think that everything is just so not important compared to that

right like when i came back i remember uh going back into

the college environment and like things people worried about i was like

listen let me explain to you you know what the real world is like right

but i think even today right if you talk to people who know me really well

i don’t get worked up about a lot of stuff i don’t get you know in either

direction good or bad uh anything because ultimately it just

comes down to if that’s the final result

let’s enjoy it it’s fascinating to ask you

because this reformulation of money essentially buying time

and uh you know there’s the old question of does money buy happiness

do you think money can buy happiness in the context of money being able to buy

time or is happiness something else that is

beyond all of this when people talk about this question i

think that they really focus on money as a means to getting materialistic

things so they want a big house they want a boat they want a fast car they

want you know whatever they think that’s the stuff that will

make them happy what i think about it is if you have

resources you can have time and if you have time and

you spend it the way that you want to spend it then that’s ultimately

happiness so i always say to people if you think that money doesn’t

buy you happiness what if i told you that if you had more money you could

spend more time with your family it reframes it yeah and now is all

about i want to do certain things in life but

there’s a lot of people who spend their life

not doing those things because they feel the need to pursue economic

means as a way to provide a living or

whatever and so i explain this listen in my opinion again it’s my opinion it’s

what makes me happy if i can leverage financial resources to

create more time to do the things i like i’m happier

might not work for everybody but like that’s what works for me and so there’s

this element of like i don’t care what other people think if

they like that or not because they’re not me right like there’s

almost this element of like you gotta figure out what works for you and if it

works for me then like no i think that resonate that that will

resonate with a lot of people i think that’s a brilliant reframing of it

uh that said uh you kind of imply there’s a

there’s a reason behind this whole existence of ours there’s a meaning to it

so let me ask what is the meaning of life

anthony do you think about these ridiculous big questions

that have no answer every once in a while or do you just enjoy the shit out

of every day i answer it in a way that um isn’t meant

to be accurate it’s meant to um

be the right answer for me which is ultimately you know and i talk to a lot

of people who always ask like what’s the what are you doing why are you doing this

i say it’s to be happy and the reason why i think of it that

way is i’ve got a friend jonathan galler who talks about uh

you know enough being enough and recently he talked about it in the

um context of bitcoin and so bitcoiners are have two things any

bitcoiner if you talk to them they believe the same two things one

they don’t want the us dollar price to go up because they actually want to

acquire more bitcoin right and then let it go once they feel like they’ve got

enough but two is no matter how much they own they think that they don’t own

enough and they want to acquire more and so at some point you say to yourself

what is enough and and i think that the whole meaning of life

is to understand kind of what your level of satisfaction is and for

some people that’s a monetary thing some people that’s a freedom of time thing

for some people it’s an impact thing whatever but just

understanding that’s important and then going and accomplishing it

and what i’ve found is that the people who i know who have done this and been

intentional about it they accomplish it on a much shorter

timeline than people who don’t right there’s some people who start thinking

about this when they’re 60 naturally you’re not going to accomplish

before you’re 60 if you just start thinking about it 60

people who are thinking about it earlier can do it and so i think that’s really

it for me it’s just like the meaning of life is to enjoy it

the way i think about it that’s because it’s a really nice formulation i i

almost like to sort of oscillate back and forth so

majority of the time is spent at the moment of enough is enough

of gratitude of basically being content with where you’re at like deeply

appreciative of every moment and all the bitcoin whatever bitcoin you

have being deeply appreciative of it and that being enough and then some

fraction of time perhaps it shrinks as you get older that’s

maybe there’s an optimal trajectory there but

some fraction of time is spent being yeah like deeply self critical

and nothing is enough nothing you’ve ever done is worth anything it’s the

marvin minsky said like the secret to success

is hating everything you’ve ever done so like that mode of just hating

everything you’ve ever done and just like trying to improve trying to make

stuff better nothing is enough it’s never enough that

kind of stuff and then oscillating back and forth like

you don’t have to have the same algorithm operating throughout the day

you could just like oscillate back and forth

and maybe reserve that gratitude part the chill part to when you’re hanging

out with family and friends and loved ones

and then when you’re like alone or maybe at work

that’s the madman comes out kind of thing i also think it’s um

kind of purpose driven in the sense of there’s a lot of people who have the

uh i need to do more but in a somewhat altruistic way

so they’re you know take elon as an example

the idea of colonizing mars sure if he is successful he will be very

rich i don’t think you or i or many people

believe he’s doing it for the money right there’s a lot of other things he

could do that would be much easier that would make him tons of money

and so in some weird way he has enough because he’s able to free himself from

the constraints of i need to acquire more resources

and he can focus on what is the thing that i want to work on regardless of

money and so in that pursuit that is

non economic you can be as selfish as you want

because ultimately you’re not tied back to

this like measurement tool and so it’s this

uh again like altruistic non monetary purpose and i think that there’s a lot

of people who spend their whole life looking for that and they don’t know

what it is and so again some people may not think

of it that way but if you can find something to do that

you win i don’t think there’s a better way to end it anthony i’m a huge fan

it’s a huge honor that you waste all this time with me today

uh you know i thank you for just educating the world for

for teaching me uh inspire me to learn more about this new

set of technologies that look like they have a potential to change

transform all of human civilization so thank you for coming today and thank you

for being who you are absolutely thank you so much for having me

thanks for listening to this conversation with anthony pampliano

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to support this podcast and now let me leave you some words

from mahatma gandhi freedom is not worth having

if it doesn’t include the freedom to make mistakes

thank you for listening and hope to see you next time