TFTC: A Bitcoin Podcast - #377: Is Bitcoin Violence? with Jason Lowery

Episode Date: November 29, 2022

Join Marty as he sits down with Jason Lowery to discuss whether or not bitcoin is violence. Follow Jason on Twitter Shoutout to our sponsors: Unchained Capital Braiins HodlHodl Upstream Data CrowdHealth TFTC Merch is Available: Shop Now Join the TFTC Movement: Main YT Channel Clips YT Channel Website Twitter Instagram Follow Marty Bent: Twitter Newsletter Podcast

what's up freaks it's your boy marty here to introduce this rip of tftc i sat down with jason lowry to talk about is bitcoin violence is it a weapon what is bitcoin is it money will it be used for other things how should we frame it to the government what amendments are applicable to it what does it do to the government covered it all long conversation three and a half hours if you're listening via podcasting 2.0 app that participates in the value for value model thank you we appreciate you boosting streaming whatever you're doing if you're listening on apple spotify wherever you're listening please give us a subscribe a rate of review goes a long way this report was brought to you by good friends

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So it's all acting like safe haven. I believe that in a world where central bankers are tripping over themselves to devalue their currency, Bitcoin wins. In the world of fiat currencies, Bitcoin is the victor. I mean, that's part of the bull case for Bitcoin. If you're not paying attention, you probably should be. And we're live. Jason Lowery, welcome to the show. Thank you, Marty. Glad to be here. Long time coming.

a lot of uh yes there's a lot of i wanted to apologize that it's taken so long but i'm glad that we're here it's all good better late than never a lot of chatter on twitter about this discussion i've been trying to think of how to frame it i think the easiest way is just to begin with the simple question is bitcoin violence so i stopped using that word over a year ago because I don't think it's a productive word and I actually changed how I talked about it so anytime someone brings that up they're they're talking about something I haven't said for over a year but I'm happy to talk about why I said that yeah what I guess why did you say why is it not violence or why is violence not a productive word yeah so so i'm the military dude and the way that

the military especially the u.s military uses that word is more so associated with how the french used that word back during the early days of the united states so when the when the French military was kind of the dominant global military. And back in those days, violence was essentially a word that meant to bring force at something. So it's a combination of wies from Latin and pharaoh. So you combine those together, it's to bring force at something. And so really, when it comes to the military usage of that term, What it essentially means is to bring force at something for the sake of imposing a physical cost.

So the whole thing with national security or any type of military campaign is that the way that you achieve security is by imposing physical constraints or an easy way to think about it is every single animal or person or nation or group of people or whatever you want to try to defend has a benefit to cost ratio of attack where they have some benefit to attacking and some cost of attacking. And so the purpose of violence in this theology is to increase that denominator. You want to increase the physical cost of attacking you so that you can drop your benefit to cost ratio. And so that's kind of how the U.S. uses the term and how we think about it. it's it's not really uh it's not how the public thinks about it and especially how the english uses it because in the english terms of violence it means basically to cause harm so like it's like a catch-all word for like all things bad is violence like every bad thing you can think of is bad whereas in the military term it's to project power to impose a physical cost

in order to lower your benefit to cost ratio of attack it's not explicitly to cause harm or to cause injury that is the side effect of imposing physical costs does that make sense yep yeah so so so being the military guy who has almost no experience talking to the public i made the genius uh assertion on my first day on twitter that thinking, okay, well, the whole point of Bitcoin is to impose a physical cost to secure your access to a piece of property by lowering the benefit to cost ratio attacking you, right? You can't achieve centralized control authority over the ledger because it is too physically costly to do so. So all these miners are imposing a real world physical cost measurable in watts

to make it impossible to justify the physical cost of attacking you. And so to me, in my limited, smooth-brained military mind, that to me looks like a digital form of violence. So I said Bitcoin is digital violence. It's taking the same physical power projection game of imposing physical costs on people for the sake of defending yourself by lowering your benefit-to-cost ratio of attack physically, but it's doing that in a digitized form so i said digital violence and that was a trigger word and

that took off and i still have yet to actually match the number of impressions that tweet has made so most people only think about me for that tweet and how so you got past uh you brought your military perspective to bitcoin saw hash rate and the cost that an immense amount of hash rate could potentially be thrust on a potential attacker at the mining layer as violence. The side of that word wasn't apt for this particular asset. So what is your, I think a lot of what people are worried about with the particular framing that you've been putting forth recently is trying to pigeonhole Bitcoin into a weapons grade cybersecurity tool that should be thrust into the second amendment.

or their production should be thrust on the network via the Second Amendment wiseness. Yeah, that's the idea. And I know that gets a lot of flack, but I think it's a logical approach. And I don't think it's as radical as it sounds. I also think it's a technically accurate approach. And I'm happy to talk through that too, if you'd like.

Yeah, let's talk through it. Okay, so I guess I think a useful starting point here is to think about the history of, actually, we could go back. I was going to start in cryptography, but let's go back further. Let's go back before anyone had discovered electricity. so actually let's go back 10 000 years to the emergence of physical power projection and power dynamics in agrarian society so generally speaking if you want to just give like a general description of warfare what kind of seems to happen is that people don't want to use physical power as the basis through which they settle disputes or determine control authority

over resources or establish consensus or achieve consensus on the quote-unquote legitimate state of ownership and chain of custody of property. People do not want to use physical power as the basis for doing that for obvious reasons. It costs a lot of energy, but it also harms people. It causes injury directly. So agrarian society in their capacity and people's capacities for abstract thinking try to come up with alternatives to using physical power as the basis for settling disputes. And that's what gives rise to abstract power hierarchies or governments or any form of like adjudication mechanism where some guy with imaginary power gets to decide who how the dispute goes and so that's kind of the basis for most most governments is just this idea that we can

figure out a way to do all these things to manage our resources to establish a pecking order to solve disputes in some quote-unquote non i won't say violent anymore but non-physical power projection way okay so there's merit to that if you have a trustworthy government especially then that can work the problem is governments are demonstrably untrustworthy anytime an abstract power hierarchy is formed it becomes systemically vulnerable to exploitation and abuse people abuse their abstract power. Abstract power has a lot of just general disadvantages compared to using physical power. The big ones being it's trust-based, so you have to trust the person with abstract power not to abuse it against you. It's rank-based, so it's inegalitarian,

not everyone has access to it. It's permission-based. It has a bunch of flaws that make it systemically exploitable and at the end of the day it's fundamentally a belief system there is really no such thing at least in physical reality as the government you can't touch the government it's a belief system people are just agreeing in this higher power and going along with it okay so if agrarian societies start to do that then that's cool that if the government's trustworthy, that's cool, but they break down. So you have to get back to the benefit to cost ratio of attack problem. The more successful an abstract power hierarchy is, the more resources that those people with abstract power can control, there's a more benefit to gaining

that control or exploiting that control. So there's a benefit to attack. And the less a population is willing to resist against that, the cost of attacking them is dropping. And so now the benefit to cost ratio of attacking or systemically exploiting a population at a large scale through their belief system is actually increased. The benefit to cost ratio of attacking them increases as they adopt these abstract power harkies, if they do nothing to keep their government accountable and so that's bad because you're inviting systemic exploitation alternatively another thing that could happen is people become essentially um pacifist they they they get so comfortable in their well-functioning government that they forget that there's a lot of governments

that there's genghis khan and hannibal and napoleon outside you know neighboring them And if they do nothing to physically defend their abstract power hierarchy or whatever resources they control, they make themselves vulnerable to invasion. So either way, if you forfeit your capacity and inclination to project physical power, you're going to either be systemically exploited at a massive scale through your belief systems, or you're going to be invaded. And so we have 10,000 years of empirical records to show that, and then 5,000 years of written testimony to say that. That's just kind of how it works. And then this is a recurring problem. People adopt these abstract power hierarchies. They eventually get their benefit to cost ratio eventually climbs.

They start to get exploited. They have a revolution or a civil war, or they get invaded. War breaks out. People become inclined to project physical power. They're inclined to accept the downsides of the energy required or the injury risks that you do. And then that cycle just repeats itself over and over and over again. So there's this like unfortunate complex emergent property where ironically in agrarian societies attempt to adopt systems that don't use physical power as the basis to settle disputes and establish resource control authority and achieve consensus on the legitimate state of ownership and chain of custody of property. in their efforts to not use physical power as the basis for doing that. They adopt imaginary power hierarchies. They adopt belief systems which are systemically exploitable.

And then that breaks out eventually in yet another war. And that just keeps on compounding and compounding over time until we get to where we are today. Well, as that process has been going on for thousands of years, humans have been doing their thing that they do best. and making increasingly clever and efficient ways to project physical power. So if you look at all the weapons of war over the past 10,000 years, you can see that what a trend and what humans are effectively doing

is getting more and more efficient at projecting physical power. Large quantities of physical power and watts can be projected on people. In this case, it's kinetic power, so it's force against mass. and they can do it for less size, weight, and energy requirements and money requirements. So they're getting more efficient at projecting power. So ironically, agrarian society has become so efficient at playing the kinetic power projection game

that they got to the point where they have nuclear weapons and they risk mutual annihilation. So like we're now at an existential threat where it's like we can't actually use our most efficient power projection technologies because iconoclastically, it's inefficient. It's too efficient to be useful because if we went on a peer-to-peer strategic level warfare with nuclear weapons, that would not be winnable. It would be too costly in terms of lives lost.

So it may be efficient in terms of how many watts you can project for how cheap, but it's actually inefficient and how many lives lost. Okay. So that's a problem because if agrarian society must continue to effectively revert back to these physical power projection games to kind of resettle their disputes and reestablish consensus on the legitimate state of ownership and chain of custody of the resources, then that could be a problem. And one thing I wanted to note about that is if you zoom out and you look at humans from like an alien point of view and you look down at all the resources what you'll notice is that it is precisely because of this global scale physical power projection competition that has been waged for the last 10 000 years

that control authority over earth's resources is decentralized so the the complex emergent social benefit of warfare is the decentralization of control authority over resources. We have 195 different countries with 195 neatly defined and well defended borders. And so the abstract power, the imaginary power of these people that are in charge of these governments cannot expand precisely because they're physically constrained from expanding. anytime someone tries to effectively 51% attack the Earth's global resources, if they want to pull a Genghis Khan or pull a Hitler and try to project a whole bunch of physical power to try to physically capture resources, they get constrained. It's really hard to sustain that. Everyone kind

of unites against them and make sure they can't 51% attack the resources. And so that's noteworthy Because what we're showing here is there are implications of warfare as effectively a proof-of-war protocol. It is a way for people to engage in a global-scale physical power competition to achieve decentralized control authority over our physical resources. And up until the invention of computers and electricity and stuff, that was purely kinetic. So it was purely forces against masses. but it was still a power projection game and i think so that's just worth noting now what i'm describing is what tesla described in in 1900 he you know had that essay the problem with increasing human energy or something like to that effect and he and he basically said we're

getting too efficient at um at doing this power projection game that the end state of this is people are going to have to basically take humans out of the loop and let machines engage in energy competitions with each other because if you go if you continue to go down the kinetic route he says that's just going to be too destructive so he was a since he was kind it sounds like he was predicting mutually assured destruction 40 years before the invention of of nuclear weapons and he was actually inventing this before both world wars before airplanes before aerial bombardment and a lot of the a lot of the nastiness that played out right after he made those predictions but the bottom line is he predicted that eventually humans would become

so destructive with their physical power projection technologies that they would have to turn to this like machine-like apparatus where these machines compete against each other using some energy competition and like the way the wind the energy competition is one way to do it is to become more efficient. So I say all that because that makes sense from kind of just a big picture head in the cloud level. And we see it play out at the nuclear strategic level. Now, some will say, well, we're not actually strategically stalemated at a global level because there's other ways that you can project physical power and you see it all over the news, right? You still see people using kinetic power and engaging in

competitions with each other. The issue with that is we actually don't know if that can solve a strategic level policy dispute because it's only been asymmetric. There's never been two nuclear powers to go up, go head to head with each other. So we don't actually know if we could use these deliberately inefficient ways of projecting kinetic power to solve a dispute. And it's worth noting that. Governments are deliberately choosing an inefficient way to project kinetic power to engage in this competition because they know the nuclear one, the most efficient one, is ironically too expensive to use. And so, okay, but if you pull that thread, let's say two nuclear powers go to war against each other they choose inefficient power projection technology so

non-nuclear warfare as the mechanism and they use just traditional munitions if you assume that they could actually solve that dispute without escalation to the nuclear level which i personally don't think but who knows then the problem with that approach is what you're going to do is agrarian society is going to continue coming up with increasingly clever ways to project kinetic power efficiently at each other. So what that means is they're just going to discover another way to mutually assure destruction. So right now, the only way that we can mutually assure destruction is through nuclear weapons. But if we continue this non-nuclear kinetic power projection game, we're already seeing that trend. It's becoming humans out of

loop it's becoming drones fighting drones it's becoming swarms of drones fighting drones and maybe in the future it could be something like ai powered drone swarms just like terminite terminator style skynet style mass drone warfare and so so the point is just because we have temporarily found a way to engage in physical power competitions to attempt to settle disputes doesn't mean that that mechanism can't also meet the same end that nuclear warfare has which is effectively a stalemate we it's we've we just like we would will probably go extinct if we tried to do a full-scale strategic nuclear war okay so why do i say that well because um And fortunately, if you go back to Einstein, he says, well, matter is swappable with energy.

Okay, so instead of projecting power by displacing a piece of matter across a distance, you can project power by passing a charge across a resistor. So you can produce watts electronically and it's physical power. So you can do this in a permissionless way. You can do this in an egalitarian way. People can access their watts all across the world. And so then the idea is, well, what if agrarian society learned how to engage in a global physical power competition electronically rather than kinetically? so you would still get the benefits of using physical power as the basis to settle disputes and achieve consensus on the legitimate state of ownership and chain of custody of property and determine control authority over resources but you would do it in a way that could actually be won so you could actually win a physical power competition instead of just stalemating it there would be a clear winner there would be clear losers and and so for that reason it's actually

useful um and so that's interesting okay so then we then you have to start thinking right in the future if we ever did need to get into some massive level strategic war fight um is it reasonable to expect it to be a kinetic fight if we know that's already stalemated or is it reasonable to expect it to be a non-kinetic power projection competition, global scale war? And then back to my earliest point, if nuclear superpowers are stalemated against each other, then that doubles as a stalemate between the ruling class of those superpowers and the ruled class. So you've created a massive asymmetry between the nuclear the nuclear-powered ruling class and the non-nuclear-powered ruled class.

And so just like it has been for the last 10,000 years, it is very possible that it's very logical to believe that a stalemate at this level represents a major systemic security hazard of oppression, Not nations fighting against each other, but nations oppressing their own classes because their own classes, their own populace has no real realistic way to stand up to a nuclear powered state. and so add all these things together maybe the future war wouldn't be maybe it's not reasonable to believe that the future war would be a kinetic war because that's a war that is increasingly less likely to be winnable maybe it's not likely that the future global war would be a war between states maybe it would be a war between the ruled class and the ruling class

and it's very plausible to believe that it would be an electronic war or something using a non-kinetic form of power and so you add those together and it's like okay well what would that look like if how would that work what would it look like and so that's kind of where you start getting towards bitcoin but i'll stop there if you have any questions thanks for letting me talk so long no um yeah i guess the big question is in terms of like the history of warfare and these hierarchies that have been erected that's that's why i've been drawn to bitcoin and why i like bitcoin it allows us to get away from these uh these hierarchical structures that are thrust on to people throughout the world and just allows us to opt out and use this peer-to-peer digital

cash system to cooperate maybe yes compete on the open market to provide goods and services but having a a global sound monetary standard which will allow us to coordinate and settle that competition via the free market? Yeah, so let's say we're 20 or 30 years after the invention of nuclear weapons, so the invention of kinetic power projection technology that's effectively too efficient to use. And we have created, if we just assume for the sake of argument,

that we have created a hazardous situation where governments are asymmetrically powerful against their own people, then situations like, or technologies like cryptography represent a way for people to secure themselves against systemic exploitation and abuse from their own governments. And I think that was the original argument with all the crypto wars and the drama with uh zimmerman and and and pgp and all that stuff is if you look back and just kind of read about that stuff the core argument the kind of overarching like ethos of that of that time period was this is a type of technology that we can use to secure

ourselves against systemic exploitation so in this case specifically mass surveillance against our own asymmetrically overpowered government and zimmerman it seemed like people like him and the and the cypherpunks were really trying to empower the public to have this access to this technology and so it it it has very second amendment like undertones to it right it's not the first one right yes well yes so my argument it's both but my main argument is first amendment's weak second amendment's strong so but if we go back to that before the whole first amendment thing popped up, really, it's like, okay, people, here is a, what the government defines as military grade munitions that people can have access to, that people want to have access to, so they can

secure themselves against systemic exploitation and abuse from their own government. And the problem was the government was trying to prohibit them from doing that. That's what made people so angry. It's, hey, if there is some non-lethal way that I can secure myself against the asymmetric power of you, then I deserve to have access to that. Why should I not have access to that? And why would you stop me? And that was one of the main big undertones of that movement. And I know that the angle that Zimmerman took, and especially the public took to support him, was to make the argument that hey rsa encryption is is is code code is speech people have the right to free speech this is unconstitutional and i know that like mit press printed out rsa code on like there and then

like exported it just to like out of solidarity and the people would wear their shirts too but while the although the public was really pushing the first amendment argument i think that the Second Amendment argument was also a strong argument that could have been taken. And as that case was going forward, and as the Zimmerman's legal defense was kind of starting to pressure the government on that, they backed off real fast. So it's important to point out that it was, although they tried to play the, hey, you're violating the Export Control Act by exporting this, what we define as munitions, as soon as the public started pushing back on them, they backed off real fast. That case was never settled. And then follow-on cases, because of

the popularity of the First Amendment argument, follow-on cases were pretty able to set the formal precedent that speech represents code people have a right to free speech etc etc but then but you know for sure we know for sure that it wasn't just a first amendment argument because of the clipper chip debacle so when after the zimmerman case nsa was like okay fine you can have your encryption you can have your free speech use our clipper chip but that was encryption technology that had a backdoor to it. It allowed the NSA to bypass the keys and look at everyone's messages, encrypted messages. And so policymakers tried to argue, it's like, hey, you can have your free speech and you can have your encryption, just use this encryption.

And the public raised hell, gave them a big middle finger. Why? Because the point is not just free speech, it is the right to be secure against exploitation of my own government. So clipper chip still gives the government the means to mass surveil me or to exploit me another way. So it's like clearly not just a First Amendment like angle, because if it were, then people wouldn't have been so upset about the clipper chip. And then fast forward three years, finally, we get to Executive Order 13046 or whatever it was, 1996, when Bill Clinton essentially changed the rules. And how the rules work is not necessarily that cryptography is no longer considered munitions. How it works is the secret squirrels do the, they develop the encryption technology and then essentially the president decides which of that technology to release to the public. So it's like when military-grade encryption starts, when that baby is born, it begins as a munition, and then by some internal legal process, it's popped over to the Department of Commerce or something, and then it's published. And it is precisely because of that victory, because we were able to convince the government to allow the public to have this security technology, which they define as weapon-grade munition, to allow the public to have access to this security technology explicitly for the case of defending the public against systemic exploitation and abuse from their own government, that we have SHA-256, that SHA-2 was published by the NSA in 2001.

So this battle that was fought is the precursor to the core enabling technology of Bitcoin. And Bitcoin relies exclusively on SHA-2, 56 right now, which was by the own government's admission, munitions that the public ought to have. Okay, I'll stop there. Any questions so far? no question it's a couple comments going back to second amendment stronger than the first amendment i would disagree with that and then on you know sort of building on what you just said uh i think this proves it like the like yes we can we can agree that encryption was defined as weapons-grade munitions by the government, but I think why they had to allow Zimmerman and company succeed in getting PGP into the hands of the public is because at the end of the day, code

is free speech. It is simply text. And there's a more recent precedent that doesn't involve cryptography at all that really drives this point home, and that's defense distributed, it which won a massive case uh and basically got their files that allow people to print to 3d print actual physical munitions that can harm people in the real world they got that defined as speech and so that's the first amendment is the base layer they have to allow these technologies because at the end of the day they are software they are code they are text their speech yeah so we have to so my argument is not that the first amendment is we that we should continue that we should not continue to use the first amendment i think that's still a good

angle, I don't, I think there are a lot of ways that the government could and has used like public health emergencies or some, you know, it's important for the public safety measures to prohibit this type of free speech. And so my concern is that if you look at like the ESG movement that is greasing the skids to make it politically feasible to say bitcoin is bad for the environment and therefore it's basically greasing the skids to do another clipper chip where you can try to convince the public all right you can have your cryptocurrency but just not bitcoin because bitcoin's bad for the environment there's a public safety concern there that's usually the public safety angle is usually the justification for why speech is

prohibited like what constraints can be applied to free speech and so that's concerning because you can see them clearly starting to try to grease those skids there's clearly like this campaign to market bitcoin as quote-unquote a public health hazard because it's causing you it's boiling the oceans or whatever and and so that's just worth considering now another i would argue there esgs we're going to destroy esg esg is killing itself we actually don't even need to destroy it we're finding out in real time that the policies that have been enacted due to esg or like-minded ideas seeping into the public policy sphere have made life materially worse off for the people who have been subjected to those policies obviously what's going on in europe with their

energy crisis here in the united states and california with their energy crisis with the e it's becoming very obvious that these policies do not work and do not benefit humans and humanity overall and then you get to the s and the g and sam bankman freed had a higher s score in the esg than than exxon ceo ceo and it's proving that it's all larp and then you get into like the woke boardrooms and stuff like that and and people yes they can grease these wheels they can try but economic reality and social reality is beginning to really rear its head and prove that this stuff does not benefit humans at the end of the day yeah so um and especially like in texas i think there's a herculean effort that's working on helping people see the clear

benefits to the grid and the optimization of of bitcoin and i've um i think i've been able to help uh policy makers see that in a different way too um that's definitely that's definitely a good angle okay um there's there's another issue too which is the crypto attack so So I think that with the CBDCs and with like proof-of-stake systems and all this other crap, that that attack vector is effectively a reemergence of the Clipper chip idea where it's like, okay, convince the public that they can have this cryptographic technology so long as it's the one that we have the backdoor access to. So that's really what CBDCs and proof of stake represent is here's a, you know, decentralized and here's a dino system that we really do have unimpeachable control authority over, despite how much we put people to, yeah, to LARP about it, right? Like POS is a POS, but people don't see that. And the long con is to say, well, it's got crypto in it, so it's got the same security as crypto, as like Bitcoin, so you should value that.

But what they're missing is the importance of not just cryptography, but the importance of digital power, of giving people the means to impose large sums of physical power against each other in, from, through cyberspace for the sake of making it too physically prohibitive to systemically exploit the protocol. so so like proof of so for example bitcoin um i my new favorite saying now is to say that bitcoin is proof of proof of work working and so if you want to make people understand like the value of bitcoin as a security technology they have to understand the value of proof of work which means They have to understand power dynamics and the benefit to cost ratio of attack situations and how enabling a global society to engage in a global scale physical power competition creates the complex emergent benefit of decentralizing control authority over the underlying resource. So when you explain warfare, you're explaining proof of work. and when um but just in a and traditionally it's kinetic but now it could be it might be becoming electric okay so let's say for the sake of argument like i understand that the concern

is this could give um politicians an attack vector on bitcoin to say and to reattempt the same attack right say this is munitions and try to ban people from it is do i have that right is that the main concern that you have yeah i mean certainly if the government especially considering again going back to like i don't believe the second amendment is as strong as the first amendment particularly right now in 2022 america uh if you somehow get bitcoin deemed as military grade munitions it seems that the administration that's in place and many that have come before it are hell-bent on taking away guns particular types of guns right now and if that erosion around the security of the second amendment continues moving forward it's easy to see

first they take your ar-15s and then they take away your ability to to hold bitcoin to mine Bitcoin to run a full node to validate Bitcoin, which gets back to another topic that we really have to touch on is what provides security to the Bitcoin network. Because I think that's one of the assumptions that you've been running with that I would disagree with is that hash power creates security for the network when it's really the individuals running the consensus rules on their own full nodes to have the power at the end of the day yeah i know there's the ongoing um there's the block size wars and that debate i don't think we can i don't think we can know yet for sure um i i think it's probably like a

checks and balance thing i think it's probably a combination of both um the the only way we really gonna we would really know is if if bitcoin got 51 attacked would the nodes be able to invalidate block out of it i mean the nuclear option is to to fork and change the consensus algorithm move away from shaw yeah so like adopt a different like uh yeah adopt the different cryptographic so that's true but that wouldn't necessarily stop the the vulnerability you would just have a new chain with the same vulnerability like you could the the same type of attack could repeat itself if you fork yeah and then does that make sense it does um certainly and that's why it's a nuclear option you don't want to do it obviously this topic came up

a lot in the summer 2017 leading up to the failure of segwit 2x which had 90 of hash rate signaling for it um but then you get into like the whole what is mine again mining is a business right like individuals take capital risk to i need money to get these assets to and then find cheap energy to plug them in and hopefully make a profit margin not only is it a business it's an extremely ruthless one and i do think we have analogs from history that prove that it's probably not wise for governments to embark on these types of endeavors because it's it's very well suited for the uh the private sector and entrepreneurs as opposed to a monolithic government and then i want to talk about that too but let's wait because this because that's a

separate train of thought yes but we have analogs in terms of a nation or a group of people having control of the production of a commodity similar to bitcoin gold uh that really don't have any control over the gold markets or don't have a lot of gold at all so like in the ninth or 20th century switzerland amassed a a large trove of gold they have a ton of gold they've never produced gold in their life whereas uganda has produced and throughout the 20th century produced immense amounts of gold but doesn't hold any so they they had the power of the production but they were no better off uh at the end of the day because they didn't actually hold the asset smarter countries like switzerland just realized that gold at the time was the

best monetary asset that existed on the planet and accumulated it and they didn't need to do gold mining to to accumulate that type of wealth or that type of power that that wealth eventually gave them and the ability for them to become one of the wealthiest nations on the planet yeah and i think um i think the way that i differ a lot from so i i tell people on twitter that i'm not i don't consider myself a bitcoin maxi i consider myself a proof of work maxi because i try to to stay true to the idea of bitcoin being a reusable proof of work system and that there could be other use cases for reusable proofs of work beyond specifically serving as a fantastically secure base layer monetary system that would be very secure against systemic exploitation and

abuse of people who control computers. And so that kind of is like, I take a different approach to thinking about that kind of stuff than I think a lot of people do. Yeah, I mean, I wouldn't argue that there aren't other use cases for proof. I mean, the original use case of proof of work was email spam protection. Adam Beck did not have a difficulty adjustment,

so it turned out not to be as useful as it was when it originally launched. But again, I think that that's tangential to Bitcoin. I think Bitcoin leverages proof of work, certainly. But again, it brings back to the real value of Bitcoin and why I'm a quote-unquote Bitcoin maxi is because I am a monetary maxi as well. I believe that humans, once they come into contact

with a really good money, are going to choose to use that money over others. And that's basically the ball that Satoshi started rolling in January of 2009. And I see that free market money as being a way to opt out of the bloated federal government system that exists all throughout the world and will allow individuals like you and me to coordinate, to accumulate wealth, to coordinate economic activity and reinvest in the economy.

I don't see the need for nation states to spin up hash forces and do all this. The free market economy has already done an incredible job of building out the infrastructure of the Bitcoin network, whether it be full nodes, full node software, full node devices, whether it be mining ASICs, energy contracts, energy infrastructure.

The free market has taken care of that pretty miraculously and pretty incredibly in the first 14 years that the network has existed. So I can give you an alternative perspective if you're interested. Let's do it. As nuclear weapons were being designed, so too were the first operationally proven general purpose state machines aka modern day computers in fact the first operational general purpose state machine the first programs that it was running when it was uh it was at harvard it's the harvard mach one mark one among the first

programs that it was running was the design for the detonation device for the for the manhattan project so von neumann was coming here in into cambridge to replug the the transistors or the the plug boards of this computer in order to have it run the program to design the bombs or to see what's the best like implosion mechanism anyways the point is um as humans were kind of starting to get to the point where they're projecting kinetic power to the point where it's too devastating. They're also starting to create the very beginnings of what would become the now virtual reality we know as cyberspace. And really what computers represent is a belief system. We choose to assign symbolic meanings to state changes in a state machine. And we choose

to abstract that at higher and higher levels. We started with machine code where we're just using Boolean logic to convert state changes to information, ones and zeros. And then that scaled up to assembly language and that scaled up to general purpose language. And now we don't even talk about software as if it's a general purpose language anymore. We talk about software at such an abstract level that we call it things like coins or thumbnails or clouds is it a belief system or is it i mean it's object like you put in inputs and you get objective outputs is that belief or is that isn't yeah isn't it weird so so this gets to like the core mind-blowing pieces of like computer science which is the machines are obviously real the machines in

front of us and the state changes that that we can see in front of us in this in this array of light emitting diets that we're using to talk to each other and the like that's obviously something real and shared objective physical reality but the way that is being presented to you is that humans effectively invented a symbolic language a syntactically and symbolically complex language called machine code and learn to apply that symbolic meaning to... I wish I had a... I usually have like a prop for this. Oh, here we go. So, here's a... You see this? Yep. So, this is a state mechanism, right? It's got two states,

on and off okay this is a state mechanism the state space is two states so what humans decided to do is they decided to call that state one and that state zero so they digitized a state change in a state mechanism so the the state thing that this is real right this is clearly a state and this is clearly not a state. But this is not one, this is not zero, we are applying that meaning to the state change. If that makes sense, it's a symbolic, we're using our prefrontal cortexes to imply symbolic meaning to a state change. And we're choosing to decide, but we're volunteering to decide to call that one and call that zero. And that's machine code in a nutshell. It's just mind-bendingly miraculous thing where we can assign symbolic meaning to state changes in a

state machine. And then with general purpose stored program computers that von Neumann and the people invented in the 40s, what they figured out how to do was store information. So store state changes as information within machines and then have those machines recursively run operations on their own instructions so when a computer programmer is like programming a computer they're essentially just converting state changes into information and having the computer they're basically created a way for humans to speak to machines and then for machines to then take that information and then speak back to humans and so you're having a computer speak uh, their machine code, but then translate it back to the symbolic language that you can

understand or in some way that you can understand. So what you see in front of you is what has been programmed to look like what you normally see in front of you. But really all you're doing is just looking at a light emitting, uh, an array of light emitting diodes. It's like, you don't know for sure that i'm real if that makes sense you just know based off of where we are in technology and and how how kind of like your own kind of experiential knowledge that even though all you are doing is looking at a computer screen right now i'm probably real i know it's trippy it's computer science is pretty miraculous are you an ai hologram just to be determined i know and so you haven't seen me around right

like not we have not met in person yeah so i could be and even if we had how could i know this isn't a deep fake that's true but how does this pertain to bitcoin and its nature yeah so so um we have two parallel paths that are developing people can no longer um use kinetic power but at the same time people are learning ways to apply symbolic meaning to state changes and they're becoming increasingly more important or better faster cheaper computers and better you know lower size weight power requirements more efficient computing requirements um people have figured out how to apply symbolic meaning to all sorts of physical

state changes in in the world around us anything that can change its physical state can be a computer or can send digital information that's why we have things like wireless internet because what the computer does is they change state changes in electromagnetic waves they apply symbolic meaning to those to this phase and frequency and amplitude and stuff like that and so you can digitize state changes in the environment to send information wirelessly from one computer to the other. So the point is you can change any physical phenomenon into information. Okay. Well, we, at this point, we're getting so good with that. Like we have photonic computers now where we're sending laser, like we're transmitting information through laser light.

So you can change all the same stuff with normally with electromagnetic radiation. And it's becoming super efficient. You can send a lot of data, like the fastest computer chip right now can send the entire internet's worth of data within like three seconds okay what has been unspoken this unspoken engineering assumption that people have been tacitly making that people have not been admitting to is that they are believing that more efficient computing is better they believe that it is virtuous to build state changing mechanisms where the the transistor states are cheaper and cheaper and cheaper to change require less and less energy are smaller and smaller and smaller and that's what's driving like the performance of ai and stuff it's just so

cheap so small that you can have your nvidia 380 3080 and run like ray tracing on call of duty and stuff like that okay well what people aren't asking is what if you did the opposite what if you tried to create a computer that has very difficult to change states like it takes a lot of power to change state um what would be the advantages of that and so this is where it comes back down to bitcoin because i think a lot of the reason why people i think a lot of the reason why i have a very different perspective of bitcoin than most people is because i do not look at Bitcoin as an innovation in software. I look at Bitcoin as an innovation in the base layer of the tech stack. It is a fundamentally different base layer state changing mechanism to where today

we're not just using what we know as our regular computers. We're not just using floating gate transistors as the state changing mechanism through which we use our software, our program stuff. I think what proof of work does at the fundamental level is change quantities of electric power and use quantities of electric power as the state changing mechanism of the computer. So that's just a complicated computer science engineer nerd way of saying that we're effectively turning the global scale electric power grid into the base layer computer. We're turning the world the entire global scale electric power grid into a base layer state mechanism and then plugging it into the internet and then the question that's like the mind-blowing that's like

kind of like the big thing about my thesis is if that's true then it's like holy crap that's pretty mind-blowing what would the benefits of that be and the benefits of that would be is you have a computer that is globally decentralized, like the computer, the global electronic grid is the motherboard. That is the thing that's storing the information. And the physical change, the state changing mechanism is quantities of physical power, not transistor state changes like on our computer chips and here, but quantities of physical power and electric grid is what we're applying boolean logic to so we're converting quantities of physical power into bits and then we're sending those bits back into cyberspace so to me i see bitcoin as bit power we're converting

power itself quantities of physical power drawn from the globally decentralized electric power grid into bits into information that can then be transferred through the through cyberspace i'll up there yeah again i would push back again i think the misconception is that like the mining controls the network where it's the full nodes where in that scenario just laid out like if you think of like a world computer and you're pulling hash rate off so you're using less electricity one would think if it is the mining industry is the the motherboard the base load that it's being deprecate it but that's why the difficulty adjust and really the motherboard the base layer of the global computer if we're going to use that analogy

is the distributed ledger and its history as secured by full nodes yeah so um maybe we should go back so it's a data file it's not really the electricity or the grid So let's go back to Finney. Finney makes reusable proofs of work converting, if we just assume I'm right for a second, just for the sake of argument, converting quantities of electric power into information that you can choose to call these bits of information. you can choose to abstract them as coins, or in his case, reusable proofs. A challenge with Finney's efforts was that it still essentially relied on pretty much a trusted server, like a centralized server. And so one of the big changes between Finney's approach and Satoshi's approach was, okay, take reusable proofs of work this whole idea but you don't want to have to rely on a centralized

server to manage that because then you have to trust in that server and that's not a very trust is not a very good security protocol right you could easily be exploited by that um and so he he his approach of course obviously was to use a distributed network but of course and so there's your notes the problem of course with using distributed networks is you run into the byzantine generals problem right where how do you get all these globally distributed nodes to achieve consensus on the legitimate state of ownership and chain of custody of the reusable proofs of work so like yeah you can have um i think you're right that distributed nodes are a linchpin and a core part of the technology and definitely a core part of decentralization

But it's also true that it's not just the decentralization of nodes. It's decentralization of control authority over the ledger, i.e. the quote-unquote legitimate state of ownership and chain of custody of the reusable proofs of work. so that's just a long way of saying is to solve the byzantine general's problem it looks to me my argument is it looks to me that satoshi effectively invented soft war a soft form of global scale physical power projection where people can compete for control authority over the ledger the right to add transactions to the block right um but because that's a it doesn't give them control over the ledger though so if you have the ability to add transactions to the ledger then you have the ability to withhold transactions from the ledger so that's a tacit denial service vulnerability right like that's

the problem with proof of stake one of the main problems with proof of stake is these validators can and are censoring the blockchain by withholding non-compliant transactions, right? Yeah, and this is where mining, the mining industry specifically, mining as a mechanism being a ruthlessly competitive business comes in because miners can only enforce—enforce isn't the right word— they can only try to subject that type of control over the ledger until it's economically unviable. The miners are slaves to the full node consensus.

They are economically incentivized to play within the consensus rules set forth by the full nodes and then if you do have one miner in one part of the world who is withholding transactions or a number of miners working in a cabal to withhold transactions the beauty of the economic system that satoshi designed and launched is that users have the ability to attach transaction fees and at some points the fee will be high enough where a miner who is running a good business and is profit driven will will include that transaction or many censored transactions in a block so they're sort of beholden to the will of of the full node operators and individuals sending transactions they are slaves to these actors

in the economic system with multiple stakeholders. So consider what would happen if, well, before we go there, I agree that there's obviously that dynamic. That dynamic's obviously true because we saw it with the block size wars. What we haven't seen, like what we didn't see during that is,

I guess there's a lot of different ways that could have gone down. So let's say, yes, totally, the nodes could invalidate blocks or refuse to pay their defenders, right? Refuse to pay their miners. Like, we haven't, they weren't, that theoretically could have made them super vulnerable to a 51% attack as they were doing that.

And it might have just been the case that that didn't happen if that makes sense yeah you can't prove a negative but yeah so yeah so like i guess there's i'm saying there's a whole lot of ways that you can compromise the security of bitcoin and i'll give you another we've only we haven't tested them all i mean we've talked about the fork wars we have had one other test um in 2015 i believe 2014 or 2015 where i mean this is a testament to the individual actors particularly in the mining industry being economically driven where you had one mining pool ghash.io accumulate 55 percent of the network hash rate. He had Peter Todd, who's an infamous, was an infamous core developer. I'm not sure he's

working on core anymore, but he sold half his stash because GHash acquired 55% of the network hash and had the ability to 51% attack the network. What you saw there is economically rational actors being the individual miners who were pointing their hash at GHash at the time immediately leave ghash and flood to other pools because um they didn't want to be contributing to a potential 51 attack yep yeah so but the whole idea of a 51 attack proves that miners do have some form of control authority over the ledger like you wouldn't be afraid of a 51 attack if miners couldn't withhold transactions or couldn't abuse that control authority over the ledger the the fact that they can do that is the reason why the the 51 attack vulnerability exists

and and so that's just i guess just it just kind of proves the point that there is um there is an attack vector there and there is but there's good defenses to that attack vector as well economically yes driven individuals and then the nuclear option of doing something at the consensus layer to stop the attack yeah so if you take my kind of radical theory and you look at it as a soft war type of dynamic power is the ultimate free market whether it exists in kinetic form or or electric form like your ability to find sources of power to wield sources of power to come up with increasingly clever tactics techniques and technologies to project power more efficiently that's the in my opinion the the real free market and um and so

in when you couple this ability to add transactions to the block to the projection of power what you do is you create all you recreate all the complex emergent benefits of power projection that we already see in kinetic warfare but you effectively replace it now in in the cyber cyber domain um and so that's just a long way of saying like you know how the whole point of proof of work is to impose a physical cost to you know to prohibit a denial of service attack that was like the original point you can't send an email unless you solve it but you go through the burden of spending the electricity of solving the hash function house cost function what satoshi did was um he coupled the ability to add transactions to

the block he basically used proof of work to defend that control action so you cannot add transactions to the block unless you solve the hash cost function so he's using proof of work to secure the ledger against systemic exploitation in that in that way does that make sense is he securing the ledger or is he just create leveraging proof of work particularly with a difficulty adjustment to create a fair way to add transactions a fair way on a globally distributed network? I think it's both. I think it's definitely fair. I think it's zero trust. I think it's permissionless. I think it's egalitarian because I think all power projection is that way. And, but you know, you have to go back to the whole point of proof of work in the

beginning, which was proof of work is a denial of service countermeasure and a 51% attack is a form of denial of service. So it just makes sense to use proof of work to prevent a 51% attack by not allowing people to add transactions to the ledger unless they solve the hash cost function. So you effectively park the ledger behind the proof of work protocol. It's confusing because it's recursive. Bitcoin is effectively proof of the merit of proof of work or proof of proof of work working the fact that it can't be that it hasn't been 51 attack the fact that all these dynamics that you're saying which i also agree with are play out and the and the game theory plays out is proof of this proof of work idea working

and and so so what that means is bitcoin proves its own merit that if you enable people the opportunity to use power itself watts to impose physical costs to make it impossible to justify the physical cost of performing these types of systemic exploits then you can achieve a level of cyber security that no other type of software has ever been able to achieve before because predating this type of proof of work system the only way to attempt to secure software is using logical constraints, not physical constraints. So really what Bitcoin, or I guess really what proof of work represents is the first viable way to physically constrain software to achieve software security using physical constraints. And it's not the only way. And so there's definitely

more ways you can exploit Bitcoin. And I'm not trying to argue against like the stuff that you said, but it's just worth considering the potential computer science precedent that what specifically Adam Back may have unlocked here is a total transformation of the game of cybersecurity that we just weren't able to achieve yet. And he did it by tapping into the power grid as the base layer computer. So if you need to send a transaction,

like if you send a transaction across the Bitcoin ledger, normally so like if you go to proof of work and you send a transact eth transaction what's happening at the base layer is transistors floating gate transistors in my computer change state it's like essentially nothing happens it's like basically no power is moved in order to send a bitcoin across the ledger in order to send information across this thing very large material sums of physical power has has changed so there is a very real

and shared objective reality very expensive quantity of physical power has changed its state and so that's that gets pretty cool because now you can prevent unsafe control actions or you can secure unsafe control actions like the ability to add transactions to the ledger by physically constraining it so it's not that like people don't know what the exploitation to bitcoin is and it's not like it's logically constrained everybody knows that if you can have majority hash rate you can systemically exploit your control authority your tacit control authority over this over this ledger it's not that they don't know it and it's not that they can't exploit that logic. It's that it's too physically expensive. It's impossible to justify

the physical cost of doing that in watts, and also money, but really in watts. That's game changing, I think, in terms of cybersecurity. I agree. I mean, that the immense amount of energy needed to add a block of transactions to the network does set Bitcoin aside as something that's incredibly unique and innovative and revolutionary to a degree. And then I guess this just dovetails into the whole question, why do we have to equate it with war? Why can't it just simply be free market actions by profit-driven individuals and actors who want the ability to profit from adding transactions to the ledger? and then those individuals whose transactions these miners are adding to the ledger simply want to be able to cooperate amongst each other outside of the state's purview. Yeah. So I guess just from first, like just a very first principles approach,

if we say, okay, from a cybersecurity perspective, this is revolutionary. We have figured out a way for people and programs to impose physical costs on each other in from through cyberspace to empower, literally empower people to decrease the benefit to cost ratio of attacking them or exploiting them through their software. And there's definitely something happening at the base layer that's different. Like there's a physical, meaningful physical difference between the way that the Bitcoin protocol tech stack works in the way that like some other poser uh cryptocurrency tech sec works like there's a whole lot of big ass machines projecting a lot of power so there is a materially physically different phenomenon happening that's

happening at the base layer what that means is what is really what could be really happening is that we're like i said we're learning how to use the globally decentralized electric power grid as a base layer computer and then we're plugging that into the internet and then why would you want to do that it's because the state space so what is the state space remember this thing has a state space of two on and off but if you sum all the all the potential state changes you create a state space the state space of this global computer is physically constrained and physically decentralized in ways that no other computer that's plugged into the internet has ever been and may ever will be that means you've created a part of cyberspace that is physically constrained and that allows

you to impose physical constraints or secure your own software with physical constraints in ways that no other piece of cyberspace has ever existed not to mention the fact that it also gives you other use cases like giving you a way to settle disputes in a zero trust and egalitarian fashion or giving you a mechanism through which you can achieve consensus globally distributed distributed consensus on the legitimate state of chain and legitimate state of ownership and chain of custody of underlying stuff that is basically just a long way of saying this is so much bigger than just money money just happens to be the first obvious use case of making a a the most secure place the most physically constrained place and what could be the potential foundational base

layer of the internet money is just an obvious first use case for it because of course you want your thing to be you want your money to be secure like if bitcoin is proof of proof of work working then that means bitcoin is proof of the the cyber security merit of this technology which means if you use bitcoin as your money you have the most secure thing that's ever existed because we created it uh it's just been created and it's uh essentially impervious to nuclear scale warfare like you would have to like the internet will survive humans if we get into a nuclear war like humans would go extinct faster than the global uh you'd have to destroy the global internet and the global electric power grid in order to stop bitcoin if

if this theory is true um and so you know it's back to your question why frame it as war because i think that well that goes back to what we were talking about earlier tesla predicted that in order for agrarian society to prosper long term they would have to find some other means through which they engage in their power competitions and it probably can't be kinetic power competitions because they're uh they're too lethal we're getting too good at killing each other. Uh, they're too destructive. He predicted that we would go towards, um, some form of electric, you know, machines competing against other machines. He did this before he knew about software, before he knew about computers, general purpose computers hadn't been invented

yet. At the same time, you've got the people like Fords and standing next to Ford, you've got people like Edison saying, if you want to solve wars, turn power, electric power itself into money. And what both of those titans of American industry were missing was software. They didn't have a way, like if you create a global scale physical power competition, energy competitions with machines competing each other, how do you manage it? You need some form of software. And if you created energy money, how would you manage it? You need some form of software. I think what Bitcoin might represent is the marriage of both of those two ideas into a single system where just as valid as it would be to say that Bitcoin is a form of electronic money, as was the Edison argument,

I think it would be equally as technically valid to describe Bitcoin as Tesla's vision of the end state of agrarian warfare, where people are competing against each other in a zero trust and egalitarian way using an electric form of global scale physical power competition. I think they both saw the same end state, and I think Satoshi created it. yeah so it brings about peace it's not war it's uh and so that's one thing that just to be completely upfront like i've had i mean i've said publicly i've tweeted out let the hash wars commence and i've thought of it that way as well as like this global war for hash rate but as i've gotten more into mining as an industry specifically as somebody who um runs my own personal mining operations i'm uh connected i'm professionally involved with a couple um mining companies as well like it's becoming glaringly obvious to me it's not really a war at all it's it's ruthless

capitalism driven by profit motives that and so that again going back to the whole framing of your thesis and trying to get bitcoin defined as munitions grade cryptography or cryptography grade munitions or whatever the word is yeah the phrase uh that scares me personally i won't speak for anybody else because if it does get defined as that and the narrative of the world is in a off war to control the Bitcoin network or have their stake in the Bitcoin network, and not the world, but governments of the world, which are extremely corrupt, arguably the most dangerous entities that exist on this planet, and really have proven, particularly in the last three or four years, that they don't really care about civil liberties or

freedom in the digital age. pigeonholing Bitcoin as munitions, warfare-grade munitions, creates a crack in the door for the state to say, oh, this is warfare-grade munitions, only we have the right to declare war and control those types of munitions, so we're going to take over the hash rate industry.

So, there's a couple points to unpack there. So, you say, okay, clearly Bitcoin is peace, not war. So, this is the, bear in mind, I'm the military dude. So, I'll give you just my perspective on this idea of peace. There has never been um a meaningful duration of time in the last like 12 000 years where like humans haven't been engaging in power projection competitions against each other to capture resources or to capture control authority over resources this like idea of peace is not in my opinion a replacement to war like you can't replace war with peace peace is a reprieve from war it's that temporary state of high trust between wars when people and governments can be trustworthy with alternatives

to physical power as the basis to settling their disputes but to your point it gets corrupted governments get corrupted people get drunk off their imaginary power and start abusing people through their belief systems and exploiting them or they just flat out get invaded they just they're just weak and they get captured so like this idea of peace to me is just the thing is an imaginary thing that has never existed it's just a reprieve a temporary reprieve between physical power competitions where our demonstrably dysfunctional abstract power hierarchies um are somewhat functional if that makes sense yeah i can i mean yeah that does make sense and again that's the whole point of bitcoin it's like

anti-state separate money from state because we don't want these corrupt hierarchies getting us into wars uh we don't want to fund them or allow them to fund themselves via the fiat monetary system to perturb the ability of peacetime to take hold yeah i mean that's definitely one so when i look at when i try to look at technology i try to be as like uh what's the word like it sounds bad but i try to be as like sociopathic as possible i try to not apply any type of um ideology to the technology despite what its inventor might have called it there's there's a lot of examples in history where like you know the person invented a thing intending it for to be for one reason where it it ended up not being for that reason so if you just look

explicitly at the technology here's the technology that allows people to digitize convert power into bits and then pass it across the internet and by doing so you can um essentially send packets of power you can convert real world quantities of power into packets of information and pass it back to each other and by virtue of doing that impose physical costs on each other but that again now we're getting to like semantics of how bitcoin works going back to like full nodes like Like when I send a transaction from my node to somebody else's on the network in a peer-to-peer fashion, it is getting confirmed in a block. And that process to get confirmed takes a lot of energy,

but actually me sending that transaction is the same amount of energy as sending a tweet. So actually sending these messages doesn't really – and this is like something that's gotten Bitcoin and talk about like the ESG slant. And this is what that dude from Digiconomist has really leaned into, the energy per transaction metric

that he made out of thin air that is objectively just not how this works at all. When you send a transaction, you're essentially sending a tweet and it takes the same amount. What takes a lot of energy is confirming that and confirming that transaction in a block is on the front end of that is a lot of capital risk uh by an entrepreneur who wants to make a

profit for providing the service to the bitcoin network of getting these transactions confirmed so when we talk about bitcoin security uh i do think when you talk about we need to separate two things the security of a transaction in a block so how confident can you be that your transaction isn't going to be overwritten by somebody who reworks the chain and then security of the consensus rules and what people are allowed to do within the bitcoin network which is determined by full nodes so maybe the more the better way of saying it is confirmed information Like once some type, once it has been confirmed enough to have successfully achieved consensus across the nodes, that confirmed state of information required a substantial amount of physical power to achieve that. Yes.

Yeah, so to pass confirmed information, right, to pass this bit of this packet from one node to another and to get those nodes to all agree and achieve consensus on that passage of information across cyberspace, a non-trivial, materially relevant amount of physical power had to be expended. so if that's true then when you observe a bitcoin a bitcoin passing across this ledger that technically represents symbolic meaning that you have applied to a materially large quantity of physical power that has changed its state so you are so like if i'm like what i'm looking at you like when i'm looking at you right now or like anything on my screens here um that is symbolic meaning i have applied to transistor state changes but if i were to see a bitcoin transaction and like be able to validate it through a node that this is like a valid bitcoin transaction that's completely different than anything else in cyberspace that represents

not a not just so to your point yes it does still include transistor state changes because what nodes do that's what they're made out of but it also does include materially large quantities of physical power that's changed state so it's not only just transistor state changes it's large quantities of physical power state changes that means a bitcoin transaction or any information that's passed through the bitcoin ledger is fundamentally different in a computer science perspective at the base layer at the state mechanism layer it is a totally it is a totally different type of computer that's never existed before that's now plugged into the internet that are people are using through the internet i think i don't know these are just theories

no just talk about the internet too like that takes an insane amount of energy i mean this is just humans harnessing energy in different ways well the i think one of the core problems is people for whatever reason they think that um inefficient or power intensive um you know requiring a lot of power to send information across cyberspace is is only bad for whatever reason they think that and for whatever reason people just tacitly assume that the cheapest way to send information across the internet is good but what bitcoin proves is that actually there are major important use cases for making it physically expensive in watts to send information across cyberspace. And the obvious one is security, because that is the mechanism through

which the reusable proof of work ledger itself is secured against systemic exploitation, at least in the form of 51% attacks. So it gets back to the same thing I keep harping on where Bitcoin is proof of proof of work working. It's proof that the ability to impose physical costs, it's proof that a computer that is physically hard to change states is actually useful as a security protocol, because look at it, it's brilliant. So that was the first point. There was another point. Crap, I forgot where we were. Why war? War. Okay. Peace doesn't exist. It's a reprieve. Oh, yeah. So peace is a repeat from war. It's the thing that happens. Consider this thought experiment. If war didn't cause injury, if there was a way, just hypothetically speaking, that we could fight wars without physically causing people, would people think it's bad? Would people even want abstract power hierarchies?

I think we need to take a step back first, like why are wars fought? We can talk today to focus on today's day and age, like why are wars fought? A lot of individuals would argue the U.S. military-industrial complex exists to protect the petrodollar system at the end of the day. So Bitcoin's created this peaceful alternative where you don't need that kinetic warfare to go into far off lands and occupy them and use force to intimidate other countries to convert their local currency to dollars to buy oil on a global scale. You can just nix that and participate in this peaceful monetary system that does not need that level of force. So the cost of attacking Bitcoin is so high that it's not even worth going through the kinetic process of attacking individual actors globally distributed. um like so that like why humans fought wars historically most importantly today um to for the u.s perspective to protect the petrodollar system and

one could argue that the u.s is the biggest warmonger on the face of the earth right now um and then two if bitcoin provides us the ability to peacefully protect a monetary network without having to go to go flex around the world why why would it be crazy to think that that could bring about uh an extended reprieve of peace yeah no i i think that's a very logical argument so when I think about what is uh what is war why is it caused I go first principles in everything I do so when I think about war I think about why do animals prey on each other um just generally speaking beginning like before before human beings existed um why do pack animals constantly fight with each other to establish a pecking order i think at the end of the day there's just

there's no replacement for physical power as the basis for settling disputes in a zero trust and egalitarian way i think power projection is the only free market so i think war is the only free market and i'm not i'm not saying that as like a like a for humans i'm saying if you look at just you go outside or if you you know take a spoonful of of seawater and look at it under a microscope what you see is a whole bunch of animals killing each other over resources and so i don't understand why why is that because they weren't imbued with logic to figure out a way to cooperate too yes yes so so yeah so that's what humans did is humans were like okay you know we we uh we got our

fire we started cooking food we started growing having a lot extra power all that power went into thinking power so we grew these prefrontal cortexes and then we started thinking abstractly And we started developing ideologies and we started coming up with all sorts of interesting new concepts like ethics and morals and theologies and all this stuff, especially once we got to agrarian modern society and behaviorally modern human beings or sapiens. And so I think you're right. I think what makes sapiens completely different from all these other wild animals is that they have the means to actually think of alternatives to killing each other to settle disputes and determine resource control authority and all the stuff I keep saying, achieve consensus on the quote unquote legitimate state of ownership and chain of custody of property. humans can think of alternatives to physical power as the basis for doing that to killing each other as the basis for doing that the problem is they're just they're demonstrably dysfunctional they do not work they keep on breaking down they lead uh it's obviously true that humans still use physical power as the basis to settle their disputes they still kill each

other to settle their disputes and they do it at a larger scale and use far more energy and cause far more injury than they because of their desperate attempts to to try to find a replacement it ended up it ends up being a battle over ideology yeah well then again we have to get back to the core of these disputes which many would argue myself included that the core of these disputes revolves around some perversion of the free market particularly the free market for monetary goods where you have these corrupt governments gain control of the money printer and that gives them control over these other aspects of the economy of society which creates restrictions for individuals to access goods or services or do and say what they want which

leads to the boiling point which creates the the war the dispute the physical confrontation and going back to I definitely agree and so it hasn't been until and this is why I think we need to be very particular

very specific with how Bitcoin is framed for society as we move forward it is this revolutionary technology that allows us to get away from that morass created by the perversion of monetary systems by bloated governments that allow them

to control the purse and then control everything else from there we finally think it is we were born at this weird inflection point in human history where we've been given this tool that allows us to get away from that. And my perspective, probably someone who considers himself an anarcho-capitalist would say, hey, we should not be trying to convince the governments that Bitcoin is a weapon of war. We should simply say, hey, Bitcoin is text, it's speech, it's software. If you do believe in free speech, it should be protected that way. I should be able to send a transaction, send a message to peers on the network without fear of retribution from my government. Thank you for attempting to provide me goods and services, but doing a terrible job

over the course of my life, at least. I opt out and am deciding to operate within the consensus rules as set forth by the Bitcoin network when it comes to interacting with others throughout throughout the economy when i exchange money for goods and services yeah so um before we go into the i know we're that's the meat of the convo is why i call bitcoin war but before we go there since we since we can follow up at that point it's like why wars are started or why they happen um it's important to note that like it's kind of unclear to where the boundary between humans just fighting with each other over stuff to like war like actual being qualified as war large enough to be qualified as war started but what's what's very

clear is that like paleolithic sapiens started um they stopped at early in the like you know maybe 30 000 years ago they didn't really have property they just carried around like what they could walk with and they were just constantly hunting and gathering and it wasn't until they figured out irrigation and and agriculture where they started parking themselves in the same place so they started becoming um just like they just started not moving and and then that's when like that correlates to when this thing that you could call warfare started when people started like actually taking over people's agriculture their land and and or trying to capture control authority over that land so this phenomenon that we could call war started after agrarian society was

invented after people started using agriculture and started coming up with these abstract ideas about quote-unquote like governments or at least some form of what would resemble a government back in the day and all that happened and all those wars were fought thousands of years before what we now know as money or control over money emerged before even gold was used and adopted as as money so it can't be true that the only um driver of warfare is is like a fight over money but i definitely would agree that's one of the main ones now and yeah that's why i wanted to focus on war in today's day and age because obviously there's been a progression a evolution of society so if you think about it uh money is a belief system you're applying symbolic meaning to

uh something right you're saying this has value is it not some it's a belief system you're choosing to say this piece of whatever shell or gold is of some certain value this gets into like the whole uval nurari or harari money is a shared illusion which i don't think it is money the market has shown slowly but surely over time and arguably will happen more quickly as we move forward into the digital age that yes at the end of the day you have to agree with somebody i believe that's money and you should give it to me but uh and i will give you these goods but um money does have certain properties monies do have certain properties that make some better than others portability scalability scarcity divisibility verifiability

all that stuff yeah interesting thought experiment going back to the uval thing is do do you think that animals that aren't capable of abstract thinking that don't have the prefrontal cortexes or whatever uh do you think that they can conceive of money or is that a uniquely human thing because if it's a uniquely human thing and no one else can recognize it then that could be a leading indicator that it is in fact a it is symbolic meaning applied to certain things and And to your point, some things are better to apply symbolic meaning to than others, gold being an obvious one, because if you imply the symbolic meaning of value to gold and gold is physically constrained or physically scarce, then you actually create a defensive

mechanism where you physically constrain people from exploiting that belief system by trying to increase the supply of gold. Yeah. I mean, there's plenty of examples out there of scarecrows and monkeys, scarecrows putting twigs into a vending machine to get goods, and monkeys exchanging something for grapes in return. So I think they have the ability to recognize a value exchange, at least say I put the stick in this vending machine. Yeah. Or a cause and effect. Yeah. But okay, let's fast forward a bit. 1971, gold's no longer the basis of of uh the monetary system um it's that means there's no physical

basis of the united states dollar right would you agree on that like it's just purely an abstract idea it's backed by nothing at all that's that's i mean technically it's not backed by nothing it's backed by treasuries with different durations that essentially say hey we're going to give you these treasuries and we'll promise to grow our economy at x percent in the future and that is going to be the value the future production of of our our country's uh economy yeah and future anything is an abstract idea like the future doesn't exist right like i don't know for sure that i'm going to exist in the future so but yeah so like fiat in general like i think one of the problems with fiat in general is it's

too much of a belief system it doesn't have enough physically backing it and i think another argument that could be made is that the united states dollar system specifically is essentially just a piece of software the the the issue is somebody has control over that ledger and with a keystroke can change it right so if money is a if you can if you can say well the modern state of the united states dollar or the fiat system is effectively just a global uh software piece of software people are just looking at their ledger and and that's controlled by someone who can change that ledger then that would mean that what bitcoin represents is is is a way to physically constrain that system like is a is a piece of software that cannot be

controlled in that way it's a it's a physically decentralized physically constrained piece of software that no one person can achieve full-scale control authority which is precisely the problem of the usd fiat system is it does that make sense yep yeah and so that gets back to the war thing Okay, so war thing, why it starts. I think a lot of it has to do with belief systems. I think people have ideologies. I think they want to believe in some greater good or some right way of settling disputes

and some right way of managing resources and establishing a pecking order intraspecialy between sapiens. I think we all want that, and we want a way to do it without having to cause injury. But the problem is when you use abstractions, when you use abstract beliefs or ideologies to do that, you implicitly give someone control. So like if you use a judge to adjudicate disputes, that judge has abstract power, that judge has imaginary power. by virtue of our morals by virtue of our ethics and theologies and ideologies we create belief systems which can be exploited we make ourselves systemically vulnerable or we give an attack vector to ourselves through our belief systems

that we would not have if we continue to use physical power as the basis to settle disputes and establish control authority because using physical power as the basis to do it is effectively just choosing the heuristic might is right. The most physically powerful and most intelligent person capable of projecting power in the best way gets the pecking order. And yeah, it's a bloody fight, but at least it can't be systemically exploited. There's no changing goalposts about what constitutes right. There's no body trying to fight or say what the correct ideology is. And I think a lot of what you see in agrarian warfare is people competing. They're essentially fighting for the right to define right. They're like fighting for the right to define what the morally or ethically or theologically or ideologically correct way of settling disputes without physical power is. and if that's true then the problem of war is just that it's kinetic that it causes injury and that

you can solve all this by just converting it into an electric form and then everyone just choose they pick the might is right heuristic again and they just let let your belief system be founded on something that's zero trust and egalitarian and permissionless and i i think these are all kind of these dynamics are all happening in play right now i think i think that people can believe in bitcoin and use that as their foundational thing to believe in like we can stop believing in usd because we finally have an alternative things to believe in and it's secured and it's it's uh it uses the exact same global scale power dynamics as warfare but it just does it in a non-lethal way and that's that's not just disruptive to money that's disruptive to all beliefs to include

government so it's like if we can use a zero trust egalitarian permissionless system to settle our disputes what is the point of government why do we have um uh why do we need somebody with imaginary power to determine what the the legitimate state of ownership and chain of custody of property is when i can do that in a zero trust and egalitarian way that can't be systemically exploited by my government that doesn't have that security vulnerability and so again again it gets to this like thing where it's like i think this is more important than just money i think this is i think this is such a big deal that it is disruptive to the entire concept of agrarian society in the first place it's not just disruptive to money

it's disruptive to the idea of government itself and the idea that we even need an alternative to physical power to settle our disputes anymore because if it's not causing or hurting anyone then why why is it bad it can't be bad like how can you morally justify that's bad unless you try to use the attack vector of esg and try to quantify its power usage as quote-unquote unethically bad that's why we have fix the money fix the world and neon lights right over here i do believe i mean yeah that's why it's fix the money fix the world i think it's much bigger than money yes because the sound distributed peer-to-peer cash system uh will allow us to coordinate in a free market fashion to fix the world that these governments have fucked up pretty massively

as it stands in 2022 and i guess i i think this gets back to the whole what i you know just talk from my perspective is like what i worry about by like lobbying the government and trying to convince them that this is a weapon of war particularly in the u.s again gives them an open door to say all right we need to control this weapon of war which would defeat the purpose of bitcoin in the first place and and that's why i'm very steadfast and ardent about really leaning into bitcoin as a first amendment free speech right um and i i think you could apply bitcoin to many amendments many of the first 10 potentially all um third amendment prevents the irs from from uh courting your bank account or quartering in your bank account i think michael goldstein

has said that before fourth amendment unreasonable search and seizure um they cannot um they cannot seize your private keys uh if you if you have them protected in the right way um they would to go prove that in the court of law and have you hand them over um again yeah i think that's the the big uh issue i have with the framing of bitcoin is first and foremost the second amendment issue when i think it's a free speech issue and it could potentially um i will concede it could certainly um apply to or fall under the second amendment in some context but i think the first amendment strongest and then at the end of the date is money um as well um money is speech in a certain way you're basically articulating um that you're willing to exchange a defined

unit of value for a good and service um yeah not to sound too nerdy but speech itself represents syntactic and symbolic meaning that you apply to state changes in audible wave patterns right like it is a belief system uh speech itself this manner through which we communicate with each other is semantically and syntactically complex meaning and that's precisely what we're also doing while we establish symbolic meaning to things that we choose to call us our like you know money so yeah i think they're literally the same like um from the foundational level um okay real quick you said bitcoin is money or like that's what its purpose is i want to make the point that um um when i don't remember how many years ago like 900 years ago or something

when the chinese folks were when a bunch of doctors were trying to develop new concoctions for medicinal purposes they came up with black powder and to them black powder was a form of medicine because they were doctors intending to build medicine and they thought it could have medicinal purposes like cauterizing wounds or other stuff like that because they did notice that it was quick to hold a flame. And for hundreds of years, the doctors perceived black powder as a medicine. It was to them, the purpose of this thing was medicine. And they even, it had monetary value. They traded this thing. It wasn't used, I don't think explicitly as money, but it had monetary value. But the point is people created a new type of power projection technology

and they thought it was medicine and then in the future it started ended up using as something more than medicine it didn't it changed the perception of it changed to gunpowder once guns were invented or once the mechanisms through which people can project this power at each other to impose physical costs at each other changed and so now we look at gunpowder today and we think just take it for granted, like, of course, this is a weapon. But for hundreds of years, people didn't think it was. The point is, physical power projection, the mechanisms, the technologies, tactics, techniques that we use to impose physical costs as measured in watts on each other changes over time. And so one of the big assumptions that we cannot make is that the

future of warfare will look the same as the past. We can't expect the next war to look like the last war. Anytime that's ever happened, it's not turned out well. For example, when Orban the engineer showed Constantinople that you can use gunpowder to build a cannon, and Constantinople turned them down, and a year later, the walls of Constantinople are being shot down. There's a lot of lessons and precedents in history where it's really important to keep an eye out on the basics, which is people are going to come up with different technologies to impose physical costs on each other to lower the benefit to cost ratio of attacking. And it's not necessarily kinetic. And it's not smart to assume that the future of warfare will look anything like the

past. Your job is to understand what the future of power projection will look like, and then to posture your whatever you're trying to secure to win that i say all this because one of the main reasons why i keep like saying that bitcoin could represent not just a monetary system but also could be used as like some type of soft or non-kinetic form of war fighting is is because i it could be accurate that could very well like i know that it's like it sucks to admit it and i know that could be an attack vector but it also could be true like it just could be right um we have to consider that possibility at least my job is to at least consider that possibility because i'm not here to win last wars i'm when here to win the next wars

yeah let's play it through though like if that soft war scenario plays out nation states get control of material amount of hash rate and then engage in hash wars with each other either physically bombing mining centers or censoring each other's transactions or one gets 51%, a cabal gets more than 51% and begins censoring transactions just completely defeats the whole purpose of Bitcoin in the first place.

It becomes an unreliable system of value transfer. So, yeah, that's an interesting train of thought. um so here we can bring up the whole hash force thing so i do not believe it is logical let's assume it is software just for um this strictly for the sake of argument and we'll address why that sucks and why it could be an attack vector later but just for the sake of argument now assume it could be a software protocol i don't think it would be smart for the government to try to run the hashing um i don't see like why do something that you can get for free is effectively like my point of view on that it's like if the commercial industry is willing to

to run it just you know to have a commercially decentralized hash force without us having to pay for it then why the hell would would the government want to pay for that or or or try try to um if if you know it's like it seems like better to just buy bitcoin um unless there was a threat of like a nation state level 51 attack so to your point in these hash wars like if russia and china had like these hash pools and they started to attack the united states maybe it might be necessary for the united states to seed the operation the opex or the capex of um a commercially decentralized hash force but like it's already true today with the military industrial complex that we don't like the

space force doesn't build its own rockets we let commercial build the rockets we don't build our own satellites we let commercial build the owns the satellites we just cede money to them to do that and yeah it's not a it's not a very good free market um so it would it seems like it would be better to just let the free market do that because i think to your point it would be a far more effective way to guarantee that we have uh if this were the case that we have the most robust hashing infrastructure yeah but again like i definitely think war will change and i'm not naive to think that war won't exist in the future but going back to the point you just made war in the future becomes significantly more expensive because like you said the government

doesn't build its own rockets, it doesn't build its own weapons, it prints money and pays Raytheon to do it or SpaceX. And this is inherent in the problem that Bitcoin is trying to solve. That ability to print money ex nihilo and then allocate it towards these warmongering endeavors, number one, isn't fair.

Number two, isn't good for human progress or overall quality of life on this planet and so yeah i i agree that the printing of money to fund the war machine as it had started 100 years ago uh seems to have backfired significantly on the public because of that exact reason i think that a large part of why well the world wars were such a big deal is because we effectively set that precedent and um and and we we kind of but but the the problem with that is it becomes the shelling point so like if it's an existential imperative to win the war or else you're going to get invaded and your adversary is using a belief system a corrupted belief system where they could print money ad nihilo or ad infinitum and

uh you know like just basically debase everyone's savings to fight for the war campaign that is a material advantage in war fighting that now becomes yet another power projection tactic technique or um or shelling point and so like you know an interesting thought experiment is could the allied forces have won the war if they weren't printing or can a country that doesn't print compete against the country that does? And how would that change if that mechanism is changed? I agree with you. I think that it would improve substantially if people just adopted a different belief system and a different type of money. I think that could substantially improve. And I think that if warfare is indeed a measure through which we essentially compete over belief

systems to include like the united states dollar like what value that is then then yeah if you convert if you simply just choose to assign value to something different then you could totally end the military industrial complex if you can get enough people to believe in it and that's something that i do want to encourage people to consider i think that if you simply like i have personally decided to no longer believe in the value of the united states dollar and i only use it for just because other people believe in it and i you know they have they you know when in those cases where they're not going to accept what i believe has value i still need the use of the dollar and i obviously have to still be paid in the dollar but i'd still convert

it i have simply chosen not to believe in that and by virtue of doing that i have effectively completely undermined both the physical power of government, but also the abstract power of government. Their ability to gain access to resources or secure access to resources or randomly change the, you know, press a keystroke and randomly change that. I'm no longer affected by that, by just simply changing my belief system. I think that we can get more people to do that. They have to see why that would be useful. And I think a core reason is because we have fundamentally changed the mechanism through which we project power, through which we secure the stuff that we, the property that we value and the policy that we value using a physical power projection competition. Like we fundamentally change by fundamentally changing the mechanism of war. Then you fundamentally change the government, the money, everything like you can create an entire new form of organization that has never been seen before that transcends even this concept of a nation state, which is not even like a like the nation states have only existed for like 200 years. the scale of what we consider nation states today. I agree to your point. They're a failure. They're

not working. They're broken. People are getting exploited at extraordinary scale. I think what we've been missing is just an alternative. And I think that Bitcoin gives us the alternative because it provides all the alternatives. It's not just the money, but it's also the mechanism through which we secure zero trust and egalitarian access and decentralized control. So it's not just the new form of money. It's the new form of governance. It's the new form of warfare. And all people have to do is just believe in it and start to kind of align to that. Okay, so moving forward, let's get to the real convo. I think that the message that agrarian society has invented a soft form of warfare is fundamentally a positive message, so long as people take the time to understand really what it means. If it's true that we've created a digital, digital, electric or electro digital form of global scale physical power competition, then we've all we've obviously created a nonlethal form of warfare.

And so the thought process is, well, holy crap, if we created a nonlethal form of warfare, that's remarkable. that could dramatically improve the our ability to secure ourselves and um and prevent destruction and all the horrors that we've seen throughout the last 100 years and so i i think that's fundamentally like a a good um a good thing but also it just make it another reason why it's kind of a cool idea to think about is if you think about um what we talked about earlier with tesla and the problem with kinetic warfare is it becomes too efficient like the more efficient you come at projecting kinetic power you get to nukes and then you strategically stalemate yourself and then you get into a systemically exploitable hazard where people are like basically really vulnerable to

being oppressed by their ruling class because the the asymmetry an electric form of warfare would would could get increasingly efficient ad infinitum they're like there's no limit to how theoretically no limit to how much power that honest people can project to defend their access to the stuff they value not just against their own governments but against there's other things when it comes to hashing so so in terms of power like how much watts that people can sum together in order to impose a physical cost in watts of in this case 51 in attacking them theoretically it's hard to think of like like a limit to there might be some practical ones obviously right now there's practical ones but like the profitability limit once it's

non-profitable like why would you run it at a loss so people routinely go into non-profit it um so like well i guess you could argue it's still profitable so like for example you know one of the arguments for why people get taxed is because it's not exactly a profitable endeavor always uh not strictly speaking about the united states military but other militaries standing militaries are just by themselves super inefficient like you have to feed all these armies let's just go back not nation states but let's go back 500 years like if they're not going around capturing anything they're not profitable right it's like a a standing army sitting around doing anything it's just opex um and so there i guess there might be times where maybe probably only

temporarily there would be a motive if especially if there are nation states and especially if it was like a national scale hash war where nation states would be willing to dip into the red in order to do their attack but i think to your point long term that's not really viable yeah because they can't print money though because we'll be on a bitcoin standard and they're not the way they are yeah but they can get more efficient though they can get more efficient so like they can make the watts per dollar watts per bitcoin basis more and more efficient and i i guess just that's just something to think about um that's an interesting kind of thought experiment whereas whereas there are hard limits to how efficient you can make kinetic power

projection there might not be a strict of a limit to how far you can make electric power projection efficient okay so putting that aside war um would it be bad if we framed let's just assume that maybe even if it is accurate to call it a potential war fighting technology should we because would that introduce a an attack vector where the government could try to use it against us. I thought about that a lot, and this is kind of the way I think about it. So I can demonstrate it. Let's do a thought exercise. Let's say you're like a flight squadron commander you're in command of a squadron of um like uh a-10 fighter jets or something the a-10 fighter jets take off they're going to do some campaign some power projection campaign

and they get pretty wrecked like five of them get shot down only five make it back out of the tent and you notice a pattern for every single one of these a-10s that are landing they barely make it home because their wing tips have been shredded off and like their tail fins have been shredded off and they just like finally make it home and land so you're a squadron commander you've got some engineers it's like okay well you need to do a new sortie and you need these like fighter jets to you know like be a little bit more resilient like they need to be able to survive the fights that they're they're taking and you have the opportunity to like add some reinforcements to these jets where would you choose to place the reinforcements on these jets

that are coming back crippled with their wingtips blown off and their and their like tail fins blown off have you had to make that call if you had to replace parts of the plane or like if let's say you fix the plane up but you you keep on you notice this pattern where their wing tips are being blown off and their tail fins are blowing off and it's like barely giving them the opportunity to like land and half of the other ones are are never making it home if you have the opportunity to like add reinforcements or like add like lightweight armor to make them like more able to like withstand blows where would you put it if their wing tips and their tails are being blown I'm not well versed on the physics of airplanes, so I'm trying to decide what's

more important for the functioning of an airplane, the tail or the wings. I would assume the wings, but- This was actually a problem I worked on as a blast and ballistics engineer. It wasn't specifically this. We had lightweight armor and we had to figure out where to put it okay so um yeah it's totally rational to think all right you should reinforce the wingtips or the tail whatever one's more important to flight and like controls right it makes sense that's what your gut tells you the the problem with that is it's technically totally irrational and there's a logical flaw that's happening it's called the survivorship bias this is a problem anytime anything has to survive some type of like uh

natural selection process not maybe not natural selection but like a rigorous selection process it's called survivorship bias and the bias that happened is you're only paying attention to the planes that made it back so you're ignoring the planes that never made it home and you're only paying attention to the planes that made it home and you're noticing the pattern in the planes that made it home is that their wingtips were blown off and that their tail fins are blown off but you're ignoring the fact that what made it home went through a rigorous selection process in other words what you see is what survives you are looking at where the plane can actually handle the hits where it can actually take the hits and if you need in in all the places that isn't being

shot that's where actually you should be starting to consider reinforcing or placing armor because that's the places of the planes that didn't make it home like you're only looking at the thing that survived the natural selection okay so that's a demonstration an easy demonstration of survivorship bias you can wikipedia and they use pretty much the same example by the way the way we would do it is we would give um the pjs uh these armor plates as seats and so they would sit on the seats so they could take shots and it wouldn't like shoot them uh the rest of the airplane could get shot but the people inside the planes would wear the armor okay i say all that because let's get back to the whole big shebang this whole big argument about

like we don't want to give the government ammunition against us because they might try to repeat what they did where they call it ammunition and then try to prohibit the public from having access to it in my opinion the the logical flaw there is the survivorship bias flaw you are looking at the thing that actually survived like the last time the government actually tried that form of attack was a demonstrable failure so you you know based off of the fact that it's already happened that if the government tried to withhold munitions grade or military grade security technology from the public that it would it would have a difficult time doing that because that's what already happened you know exactly that's like you know we like there's this

tendency for people on twitter to be like this is what the government tried to do and i look at that and i'm like yeah that's what the government failed to do so you're that's the demonstrably failing strategy of the government that's why they pulled their punch you're seeing where you can take the hit you clearly can't take that hit because you've taken that hit before and we we survived it and so and then also to go back to the point that we made earlier it's like because of surviving that hit and because of getting to the point where like we're finally able to get some of this encryption technology this what this military grade munitions technology taken off of the munitions list or at least giving to the public like in a

the government already decided to do that. They already made the conscious choice to export this, let's call it a munitions or an arms worldwide. So if a government wanted to try to attack this narrative that Bitcoin is a munitions or try to take advantage of that narrative, they would have to do two things. First of all, they would have to try to explain how it's logical that something that they've already chosen to export publicly globally should suddenly be restrained, but not for everyone, only for the United States. So we've already decided to give this technology out to everyone,

but at this point, only Americans can't have it. Everyone else can have it, but only Americans can't. And then because that doesn't actually protect them from the threat of like it being used against them that just only protects them the threat of it being used against them by their own people like other countries could still do it so it's just kind of like a an irrational like hard to justify argument but then it's also the proven failure strategy like they already tried to do this and it already failed you already know that you can take those hits and so in my opinion it's like you can gain the benefit of the first amendment and the second

amendment and maybe like maybe the first amendment is stronger than the second but like the first amendment and the second amendment could be stronger than just the first amendment argument but but also like you want to take the fights you can you know you can win and i i think this is a fight that we know we can win because we already won it it would just be round two and then i think would be highly politically unfeasible or at least at least um less feasible than strictly only attacking the first amendment way i don't know about that though because like especially when you're posturing this argument in the eyes of the public that still is a bit ignorant to bitcoin what it is and is a bit fearful and sees what's going on in ftx and mount gox and all this

stuff and has a natural aversion reaction to bitcoin that for i think we could probably see most people is somewhat negative again thrusting it we need to protect this as as a weapon narrative could have them double down on on that negative connotation like wait a second the bitcoiners are are holding weapons with their private keys that's one yeah it's one rebut i would have to that line of thinking then too survivorship bias yeah i mean um i think bitcoiners specifically have proven to have extremely adversarial mindsets where again like i think that's where i come from it's like why even give this narrative legs to run on um when we have bigger things to worry about like social attacks ftx potential social attack we don't know

what's going on there like dude because that could be the attack vector the attack vector could be to not let the public to essentially take advantage to take advantage of the public's misperception as bitcoin being strictly money and not a military-grade security system for themselves that they could use to defend themselves against their own government like it could be the case that the government is deliberately trying to not bring that up because they don't want to take that fight because they know they couldn't win it last time yeah but then you have to get back to why bitcoin is a good money in the first place and why people can have confidence that it's a good money because it is distributed it is verifiable it is scarce

like it has it is a good money because it has value because it has value because it provides fundamental utility that does not exist elsewhere yeah but one of those major utilities of bitcoin is weapons great security or military-grade security like the the the narrative that bitcoin is money but also the most secure money so secure that not even the united states can exploit it in my experience explaining this to people that that resonates with people it they like they people just understand the value of security and more so than like money it's like harder to explain money i found but that's might just be because i hang out with military dudes but like for whatever reason the idea in my experience and i've just been testing this publicly is that for whatever

reason it's resonating like i can cut through so much bs by just cutting straight to we've created a new form for people to secure themselves by projecting power in from through cyberspace this is a revolution not just in money but in computer science and and cyber security and that's just like for whatever reason that connects i've seen and i think that there is something to gain by combining all these narratives together and i think that this the fear that the government would use it against you is ignoring that the government could just as equally use the fact that you're not thinking this way against you. Like they could be benefiting from the fact that you are not considering it from a securities perspective, that you're only considering it

from a monetary perspective and the fact that people just don't understand money. And I think that's why you see like the government arbitrarily deciding to bin and categorize Bitcoin as just a crypto i think they're deliberately trying to confuse people and then steer them off the path right there and i think this like last cycle has just been is proven how effective that strategy is is to get people into the shit coin path instead of the the path that they ought to be on yeah shit coins are i know it's incredible attack vector i just like for the sake of adversarial thinking we just can't rule out the fact that like for me when i'm talking to people especially at the opotis or osec def level it is i feel like i'm taking crazy pills that no one is recognizing the

elephant in the room that this is nsa technology that they made publicly available to the to to everyone there no one's recognizing the use cases of this as anything but a monetary system and so So in my military-trained brain, I've been trained to know or recognize that if you want to understand the strategy of your adversary, look at the thing they're not doing. And to me, it's a red flag that no one is willing to acknowledge Bitcoin as anything except a monetary system or that they're only acknowledging that as its only use case. It's like, why aren't they? What are they? like that that to me is an attack vector and we could be complicit into that form of attack by refusing to acknowledge it as anything but just a monetary system that's just something we had to consider and i don't think these i think these two ideas are like bitcoin is first and foremost

money right like and it just so happens to leverage shot 256 distributed proof of work with a difficulty adjustment like that is how you get the money that is what provides a value like yes it uses cryptography that was created by the nsa but that that is a piece of the puzzle that makes bitcoin work and gives the the monetary asset value at the end of the day like the the use case is money like peer-to-peer value transfer so this gets back to a more annoying computer science like Technobabble, but anytime any computer programmer decides to use whatever abstract or semantic or syntactic language to describe the intended behavior of anything they write, any form of computer program, that software engineer is making an arbitrary decision based off

what he thinks what information he thinks is important so if like i'm a if i'm a coder and i write a computer program and i want to explain to someone how this computer program works i choose arbitrarily based off what i think is the most effective way to explain this i choose what to call it so i can call it a cloud or a thumbnail or a string or a coin that that is technically an arbitrary decision and it's guided of course by the intent of the program but just because I intend for this program to work this way doesn't mean that's the only way that program or that's the only use case that program can be used for. And I demonstrated this in the Space Force because when I was a director of operations for the second space launch squadron,

we would use a special piece of software to monitor all the alarms that are going off on the rockets before they launch. And so we would just keep track of the alarms and it just made it easier to like bin them and close them out we took when covid hit we took that at literally the exact same program that's exact same software no changes and it's source code at all and instead of using it to monitor alarms in a rocket we just changed the name we just changed some of the words in it and we used it to do contact tracing for closely tight-knit combat crews that we needed for like our satellite operations so just to make sure that we're keeping track of it's just an easier way to make sure of keeping track of who's got covid and how to structure our

our staffing because we have like really tight-knit operations groups the point is i took the same software with the exact same source code that was on in one room a launch monitoring software and i used it as a contact tracing software and that became like it became more of a big deal as the as the contact chasing software than it did as lots so like the same source code can be used for multiple different use cases it doesn't matter what the who wrote it and what they think but applied it doesn't change applied to bitcoin you just forked the code and created a whole new consensus network that would not have the net and the distributed system example will not have the network effect and value of bitcoin yes i mean many people have

forked bitcoin and created other cryptocurrency systems that do different things like coin forex to supply a quarter of the block speed different hashing algorithm yes you can do that and that's the beauty of bitcoin and why it is purpose fit for money is because even if you do fork off and do that stuff it is has the best network effect has the best properties has the best distribution and therefore it's the best money and that's why let's consider this let's consider this when proof of work was first created by let's say um adam's back adam back's version of it that proof of work token which he called the stamp but later cash that was not intended to be used as a money that was intended to be used as a denial service counter

measure in his specific case as you mentioned earlier to um improve email spam yeah i get what you're saying and satoshi proof of work began as not a money and then it's use case and satoshi took that so it like the precedent was this is not money and then satoshi was like oh this could also be used as money in a specific application known as bitcoin so like that specific application the bitcoin network has siloed value purpose utility and network effects like you can somebody will use somebody other people have used proof of work with the difficulty adjustment which was satoshi's innovation and other cryptocurrencies but none have attained the value of bitcoin um and so like thinking like like thinking like bitcoin will be something

different in the future yes maybe the source code will be forked and somebody will create something else but that won't like give actual bitcoin utx's different use cases that will exist on that other chain that other code base so i tried to demonstrate with my mass blocking campaign a potential use case of bitcoin as something else beyond money and so i know like we've had you know you've got the uh michael sailors out there that that implies stuff like uh that have like bounced around ideas like um orange check right isn't that what he called it the orange check idea okay so if we just consider that for a second if it requires if you have to like

post bitcoin as collateral or something in order to have the ability to tweet or something i think that was kind of like the idea behind the orange check yeah this is sphinx chat has done this there's some lightning network enabled apps yep yeah so you've seen a couple like that yeah you can't send me an email you can't send me a message unless you collateralize it with bitcoin so you're choosing to see that as a paywall or you're choosing to see that protocol as a payment system because Satoshi Nakamoto described this protocol as a coin or a peer-to-peer payment system. But if it's also true that from a fundamental computer science perspective, that Bitcoin represents bit power or digitized power, symbolic meaning Boolean logic applied to

quantities of physical power from the globally decentralized electric power grid, then what you're doing when you say you can't send me a message unless you collateralize it with bitcoin what you perceive as a paywall could equally as could equally be perceived as an energy wall i am creating a power wall like you can't send me a message unless you have the power to execute that transaction or at least hold that bit quote-unquote coin so yeah you can't so can you can't access this unless you send me value as denominated in satoshis yeah okay so that is a security protocol like i'm i'm degrading that is a denial of service countermeasure like you can't send me and spam me with a bunch of emails unless you

you collateralize it you're choosing to call that a paywall or or a payment transaction based off of nothing other than the fact that some anonymous guy arbitrarily decided to call this thing a coin if that makes sense it's it's like it's a value transfer though like they if they view the content or the message behind the paywall or the energy wall whatever you want to call it like you give up some satoshis for what you perceive to be valuable on the other side. So you can use semantics of like energy wall or whatever, but at the end of the day,

it is a transfer of money for a good, the content. So you're applying value to power. So you're effectively choosing to monetize power. No, this, no, this goes back,

especially if it's over the lightning network, this goes back to what I said earlier, like me sending a lightning transaction over my phone to unlock one of the newsletters i've written doesn't take a lot of energy i'm i try to think only on base layer so yeah i totally agree on lightning net on lightning layer that's true but then he's just thinking even on the base layer like i'm not expending energy i'm just sending bitcoin the miners are expending the energy yeah you've deferred that energy expenditure to okay so i think another way to think about it is this i think this is where we're getting confused because i think this

is a this is another computer science thing and like people this might be explainable by virtue of like understanding how literally at like the base layer state mechanism layer like level at the bottom of the tech stack it's a physically different phenomenon that's happening when i when i choose to call call a piece of software like a normal piece of software operating on a normal computer a coin that is semantic that is semantically as a semantic thing right i am abstracting the complex emergent behavior of this computer as a what i will arbitrarily choose to call a coin or a cloud or a thumbnail or whatever okay when you choose to call bitcoin bit power, you are not technically only abstracting, because actual power is the

state-changing mechanism. In other words, in computer science, people hypostatize. They treat abstract things as real things. That's how object-oriented design works, and that's how we talk about software as objects but if if the state changing mechanism itself is power and you're assigning boolean logic or machine code to quantities of physical power and then you choose to describe that as bit power that is not hypotetization hypostatization that is not abstract thinking it is literally power like you are literally like literally quantities of physical power are transferring when you call it i'm transferring bit power to you or i have a bit power wall like there's actual literal power that is preventing that transaction or or applying that

physical constraint that's why it's like that's the whole reason why bitcoin is just like mind blowing is because it's the only thing that is like that in the whole whole internet everything else is an abstraction and so so you can choose to call bit power a coin but once you've called bit power a coin then you've abstracted on something that is otherwise actually power like actually bits of power like actual digitized power actual power that has been converted into ones and zeros just like any any state changing mechanism can be converted to ones and zeros and so they like in my opinion the more technically accurate way to describe a bitcoin transaction is actually a bit power transaction you are collateralizing you can't send me a

message unless you send some some bit power with it and by virtue of doing that i have technically imposed a physical cost and power on you so i'm like making it harder to justify the physical cost of sending me messages which is deterring you it's a it's a classic deterrence strategy and that has a lot of applications and still money you're still money you're just changing the name to bit power instead of bitcoin it's yeah but but you could also equally argue that it's bit power that you're choosing to call bitcoin because you're choosing that this stuff has monetary value like gold it was by itself it was launched with the express intent of having monetary value as a peer-to-peer digital cash system i mean if you want to get really technical

what you're actually transferring is not bitcoin you're transferring unspent transaction outputs and as denominated in satoshi's yeah so like let's consider this is gold money or is gold gold that we choose to assign value to as money? Is a shell money or is a shell a shell? And we decide to use our abstract thoughts and belief systems to call that valuable. Like physical quantities of things, physical objective reality is ontologically like different than these abstract things or this abstract meaning that we assign to it. A shell is a shell, regardless of whether we call it a money, gold is a gold,

regardless of whether or not we call it money bit power is bit power regardless of whether or not we choose to call it money and whether or not even the inventor what the intent of the inventor was yeah but yeah there's still there's still money you're just calling it something that your value is being trans energy is being expended right yeah being converted but to electricity hashes are being produced blocks are being added and utxos are being spent as inputs and new UTXOs are being created on the backend value is being transferred. Like now we're just getting to like

a very deep semantics argument, which I mean, I love getting metaphysical, but it's how productive is it at the end of the day? Well, it's important because if you're trying to pigeonhole this thing into money, then we could be missing very different use cases for it. and you're just you just have this huge blind spot it's just value transfer at the end i'm

trying to think of like different like you can't you can send messages bitcoin is a message you can send an op return with a message attract attach your transaction um maybe that's another use case of like a actual uh a graffiti wall where you can put your messages um you can do things with UTXOs, locked them up in multisigs that have conditional spends. But again, at the end of the day, it's all value transfer as denominated in Satoshis, which is a form of money. So thinking about how software works, how software gets hacked, anytime software gets hacked, it's not breaking. It's just a systemic exploitation. Somebody figured out how to exploit the logic of that software. So the way that you can secure software pre-Bitcoin is you

can only try to find a way to make enough complicated logic so that people can't figure out how to exploit that logic. But the problem is no matter what type of logic you use, you can't actually stop someone from exploiting that logic. Logic doesn't stop the exploitation of logic. And And that's why cybersecurity is so difficult, is because there isn't a way to physically constrain the execution of certain control actions or control signals, except there is now. And so in terms of like, well, what other purpose could this have besides just money? The purpose is we've created a way to impose physical costs on each other in from through

cyberspace. people can impose real costs and physical objective reality as measured in watts on other people in from through cyberspace and so can programs too why why do they do it because doing so facilitates the movement of this money this money has value all this cost that is being expended at the end of the day is because the utxos the tokens have value as monetary goods it doesn't make sense if it's not money because there's no reason to buy the asics to line up the energy contracts to buy the transformers plug that in and it's done because people want to produce a profit for facilitating the transfer of this monetary good

yeah i do agree that this system wouldn't work if people didn't monetize it if if that's what you're saying like like it needs people to value bit power as money in order to to function and to have as much of a robust ecosystem as it has now like this this whole globally decentralized hashing industry wouldn't exist if people weren't monetizing yeah this is as money and this is where like austrian theory comes into play again with monetary goods like the opportunity cost of using bitcoin as something that is not money is too high like it is extremely valuable as money so once you begin to waste it on other use cases again i don't so other than like sending messages like i'm finding hard to like think of other use cases um

At the end of the day, every software problem, like almost every software problem, hack or systemic exploitation is because some control signal was sent that shouldn't have been sent. Like somebody sent a control signal that placed this system into a hazardous state and there weren't enough logical constraints to prevent that from happening. Yeah, it's happened to Bitcoin. But if you happen to use, instead of logical constraints, you just say, well, okay, if we know this is an unsafe control action that could send the software into a hazardous state, and we don't want to try to logically constrain someone from sending that signal, let's just not allow that signal to be sent unless it's collateralized by 10 Bitcoin. then you have create you have secured the system the same way physical systems are secured like i secure my system because my my money's safe in my safe because it's cost too many watts to get

through it yeah but the systems that you're using the bit power wall the paywall whatever you want to call it are external to bitcoin like it's being like it's secure because people don't lose their bitcoin because it's valuable money and their stake they're if they're staking it they're saying all right i'm trusting that i'll get good value back and won't get taken from me um again those things are external to bitcoin bitcoin can be used i mean i use it on my website as a paywall um hey if you want this content you got to pay me 25 cents worth of sets Um, but yeah, everything, everything is completely external to Bitcoin. But imagine if you had APIs that says you can't access, or you can't send certain control signals

across these APIs, unless you collateralize them with Bitcoin. So let's just go ahead and say, it's still only a monetary system. Now you've created a way for people to secure themselves with what we'll call paywalls but are actually physical constraints because there is a material real physical presence required to send these things you need to put up value to get value you need to pay money and then yeah yeah and then you do it in a zero trust and egalitarian way that no country or any group of people has ever been able to have can have control of authority over so you have a zero trust and egalitarian system through which now you can secure software not to access content but to prevent unsafe control actions to physically

to to constrain um to basically make your software more secure we know this works because like i keep saying proof of bitcoin is proof of proof of work working so you can use this exact same protocol and you can now use it to secure all kinds of things through all kinds of of APIs that use Bitcoin, just collateralized control actions, just like a firewall, but with Bitcoin. I don't know. It doesn't really secure the software at the end of the day. Somebody could have somebody pay me and say, that's the paywall, my website, and then my

back-end, front-end development team could be shit coders and still have an insecure system on the back of that. Yeah. I mean, it still requires good design, but it's impossible to say that it wouldn't work as a security protocol because it's working as a security protocol like the fact that proof that bitcoin hasn't been hacked is proof of its merit as a security protocol because it uses proof of work to secure its own ledger bitcoin has an isolated system yes when you i agree i think i think api calls are going to be your i give you packet of data you give me three sets like i think

that's the future of data transfer or value transfer via data and api calls in the future I think that's it. But again, I think the security of the software that you're getting in return is external to the Bitcoin network. Yeah, I guess so. One way to think about it is if you have a global computer, like let's just assume that's right. We've created a globally decentralized computer with a globally decentralized state space made out of all the the power grids um if you are not allowing software or information and software or state changes in your software to change unless it's collateralized by bitcoin then what you're doing is you're constraining the execution of your software to the base layer state mechanism that

is the global computer so like your software cannot move or stay to state change states or send new control signals unless it's collateralized by bitcoin and so what you've done is you've made your software slave to the to bitcoin to the transfer of information off the off the ledger and so you can actually use like single sats as not just money but as as physically constrained pieces of of bits of data and i think it's a probably a more complicated way of what you just described but the point is that's huge that's actually that is totally game changing in the entire like 80 years of computer science and because we are already in a situation where the where where um you know we're already fighting there's like already cybercom there's already a

u.s cyber command there's already cyber warfare is already thing um electronic warfare is already thing and now if you've created this new way to physically constrain or secure things through bitcoin then it's not a big leap to think okay well crap we this could become game changing for the entire industrialized mechanism of cyber war fighting that we've already created yeah i mean it's happening people are going to listen to this podcast they're going to be streaming sats to my lightning node that's not on chain but yeah i do want to take the again and i think i agree i do think it will increase the security of software and the integrity of services and the quality of services but it's not it is because if people are going to give up their sats

they want something of extreme value in return so that will just make it so the people developing these software projects and these services will ensure that they are providing the best code that the market has to offer and but again like the paywall it's like bitcoin's not inherently securing that software it is creating the incentive to provide extremely secure software because people are only going to part with their sets if they're receiving what they believe to be commensurate amount of value in return yeah i mean it's like the social incentive of it the pure free market economic incentive like hey if i'm giving you a bitcoin i go back to like human action austrian theory like fix the money

fix the world the world gets fixed because we fix the money and the money because it's such a good money uh increases the opportunity cost of of providing a shitty service because your recurring revenue will will dwindle pretty quickly once you swindle somebody out of their sets and provide them a service we're good yeah i mean i i guess it's just two ways of looking at the same thing and if if you want to choose to look at it strictly as a monetary thing and it only is working because of its value as a as a monetary system that's that's fair but i think it's underselling it i think if you look at what's physically happening in shared objective reality where bits aren't moving or at least not

having consensus of having moved until large quantities of physical power have transferred, then what you are doing by restricting a piece of software from sending a control across an API or changing its state is actually applying a physical cost in watts to doing that. And so in that sense, you are physically constraining the execution of an unsafe control action, just like a safety switch physically constrains the pulling of a trigger yeah so again yeah i think i think we disagree here where all that is external to the bitcoin network yes a lot of energy is expended um but again it's internal to the bitcoin utx's or produced coinbase transactions are released to miners it's all external to the system and then that closed loop network of bitcoin allows

you to go create these efficiencies and quality improvements and everything bitcoin touches i do i think bitcoin will touch everything we have a company in ohio cenoto i believe that's how you pronounce it but they're doing immediate value transfer uh you send me a lot of energy i'll send you sats back uh you're gonna price your watts and sats as soon as you send it to me i'll send you sats over the lightning network like i think yeah that's certainly how the economy is going to work in the future already is working that way um podcasting 2.0 um it's just at what point the the tentacles of bitcoin extend throughout the whole economy it's going to take time yeah and so yeah i definitely agree that on its own it's its own independent system and that

other people who use Bitcoin for other different reasons are it's other systems, right? They're their own independent systems and there is some boundary where they're connected, but that doesn't mean that Bitcoin wouldn't necessarily be that they're the same. It's just, here's the core thing and other people are using parts of it as its own independent system. And there's maybe like a different boundary or, you know, you could, when it comes to systems, you can put the context or boundary anywhere you want it but yeah by itself bitcoin is is its own entity as this thing that transfers bits of um we can call them coins utxs yeah okay so you can but we have established that there are security there are ways to use that for security purposes like it's undeniable that this

could change how people choose to secure their software it might not be inherent exclusively to the bitcoin network itself it might be like an independent thing but it would still be attached because it's still requiring the transfer where the security comes in like the paywall pay hey, get something in return. Yep. It could be shit. It could have bad, like your website could have bad security. You could still have some shitty database code written

that allows somebody to inspect Element, or I don't know how it happens, but get access to user information, emails, whatever. like that's not you can't just put a paywall and all that security magically manifest yeah um it like we can get into software system security but like kind of what i said already is software system security is fundamentally someone sent a control action which put the system in a hazardous state. So how do you prevent someone from executing an unsafe control action? Maybe they should have sent it, but they didn't, or they shouldn't have sent it, but they did,

or they sent it for too long, or they sent that control action for too short. Either case, if you collateralize, or if you prevent that control signal from being submitted, unless it's accompanied by Bitcoin, then technically what you have done is not apply a logical constraint which is how software is normally secured you've applied a physical constraint that's a logical constraint it's a logical constraint like you don't get this unless you give me five sets yeah it's both yeah so the logic is you don't get it unless you collateralize with bitcoin but bitcoin itself is machine code applied to quantities of power so like bitcoin cannot be transmitted unless materially large quantities of physical power are

changed they change their state and this physical constraint agreed but again so like again difficulty adjustment hash rate fluctuates so let's just zoom out hash rate can fluctuate it has been fluctuating it's been going down the price of bitcoin's been stable last week so technically we're going off this example like compared to last week the price of bitcoin is about the same but you need uh we had an upward difficulty adjustment last week so you need a little bit more power to get this transaction confirmed but you know like monetary value that transaction is the same and so this this this reminds me a lot of the big meme that went around years ago that bitcoin mining is a battery which is just not true

you expend the energy create the hash create trillions of hashes one of one of which allows you to add a block of um transactions to the ledger but there's you're not like again when you're unlocking that paywall as a user yes the bitcoin network is expending energy to order transactions and propagate blocks, but this connection of power being expended. Doesn't it make sense, or isn't it accurate to say that people literally don't have the watts to 51% attack? The reason why it's secure against a 51% attack

is because not just the hash, but you also literally need the watts. You just need the power to do it. You just don't have it. so that right there is a physical constraint it's not constrained logically because you know exactly how to exploit the logic you just literally can't do it because you don't have the watts to do it even if you had all the hat like if you didn't have a bunch of s19s do you actually have the power to do it if you don't then that's a physical constraint that's

completely different than how most software is secure yeah and again that's specific the bitcoin not the other softwares that are implementing it as a payments gateway. But if you use, but because it requires so much power to change the state of the ledger to add another block with the ETXOs, because it requires so much power, if you logically constrain the execution of a software control action to Bitcoin,

it says this cannot take place unless this transaction hits the base layer then what like unless i see this payment on the blockchain this command action cannot take place then because it takes a materially large quantity of physical power to change the state of the ledger and because that's coupled to the control action required to change the state of the software then what you've technically done is you've not only logically constrained it but you've applied a physical cost because that state cannot change unless the materially large quantity of Watts is expended to solve the, to find the knots or do whatever else is required to get consensus. Again, I think they're distinct and separate because again, that's

like trying to like think through this logically. I guess some transactions take longer to confirm than others may you mempool may be full you may be waiting 100 blocks instead of two um yeah and then on top of that those blocks are confirming thousands potentially tens of thousands of transactions or um hundreds of thousands of payments represented by one similar transaction so to try to equate the all the energy consumption or all the energy conversion that goes into finding the hash that adds a block that your transaction is confirmed into this one gateway it just it does not compute for me um yeah i mean that's just one use case i could think of there's there's other ones there as of course the orange check idea again if you choose

use to strictly only look at bitcoin as only a coin these look at paywall these look like paywalls or these look at like ways to make it too expensive in in monetary value to uh for example like run a bot farm and spam a bunch of bots i think that was like the yeah it's all the monitor but that's just but like you can measure the value of of bitcoin in watts because it is digitized watts so like that's just some i i think you can i these are all theories that could be i mean but we have hash value um so you have hash value as a metric uh sets per terahash per day right now it's three hundred look at how many watts per terahash yeah agreed you can do that but again it's it's money at the end that you're just changing the account from watts to dollars

i think that's eventually what will happen um yeah but again it's still money the sats are money measured in watts um when we get to that point yeah agreed um but like the watts are unlike like a like a machine so like unlike steak or unlike an eth sets are like you said our watts are convertible to watts eth is an imaginary bs thing it doesn't physically exist in any material real form it's just totally an abstraction applied to state changes in a computer and so that's the difference is it's actually hugely remarkable that you can't even make that conversion between sats to terahash or terahats to watts that's like i can't emphasize enough that's a big deal going back to nikola tesla henry ford yeah i agree um yeah but again but

It goes back to, I think this is where we disagree, is what drives the value? Is it the energy or is it the token that the energy gets you at the end of the day as a miner? so like that's what drives the value is bitcoin is money it's perfect money it's the best money we've ever seen and that's why all this electricity is being expended to facilitate the continuation of blocks being produced yeah so and i think that's where my point of view is so unique is i see bitcoin as power that the bitcoin is is valuable for the same reason strength is valuable is is the same reason why military power is valuable is because the more power you have the more ability you have to keep something secure the more ability you have to decrease the benefit to cost ratio of attacking a certain thing and people like security and so bitcoin is proof of

its own merit as a security protocol and if you have something super secure that can't be systemically exploited by anybody then obviously that quantity of bits would double as a fantastic thing to monetize because it would create the most secure system and then the most secure money that you've ever seen again until we got all that wattage all that security because the token has value because it's good money like i know it's like a we got this loop right well no i mean this is no it's not a live this has been a very ongoing debate in the history of bitcoin what what leads what hash rate or price um price leads hash rate it's undeniable um we're seeing it right now price is going down hash rate is falling because it's unprofitable to my bitcoin so people have to turn

off because they're running businesses that yeah they cannot run unprofitably um bitcoin price goes up that token price goes up people start plugging miners back in because that token has more value and it makes economic sense to to plug your asics back in here's an interesting thought because because i understand the maybe the relationship between hash rate and and price has anyone done the relationship between total watts and price like how many total watts are spent over the network and then what the total value of the network is because that i think that would be interesting would be but how could you calculate it right because it's the fact that it's permission yeah um yeah you don't know you don't know so but the point is a theory could be that

maybe it's um maybe there's a direct correlation there there could be could be um it seems like It's using more power than it did before, and it's also more valuable. So maybe we've uncovered some weird complex relationship that has been at play for thousands of years, but it's never been more explicit than now that we have Bitcoin. Yeah. And by the way, this wouldn't be unprecedented because it's no secret that usually the most powerful nations have the world reserve currency. Maybe there really is like a no kidding relationship between power and value that, that we just are discovering as like a, as like a general humanity. Yeah.

Because you're starting to get some, into some deep combo here. I know. Well, that, if that were the case, Venezuela would be a world superpower. So I think, I think that was a brilliant play. i think um max kaiser is gonna is a napoleonic level genius um i think that they are going to show the world that el salvador nation also i said venezuela because venezuela's got what like the third largest oh sorry oh sorry yeah but el salvador yeah i think they made a great move as well el salvador not only do i think they're making a great move for money i think

they're they're gonna prove to the world that they can stand up to a superpower a nuclear superpower multiple nuclear superpowers yeah the imf represents all of them yes exactly and so they are proving the point that like this is a military grade security technology because the world's combined greatest militaries can't can't stop me from my bitcoin like it's um i think that has a lot that will showcase a lot of value and maybe there is some relationship between power and value and who knows if one leads the other or if they're completely separate but like the point is holy crap that's huge and holy crap you now have an example of a nation state standing up to global superpowers on something that used to be like a fundamental thing that

people fought over kinetically and it's just going to totally change the game agreed there yeah it's again they're forced like the incumbent system that they're walking away

from the dollar reserve system petrodollar system like you're forced to act within

the rules set forth by that military industrial complex with bitcoin you opt out yep and you're

forced to operate within the rules of that distributed consensus that but before bitcoin

you like if you had opted out of the usd and tried to go you would still have to be like you would just adopt the chinese superpower version or the russian super like the point is people didn't have an option to not choose a or you could be except for they kind of did with gold but then that got captured so you know i'm working down if you try to get back to gold he got a knife stuck up his ass rather quickly um that's yeah yeah it's been a fascinating conversation it's just something to think about yeah um i know that

i i i know that um i understand every single argument i i read the stuff i coded i go through these comments and um and if anything just can maybe just try to consider it as an alternative point of view. And I'm not necessarily even trying to convince anyone that this is the way they should think of it. I'm just trying to convince the people that it's like, hey, you've got to understand that this has major implications beyond money. This is going to change the way that humans organize. It's going to change the role of government. It's going to change the necessity of our traditional military uh industrial complex i i could totally agree with all that stuff i think and i'm i'm testing out these ideas in public and they're they are

resonating they are helping some people get orange pills sooner um that and i know that it's like scary to think about it but maybe just consider the the arguments that I made on why it's totally legit to be concerned, but just think that through

because there could also be benefits to it that are worth considering. Yeah. I agree. I think Bitcoin already has changed energy. It's changing payments. It's changing

podcasting. It's going to change change many other things um but again that's why they fix the money fix the world it fixes these things because it's better and it forces people to act differently they cannot then the opportunity cost of misallocating capital is going to increase so high that people are forced to actually produce good shit and provide value to the world they can't just um sit there and ride the gravy train that is the money printer anymore. They're actually going to have to sit down. And that's how Bitcoin impacts the world

in many different facets beyond money. Because we have a good money, all these other facets of our life improve because people are forced to produce a better good and service. If we do choose... So one other benefit that I didn't mention is By framing it, when I frame it as a cybersecurity technology, then I immediately undermine the authority of the Treasury Department and the Federal Reserve because they're not qualified to be talking about the merit of cybersecurity technology. um they should not be in charge of the national especially a conversation about the national

strategic implications of of this cyber security technology i would argue they're not qualified to talk about money either yeah that's a fair manage those systems as well i don't think i don't i don't think i hate the federal government i don't i do not like them um i don't think they provide value and that's what again so i guess we can wrap this up with me um just explaining my point of view which is i don't think we should particularly with the weapons grade munitions status of bitcoin i think that provides the federal government who is set to lose out massively in a in which bitcoin succeeds with an arrow in the quiver of an attack vector with oh you plebs are using weapons-grade munitions uh we actually have to step in executive order uh we can't allow this

it is a national security threat but that would be true for foreigners too it would be true for all people so you could just as easily say holy crap everyone's you figured out how to use this we must we must stockpile it we must be good at this because this is if we want to continue to be and so i think we just don't want to get pigeonholed into the idea of only the united states against only its own government because this is a global thing so if we make that argument it would say hey we can't afford to let china and russia have more of this than we do or like that would be a primary concern agreed but i also think our government is hell-bent on repeating the chinese social credit scoring system exporting that here to united states i don't think the

sociopaths in charge of our government really care about that they see china's control over their populace and get envious they've come out and said it it's not the exact terms but this has been articulated by people in the defense department the if bitcoin is what i think it is it doesn't matter it doesn't agreed it's not a this is not a negotiation it like they're gonna yeah so come to the private sector stop trying to help them out just come come work on the energy sector in bitcoin and uh uh it's tempting it's true hey um before i go i owe the um i want to i owe the people all the people i blocked an explanation because i promised i would give it to them

so i thought you were going to um be like how is it possible that you're not a spook on this like government sanctioned psychological operation i'm surprised you didn't ask me that i mean or like why is and i know that's like an understood like assumption that you're making but and you know why even bother to get me to try to explain why i'm not because why would you should be not trust not trusting me but one explanation for anyone who's listening that just can't come up with a a viable explanation for why i became suddenly so discussed so quickly is because i think there is like a symbolic relationship happening where people's like like hatred against the state or at least you know like they're discontent with certain words i think that is like actually

causing me to become more discussed or like bring more attention to me you're leaning in creating yeah like well so yeah so essentially what i wanted to prove was like i can show you that like i i like if this hypothesis is true then all i have to do is what i did was anyone who said by the way no one's blocked i unblocked everybody um So, all you have to do to kind of like showcase how this phenomenon works is by using well-known network targeting or marketing effects, using the systemic exploitable features of Twitter. And so, all I did was anytime anyone said an ad hominem argument, so just like just not really being rational, just like talking crap or had like a preachy posts of like some,

like, like virtue signaling thing about like how war's bad or if they used any of the top three common arguments that I usually get. So the argument that it's defense only the argument that it's software can't be used as a weapon or an argument that it was first amendment should be enough. I didn't block the people who made those assertions or made those memes. I blocked only the people who echoed those so I only blocked the likers and the retweeters and then I liked the people who made the you know the insults so that I could get the feed of all the people who are making the ex uh the the insults and then I only liked the echoey people and so what I was doing was I was essentially blocking the people most likely to disagree with

me or most likely to dislike me and the most likely to like and retweet it and and it started this like like dynamo vicious cycle yeah but but i know it's a vicious cycle you destroyed my notifications this weekend that's that's what happened to me i said people like you blocked me i was like i don't know so the the point is i i don't that's unintentional i'm like not trying to well in this case it literally was because i was actually trying to experiment but like i can't help it if people are like talking about me all the time and bringing all this attention i think that's why if you're trying to come up with a viable explanation for why i keep on the streisand effect of the bitcoiners yeah it's kind of like that yeah and then in the process

what i was hoping to do is show that like you can use defensive only tools as an offensive tactic because i was targeting you i was targeting your network and just trying to like force you to you know not be able to see me and kind of just constraining you and so this is a network targeting strategy and then also um um i'm just kind of trying to show you that these are the types of systemic exploitations that are happening right now all the time twitter has way more data than i can like all i can see is likes and retweets towards tracking everything every website you go to is tracking this you are being surveilled at massive scale and you are being exploited at massive scale i just use a basic exploit that i that i know of but like what

twitter and facebook and all these social media people can do is extraordinary and and they're constantly doing these social experiments on you without your note you're noticing they're constantly running these a b tests on you without your noticing they're figuring out what's causally inferable so they're actually now able to prove that they can create a response not just a correlation between behaviors but they're actually exploiting you like forcing fit they can cause actual behavior changes and like so we're already in this state of software being used not just governed by governments but also just by commercial industry to systemically exploit people at extraordinary scale and like this is the type of thing that bitcoin could help out with we could

like maybe these types of paywalls could help out with this and so that's just like what i'm trying to to show but but we just have to start thinking about this in um in a different way and the last thing I'll say is the two reasons why this worked was because people think alike. So homophily is a thing. Birds of a feather flock together. So if you are inclined to dislike me, then you have a high probability of being a friend of someone who's inclined to dislike me. And so that's why I can produce this like kind of Streisand effect or at least fan that flame. And then also when we talk in like, if you go to like a, like a public forum and talk and say something radical, soft war, what you'll see in a normal situation is a normal distribution of responses. So on the extreme

right of the distribution, there'll be people that are angry at you. And on the extreme left of the distribution, the people who are in support of you, but most people will be totally indifferent. They'll just not care. So it's a normal distribution. So the top 10% are okay. And so if you're like in a public forum, that's what you'll see. People will give you that feedback. But with these social algorithms, especially when we start using social media algorithms that rewards likes and retweets and AIs that are controlling what we see on our feed, it's been proven, it's very showcase there's actually a whole book about this if you want to go and read it called the hype machine there is a what you see online is nothing like what you experience in person it is

a j curve especially on twitter meaning a j curve meaning on the side where there's like a lot of people or on the side where people agree with you there's like a uptick then it dips so if you're looking at the actions of people on Twitter, there's people who are in the middle of you, there are dips, people who are just indifferent are doing nothing. So people who like you are kind of, you know, liking and retweeting people who don't care are doing nothing. But then the people who hate you or are angry or, you know, upset for some reason, that's the other, the tall side of the J. So what that means is anytime you're on social media, like you've ever wondered why you just feel angry on twitter all the time is because the way the algorithm works and what you

see is the the angry people self-identify they're the ones most likely to like they're the most ones most likely to retweet and that is distorting our perception of of reality in ways that we at least need to understand and ways that we could maybe one day fix if we can find cooler ways of using things like bitcoin to to to kind of quell that stuff and and in this case i exploited that feature and i basically figured out okay the people most likely to write and retweet are the ones that are most angry so what can i do to anger them will i block the ones that like retweet and so you can start that cycle but it is creepy how well that worked marty i know that is again you You destroyed, you destroyed my mentions.

And so please just be aware that these risks are real. These, the systemic exploitation is happening now. And like, these are the conversations I think are productive about why, how can we use mechanisms to fix that? Because Elon Musk isn't going to fix that. You can't fix that with a God King who has full control over the software. You would have, you just have to trust him not to exploit you with it. but, and you can't fix it with a blue check mark because of United States dollar, because that

gives control authority to the people who control the United States dollar. We have to find some decentralized way of doing this, which I, I know is like what the, like what Jack is after, you know, finally, like maybe some, but like, these are the things that Bitcoin can solve. These are the things that we should be thinking about. And just, you know, if I am a spook, I have worked the intelligence community i don't deny it that's what that's why i call you because you're literally a spook and then yeah i'm literally a spook and i'm and i'm um and yeah but i don't understand why people don't think that's like a transparent thing i do but just be aware like you might be you there might be other explanations for why i get so much attention that

Stray set in effect. Yeah, I think that's the most logical explanation and I tried to kind of showcase that and I'm very concerned about how effectively it worked. No. No, I think everybody- Okay, thank you for letting me do that. To get everybody back on your side, you just have to convince Bitcoin Twitter that you're fifth pillar, fifth column.

You're going to come to the private sector. Jason. I would, how ironic would it be if you converted me? It's going to happen. That would be like the ultimate success story for you. We're three and a half hours in here. It's been a pleasure. We talked a lot. Yeah. Thanks for coming on. I mean, I know you've been getting a lot of shit.

Some of it coming from me. Self-incurred. Yeah. But also some of it, cause I bring it on, you know, it's my fault. That's why I like, I like these long, long form conversations can hash it out, pun intended. it's a pleasure man I'm looking forward to our next talk I am as well I hope you enjoy the rest of your Monday night

freaks I hope you enjoyed the conversation follow Jason at Jason P Lowry correct yep that's it anywhere else no not yet no just that alright go follow Jason

everybody enjoy the rest of your day stop screaming at people on Twitter go read a book Peace and love, freaks.