TFTC: A Bitcoin Podcast - #426: Bringing Lightning To Utilities with Synota

Episode Date: June 6, 2023

Marty sits down with Austin Mitchell, Lisa Scott, and Alan Schroeder from Synota to discuss bringing energy providers over to Bitcoin and LN. Synota on Twitter: https://twitter.com/Synota_ 6:35 - Meet Synota 14:05 - Payment settlement struggles for utilites 16:56 - How Synota integrates 23:47 - Financing possibilities 26:20 - Utilities grokking bitcoin 34:07 - Effects of decentralizing the grid 45:22 - The team’s orange pilling 49:41 - Mining industry is maturing 55:56 - Efficiency impact of instant payments 1:01:11 - Mining permanent funds 1:05:03 - Issues building on lightning 1:10:57 - Wrapping up Shoutout to our sponsors: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Unchained⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠River⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠CrowdHealth⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Bitcoin Talent Co⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ 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

Join me, Logan. We're being silly here on a Friday afternoon. We just recorded with the Synoda team, Alan, Austin, and Lisa about the intersection of energy mining and payments over the Lightning Network. Fascinating conversation. Very important to understand what's going on in the mining industry and what Synoda is doing to really highlight that mining is helping the energy industry. and then beyond that bitcoin and particularly bitcoin flowing over the lightning network can solve a massive settlement problem that exists for utilities and miners who have to pay utilities their solution could free up a lot of capital which is pretty incredible this report was brought to you by good friends at river i want to do mining talking about mining river makes it very easy to mine in a professional way you go to river.com slash tftc set up an account you go

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stranded in big tech big banking big finance you're a bitcoiner looking to get in the space set up a profile with Bitcoin Talent Co. Go to bitcointalent.co to do all this. Tell them the TFTC sent you and enjoy this rip with the Sendota team. Dickie. You've had a dynamic where money's become freer than free. When you talk about a Fed just gone nuts,

all the central banks going nuts. 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. Marty, yeah, we're excited. I must jump in. Well, we're in. Logan just ninja launched on us.

Cool. Thank you, Logan. What's up? I'm joined with the Sonota team from left to right on your screen, Alan, Austin, and Lisa. We're here to talk about the intersection of, how would you guys describe it? Bitcoin mining and the lightning network, energy mining payments networks. Yeah. We're really talking about the integration of value, Marty. We're talking about value in in terms of molecules and electrons being integrated with value in terms of the actual payment for them.

And so there's other sort of ways to think about the value stream, but that's really what it is. So we have that first application being focused on Bitcoin mining, being focused on leveraging the Lightning Network to help Bitcoin miners pay for their expenses over the network. But the broader vision is really just that value integration for the entire energy economy.

Yeah. And it's an important one. I said this on one of the shows I did yesterday is I think in this bear market, the most bullish thing has been the tighter integration of mining with the energy sector. Cause I would make the argument that energy is the most important sector as a base layer of everything we do in our modern economy. And even though we're in the depths of a bear market some people are getting a bit weary of the relative lack of volatility in price movement the lull in price movement uh there's a lot of very important building it's a bit cliche but it's true uh that has been going on over the last 12 months particularly in the mining and energy sector and i think what you guys are doing just adds fuel to that fire by integrating the payments layer of

Bitcoin on top of that. So I think to contextualize this conversation and to start, I think it's worthwhile to get your backgrounds, how you came to found Synoda and why you honed in on the particular problems that you guys are looking to solve. Yeah, perfect. You know, I'll talk about, you know, at a high level, Marty, all of us come from the energy industry. You know, we've spent our careers in the front office, the back office, working operations, and really throughout the value chain. And so I think it's that broad experience that helps us talk about what I said earlier, which is how do we think about how value is being moved physically versus financially and where those disconnects lie. But I'll turn it to Alan to kind of talk a bit about his specific

history and we'll go around the horn. Yeah. So I'm a 16-year energy vet, primarily oil and gas midstream. You know, I really started with big corporations and worked my way to a private equity back group more recently. But really, the strength that, you know, my background is bringing is that ability to tie out the business strategy to all the pieces of the business that we're building. So I've done that on the, you know, in the physical space. During the early days of the Marcellus boom, you know, there's lack of internal processes, lack of external processes from an environmental standpoint, being able to put some more concrete processes in place, tie those out to how you develop business over time, along with doing that

with a private equity-backed group, right, where you're kind of starting from zero and trying to build a business. So bringing that in-house to Sonota as we think about how we do that in the tech stack within the energy space. Yeah, and Alan and I, we met when I was in grad school. So he was, he was my, the industry representative who came in and was helping, you know, educate the next generation on, on everything Marcellus oil and gas. That was pretty cool. You get that Gucci gas up in the Marcellus.

The, uh, no, I mean, from my experience at Great American Mining, that's, it's funny what Bitcoin does. Like I never, if you would have told me 10 years ago, I would have nowhere near an expert's level of knowledge on the, the oil and gas supply chain from upstream to midstream to downstream, uh, nowhere near an expert level, but like a good grasp on it. that was one thing we learned mining upstream it was like the importance of midstream and how upstream and midstream sort of act uh and react to each other depending on the flows of the gas at any given point in time that really is dependent on the price of the molecules as it goes through its boom and bust cycles yeah i think you see that in the ecosystem a lot right with um folks who have you know gotten into bitcoin mining either personally or through you know the companies that they join and they've come from spaces outside of the energy space

right they're really getting educated on how the energy space works and you know to you know what we've all expressed that you know energy is the backbone of the economy so having knowledge around how energy works is is great for everyone yeah i mean that was one of our big theses at great american mining is that bitcoin mining whether it be upstream or at the midstream could create significant efficiencies for that supply chain like we had we had two theories one was you go upstream and do the flare mitigation and essentially make the producers more uh efficient but then another idea we had was actually mining at the midstream with the concept of like sucking the flare in from midstream where you just create enough capacity at the midstream level that you

just flow all the gas without ever having the flare yep yeah i think there's a handful of plays there in the midstream space that we could probably you know uh rift on for for a while so yeah mario i'll turn it to uh to lisa next so one one cool thing so lisa's actually my older sister um and she's the uh smartest person i know so couldn't be happier that she's she's part of the team he's good at flattering you and he doesn't feel a little nervous too but um yeah so i spent most of my career actually doing indirect tax um and uh at a utility infrastructure construction company i spent a lot of time reading contracts to make sure that they were counting for those indirect taxes it's a very small margin industry and uh missing a sales tax can like wipe out your

whole profit. And so I educated a lot of operations folks on taxes, which I think has just made me good overall at probably talking to people about things that they're not that interested in, but are probably a necessary evil, which is a lot of what I'm doing at Sonota too. So, you know, compliance and accounting. And so all of those things that are really important as we grow in enterprise grade software but um probably less exciting than just talking about the energy and the bitcoins well sometimes the most quote-unquote boring stuff is the most exciting because i think that's the one thing is with standard bitcoin that's something we deal with a lot interacting directly with utilities is is trying to solve like the settlement of the payments for the

electricity which is what you guys are attempting to solve at sonota and i think that's a good jumping off point to jump in like what problem do the utilities have around settling payments for their particularly their large swaths of electricity that they're selling to individual customers and and how does bitcoin particularly flowing over the lightning network fix this Yeah. So what you'll see in the energy industry, Marty, is that there is this disconnect that I've talked about. A product is being delivered, whether it's molecules, electrons, but then it's not being paid for often for 30, 60, sometimes even longer period of time after that. And in one of the examples we give is imagine you drink Starbucks every day for the month of April. And you go in, they take your name down, you get your cup of coffee.

And then, in the middle of June, Starbucks sends you a bill for all the coffee you drank in April. That is fundamentally kind of how energy works. We use the product, but then we don't pay for it. And that is one thing when we're talking about retail, you, me, Lisa, and Alan, in terms of we're small size, but when you start to think about the bigger customers, the ones who consume a lot of energy, now the fact that you're waiting on payment for those services provided becomes a big issue, becomes where credit and counterparty risks start to come

into play. And so what's really interesting is that when you look across the energy landscape, it used to be that there was not a better way to do it because everything was analog. But in the last 10, 15 years, all of the, or not all, but most of the physical infrastructure that's out there has become digital. digital from, you know, point of production all the way down to point of consumption. And so now we don't need to wait on knowing what the value of energy that's been provided is, but we're still waiting on that money to be provided.

And so that's where Bitcoin Lightning Network enables us to now, you know, implement a solution where the flow of value is now integrated into one process. So as energy moves, money can move. um and in you know the bitcoin miners are uniquely positioned to help you know bring this innovation forward because they make revenue daily in bitcoin and so you know this the the challenge of on ramping isn't a challenge the you know ability to now match their revenue with their costs is something that's desirable so it sort of provides the perfect playground to get going yeah yeah when you consider especially if you're a miner of material scale and you're connected to a pool

and you're getting payouts daily like you really do have that ability to settle somewhat instantly or much quicker than and 30 and 60 and 45 whatever it may be uh and so like let's jump into like the solution so how do you guys integrate with the utilities companies and the miners what is the conversation like biz dev for you guys on both sides of the market whether it be with the miners or utilities companies yeah for sure so first i want to kind of go back to what austin said on on the risk so with the mining customers that are out there you're seeing this almost like tug of war right in in the risk space between the miner and their energy provider right you know a lot of these contracts out there started as post-pay contracts which puts the ar risk on that energy

provider right then you saw the bear market come with bitcoin you saw more of these energy providers or service providers start asking for prepayment which shifted that risk away from the bitcoin miner or um away from the energy provider to the bitcoin miner right but then it added this consistent reconciliation you know process that has to happen to continuously true up that pre payment and that's all because everyone's trying to settle this 30-day black box right there's no transparency involved right you just after 30 days you read the energy data you make the calculation and now you know what what your bill is right and so what the platform is offering is the opportunity one to create more transparency right by calculating that energy bill or service

provider bill on a daily basis so it creates that transparency and two to settle that bill on a daily basis, which creates a, you know, a neutral risk profile for both parties. Right. And so now that you have this neutral risk profile for both parties, you know, what commercial onerous terms can now be stripped away in those contracts between the Bitcoin miner and the energy provider. And so it's those stripped down terms. It's the reduction in administrative burden on settling these contracts, you know, managing that data, actually managing the payments on a daily basis, right, is what's garnishing all attraction that Sonoda is seeing in the market today. And Marty, from a technical side, you know, I think the way to kind of visualize or to think

about the solution to do everything that Alan just said is you have, you know, both parties to a contract are going to get a Sonota node. And that Sonota node really embeds within it a couple of key things. It embeds the ability to make payments on the Lightning Network. It embeds integrations to the data sources, as well as to on-ramps and off-ramps from BTC to USD.

It embeds database structures, and it also embeds all of the contract logic between you and your counterparties. So you have all of that sitting securely in to the customer, really in their own AWS Docker that they have the exclusive access to as a customer. So we provide a non-custodial solution, a decentralized solution.

Sonota does not custody customer information, does not custody customer money, anything like that. It is purely decentralized in the construction. So what's embedded in your Sonota node as a customer is really just all the information to gather the data for settlement, your what your preferred payment terms decided on between you and your counterparty and then the logic to apply that contract on Whatever those payment terms are so it's really just automating all of that in in a very decentralized way

Where we as a company can be hands-off. We're just providing software that really acts as agents on behalf of the respective parties behalves It sounds complicated honestly like when we're explaining it because it sounds like so many pieces and so many different processes but also the customers can also be hands-off not just us right so it's a one-time setup a really easy onboarding just like setting up for bill pay and then the invoices and the payments are all automated and really all you have to do is just at the end of the month download your report that shows like all of your payments and you're ready to just finalize your month like there's no manual touches throughout the whole process so it's very user friendly it's very simple you can access the data whenever you want or you can really minimize how much you even think about the whole process

and so a couple things here to dive into on the data side i imagine what you're taking in right is the amount of electricity delivered the price of the fuel source that is producing that electricity so you can actually get the cost uh yeah that's is that it on the data side like for from the utility to the miner just those two things yeah i mean that that's typically the guts of of the inputs that we see but it's really you know however that contract is structured you know what are those settlement inputs that are needed which is typically a meter reading which is you know for the energy the pricing the fee structure um but there could be some other you know variables in there that play into the full settlement structure as far as like profit sharing

or other other pieces that we do automate as as well the one thing i'll add to my is to think about what's been interesting is some of the older contracts that we've seen are very simple in nature like nameplate capacity and then you know mainly updated for like uh you know the best estimate about time and and so what why that is is because you know a lot of a lot of sort of the set you know clearing and settlement processes today are still happening in excel um and or you you know, are heavily manual. So it makes it challenging to take that and scale it up to multiple customers or to scale it up in terms of contract complexity. And so I think part of what we're offering is, you know, those should not be the roadblocks to you offering a sophisticated

contract to your customers. So yeah, sure. Go ahead. Use 15 minute pricing plus 15 minute energy data. You know, the software is going to take care of that in the background. And so part of the journey has been, you know, getting people comfortable with, yeah, I don't need to to sort of, you know, use sort of a simple thing that I know is wrong, but it's the best that we can do in a quick, you know, in a quick way. Yeah. And that was the second part of what I wanted to ask too, is like, how much time does it save time and money, uh, both end users to not have to do all that manual Excel amending at the end of the month, end of the quarter, whatever it may be. Yeah. We're thinking it saves like 10. I mean, we've run calculations and, and, you know,

talked it over with customers and it's about 10 to 20% of your costs, like whether that be administrative or bank fees, but there's a lot of costs in the whole AR, AP system. There's, especially if there's reconciliations months later, there's a lot of cost savings when you have your cashflow expedited as a supplier. So there's a lot of cost benefits there. Well, that's another thing too, like what, like in terms of financing from the utilities perspective, being able to get paid instantly on a set cadence instead of having to do the month long, two month long settlement process. What is, what does this open it up from like a financing perspective? Man, every, yeah, every CFO, you know, it's really funny. So I'll give two quick

anecdotes from my previous two jobs. So when I worked in retail energy, you know, we had a revolving line of credit, a five bank syndicate that we would draw upon, you know, six months out of the year when cash because cash flows were misaligned during winter and summer and so you're drawing upon that revolving line paying anywhere from two to four percent that's a real cost that just gets passed down to the consumer baked into your energy price then same thing at a utility but in this case my utility we were we relied on the commercial paper markets so you're borrowing from commercial paper markets three months out of you know six months out of the year potentially you know anywhere from three to five percent and then the other six months you're able to lend

into those markets but you're making one and a half percent on a good day you know so that cost of capital is is very real just in terms of that that cash flow perspective but then there's also the aspect of just the the cost of capital of when it's getting tied up in collateral um you know you think if you're a bitcoin miner and you're having to post two three months of collateral you know alan's balance been working on the roi models there but it's really astonishing of if you could have some of that collateral back reinvest in your operations how much better off financially you can be yeah yeah it's pretty that's i mean that's the one thing we i mean we see this at standard too sometimes customers uh if you want to get a lower rate you put in a bigger deposit

that locks up more funds and that's the big thing in the mining game particularly is uh the opportunity cost of capital deployment and if you're forced to lock up capital for three to six months that can really prevent you from expanding in ways you otherwise could if you had this instant settlement and disagreement with the utilities where it's like all right we're going to set this up and just pay you instantly yeah i mean no one likes stagnant capital right stagnant capital can't get a return and that is you know people want to deploy that capital um and so that is just one of the onerous terms that as we're talking with folks leveraging our software how do we unlock that value um you know especially to the miners right

to to allow this industry to continue to mature and grow um so that's some of the things where i mean we've been super excited about as we're having these conversations yeah and another theory we have is that at the end of the day mining in the long term is going to be won by those who can vertically integrate the best the most efficiently and at standard we believe like honestly the people that should be mining are the utilities at the end of the day but obviously they're focused on energy not all these utilities companies get bitcoin yet grok bitcoin they love the revenue that bitcoin miners provide but they're still a bit of a learning curve in terms of getting comfortable with bitcoin the asset

and then mining what it can do to their stack so from your perspective what are the conversations with these utilities been like are you finding any that are becoming easier and easier to orange pill or what's the learning curve look like from your perspective? I think Sonota is a good adoption path. You know, I mean, if we can onboard them to use our software, they're getting closer and closer to the miners. They're either understanding the actual risks of Bitcoin transactions. So we definitely view utilizing our software within the energy market as an adoption path for utilities. And we've had a lot of favorable discussions. I mean, we're definitely solving a real problem for them um they love the idea of the cash flow improvements

yeah i would say at least is exactly right it's the there is no um you know no qualm or what am i trying to say basically the recognition of the problem this being a huge problem you know that that's across the board and and to kind of build on that adoption point one of the things that we think is really interesting is that you know when we talk to utilities today energy suppliers etc They want to receive USD. And we've yet to talk with anybody who's not small, who is inclined whatsoever to really even have the conversation around Bitcoin, because they're really just focused on, hey, I like the value proposition of lower credit risk, better cash flow. But what's really cool is in our platform is that, you know, so we enable a company such as a utility to get USD today, but they have the opportunity in the platform to change that. So they can say, hey, maybe during the next bull run, maybe an innovative energy supplier says, I'd like to get 5% of my revenue in Bitcoin. So it's just slide that bar over 5% and now 95% USD, 5% Bitcoin.

So being able to provide that and make it so it's easy to dip your toes in during the next bull run or whenever the risk tolerance of the company changes, it's there, it's available, and we can make that really easy for the customers. Plus, because it's so directly connected, because it is their core revenue, this is how companies make money, it then becomes an interesting opportunity to talk about sort of old treasury management strategy via the software that we're providing. So what are the what-if scenarios that you can put in front of an energy supplier to consider what-if 5%? You know, it doesn't just have to be a decision in isolation, but you can actually roll the clock forward or look backward and say, this is what that would mean to you or would have meant to you. Yeah. Sorry, I just want to add one more nugget in there that I think is interesting in helping utilities to look at Bitcoin a little bit differently is the fact that when we are talking to these companies, we don't talk about Bitcoin. we don't talk about the price of bitcoin right we talk about improving their cash flows right receiving usd daily from their customers but we do show them hey we are using bitcoin technology to do that right so here you know is us talking about this utility of bitcoin technology that they

haven't really heard about yet right so it's helping to you know reframe their mind a little little bit about what all bitcoin can do yeah no and that's the thing too when you talk about sliding the bar to five percent that little toe dip can turn into a little crack addiction if the bitcoin price runs bitcoiners like to talk about speculative attacking the dollar but i think that concept works in fractals all the way down to this particular use case where if a forward thinking utility company makes that decision to put five ten percent of their cash flows into bitcoin automatically via sonota and they hold that on their treasury they can speculative attack their future financing costs and once they see that work successfully once you have to imagine

it's going to be addicting and they're going to get really creative with their treasury management and their bitcoin accumulation strategy in the long run if bitcoin continues to do what we believe it will do which is which is monetize yeah so what uh what do you think the best strategy has been for you guys to actually get utilities engaged just pure cash flow pure cash flow i think yeah i mean cash flow and credit risk so i mean you know that those responsibilities that i had working at the utility you know we're managing those things and so i think the you know without sort of saying hey there's one particular strategy i think what we what we provide is we we understand the energy industry um you know that's been to our advantage

that we we've been in it we know the language we we have a really strong network so um the you know getting in and having the conversation is not the hard part um i think it's it's really being able to show up with the right technological solution you know hitting being able to to check i think a lot of the boxes that are are things that we understand so like you know lisa talking about from a compliance and sock 2 perspective you know these are the things that move the needle in the conversation because if you can't you can't satisfy you know what are you what are you large companies looking for in terms of who they're willing to do business with the conversation won't make much progress um you know what we're finding is energy companies are are apt to as you know

alan said you know we we talk about the technology but they're they're they'll be happy to not you know talk about bitcoin when they bring the solution to their senior management because they don't need to but certainly the senior management's going to say well do they have insurance you know what's what's their compliance record you know and all those things become very relevant and so that's where i think we've been able to move the ball quite a bit yeah i think also like external factors that are pushing them to look into mining, which is just encouraging to look into working with us because, you know, there's renewables initiatives or other pilot programs going on with a lot of utility companies across the country. And for them to take on maybe

some of those projects were a really good solution. So we've had them reach out to us before we reached out to them, just to sort of feel out if we can help them take on different projects yeah now again it's the boring things that are actually the most exciting like being able to check the sock to box people don't really think about it but that's that's something that opens a massive amount of doors if you can do that yeah and our software too they they can use it without integrating it into their what their network and the softwares that they're already using so it essentially bypasses like the billing module on their on their erp which um at first glance you might be like well why wouldn't they want it all integrated but the truth is is that

could take years so the fact that they can just kind of plug and play with our software without having to get it infiltrated throughout the whole organization is actually a big value that we can offer yeah and so we're looking out 10 years from now 15 years from now at scale how do you guys think i mean we've talked about like the direct immediate impact this can have on utilities miners at scale let's let's run through the hypothetical where this catches on becomes a no-brainer to everybody how does this change the dynamics of the energy sector particularly on grid with utilities at scale okay so this is yeah this is this is what i really really enjoy because i I think what's really interesting, Marty,

is we've talked about Smart Grid for over 20 years. We've talked about being a lot more intelligent in terms of load control, generation, management, things of that nature. And what we haven't really seen is a solution come to be that can ultimately deliver on a vision that was started over 20 years ago. And so what we've been talking with folks about lately

is really being the product that fulfills the Department of Energy's vision for a transactive energy system. So this is really taking everything that is encompassed in a smart grid, but then alongside of it, having the integration of a decentralized energy markets. So that is really where we see things going.

It's where you now are getting out of sort of a top-down centralized model, where now you have a system that is welcoming to distributed energy resources, weather of all stripes, because what you have is you have local real-time price signals, you have the peer-to-peer payments, you have everything you need to have an energy system that is very flexible, very dynamic, and where you have much more efficient markets pricing in the true cost of energy, both in terms of the molecules and electrons, but also the

environmental externalities related to those. So where we're not having to sort of try to plan from the very centralized way, but now Now where we can have a very decentralized approach that ultimately will be efficient and drive more innovation and drive more energy abundance, you know, in the world. So that is really where we see it. We see the whole system being on the lightning network, every physical node having its own lightning network node, and there being the synchronous flow of value to all the parties on the system. Yeah. And just, I mean, because that's been an underlying theme last few years is the grid system in the United States, relatively centralized. And so what does empowering individual utilities companies do? I mean, you mentioned a more decentralized grid system, but what could empowering individual utilities mean for the strength of the grid overall? Do you think this solves a massive problem that we have, or is that sort of unrelated in a way? I think that, you know, what you'll find is that there's quite a bit, like, for example, you know, if you were to spend time, you know, digging into any utilities, you know, what do they know about their operations? They see where there's grid congestion.

They know where the weak spots are in terms of what's creating, you know, instability, what's creating reliability challenges. The challenge is being able to price that into the cost of providing the service. And so that way they can provide that economic – or there is an economic signal to then drive investment there in an efficient way. And so what I think is fair to say is that, you know, we're sort of pushing towards a much more free market approach to the energy system where, you know, we all know free markets are not perfect, right? There's going to be, you know, there's going to be issues where, you know, capital is slow to respond to, you know, opportunities, et cetera. But I think over the long term and for the greatest number of people, it will be a system that is, you know, provides more power at a lower cost to the most amount of people. Yeah. Or energy, generally, I should say.

Yes. How do we get the politicians to realize this? You know, I think my one thing is, you know, it's great that, like, the Department of Energy is already on board. They're, they're begging for somebody to deliver this solution. People realize it. I think it's, um, but I think it's showing them already, you know, well, the good thing is, is energy companies are, are a very important, um, you know, a very important group within the political sphere.

Right. Um, everybody, every politician has got, you know, an energy company in their district, you know, it's very, you know, everybody gets a bill from their energy company. So when energy companies start to see that this is actually better for them, you know, we think they'll be our biggest advocates. And being that it's on the Lightning Network, it's not that you're asking, what you're seeing is you're able to create a natural network effect where the full, everybody that's in the value chain is going to be incentivized to adopt this type of payment structure.

And so I think in that way, as it grows naturally, you know, people will see it. is ultimately going to be better it's going a lot of energy companies that adopt early to really grow and expand yeah no this uh is an affirmation of my thesis like everybody talks about hyper bitcoinization i think hyper bitcoinization goes through the energy sector because once you get them locked in again it's the base layer of our society and that's why i think there's an order of operations to the success of bitcoin in the long run and the first order is mining in energy and i think and it's it's weird because it's uh it's become more appreciated but it's been very underappreciated the first 15 years 14 odd years of bitcoin yeah i fully agree i i think

you're just starting to see some of those corners turn a bit on you know the impact that bitcoin mining is having within the the positive impact that bitcoin mining is having from the energy industry um and then you know as you layer on the technology and the payment flow that you know note is doing um you know you can really help exacerbate you know those positive effects right and and to get them to kind of open their eyes on on what this decentralized market can really do um as opposed to like you know trying to send energy across the country trying to pull demand more localized yeah marty i'll give you one example of of some you know i use this a lot in conversations with folks to help them you know really understand one of the problems today so

So there's a study, I think it was five, seven years ago, done in ComEd in Chicago. So, you know, there was a broad incentive offered for people to put solar panels on the roof of their homes. And it ended up being, you know, the idea was, hey, we'll offer this incentive, you know, we'll be able to lower the cost of electricity for everybody because now we have more power coming onto the grid. But what ended up happening is that all those solar panels were concentrated in a few affluent neighborhoods. And so, what ended up happening is that ComEd then had to invest more into infrastructure to resolve the grid imbalances that had been created. And so, at the end of the day, and the study proved this, the cost of electricity went up for everybody,

even the people the least able to pay for it. So, that's exactly what's wrong. We're putting solar panels on roofs without knowing where they're actually needed and not providing that pure signal and so bitcoin mining is naturally seeking that signal out because they know what it means to their overall economics so they're driving everybody in the industry to say yeah we've got we've got a big customer that knows about you know they knows about energy both you know over time and space and how much you know we should be thinking about you know arbitrage opportunities and so it's going to spread out um you talk to people in the battery industry battery technology is incredible ai you know ai pulling power off and putting back on but how are they getting paid for

that well they're not getting paid for all the services they can provide because there's no means of actually putting that representing the true value they're creating in a way that can then actually compensate them so it's going to hold back technology across the landscape if we can't sort of think like bitcoin miners and truly drive that economic value down in a very granular way yeah the uh the energy pirates of the world the bitcoin miners are it's funny it's it's crazy how maligned we are as miners but i mean it's not surprising people are very reactive to things they don't understand and people really don't understand bitcoin let alone bitcoin mining they just see energy usage and and freak out that's right as alan said though we're noticing it's the

conversation is turning you know people are willing to listen they're willing to kind of hear this out they may not fully appreciate the value of Bitcoin per se but they are starting to not just dismiss the topic there's some energy folks coming to the meetup a lot they're open to the education at the very least yeah that's great to see I mean you had to imagine to particularly for the utilities so our strategy at standard is to we operate mainly in the tva and so we we look for rural areas with falling populations that had manufacturing capacity leave the area at some point in the last couple decades and there's just these massive substations with a ton of

underutilized capacity and what we've seen is that the utilities companies love us because we come in by a big swath of power which helps them stay true to their mandate which is like hey let's keep prices low for residential consumers um and so that's the thing the energy pirates going out to these rural areas and finding this arbitrage opportunity i we've seen it as well and we do definitely think people are beginning to turn a corner yeah i think it's great to see and i think that the innovations are going they're just they're going to spread you know through us and through what other people are doing, you know, in this space, they're going to spread to other aspects of the industry.

Because Bitcoin miners aren't stopping. It's just, you know, there's a relentless, you know, relentless crew. And they have all the reasons to keep pushing this technology forward. So what are some of the biggest surprises you have encountered building this out on the software side, on the biz dev side, that you really didn't expect would have stuck out to you guys? Yeah, I'll say one is, you know, we are building the software out in a decentralized way, right? So that it's true to, you know, Bitcoin ethos, which is very exciting.

But it just also changes your mindset, right, on you as the technology company on how you manage a decentralized platform versus a centralized platform. So that's been, you know, a fun and exciting learning curve, you know, at Sonota and one, you know, definitely a flag we want to continue to bear for because we think decentralized software is the way to go. Yeah. And how did you guys get into Bitcoin? What was the switch that went off for all of you?

So for me personally, I'm a skin in the game kind of person. it was early 2018 is when i'm you know bought bitcoin for the first time and i told people i need to have some skin in the game to really understand you know understand and dig into this technology i was you know working closely with uh our energy traders and so when you know this the 2017 run-up and ico boom and all that stuff that was my first exposure uh and then and then of course you know the rest is history in terms of okay started the dca in 18 um and then it was for me personally learning about bitcoin mining in early 2021 um you know being in energy i somehow missed it all along the way but then um when i started to see it that it was that realization

that hey bitcoin mining is is doing all the things that everybody else in the energy industry is only talking about they're just doing it and and so that was what you said i've got to learn about this and um you know was orange pill fortunately i went down to bitcoin miami 2021 you know i was still working for the utility i was wearing a suit and a tie and you know it was just eye-opening but the best thing was is like the uh you know greg foss jimmy song um you know the ebex team like everybody that i encountered and got to spend time with you know just sort of opened my world up to to the the community of bitcoin but also just sort of what really attracted me with the economic incentive so from that point forward i was orange build and i knew that the path involved bitcoin

them you know one way or another uh but i'll let these guys say their stories too let's go for this all right well i i would say uh austin has been talking about bitcoin forever so i diversified my investments but um definitely more struck by lightning you could say i think when we started talking you know when we started formulating this company and just seeing seeing what lightning network offered like how it brought utility to bitcoin and what it would enable you know cross-border and just how it would change payments i think was just really exciting for a while i thought bitcoin was interesting and you can see the utility but you don't really see how it translate translates very well to your day-to-day life um until i really started to

understand the lightning network and i will say now working with three amazing developers in in that space and just being educated literally every single day about the technology and the ethos and and just all the great benefits i can't count how many times i've complained about something in like the compliance or regulatory or banking world and they've been like that's why bitcoin and now i'm saying it to people all the time so um yeah it's been a more of a process for me but um it's yeah i mean the utility just continues to exponentially grow i think so it's very exciting yeah i'd say mine was a gradual process too it started about six years ago when a friend of mine asked me to buy into uh you know 20 percent worth of a minor and i was like i have no clue what that

is but i'll do it um so you know i was one-fifth owner of a minor and he you know he installed it in his basement and he quickly called me and said his wife was complaining about the noise so you know i googled you know you know how do you how do you manage you know noise abatement and quickly went out bought a cooler and some flexible exhaust you know cut holes on each side and you know built out a nice system for him in his in his basement and then just kind of watched that over time and then just started noticing you know all the you know true bitcoin mining companies out there and how they were attacking you know this um abandoned energy issue and then also just kind of seeing it you know in my oil and gas side of the business you know how it could

play in so that really started to get me excited about how bitcoin can really positively impact energy and then as you know talking with austin and lisa over time of like well let's go beyond that let's let's jump into what the technology can do on the payment side as well for for the energy space and i think that's where things you know really started snowballing yeah and as it pertains to mining i think over the last three years particularly after the china ban and the migration like mining for the first 10 12 years of bitcoin was very wild west not a lot of professionals i mean a lot of wildcatters if you will taking advantage of an incredible opportunity but there's been and i'm trying to be careful my words here

because i don't want it to be taken the wrong way but there has been somewhat of like a professionalization of the industry from the the hardware the asic manufacturers the farm management system the firmware products like sonota come to market like it does seem like we're hitting an inflection point where the mining industry is maturing and becoming more palatable to the incumbent industries whether it be energy utilities payments and i think the mining industry garnering more respect than it had in the past because for the longest time it was just like oh there's just a bunch of people over in china and in their basements mining this weird digital currency yeah you know just to kind of reiterate what you said and what we were saying earlier i mean

we say that all the time we think this industry is is really maturing um snow is here to help mature the industry and that is what's turning the corner on some of these conversations with these large energy companies right um bitcoin mining is not just a hobby bitcoin mining is a true industry with positive impacts um and the technology you know is just scratching the surface on what you can do with it yeah that actually just stuck to a thought particularly what you guys are doing at sonota and that's one thing miners have to deal with is risk management we talked about the way you guys can help prevent the capital lockup that happens with prepayments but then it comes to like hedging strategies too like what does being able to integrate a product like

sonota into a mining operation do for a miner's ability to properly hedge risk within the market whether it be the price of bitcoin the price of energy hash rate at any given point in time yeah it's a great question and we'll say that you overall that the the view that we take is we are we are one one piece of that that risk management strategy um and and so specifically you know what are the reasons why you as a miner would would want to hedge um certainly over the short term if you are if you're in a position where you're having to liquidate you know or exchange some of your btc revenue into the local fiat to cover you know local fiat expenses um you know you're you're you're exposed to fx risk right so if you you could do that conversion every day you could

or you could wait until you had 30 days, but either way, there's some FX there. So part of the way that our solution works is, you know, as the, as, you know, revenues is being paid out from the pool, you know, we can, you know, automate then the payment of those expenses as soon as possible. And so the amount of FX exposure is greatly minimized. So that's, you know, one way in which you're reducing the need to manage the risk on that front. Certainly as we think about hedging and hash contracts, what we see as an opportunity is to be, again, part of that equation, because it still is requiring, there's margining, there's settlement of those contracts, these are all things that can be tied together into

one solution. Why are we going to have one way to pay for physical energy and another way to pay for hash derivatives, et cetera? The more of the value exchange that can happen on the Lightning network, the better the network's going to become, the more the network's going to grow. That informs how we're building our solution because we talk a lot about physical energy settlement, but when we actually sort of take that piece away, what we've essentially built is a decentralized settlement platform.

It's smart contracts on Lightning, but better than smart contracts as in the popular way in which they're known, because on Lightning, they're fully decentralized. They're cheaper, faster, and more secure. So you can take any type of contract, whether it's for hash price or it's paying an employee where it's, you know, the rent on your building and you can use our software to do it. So we do, we do, we're having those conversations. We want to be, you know, in, in that mix of how do we start to sell everything? And then you can create more of that, you know, flows in multiple directions where then you're, you're able to balance out channels more naturally, um, and

make the network overall more efficient. Yeah. Yeah. It's fascinating. Now my mind's running to because that's another trend smaller trend but something that's developing something we did at cathedra this cycle particularly with older models of miners that we have in our fleet is is underclocking and so that's another aspect of the relationship between a bitcoin miner and the utility companies like working into the contract the ability to take on less energy when you can increase your margins by underclocking and i think that's going to be a very important ongoing discussion between miners utility companies is like saying hey i want to be a long-term customer but i need to be able to work in the ability to to consume less energy at particular times when

hash rate is in one place price is another and i need to increase my profit margins it's not really a question it's just a comment that uh yeah oh go ahead i was gonna say that i mean that that's what we're after here is to help to be a facilitator with the software right you know that's another maturation of this industry just what you said and and we as you know snow to want to help support that with our software um by effectuating those those types of transactions or you know producing the data that helps people make those decisions you know better more real time um so that you know that's another you know exciting thing about it yeah because you know when you're bringing that to you probably the first thing to say is well

you got to talk to the people in settlements how are they going to how are they going to you know integrate this into what they're doing you know once you clear the operational hurdle which you know that's probably the easier one it's the back office how are they going to settle this that's where you usually get tripped up so when you can have a solution that says listen any granularity any any way you know we can build this we can get the payment done and we can settle this out cash in the door okay you know you just sort of accountants accountants are our best friend right now marty that is that is absolutely the case we they're usually our second conversation when when talking to a company but when you are able to communicate that hey

there's no more liability on your balance sheet you simply get receipts just like go back to the starbucks example at the beginning if you are paying every time you go into a merchant you just get a receipt you don't first get an invoice they don't record that as a liability in their balance sheet and then you finally pay and then they change they update their balance sheet it's just, I paid, I got a receipt. If we can make energy that way, then everything that is occurring in the back office becomes orders of magnitude simpler. Again, the most boring things open up the most exciting opportunities. It's true. It's absolutely true. And daily, you know, I mean, that's what, that's what's crazy too, like faster settlement, but less work. And so like seeing all

of those, like seeing the benefits of like the margin benefits on a daily basis, I think opens a lot of a lot of interesting discussions yeah and i'm just going to over emphasize what you two said there is that when we say daily payments to folks they go whoa you know right sounds like a lot but it is less work right so i mean because there is no invoicing process it is truly a receipt process where you just download that data at the end of the month and you you know exactly what you got paid and how much you invoiced um so it is truly less work it just when you first say it sounds like a lot yeah it sounds almost too good to be true but yeah and i know you mentioned it earlier but i think it's really important to stress like the capital efficiencies that are

gained through this process should not be understated like think about the types of innovation that can begin to happen because all this capital is freed up to be allocated in areas that desperately need it yeah on both sides you know that's how much friction is in system, that our software isn't like, oh, one person ends up better than the other. Both sides, they're freeing up capital and they're seeing the benefit. Yeah. And I'll take us on a related tangent. The thing that, one of the things that we have as a team spent time and we're passionate

about is the unrealized economic value in emerging markets. You know, capital from, you know, private capital from developed markets is largely not making its way to increasing energy access in emerging markets, you know, raising up, you know, the standard of living and helping economic prosperity. When you look who's making those investments today, it's nonprofits, it's governments, it's local utilities. And one of the reasons is that it's difficult to take capital into those locations, but also then to bring it out. So if you are investing, how are you going to get a return when you lack the assurance on payment? You know, that's something that, you know, Bitcoin Lite Network completely opened up is, well, now it's very simple for somebody in Africa or in South America or wherever they may be to be able to pay their energy bill or pay, you know, pay for the infrastructure they're using directly to somebody in the U.S. or in Europe or wherever the investment came from. So you're sort of unlocking capital flow, not only in sort of the U.S.

or in sort of in these contractual relationships that we're contemplating here, but it's truly at a global scale. We can start to think about the energy economy now being completely free and open so that way we can realize economic value or maximize the economic value for the investments we're making.

Yeah. That just reminded me of Ross Stevens. shareholder letter when he when he first announced nidig and and nick carter's explanation of like the global energy markets being this this flat service with holes in it and bitcoin miners just like fill in those holes and level it out like do you guys think we could truly have an extremely almost optimally efficient energy system globally via bitcoin mining yeah it's only the government we get out of the question you know you know like austin said earlier you know markets aren't always you know truly 100 efficient but definitely we can make

them more efficient right and not just within their own borders you know outside their borders as well right to truly interact borderless more often than they do today um so there's definitely a pathway to improvement where that ends we don't know but we're we are you know definitely one of the folks that want to you know take that on yeah yeah kind of throw out another marty idea that i've had i'm looking to bounce this idea off people because i need to know if it's crazy or if it makes sense, but I've had this idea for the longest time that there should be Bitcoin mining permanent funds, like bringing the government into the conversation. I think the more we can strengthen local communities, local municipalities, state at the state level, I think the better off

we'll all be at in the long run. I've always had this idea that there should be Bitcoin mining permanent funds whether state or a city government either issues a municipal bond or raises cash in some way to invest in a mining operation partners with a private mining operator they get the cash they get the machines the operator operates builds the infrastructure plugs it all in and they get to participate in the profit share but then you pay off the muni bond plus the interest to those bondholders and then after that the the mining revenues just roll into this this mining fund that that you can use as a local municipality or a state to fund your operations whether that be roads schools whatever it may be

am i crazy yeah well listen i don't think there's any crazy ideas i think you know everything sort of meets the test when you try to when you go to implement but um i would say that you know what's interesting about this is that, you know, government has, you know, at all levels has always made investments into infrastructure and particularly into energy infrastructure. So as we're talking here today, you know, Bitcoin mining is increasingly a fundamental part of the future of the energy system. And so it's not crazy to me to think that the government would want to do that, but then as well to think about how are we going to, you know, serve people who are underbanked? How are we going to provide recurring, as you say, things that are long-term

investments in communities? So I think we've always been intrigued by that concept to think about how Bitcoin can be an enabler for communities, can be the basis for community banks and things of that nature. So it's in the future. What's the ultimate way to get there? I'm not 100% sure, But I would agree with you that when you think about this becoming a long-term asset and a benefit to communities, I would certainly want to live in a community that sees it that way. Yeah. No, we're seeing it. It's not like we're streaming sats to individuals in the towns that we go into in Tennessee and Kentucky. But if we're able to help them get a lower monthly bill for the electricity, it opens up capital for them to do other things.

Would that be start their own business or simply to subsist without having to fight inflation? If we can solve the energy inflation problem for them by helping to keep their rates lower, I think that's extremely beneficial. Absolutely. Absolutely. And, you know, like Lisa said in the beginning, you know, 10 to 20% of, you know, a lot of folks' bills that they get at home is just due to financial friction, right, within the current fiat system and the way the funds flow, right, through the daisy chain. And, you know, here's an opportunity to leverage the technology to go to more of a peer-to-peer style leveraged lightning network, which is, you know, cheaper, faster, more secure, you know, to make energy payments to drive those bills down 10 to 20% over time. And thus, like you said, releases capital back to everyone's wallet. Right. And that's what we're after.

Yeah. Yeah. And so building a lightning, obviously it's a very powerful technology, but what are some of the hiccups, if any, that you've run into? What do you, as a team that's really closely integrated with the lightning network, what are some things that you'd either like to see or have seen? Well, Marty, we will not, you know, do this answer nearly just as the engineers in our team would because they are the ones, you know, on the front lines, you know, facing these challenges.

So first, it gives me just an opportunity to highlight the incredible engineers, you know, Alan, Max, and Colin. They are so smart. And in what's just a little bit of praise, like they're so smart, not just in the engineering side, but on the economic side, like they are students of Bitcoin, that they're constantly educating us. And you asked the other just like what surprised you i think that's been the the depth of which the bitcoin ethos can go and how they can then influence every decision you make and lower your time preference as a company our engineers from the get-go were thinking longer term than what we than what we had been trained in the corporate world and so they've pushed us longer term lower lower time

preference thinking and we love it um now to answer your question specifically um you know You know, lighting is absolutely a challenge. I mean, I would say most of what we're doing are things that, you know, either haven't been done before or just the solutions for them haven't matured yet. And so, yeah, there's a lot of research, a lot of exploration. But I think the cool thing is there's also a lot of excitement about when you're doing something that, you know, whether it's something small or big that somebody has not talked about or done yet or built a company doing. So I would say, you know, it's a very high-level answer. Of course, you know, we have the same challenges with, you know, liquidity. You know, that's going to always be a thing.

Of course, we have to think about, you know, how we're, you know, staging, you know, or how, you know, the software is interacting, you know, with the broader Lightning Network. You know, when you and I first met back in November, you know, I said, hey, right now we're building in an intranet way. So like we were had a closed solution because, you know, our we were still uncertain about how we would interact with sort of, quote, the lightning network. You know, since that time, you know, we've gotten to the place where now we are we are in the network and we're loving it. But it took a while before we were able to feel comfortable that that was going to be the optimal way forward for us as a business. And so, yeah, just some some things that, you know, we'll learn along the way. Lisa could talk a whole lot about, you know, how do you actually build, you know, an accounting system from what's happening on Lightning? Yeah, there's a long way to go to make it,

you know, B2B friendly, probably. We have, we've done a great job of pulling off the data necessary, but it's been hard to track like the fees and they're low, but they're variable. And just some other, you know, there's just some other aspects to it that just, yeah, They're just not built out yet that it's very much like a consumer, maybe point of sale network at this point. And we're trying to to build up at least, you know, as part of our solution to make it more B2B friendly and and that's taking adding on like a lot of solutions. But it's also taking a lot of collaboration, which has been really cool, like working

with a lot of the other people that are, you know, very involved in the Lightning Network to build out, you know, full solutions. yeah no i know this problem very well due to podcasting 2.0 where i get uh anywhere from one to like 300 satoshi stream to me every minute of every day and just accounting headache that comes from that it's like oh my god it's overwhelming yeah yeah and like right and then like when you're sending and receiving at the same time and you and we are mixing a little bit of on-chain and lightning so there's just a whole variety of transactions happening at once.

And it's easy to pull some of them off accounting wise and then other ones you have to dig a little deeper. And so, yeah, we're learning. I think, you know, maybe Marty, one of the things to highlight is the biggest opportunity that's in front of us as well. So if you think about it, you know, a Bitcoin miner today is, you know,

if they're either, they have USD that they're paying their expenses with, or they're converting some of their Bitcoin into USD. And then, you know, on an exchange Coinbase cracking, you name it, and then wiring or ACH the funds over to their counterparty. So what our software is doing is it's getting a minor off of zero.

So now they're doing one transaction on the network. So it's building, growing and scaling network. We're bringing liquidity on, but by and large, because the energy suppliers and the hosting companies that we're working with today, they want to receive USD. Well, so it gets on the network and then it gets off the network. So one of the challenge,

but really I'll frame it as an opportunity is how do we now get transaction two, three, and four to occur on the network? You know, that's really where this gets really interesting because we were getting miners off of zero. They're now on one. And so I think that's where we're really excited to hear ideas, to talk to people in other industries or tangential industries that can, can sort of have reason or cause to push the funds back in a different direction. And so now how do you start,

start to build that circular economy start to build that network effect yeah not very exciting problems to be tackling it's uh there's never a boring day in this industry that's for sure no that is funny yeah that's been the best part about about starting this company every every day is exciting every day is exciting no day is the same no well thank you guys for building what you build i think it's very important again going back to the maturation the continued maturation of the industry this is always something that i think many people believe is necessary if we're going to take that next step towards fully integrating bitcoin and bringing that circular economy you just mentioned forward um and again i i've said

this before and i do truly believe it i believe we have a moral imperative to get these tools to market when you juxtapose what we're building with the incumbent financial monetary system and the precarious situation that it finds itself in and so yeah i think the work that we're all doing collectively is is virtuous and what you guys are doing particularly is pushing thing the edges out further which is extremely important yeah we appreciate that we we agree um you know it definitely is is the most exciting thing is to really think about how do you you cross that chasm to bring bring enterprises onto lightning and we're excited by the work that other folks are doing in this space because it's reinforcing to the direction that we're going when we see

when we see you know big companies taking interest in this space you know it give it helps us then to kind of point to what's happening out out in the landscape um so i would say you know we're with smaller but but really big impacts already being had and uh we're just excited to be to do our to do our part um and uh so thank you very much for for this opportunity to come in and talk about what we're doing because uh we we feel very fortunate and blessed to be uh to be in this industry having come from from where we were to where we are now i don't i don't know if we could be any happier than we are today it's amazing no and you guys are emblematic of a trend that many bitcoiners have predicted uh which is smart minds from industries coming to bitcoin like being drawn

to the light of bitcoin and then incorporating it that's i think another thing that this bear market has really highlighted is the trend of people ditching big tech big finance banking energy um to come into bitcoin and then bridge the worlds of bitcoin with those industries which is again really important yeah we couldn't agree more and it's helpful to know how to how to make those bridges because very hopefully you know to to lisa's point on on fees as an example you know you it you still need to figure out you have to you have to track them all like companies even though they're small like it's it's required that they know where they're what they're paying you know their expenses towards and so we can't just write off a few satoshis no they've got to be

track they've got to be accounted for yeah um and so yeah we agree with you and so before we wrap up here let's get some final thoughts for the freaks what are some things on top of your mind maybe we haven't touched on yet that you think anybody listening to this should be aware of or paying attention to i'll start i think you know recently went down to micro strategy and presented down there and i think you know first observation being you know what a great event because you know here you had industry leaders from uh you know who weren't sort of there for bitcoin but but showed up to the bitcoin presentations and were extremely engaged the entire time there but really the key message is one that sort of has been a theme through this conversation has been that an

abundant future begins with energy and so we really i think what what unites us and we hope that people see is is that the real future that we can build is an abundant one and with the technology that bitcoin brings from from mining up through what you know sonota is building it really is about saying energy is abundant in in in the full scope of things it's just a matter of fixing the underlying issues the economic incentives etc to really make it affordable and available to everybody on the planet uh we absolutely think as a company that that is possible. And we absolutely think that what the technology we're building is keys to enabling that future. So we just really want people to be extremely excited for the future, to

not be afraid of energy scarcities, the boogeyman. It's not true. We can solve these problems if we continue to push innovation forward. So that would be my closing thought is just extreme passion around energy abundance. Yeah. I don't know if I can top that one. Yeah, I'll share that passion for sure. Yeah. I'll also say, hey, local meetups are unbelievable. That is, it was, you know, us being at our local meetup as just passionate Bitcoiners that led to us being passionate Bitcoiners

with engineering friends. And so that's really key. Yeah, the Bitcoin third places are important. Much more productive discourse in person. Yeah, that is true. Wow. Alan, unless you have anything to add. Yeah, I really think it's back to that ecosystem that, you know, you mentioned, Austin kind of hinted on. You're really seeing this ecosystem grow.

And when I say ecosystem, I mean all of the technology, the mining industry, the maturation of it, but also the other technology that's coming to bear, the new companies that are entering the space. And as you put it well, pushing the boundaries out a little more, right? You take a look at the price of Bitcoin over time, right? Up and to the right, hash rate up and to the right. But if you go and look at the ecosystem, the amount of money, fiat money coming in to invest in this technology into the space, the number of companies that are being built, I think that's also going up and to the right.

And so that's got to be exciting for everyone. And as we are pushing our boundary, like Austin said, we are very supportive to see other folks find their piece of the puzzle to go out and, you know, push their boundary, wherever that is. And let's watch this ecosystem grow together. Yeah, there's a lot to do. That's the other thing. It's never boring. I don't think it's not going to be boring. I don't think it's not not going to be boring for, for at least a decade, potentially more. I would say not. And so, Marty, we are an open book. You know, we want people to reach out to us if they have ideas. We are grow the pie type people. So, you know, hopefully anybody listening, you know, feels comfortable. If they have questions, they want to work with us, you know, reach out.

Let's do it. Utilities companies. Let's go. Let's go. You know, the first one, the first one that jumps on and they're receiving their cash two months before they have to send it out, that everyone else is going to be quick followers afterwards because they're going to be in such a great cash position. Yeah. Yeah.

We just need that first utility company going to the industry cocktail party. Like, Oh, you're waiting to. Exactly. It's going to come. Bikes and all their cashflow. Well, Alan, Austin, Lisa, thank you so much for your time today, Friday afternoon. this is a great way to end the week for me

yeah we really appreciate this we were really excited to talk with you Marty so thanks for the time thank you guys keep crushing it I'm sure this will be the first of many conversations as the industry matures as you guys mature as a company and as Bitcoin continues to

take over the world so this is not a goodbye it's a see you later and a thank you for your time this afternoon see you soon Marty see you later everyone take care that's all we got today freaks peace and love