TFTC: A Bitcoin Podcast - #537: Go File A FOIA Request Tomorrow! with OpnState

Episode Date: September 17, 2024

Marty sits down with OpnState to discuss the growing power of unelected supranational regulatory bodies. OpnState on Nostr: https://primal.net/p/npub1v6z4srj4ktch4f3ee9ze2zp7ml4n9rshttmntpamfed0nvpev5fszzuq49 0:00 - Intro 1:41 - OpnState’s background 6:23 - The influence of standard-setting bodies 12:11 - FATF 16:55 - River & Unchained 18:11 - Bank Secrecy Act - Power further removed from citizens 27:06 - Public-private partnership - effectiveness of aml is questionable 35:01 - Gradually, Then Suddenly & Zaprite 36:39 - Circumnavigating due process - Sanction lists - total control 49:10 - Malice/incompetence - System meant to incentivize altruists attracts snakes 57:04 - Knowledge asymmetry with govt - The power of FOIA - go send a FOI request 1:12:54 - Voter responsibility 1:20:25 - Political power cares about you - FOI strategy 1:25:15 - Open source regulation 1:46:54 - Simple choices, big change Shoutout to our sponsors: River https://river.com/tftc Unchained https://unchained.com/concierge/ Zaprite https://zaprite.com/tftc Gradually, Then Suddenly https://thesaifhouse.com/gradually TFTC Merch is Available Shop Now: https://merch.tftc.io Join the TFTC Movement: Main YT Channel https://www.youtube.com/c/TFTC21/videos Clips YT Channel https://www.youtube.com/channel/UCUQcW3jxfQfEUS8kqR5pJtQ Website https://tftc.io/ Twitter https://twitter.com/tftc21 Instagram https://www.instagram.com/tftc.io/ Follow Marty Bent: Twitter https://twitter.com/martybent Newsletter https://tftc.io/martys-bent/ Podcast https://tftc.io/podcasts/

I wasn't drug dealing for people who were, you know, addicted to EasyCrypt. I felt dirty every time I went to work. I have a background as a banker. I used to do commercial banking. I realized just how corrupt that whole system was. I really do think that regulation is, it's a very tricky double-edged sword. Once a government official is elected, he has a burden towards the global financial standard-setting bodies that supersedes the, you know, what he has to do for the citizens

of this country. We saw this wave of crypto projects and Bitcoin create new crypto millionaires. who were not accredited investors what if you can be added to a sanctions list you know for spreading misinformation i mean that seems to be the direction things are taking now and so that that standard of being found guilty for the sole fact of being on a list is very very troubling so if that doesn't scare you i don't know what will this rip of tftc was brought to you by river it's the best place to buy bitcoin go to river.com tftc and enjoy this episode

you've had a dynamic where money's become freer than free if you talk about a fed just gone nuts all 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 what is up freaks first time i've i've opened the show with that in a while and i think it's a apt because it feels like we're getting back to our roots here sitting down with an anon open state to talk about a subject that i'm very passionate about which is getting to the root of

these super national regulatory guideline agencies that put out stringent kyc aml compliance regulations that get wantonly adopted by governments and regulators around the world. And from what I understand, OpenState has a lot of experience in terms of understanding what is happening behind the scenes and how this coordinated effort to thrust the digital panopticon onto the world, particularly the financial layer of the world, is happening. But before we get into that, why don't you introduce yourself, OpenState, why you're passionate about this, how you got into Bitcoin specifically and felt compelled to come on the show today. Sure. Nice to meet all of your viewers. This is my debut. I haven't done this before. By day, I'm a civil servant in a consequential jurisdiction. I do policy and legislation. I draft laws that pertain to financial services in my country.

And by night, I'm a freedom-loving Bitcoiner that wants to help make the world a better place. So I have a background as a banker. I used to do commercial banking where I managed fairly large businesses. They needed to have about a million dollars of lending or more. So I was quite successful there. But gradually, especially after the 2006-2009 debacle, the great crash, I realized just how corrupt that whole system was and how the world needed to improve. So I felt dirty every time I went to work. I was a drug dealer for people who were addicted to easy credit, and something felt wrong. So one day I decided to apply, put my name down for a government role. I figured a government agency, some kind of department that did policy and legislation, I could finally change the world,

make the world a better place. The incentives at the government would be very different. It's not about sales targets. It's not about managing profits and whatnot. It's about doing what's best for the jurisdiction or so I thought so I put my name down as a kind of policy advisor in my country and lo and behold they needed somebody with banking experience and so they took me on board and when I joined you know full of hope full of desire to change the world and to you know hit the ground running and changed the laws that needed changing. They asked me if I knew what the FATF was, Financial Action Task Force, and what I knew about AML. And at

the time I knew very little. But over the years I've gotten to know AML quite well and how it's implemented. I've drafted probably about 12 pieces of legislation that implemented AML requirements in my country. And one of the projects that I was given was the development of a regulatory framework for digital assets in my country. And this was back in 2018, 2019, when this was all new.

So knowing very little about Bitcoin, but having a strong desire to do good in the world, I dove headfirst into the world of Bitcoin and I gotta admit I also did a little bit of web3 and all those tokens but realized you know the the cypher punks really kind of resonated the the ideals and the values really resonated with me and so I bought my first Bitcoin I think the coin was six or eight thousand at the time not that that matters but then I was tasked with doing the regulatory framework and um you know i realized what i was doing i was uh i went from

one industry where i was you know doing loans for people who are addicted to credit to being cog in a global kind of effort to control financial services and was it a jarring experience going from private to public life with this intention of really fighting back against a system which you deemed to be parasitic and did i mean that's a leading question but like was there a point at which you realized or it seems obvious now that you're on here talking about this that there certainly was a point but what was that point when you went to the public side of things where you realized oh i'm not actually going to be able to affect change in the way that i believed i was when i was coming over from the commercial bank

Yeah, let's just dive right in. So the realization came when I saw how global standard setting bodies like the Financial Action Task Force, the WHO, the IMF, you name it, there's a plethora of different, you know, letter agencies and organizations around the world that set standards for countries. And, you know, they rule with an iron fist. When I was doing legislation, you know, I thought that a country like mine would be able to, you know, freely draft the legislation that was right for the citizens, right, of that particular country. And I was wrong. It turns out that once a government official is elected, you know, he owes, he has a burden towards the global financial standard-setting bodies that

supersedes what he has to do for the citizens of his country. So countries are members of global standard-setting bodies or they've issued strong commitments to implement the standards that they they develop and so when a politician I've you know seen two two ministers now that that I've been working under and the first thing they do when they join is they quickly realize that you know if if they don't implement the standards then you know bad things happen and back things could be anything from being put a gray list which doesn't appear to be you know a big thing or just having an increased kind of or a higher risk rating when it comes to AML and that has a huge consequential effect for

jurisdictions that aren't you know in the EU or the US or Canada or any kind of big normal kind of country in Western countries. So we depend as a jurisdiction on correspondent banking relationships, right? And so if the country's put on a gray list or a blacklist, those correspondent banks, which are mainly in the United States, like the big names like JP Morgan and whatnot, will look at the jurisdiction and say, well, look, the anti-money laundering risk in this particular country is elevated now, they were put on a gray list, on blacklist, and then the correspondent banking relationships start to fail, which means it's harder for merchants to buy goods, sell goods, ship goods, buy material. It's more

difficult for people to get credit. Rates go up, you know, US dollars which have been used, you know, by most, you know, for global trade are suddenly difficult to obtain. So there's a lot of examples of this happening. So as soon as a politician is elected, especially in the financial services world, they see this. And so their allegiance essentially goes towards these global standard setting bodies. And it's gotten so bad now that most of the private sector, which is the, you know, the actors in the sector, in the financial services sector, like the banks or funds or whatever the industry is, it appears as though they've just been whipped into shape now. And compliance and abiding by these global standards

has become something that is lauded. And just you feel euphoric when you get a good rating you know as a jurisdiction you know politicians will be super excited you know they'll go up in front of the the people in the country and people will applaud them for for their excellent act of compliance these global standards and it's you know looking at all this as a bystander and being unable to draft legislation that in my opinion you know would have been better for my country you know I couldn't deviate at all from the standards that were set for us so it's kind of like saying you know this this global body says right you know everybody needs to eat pizza and each individual country can choose what

toppings they want on their pizza so whether it's pepperoni or mushrooms or anchovies if you're if you're weird um but you can't serve spaghetti or salad or you know chicken pot pie it has to be pizza so jurisdictions are dictated what they must do and um and do it and now you have i mean i can speak further on the fatf which is kind of i think it's necessary for your viewers who aren't maybe as familiar with that organization but um that's that's when it me that's when i realized all of that yeah the fatf the financial action task force which is a super national guideline setting the way i understand so i said the way i understand you can jump into more particular details but i've been writing about this and talking about it

for probably four or five years now because i wasn't aware of them when i first got into bitcoin it wasn't only until um they started writing guidelines for digital assets probably around 2020 2021 where i really started to pay attention and that's what piqued my interest is like who is this financial action task force and why are they writing guidelines um and it really began to rub me the wrong way once i understood it's like an unelected against super national entity that makes these guidelines and the frustrating thing is they'll position and frame things like hey we're just writing guidelines here it's not like we're We're writing the regulation.

We write the guidelines, hand it over to the regulators. And then they decide whether or not they want to actually implement the guidelines that we set forth. But lo and behold, it seems like they're writing guidelines and people are just blindly applying them to their jurisdictions and their regulatory environment. And I think it's a massive problem that citizens around the world need to be aware of. You think that you, if you believe that you live in a democratic representative, if you believe you live in a representative democracy here in the United States or countries over in Europe and other parts of the world, like you think that you vote people in and they make the guidelines. But as it pertains to financial regulations, particularly around KYC AML, know your customer, anti-money laundering, there's this weird entity that operates out of France, I believe, that does all this. So you're right. The FATF started in 1989.

And it was an initiative started by the G7. And the original purpose was the war on drugs, right? um and um you know there was a very successful war very successful war by the way huge hugely hugely um you know it um the more money you throw at it the better um and i think the u.s has succeeded in that in that fight it's it's one of those forever wars um so that's how it started and it was really to kind of stop you know money from drug sales from kind of entering the system and being laundered and used by criminals. And then it grew. It started growing as an organization, as a project, especially when 2001 happened, 9-11. Once 9-11 happened, then

it was like a blank check for this entity or this project to add whatever they wanted to add there to stop terrorism so they added the requirement to you know that to stop money from terrorists from being used and integrated and and not only that but the infrastructure is being laid at the time by those by those additions for kind of monitoring data collecting and basically freezing funds without due process, right? You don't have to be found guilty of anything. You can just be suspected. Some kind of red flag pops up. I don't know. You said the wrong thing. Boom! Your funds are frozen and it can take you a long time. As many of your

viewers I'm sure know, once you receive money and you know it's frozen by the bank and they want to know the source of funds and that sort of thing. So in this in this world you know you're assumed to be guilty. Your money is assumed to be the proceeds of crime until you can prove that it is not, right? And this flies in the face of, you know, hundreds of years of our ancestors fighting with their blood, sweat, and tears for, you know, our rights and due process, which I think is really being trampled here. To your analogy about, you know, these being recommendations, you're right.

The FATF writes recommendations, quote unquote, but it also has a gun to your head. So it's like, you know, I recommend you implement this. And, you know, if you don't, I'm going to pull the trigger. It's a great way to, you know, get countries to volunteer and to, you know, follow your recommendations, right? This episode was presented by River. River is the best, most secure place to buy Bitcoin in the United States.

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properties. Their cornerstone product is their Volt product, a two or three multi-sig Volt, which allows you to hold two of three keys in a multi-sig quorum. That gives you full control over your Bitcoin. They also have an IRA product, a lending desk, and they're rolling out a bunch of other products including inheritance protocol and sound advisory so go to unchained.com set up a call with our concierge onboarding team today tell them that tftc sent you and use the promo code tftc at checkout unchained.com trying to think of where i want to take this because even when we get to fat if like at the root of all this is where we're going to take it what i believe is like the bank secrecy act here in the united states really lays at the core of a

lot of these issues that we have talked about and we'll continue to talk about particularly around kyc aml and i believe the bsa was signed into law in like 1971 funnily enough 1970 1971 that era was a nixon error policy if i recall correctly and um similar thing obviously anti money laundering uh i think it was the first time it entered the lexicon but that put some rules about knowing information about particular clients at banks, again, pertaining to how much money they were moving at any point in time. And it seems like over the years,

particularly here in the United States, like the Bank Secrecy Act has been used and expanded and things have been not added to the act itself, but the act has been used as an excuse to put more stringent compliance and regulations on companies outside the banking system. slowly but surely over time and that turned into um the fact that the united states economy is the largest in the world and we're doing a lot of international commerce sort of pushed the entire

globe or the western world particularly towards this overarching compliance regime which then brings in fatiff and it's sort of morphed into again the supranational regulatory um it's not officially a regulatory body but essentially is a regulatory body um pushing all these compliance and regulations down people's throats and the worst part about it is it's completely ineffective if you actually look at the amount of quote-unquote money laundering that is prevented by these compliance measures it's minuscule and it completely neglects the fact that criminals are going to criminal criminals uh by default and by definition do not care about your laws they're going to find a way to break it no matter what the initial um to your point the initial um

kind of imposition of the united states's standards on the world was fatka um and um you know most countries um most non-us citizens leaving living abroad will remember fatka were you know if they had a US account in some Swiss bank or any other country in the world they suddenly had to fill out a form you know with some basic information basically stating that they had a you know they have no tax kind of liability to the United States and that was the shot across the bow that started it all. And I mean, it's, as I mentioned earlier, it's devolved now into a frenzy. In my years in this particular department, I haven't seen

really anybody question the recommendations by the FETF. It's gospel, and it's sad to see that. As you mentioned, they're unelected. Now the FATF does have a structure where countries meet. There's 40 countries currently which are full members and they meet. They have plenaries and they meet and they look at the recommendations. They determine what should be added, removed, tweaked and these deliberations take quite a bit of time. So there is participation from countries. However, the bureaucrats that go to these plenaries they're not the elected officials and the elected

officials go there you know they're not the experts they have all sorts of problems to deal with so it's the it's the bureaucrats is the people like me that will go to a plenary and you know submit some comments or some observations and the worst part is that there are secondary members or observing members there's a hundred and ten or so different countries that are you know secondary so secondary means they can't really they can sit and observe in plenaries but they can't speak and so they have very very little say on how the recommendations are are drafted and forged and developed so it's basically

the rule of 40 countries on the rest of the world and it's big. I don't see it going away anytime soon, which is, you know, I don't know what somebody like me can do just coming on this show but the circumvention of due process I think is the biggest issue here and probably the angle that um you know can be taken to maybe tweak anti-money laundering regulations um i think it's impossible to do in a period of emergency for example the united states is still under the 9-11 state of emergency right it's renewed every year um and so there's a lot of things that can be done under a state of emergency especially if it's what is it now 24 years going on right it's It's the war on terror that causes a state of emergency to be renewed every year, and

just like the war on drugs, I don't think the war on terror is going anywhere. So this is a perpetual state of emergency under which basically anything can be done. Soldiers can be sent. I think the, I'm not an expert on this, but the US state of emergency from 9-11 allows your government to go and send troops without going through Congress, which is a problem in and of itself, but it also allows the collection of information, the circumvention of due process. And it's a big thing, and it's not just in the U.S. You know, I'm not a U.S. citizen. I don't live there. And now it's become global. So you may see it as kind of a U.S.-led initiative,

it's way beyond that now. This is a global standard-setting body which can now dictate what the U.S. has to do. It's grown to that point. Surely the U.S. has a big voice during those meetings, but it's not, it's not, it's not a, you know, they don't have the ability to do whatever they want anymore. So from your perspective, you see your the balance of power shift from, you know, it shifted from the states to the federal government and now it's shifting to a global organization. And so you are further removed as a citizen from keeping the people making the policy decisions and keeping them accountable.

You know, good luck trying to find which bureaucrat went to the last plenary from your particular country and then trying to find out, you know, what they suggested and why. And it becomes very, very difficult for governments to be held accountable if the decisions, the policy decisions are being made overseas in a matter like this one. and we see this for the WHO and the OECD. The OECD is the global standard setting body for taxes. They're implementing a global minimum tax of 20%. And so if your industry is part of a taxable kind of industry, it doesn't matter where you are, you're going to be taxed 20% by somebody. Even if you go to a tax-free jurisdiction like BVI or the Caribbean, the BVI might not charge it, but other countries can because it's what the OECD says that should be done.

So it's concerning to me, and I think the whole system could benefit from some transparency and awareness. Yeah. Yeah. And to the point of this shifting from states, the federal government, to this overarching international, supernational conglomerate of bureaucrats making these decisions, who, like, I've heard a lot, I'm sure you have as well, about the public-private partnership and the idea that we really live in a corporatocracy. And that's one of the theories I've heard is that the big banks and the big financial institutions actually like this compliance because it allows them to create these regulatory moats that make it hard for competition to break into their industries and to take away some of their market share and user base. Is that what you're seeing on your end? Like, is this really, is part of this being driven by the large financial institutions around the world that want to create those regulatory moats and are more than happy to work, step in hand, or what's the word I'm looking for, hand in hand with these governments to comply with these regulations that are set forth because they know at the end of the day, they're going to benefit from it. Because not many other institutions are going to be able to compete to pay for all the compliance that is necessary to, or all the boxes that need to be checked to, to be fully compliant, to actually be able to operate in the first place.

You know, I can't speak to that. I can only speak to what I see working in my particular little circle. what I see you know in my country is a growing burden of compliance we have things like beneficial ownership now that has to be done reports have to be sent we have international tax agreements with different jurisdictions you know all of those things just it's like the boiling frog it gets added and added and added and from in my jurisdiction I know this regulatory burden is a burden you know there's there's huge costs to complying with them I think your you know comment stems

from the fact that you're involved in Bitcoin businesses and you know alternative kind of financial services and you know it's very possible that major banks are you know have pushed organizations like the FETF to implement standards for you know crypto in general or Bitcoin specifically or digital asset services in order to stop competition I really do think that regulation is something that it's a very tricky double-edged sword. You know we were used to living with centralized regulation regulators but it's only been like that for about a hundred years. That's 19 early 1900s you know and there's no

doubt that you know a regulator or having kind of a regulated industry having standards that are applied is a good thing. But like you mentioned, there's a fine line between, you know, having standards applied in a sector and having powerful, you know, lobbying entities create, you know, walled fences for a particular sector or activity. So I can't confirm or deny that that's happening. From my perspective, the countries are complying with this, and the financial services actors within those countries see it as a burden. But they also see the consequence, they've seen the consequence in other jurisdictions

that failed to comply. And now it's this theater where these financial services will go to a conference and cheer and pat themselves on the back for being compliant. But really, how truly happy are they that these burdens are being added? And like you said, how many criminals have they caught? I know the study that you're referring to that speaks to AML, there's a few flaws with that study, but it is very, very difficult to measure quantitatively

how many criminals have been prevented to operate because of compliance standards. So, yeah. Well, it's good to know that that study was a bit off Because the one I think the one I'm referring to is like, I think it was being shared three or four years ago. Not this point. It was claiming that 0.1% of global anti-money laundering volume was actually prevented by KYC AML compliance measures. And so knowing that that stat may be stale, if not wrong, is it directionally correct, at least?

Yeah. well you know if you if you have a just a country neighborhood right your neighborhood for your houses and you're plagued by thieves that come regularly right and you just post a cop car just on one of the street corners you know with the lights on right so it's obvious that there's a police presence in your neighborhood now you know what what what do you think the thieves will do will They try and, you know, they might try and avoid the police car and still rob your neighborhood. Oh, they'll just go somewhere else, right?

So how effective was that police car if it didn't, you know, arrest any criminals? But just for being there, you know, it might have prevented quite a few break-ins from happening. So it's the same thing for AML. it's like shining a light in a dark room full of cockroaches and you might see one or two skitter but there were a hundred there and so that's why it's very difficult to quantify if you ask me as defined by you know the anti money laundering definitions and the standards you know it certainly has made it harder for you know these quote-unquote criminals to operate but I also see lots

of legalized criminal activity but no longer criminal legal activities which are very questionable you know happening in major banks or at least I hear about them I don't see them you know people speak of major banks you know facilitating powerful individuals, moving money for them, doing loans, doing opaque structures so that the police can't find who ultimately owns the money that's being transferred. Those kind of activities do happen and more often than not, it's just a small fine that the bank can easily, you know, pay. So this kind of in your face application of AML, it's like a double

standard. You know, you and I were little plebs. We're going to be questioned to death. But certain individuals, it's like, you know, you're good to go. I haven't seen this myself, but that's what I think is happening right now. Quick break here, freaks. This rip is brought to you by Gradually than suddenly a framework for understanding Bitcoin is money by Parker Lewis. I wrote the book. I'm honored to have done so because it's the best zero to one primer. If you're looking for a logical explanation of why Bitcoin obsoletes all other money, buy one for yourself and maybe a few for your friends. Go to the safe house.com slash gradually. That's the safe house.com safe spelled S A I F the safe house.com slash gradually use the promo code TFTC for $5 off

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e-commerce stores, connect your wallets or custodial accounts, and be set up in minutes. We can also connect our bank accounts, our Stripe accounts, our Square accounts to accept fiat as well. The time is now, freaks. The fiat system is fragile. Invest in the infrastructure that rest the future invest in yourself bitcoin payments with zap right go to zap right.com slash tftc to get 40 off their annual subscription zap right.com slash tftc 40 off yeah i mean we just know off of public information like jeffrey epstein specifically had accounts at jp morgan and deutsche bank after he was released from jail for being a convicted uh sex trafficker and they still did business and allowed them to to make wires um that should have probably been flagged by aml

that was only brought to uh brought to the surface after um he quote-unquote died uh a couple a few years ago whenever that was um but yeah there's always this double standard and earlier you mentioned at the i mean is this what you're alluding to earlier when you said there's this circumnavigation of due process or is that completely unrelated the um the sort of implementation of these regulations from the supranational unelected unelected bureaucratic body is circumnavigating due process that were you were you uh focused on that double standard earlier or is this circumnavigation of due process completely separate from what you're just describing It's not separate. It's integral, but it's ever present in everything related to AML.

So, from my insider view, I see the types of conversations that take place. For example, I'll just mention the sanctions lists that were updated. So, I'm sure your viewership is familiar with what a sanction is. They may not be familiar with the lists that are being maintained by the UK, the EU, the US. Those sanctions lists, you know, individuals are added to those lists because a particular government doesn't want those individuals participating in society. Now, what are the reasons for that? Are they convicted? Have they gone through due process? maybe, maybe not, probably not. You know, have they been gone to trial? Have they been in front of the judge? Probably not. So these people that are added, you

know, in whatever state legislature you have or Parliament, somebody suggested that they be added. You know, a couple people looked at the business case and rubber-stamped it and then now they're added to a sanctions list. Now governments around the world, Western jurisdictions, are compelled to, by the FATF and the standards, to look at those lists and to deny anybody on those lists from participating in society. And this means confiscation of bank accounts, freezing bank accounts, confiscation of real estate, denial of travel and you know from from my perspective when the sanctions lists

were added because of the conflict in Ukraine you know I the the some you know Russian individuals were added you know but in the US sanctions lists UK and Europe and you know other countries were compelled to implement the measures to prevent these people from participating in society. Now did my country, are these individuals you know have they been found guilty of a crime in my country? No. You know does my country review the lists and you know fully assess what these people have done, you know, with our country standards, you know, for what a crime is and is not? Nope. These lists are taken as some kind of

gospel, and I saw personally, you know, assets being frozen and taken away and you know, without question, with glee even. It was a humbling experience to see that reports were written, committees were set up to make sure that these individuals weren't in the jurisdiction or using corporate entities in the jurisdiction. You have a person with 10 passports around the world being added on a list and suddenly you don't know if they're, they have a different name somewhere else. Um, and so, you know, if the, the, the sanctioned individual's name is, you know, John Doe, um, you know, now he could be Bob Doe and now he could be, you know, Bob John. Um, and, uh, and so governments will look at those

lists and say, well, all right, what, what permutations, what, you know, can these names take. You know, there's huge consequences for non-compliance. If, you know, a country is known to have allowed, you know, John Doe from using a corporate structure or flying in, or there's a yacht there or a private jet or whatever, you know, bars of gold in a vault somewhere in that jurisdiction. There's huge consequences for that jurisdiction. All of a sudden now it's, the word's going to spread that that country is a safe harbor for criminals. You know, they'll have, they'll be added to a gray list. Maybe they'll be reviewed negatively.

And all of that happens without due process. And the worst part is to your public private partnership point, banks and financial institutions have to take the, you know, the highest level of due diligence when looking at these sanctions lists. Now, what happened in my country was that, well, you know, we don't know if John Doe has a different passport from another jurisdiction calling himself Doe John, or even Bob John, or, you know, Mr. Fridge. and you know we're just gonna you know prevent all Russian passport holders from you know interacting with our financial institution right problem solved it's the the the least amount of

they want to minimize the risk right of being fined of being found to be non-compliant all the banks realize that you know if they if they're non-compliant and I'm talking banks in general there may be some that don't care but at least in you know if you ask them or if you look at them and you you see what they do they'll they'll jump on this and they'll just ban every Russian passport holder now you know in my country I had a Russian neighbor and I was a single mom and when this happened, she wasn't able to send money through the SWIFT system. She couldn't. She had to find a way to get money just to live and pay rent and that sort of thing and she couldn't. She basically had

somebody else somewhere else buy her tickets and had to leave my country. Now was she on the list? I highly doubt it. Maybe she was but knowing her name and having seen the lists I didn't see her name there. So how is that for due process for you? What do you think? Do you think that's a great system? There's a lot of collateral damage and the worst part is, you know, your viewers will love this, you know, what if you can be added to a sanctions list, you know, for spreading misinformation? I mean that seems to be the direction things are taking now and you know you can be a subversive kind of disinformation spreader and so be added on the list and suddenly now it doesn't

really matter where you go there will be consequences and life will be much harder for you and so that that standard of being found guilty for the sole fact of being on a list is very, very troubling. It completely subverts due process and it forces a country's standards on every other country that participates in the scheme and abides by those sanctions. So if that doesn't scare you, I mean, I don't know what will. The standard for being added on or being found being subversive me just being on this podcast you know well look I spoke against government I questioned some things nothing that I've told you is top secret nothing that I've told you is you know I I haven't told

you anything I'm just talking about my experience and what I've seen I'm not revealing any secrets but you know one of the reasons I'm wearing this mask today so I can speak my mind without having to worry about, you know, the next 10 years and how this system will evolve. Certainly if there is a bad government actor and the right opportunity, the framework is in place for complete control not just in the financial markets but also in travel and in health that's being implemented now right so what do you think is that is that proper due process no no and it's actually reminding me of an episode recorded earlier this year with carlino from simple proof and he walked

us through the story of how his family ran a construction business for 30 years and they by accident got put on one of these lists and it destroyed their family business because they couldn't get access to bank accounts they couldn't operate for two years and they had to go bankrupt for a simple mistake of being put on the list they never should have been on and that's a prime example in my mind of what you just described like somebody getting thrown on this list and have their life ruined without due process and destroyed a generational business that his family depended on for 30 years it's insane you're just going around with the sledgehammer um throwing the baby out with the bath water if you will because as you mentioned earlier like

there is um there may be a need for proper regulations to to make sure that their standards and people are not living in the wild west and do have some assurances when they're interacting with third parties but i think it's more than safe to say that things have gone a bit too far the overreach is um extensive at this point and i could make the argument it's doing more harm than good considering the fact that you can be put on this list and your life can be flipped upside down in an instant and then on top of that the data collection um all these institutions have been proven to be woefully incompetent when it comes to actually securing this data and we've had hack after hack after hack we had a hack of a government system here in the united states

earlier this summer that leaked three billion um pieces of data on individuals across the united states so you got social security numbers addresses phone numbers email addresses out there and that's bought and sold by criminals on the dark web to target individuals i mean we see it every day every week in the bitcoin and broader crypto industry with all these phishing attempts and people either stealing identities and taking over exchange accounts or levying phishing attacks because they get access to this information

because it's not protected sufficiently and there's got to be a better way. And that's the main question in my mind when I'm interested to get your opinion. Do you think this is nefarious in nature or pure incompetence, bureaucrats just thinking they have a job to do, thinking they're genuinely doing good things in the world um and doing what they do as middle

bureaucratic managers um adding more compliance because they need busy work to do um or is it more nefarious in nature where these entities or the people behind them seek control over individuals and individuals ability to move money and operate throughout the economy Well, let me flip the question to you. You invest in, you know, many companies. To what extent do you want information on what your employees or the employees of the companies you invest in, to what extent do you want information on their daily activities? You know, if you are okay trusting your employees and, you know, just getting the job done and you let them do it. You're a very good leader, you're a good manager, and I want to work in one

of those companies. Other people. And we can talk about how the current governmental system, the whole government infrastructure, puts incentives. The way that the incentive structures are in government right now you know I'll take an example in Canada right at the I think you know Justin Castro the Prime Minister of Canada I think his wage is a hundred and eighty thousand a year something like that maybe two hundred fifty thousand a year something like that whatever it is you know you you get what you pay for you look at a large CEO of a company and there you they're going to be making three, four, five million dollars, whereas the leader of a country

makes 250k. So the incentive structure in government will attract either people who are completely willing and able to give their time, or will attract people who are aware there's other ways of making money and so you know it invites corruption and other kind of you know sinuous ways of making an income you know you've seen in the US lots of individuals just their net worth is doubled tripled you know 10x you know while they're in positions of power it's not because of their wage and so the the incentive structure tends to attract individuals who are either very charitable with their time or crooked. And so do you think people who are, I would say,

encouraged by the incentive structure of government to seek payouts and $500,000 internships for their nephews and that sort of thing, people who are like that, Do you think they're going to be good leaders and good managers and, you know, not want to know perfect information on the citizens so they can control it? And, you know, if you're a guilty soul, if you know deep inside that your conscience isn't, you know, something's not right, you're going to project that on others. to answer your question though you know is this nefarious I think it's the way the system is designed I think as I said the incentive structure in government you know should change you know if you paid I know this is very controversial most voters will hate this idea but if you paid

the leader of a country, you know, the equivalent of, you know, what a CEO makes for a big corporation, you know, a couple million or whatnot. You know, individuals will join and want to take on those roles and be adequately compensated. And you might get better quality in terms of who joins the government. And so is it nefarious? I'll answer your question. I haven't seen anything specifically in my years in government to say, yep, look, these people know what they're doing.

They know they're acting maliciously. They know they're doing this for a purpose. There's Klaus Schwab in the background rubbing his hands. I haven't seen that. What I do see is a misaligned incentive structure in government attracted in certain type of individual who then go on and, you know, do what they do and do it badly. and I can also speak if you want on how organizations like the FATF make governments comply to the standards which also plays into this because it's not in my particular country it's not one or two individuals to saying oh you

know this is something we want to do and no it's a very organic self-feeding you know leviathan um that um has a very beautiful carrot and a very strong stick um you know in in in its tentacles um so yeah that's that's my point of view on there i knew you were going to ask that question um and that's that's the best answer i can give you yeah i mean it's a question i ask a lot too many guests because i flip flop back and forth i can see the nefarious obviously there's been stretches on the show with particular guests where it's yes it's nefarious these people want to control you and then i think i'm right now more in the camp of what you just described as the incentives are out of whack and if you create a system with

particular incentives you're going to get a particular outcome and it seems like we set up incentive structure like going back to the politicians in their pay where their incentives are out of whack only sociopaths who crave power and are willing to bend the rules in their favor would go get that low-paying job because of all the status that it comes with and the the favors that can be given out and the backs that can be scratched and so yeah i think setting up the right incentive structure and answer your question flipping it on me like as an investor in private companies like i don't need a again good incentive structure as private companies either provide a good service to the market um and if it doesn't drive demand

you don't raise any more money um and if it does you make a lot of money and you're highly incentivized to make sure that you're delivering that product um to the customer and treating your customer the right way so i think incentives are aligned um for many most private businesses that actually want to go out and provide a good or service and make a profit um but yeah when you get a pat on the back for that one good job yeah the government that's he like i don't care what individual you invest in a team uh a leader because you believe that they're competent enough to decide for themselves who they need and what they need to build their product or service.

And then the government, too. One point I wanted to bring up, there's no accountability. In the startup world, private market world, there is accountability where if you don't provide a good service and you don't have any product market fit and you're not gaining cash flow, particularly under Bitcoin standards, you're just going to go bankrupt.

But in the world of government, you have this money printer which allows you to be completely unaccountable. you can paper over all your mistakes pretty easily with a treasury auction or a Fed bailout, whatever it may be. That's a true statement, specifically and most especially for the United States. You'll find that other jurisdictions around the world can't necessarily print money the way the US does. And so there's a higher degree of accountability there. The asymmetry of information, you know, is growing. Who knows what about who, right? When it comes to governments knowing more about you and versus you knowing

something about the government, there's a growing asymmetry there. And of course, knowledge is power. It allows you to play better chess if you know what your opponent's doing or why they're doing it and what they're doing and kind of look into their brain. And you're completely right. I mean, I have a hat that says open source the government. I mean, I think about this, you know, quite a bit. There's a lot of big, massive changes that can be, you know, enacted. For example, if a politician or even civil servants in general got a bonus each year based on how well the economy that they kind of supervise, I don't like using that word, but the economy that they're active in,

if the economy does well, then they get a bonus. I mean, how hard or difficult is that to do? If the economy does bad, they don't get that bonus. right like it just just something you know that easy to do you think would be easy to do but it isn't um and so the the the accountability uh those kind of big easy low-hanging fruit you would think changes are actually really hard to put in place um and so i look at what you know what can you do um so i got a question for you um you know hopefully i want i don't want to be all doom and gloom um i'm gonna ask you a question have you ever sent a freedom of information

request marty i have not not at the federal level i've done one at the state level but not good for you good for you that's that's more than most people um there's 110 different jurisdictions around the world that have freedom of information legislation and that legislation is backed up by an ombudsman review process you know sometimes you know it's got a basis in the Constitution of that particular jurisdiction or the founding documents it's very very easy to use I mean you can I looked in the state of Texas where you're located you can send the freedom of information at the state level like you you already know the process it's just a letter it's just a simple letter

You can create, you know, you can call yourself Monkey Banana, you know, Mr. Big Fridge, create an anonymous, you know, email and send a letter and you say, Mr. Big Fridge, and I want to get all the emails of this or this particular department or person, you know, emails that pertain to this or that. I mean how easy is that and it's free in most cases unless what you're asking is gonna take you know a considerable amount of time and you don't have to justify why you want that information you can just say I want the emails of you know Frank who works in the lands and survey department you know between this period. You don't have to say why. You can just get Frank's emails, you know, and like how much transparency does that give? It's huge. So why don't people do it? You know, I've sent probably about four or five different FOIs. I got an example for you. Whenever an FOI is received

by a government entity, if it is a person, if it relates to a person within the government, so you're asking Frank's emails, Frank will be notified. You know, if Frank's gonna get a notice one day, hey, there's an FOI that says, you know, we should disclose all your emails from this and this date. What, how do you think Frank, you know, will react to that? I mean, government emails, you know our public record and he probably used his email to order pizzas or you know say good night you know to his wife or whatever and maybe you know said a few things that he doesn't want people to know made a few comments and you know that puts him in line even if the emails aren't sent for whatever

reason. He is now more aware and aware of the consequences of his actions for the simple fact that somebody in that, you know, location sent a Freedom of Information. During COVID here, during the lockdowns, you know, our public health person was targeting children and quite heavily, you know, giving gifts and that sort of thing. And it was a very sketchy individual who had, you know, questionable background and history and whatnot. So, you know, I just sent an email with an FOI request in it asking for every email that contained, you know, the word, you know, Pfizer vaccine and whatnot for a specific period. Literally that week the

guy completely went dark and about a month later left the jurisdiction, left the country. I didn't get the emails. The feedback that I got was that the request is overly burdensome for that particular department or whatever and I could have pushed that to be fair. I could have gone to the ombudsman. The justification they gave me not to give me the emails wasn't sufficient. I could have pushed. I didn't because the guy left. And it's just if you want to keep a government accountable, why the hell aren't you sending FOIs? I mean literally anything you want to know you can find out. I mean unless it's specific

cases like a negotiation or something that would be considered to be kind of very dangerous or you know would harm the jurisdiction as a whole if it went public. I mean you've seen big FOI cases with you know everything blacked out you know etc etc but you know as an individual keeping you know unelected individuals accountable is done by FOIs and you should send one tomorrow. Your viewers should send one. Is there something that you're kind of scratching your head and going why did the government do this? Why do they say this? Why did they sign this contract? Why did they build this road? Why are they a member of this or that organization? Heck, how many people in this particular department went to the latest World Economic Forum meeting? You can FOI agendas.

Why don't you? You'll know everything about them and about the people who are drafting and building policy in your particular kind of region. And you can do so anonymously. I mean, why wouldn't you do it now, right? So that's a tool that we have as, you know, freedom-loving individuals to really affect change. And I'm telling you, you might not get the info that you sent, that you requested but it will keep people accountable just for the very fact that you sent it and if people don't do it well fine it just means they don't want to know right yeah no and i completely agree then like the american context like there's

um redactions that a lot of these foia requests come with and then i think we're the freedom of information act has been leveraged particularly by journalists in a very good way over the last 10 years i would say like post wiki weeks post note and people really began to understand that the freedom of information act was there and that should be used but like to push back a little bit a great example going around the vaccine and covid here in the united states like they fully requested all the emails at the nih i believe between fauci and like it came out that they were ex explicitly in those emails like say like using a dollar sign for an s to make sure they couldn't search a particular name and telling people um on chains

that they shouldn't be communicating with these email addresses and nothing came of it so like i agree get the foyer request and surface the information but i think that's one thing we we have yet to figure out particularly here in the united states is the way the media works is they're not gonna surface this data it typically lives on social media and what are considered to be fringe accounts or independent media organizations that do get this information but nothing ever comes of it i think the fauci nih early covid response for your requests that came out earlier this year last year it's like a prime example of that I mean, those emails, and I'm aware of them, you know, they're very high visibility.

You're targeting the, you know, the Goliath. You're targeting the, you know, the kind of the biggest actor. You know, think smaller, think local. You know, Fauci, you know, for in all his wisdom and omniscience and presence in government is unlikely to be the one actually making the decisions, not because there's a shadowy person standing behind him, but just for the fact that he has a lot to deal with. And so he has a team of bureaucrats drafting policy for him

and suggesting actions. And those individuals are, like me, completely behind the scenes um and you know because you know somebody under dr fauci um you know he's under dr fauci maybe that person doesn't feel like um they have to be accountable for anything because if anything ever happens oh it's dr fauci who who who did it right and so doing an foi for somebody like that and doing an FY for every single person within Fauci's team or whatever, whatever department. So I know that you target, you know,

we have an instinct to target kind of the head honcho, but it is very much a self-running machine. I mean, look at the U.S. now with, you know, Biden, you know, his current state and, you know, the vice president is out, you know, doing interviews and knocking on doors, you know, who's managing the country? Well, it's people like me. It's certainly not those individuals. So, you know, somebody like Dr. Fauci, you know, you can FOI, you know, Biden's emails, you can FOI, you know, the VP's emails, Kamala Harris, or somebody big like that, but they're not the ones

making the real decisions um and that's just for the very fact it's not because there's a nefarious element at play it's simply for the fact that they they have a lot to deal with and so you might you know foi your elected um you know elected official that you know you know it's uh you know bob doe and he's the one that you voted for and now he's not doing what you want to do so you're and FOI him and why did he do this. That's great, but you might have to dig a bit deeper to really get to the information A and B to effect change. Because as long as there is a veil protecting individuals who are actually doing policy in a role like mine, it's difficult for them, they're only beholden to their conscience. And most people, whether it's justified or

not, think that civil servants and government employees have cushy jobs and they get paid tons of money. It might be true in some cases. I can guarantee you that as a whole, it really isn't. There's a certain level of safety to working for government. You're less likely to be held accountable and a kind of, you know, how many reports did you write this year? And there's no weekly kind of goal sessions that a private sector would have. And so there is that, and, you know, pensions might be good. But, you know, you see many examples of a revolving door between civil servants and industry. But why do you think that happens? Why do you think somebody would you know work at a you know government job for a few years and then switch to you know big

bank or big pharmaceutical company or whatever it's because the pay is higher right so every single civil servant who is you know even a little bit kind of desirous of more money and you know they they're aware of that and so they'll act accordingly that's the incentive right? The pay is disproportionate in some certain circumstances and in those particular circumstances that's where you'll see more, you know, nefarious kind of actions and getting emails, getting agendas, getting reports goes a long way for a population of a jurisdiction or a certain area to know why their government's doing things. But you do have to dig deeper.

And so you'll hear about the Dr. Fauci emails. But if you're going to send an FOI, send it to find out who's a member of a team. Ask for any emails within a particular department that has a certain word in it. And that's how you send the FOI. Yeah, that's good info. Yeah.

You know, the government system, I might be taking this on the tangent, but, you know, you, there is a, you know, our current political system is very, very interesting. And, you know, I step back sometimes and just look at it. Well, you participate in a voting process. I mean, I assume you've voted, right, Marty? Yep. Yeah, you vote, right? So you participate in that process. And to what extent are you enabling the system? And I know there's, you basically vote for somebody, you know, person A, and then you cross your fingers, hoping that person A will do what you want them to do, right? and oftentimes they don't. So the majority of the people around the world, not just in the U.S.,

are disappointed by the current system, the government system. And it's an interesting relationship that voters have with their government. So their government might go out and send a thousand bombs and kill a hundred thousand people in some other country for whatever reason or excuse. It's my belief that everybody who voted in that election, not for the person, but voted in that election, are partially responsible for that action that the government took. I think society as a whole, and you know people might not like hearing this from me, are very lazy and so electing somebody every four years is a way for you to voice what you want you know very weakly and because you can only really vote between two choices which are sometimes not

very different and so you vote and that's your way of expressing what you want and then you can just step back right there's um there's a feeling now that the government is a is a thing it's a it's an actual entity it's not it's a construct that gets its power by people participating in it and you participate in it by by voting um and so i i i look at that as a whole and um you know, wonder, you know, to what extent are you responsible for government's actions if you if you participate in it? What would happen all of a sudden? I mean right now I don't know the stats and especially not in the U.S. but say half or 51% of the people get off their asses and go voting, right? That means

that the government has a it's fairly legitimate there's a small minority of people in the country that you know support the process well maybe there's a vote against the process and that's not to vote i'm not saying don't go vote um you know i see your candidates in the u.s i know which way i would lean um however you know how much change is that really going to effect. You're going to have, on one hand, you have a kind of a socialist individual. And on the other hand, you have a person who's going to put everything in the private sector, putting big private sector names in positions of power. And whether that's good or bad, I mean, I've listened to your Whitney Webb interviews. She's better placed than me to talk and hypothesize

about that. But imagine, all of a sudden, if only, I don't know, 5% of the population voted. Just doesn't matter for who, just only 5% voted. 95% of the people didn't vote. Whoa, what does that mean, right? I think, you know, is it likely to happen? No, no. But as a conscientious individual I kind of sit back and think about those things and to be fair, you know, I think the system is misaligned and needs some heavy changes and I believe, you know, my message to your viewers is to start with the FOI process and let's just get some light and some accountability And just let's flip the asymmetry of knowledge from government to the people. And there's a system in place for everybody to participate and do that.

So I've seen situations where people are requested. They might speak their mind and say, well, I'm not happy about this. I'm not happy about that. But when it comes to just writing an FOI, a simple little email, you know, oh, I can't do that. Oh, yeah, I'll do it next week. You know, life takes over. And so this kind of attitude is also reflected in, you know, the current voting and government system that most Western countries have. you express your desire once every four years and then you kind of sit back and most of the times

you're disappointed. Well, how rewarding is that? People need to take action. You need to stop delegating your conscience to one individual. You can still vote, go ahead and vote, but also take action around you you know stop relying on media or big names you know like Marty Bent you know to have those important discussions go out and have them with your neighbor right we've delegated even the responsibility of discussion to the media and to you know big-name influencers really we stop talking to our neighbors. We might talk with our friends, you know, over a steak dinner. But it used to be that political policy decisions were discussed you know, at town halls and locally. And that discussion needs to take place

locally, you know. You talk to your neighbors. Do you know your neighbors? Maybe you do, maybe you don't. Your squash club, your pickleball club, whatever. you know I think it's important for people to kind of have a big a bigger open mind but sadly what I'm seeing is that's very very hard to do for the majority of the population so I'd love to know how many people go out and send an FOI after viewing this it I think we can only do what we can do I can do what I can do which is to come on a show like this and to express what I see my observations uh and to give you a solution um and i can't do more than that i can't force anybody

to take action but um you know hopefully that's enough to to win like you're um you're so fond of saying we're gonna win uh no and i can i completely agree this is incredible conversation um and that's like i was a big never vote voting doesn't have any uh effect on the outcome they're going to do what they do but uh last few years particularly now that i have children and have more skin in the game in terms of exposure to the ramifications of particular regulatory regulations that do or do not get pushed through like i've been forced to participate um whether that's voting in local elections um did not go our way this time in in austin but there was a election earlier this year uh that i felt compelled to vote and it did not go our way but it did feel

good to sort of voice that opinion with a vote but outside of voting um in the bitcoin industry particularly bitcoin mining that's something i've become way more engaged with in the last few years particularly at the intersection of energy policy and bitcoin mining and it really became clear to me despite the fact for the longest time i was a disenfranchised american who grew up with 9-11 the wars in iraq and afghanistan wikileaks snowden um covid uh you may not care about political power but political power cares about you and when it comes to bitcoin and being in the mining industry specifically it was like a fight or flight uh decision that i think many people in the industry i've realized over the last four years specifically as the industry has shifted over to the united

states after the the chinese mining ban um you have to engage and there are things that you can do i mean one of the four requests um that it wasn't for you but the freedom of information requests that we did at the state level here um in texas around uh during the last legislator I believe it was at the beginning of this year, had to do with lobbying efforts on behalf of one individual legislator to try to push through a bill that would basically make Bitcoin mining operations engage in demand response within the Texas grid, second class citizens, burden some taxes. The funny thing is we did a Freedom of Information Act or Freedom of Information Request. Parker Lewis officially made the request, but we sort of game-planned it and it came back. There was no emails about this particular topic. So that's another thing, too.

If you do these Freedom of Information Requests and you do get a response and it comes back, hey, they didn't talk about this and they're pushing a bill, Like, that's evidence that they obviously had conversations outside the purview of their state-sanctioned email, which they're supposed to be using for these activities. And I don't think we pushed it this far because the building had passed through. But if it did, it's like, all right, is this individual legislator working outside the system and doing deals behind closed doors? Why wasn't this discussed publicly via the proper communication channels? Yeah, I'm not saying it's a perfect solution. No, but that's a solution to the problem. If you get a request and it's like they never talked about this,

but they produced a bill that was very specific, it's like, okay, then you push it up the ladder more. It's obvious that you had to have some conversations about this particular activity somewhere. Most avenues that anybody can use, like WhatsApp or a personal private email, are also FOI-able if the subject matter being discussed is public policy, right? And so, I mean, you could choose to go to the ombudsman and push it

if you have kind of a good reason to believe that it was discussed and or target somebody differently, you know, within the team. There are ways of pushing it, but I can guarantee you that just sending the FOI or whatever you did, you know, they were notified of that and, you know, whether or not it influenced decision. Again, it's one of those AML things, hard to quantify. And I hope the decision went, you know, positively for you and your purposes. But it did have an effect, I guarantee you. If I get an FOI on my emails, you can bet I'm gonna, you know, that'll be a little shock in the in the ass i'm going to be okay people are watching people know i exist well i got to

be careful here and that's how unelected government bureaucrats will react if you send an foi do it you know keep us accountable um by all means um yeah and you mentioned this being like a foray first step into better incentives within the government like what else i noticed in the notes that you sent me like ideas around open source regulatory standards like do you think from a technical implementation perspective there's there's things that we can be doing better to to drive more transparency and accountability at the government level you're asking specific to the government level um but let me um bring you back to the cypherpunks and the mailing list and um and look at how you know that development took place

very organically um and how bitcoin was released very anonymously um and um um you know did anybody ask government whether they could do this you know did anybody you know Maybe it's a CIA person. I don't know. I don't care. The fact is, it's a good system. It's great technology. It has really, really useful use cases.

And it was developed without any kind of regulatory framework. So you, when you start a new business, you have a new venture. You're going to create some kind of legal entity, a corporate entity, and that makes you governable. Why are you doing that? I mean, I know why. There's tax issues, there's, you know, liability issues that you may be concerned about. There's a lot of good reasons why you would use an existing, you know, corporate structure that's well understood by investors. There's also very good reasons now and growing

reasons why somebody should just develop anonymously and release new technologies anonymously and not ask government for permission. You've seen the recent arrests and whatnot with certain developers. I see this as a growing trend. There's talk in my circles of KYD, which is know your developer. If you're contributing code now you know, you'll have to be kind of, you know, fully doxxed and, you know, with the kind of actions that are being taken against, you know, developers and certain projects, you know, as a developer, you're taking on a huge amount of liability if you open your code and anybody

can add code to it, you might be liable for the ultimate product even though you had no, you know you didn't you know submit any code towards the project and so all those entities that you are incorporated under are governable entities it allows the government to collect information on you to know who you are it allows the government to come in and put its nose in your particular project and believe me the infrastructure is in place for full exchange of information on an international level, the tax information agreements that countries have with one another, the countries are compelled to share any kind of information that they have on file, or even if it's not

on file they have to get it and send it when a request is received. that how you want to operate as a, you know, freedom-loving individual? Now, it works if the government's honest and accountable. That's great. Then you have, you know, great use for corporate entities. It makes sense. You can trust that you're not going to be, you know, acted on unjustly. Everything's great. Hallelujah. I do believe the trend is the other way, unfortunately. So, as an industry, you know, developers and, you know, new projects may want to open up an anonymous account on Nostr and stop using GitHub, which is owned by Microsoft and, you know, will ask for 2FA,

you know, if you contribute a certain amount of code and which is used eventually to, you know, track you know who you are in some cases I'm told I have no evidence of this but and so as an industry I looked at regulation right so you have the SEC of all those you know the centralized regulators around the world and I see them being very very pissed at Web3 and crypto over the last few years because it allowed Joe Blow average individual to participate in you know what it deems to be very risky projects you know by buying tokens or buying Bitcoin without you know proving that they have a certain net worth or you know that

they're able to so that basically crypto was an eradication and I speak crypto in general because it's it's not just Bitcoin it is kind of the whole crypto kind of infrastructure and that whole push and that wave of new projects and it made a lot of people a lot of money a lot of people lost money and it was kind of the Wild West and I know regulators hate that because they can't control they can't control those projects but for the first time the flip side people like you and I I don't know about you I'm not a I don't know what the u.s. uses I'm not a sophisticated investor just credited you know

accredited investor right fine so i haven't been vetted as somebody who can take risk and decide for themselves what they want to do right i'm i'm deemed a low lowly pleb who must be treated like um somebody who can't an idiot i have to be treated like an idiot because i'm not you know whatever standards your country has for so that means i can't participate in you know pre-sales of stock or whatever. There's a lot of things I can't do. And that means, you know, the people who are accredited get all the money, get all the glory, get all the returns. It's fantastic for them. And so looking at all this system led me to, well, how could regulation, you know, how should it take place? We saw this wave of crypto projects and Bitcoin create new crypto

millionaires who were not accredited investors and it allowed people to assume the risk themselves that they wanted to take which is great. I think that regulation shouldn't be you know to a certain degree shouldn't be mandatory. I think if you're you know in a country in a financial services you know you want to invest in something you want to know that the people are not criminals. you know there's a basis of kind of criminality that should be regulated by a country but when it comes to you know my net worth and whether or not I can assume certain amount of risk or if I should be allowed to participate in a

project I think that should be left to the individual and so I wrote a paper which discusses a free market regulatory system where basically it's just like the you know a simple analogy is just the certified organic that you see in in the stores right i mean is that certified organic by government edict maybe but in most cases it's not it's a an industry that got together and said all right we're going to create you know organic standards and we're going to go out and if people want to have that little badge on their product you know somebody's going to go and inspect their you know the food that they use and that sort of of thing whatever standards they implement and then they get the little badge so why can't

regulation be like that and if I wanted to start my own certified organic standard because the other one sucks I can people can get together and we can say look the the old one is is pretty crappy for this and that reason we're going to create a new certified organic standard and we're going to compete with the other one and we can do that and that's how free markets work so when it comes to you know regulation if you're looking at a certain project say we're developing an app and they're issuing stock or whatever and you want to as an investor right you want to know that there's a certain standard of criminality that's not gonna happen they're not lying to you openly and they're not just gonna take their money and run if they do there's consequences so that's fine but when

it comes to the the audits of the accounts and kind of the nitty-gritty of you know who should be able to invest and how and and all of that and you know what standards are applied to the particular project I think industry is is best placed for that and competition would you know allow a plethora or a large number of regulatory bodies who each have their own standards it would weed out the good from the bad. And so I would know which, you know, if I'm looking to invest some money, I'm going to look for the one that has badge A, because I know that badge A is a good badge to have. And if badge A becomes a bad badge to have because they, you know, they're paid under

the table or they, you know, the things that they certified in the past turns out to be bad, then you know there's going to be badge B is going to compete with that. So I think regulation doesn't have to be centralized. You know the regulatory system that you have now certainly is used to fence off participants like you and I in certain circumstances. I think that's bad. So you know regulation could be free market. Why isn't it? So just another thing that the sector could do and going back i'm sorry i'm talking quite a bit here but going back i love it going back how bitcoin you know got started um you know the ultimate certification the ultimate

regulator marty is open source you you have because you know for digital for digital um you know digital things like apps that's the ultimate regulation you know anybody could pay I mean if you're gonna invest a million dollars in something you can pay somebody ten grand to go and audit the code right to see if there's any weaknesses is it work and you can pay somebody else to assess the market you know is it gonna make money and all that so you do your own due diligence and the code being open is the the kind of the number one the number one regulation you can have in the digital space you know bitcoins code is fully regulated by all

the people who look at the code so why are businesses companies new projects very specifically in the you know web3 space you know pandering and begging for regulatory approval, I think, you know, that whole sector has lost its way. I think there are alternatives to, you know, the way it is now. I know the way it is now is very wrong. It is corrupt as far as I can tell, my personal opinion. I have no evidence of this. And so there are alternatives and we don't have to for permission that's a great thing um you know we we can just go ahead and do it like satoshi just do it don't ask for permission and um yeah yeah and we've we've seen this

try to manifest um within bitcoin in a couple of different ways and and i really love the framing i'm just like think about it uh i think we'd like to agree that open free markets with competitive actors do produce better outcomes for the market overall that's true for good and services why wouldn't it be true for regulation too and i think an example of something that tried to not necessarily self-regulate but to not really regulate but self-report the bitcoin mining council is an example of an attempt um to do that and though i didn't agree with it like it was a free market attempt at a solution to solve a problem that the mining industry had with people did not understand the energy energy consumption profile of the bitcoin mining

industry and personally i think they were pandering too much to environmentalist and we're planning the flag saying that bitcoin mining is going to use all renewable energy when i knew that was not going to be the case in the long run people are just going to use the cheapest energy and that cheapest energy may not always be viewed as clean energy depending on who you ask but that is an attempt uh to self-regulate another example is not really regulation but it is guidelines the bitcoin design guide uh exists out there um bitcoin design dot guide to sort of create best practices of what you should um what a wallet should include and how it should communicate what it has included to its users to make sure that they understand what they're doing as they interact with with

a bitcoin wallet um and i think there's plenty of room for more of this i mean down the hall here unchained capital we've seen many bitcoin collateralized lending desks blow up because they re-hypothecated their customer bitcoin and gave it to degenerate gamblers i think there's certainly um an area which unchained could lead and has led just from their product but there could be loose standards or a stamp of approval that says unless you if you're doing bitcoin collateralized loans unless you do it in this way where you have a low ltv the collateral is in a multi-sig escrow that cannot be controlled unchained hodl hodl debify are producing solutions like this there's certainly room for a bitcoin lending sort of not regulatory but standard

free market standard guide to come out and say if you're not doing it this way you're not going to our stamp of approval because the likelihood of you losing your customer funds is increased if you do it this way it's provable that it's not um no i think that's a really good idea those those those standards will develop and grow and um with awareness you know investors and users will look for that you know badge um and it's just it it's going to be an uphill battle for a while um you know i grant you that where where individuals are looking at you know the sec and the centralized regulator or government, you know, to do one thing or the other, but it's my personal opinion that the government doesn't do anything. The way

government does something is by getting out of the way and allowing people to do it, whether it's a government functionary or some kind of elected representative. The government will say, well, yep, you're allowed to do this, so go ahead and do it, the government itself doesn't really do much. It's people like you and I that do things. The government itself is a strange nebulous kind of veil that people hide behind or they worship or they're scared of. And really, we're all human. The functionaries are human. The elected representatives are human, and we are the ones doing things. You know, if you see a police officer in front of you, you know, is that a police officer or is it a human? I don't know.

You know, we see the police officer, right? It's a veil. It's a veil that's put forward that you acknowledge, and it, you know, removes liability from that human for his actions. if he acts unjustly. So this veil exists throughout government and people kind of look at it and say well government is an actual entity, you know it has all this power, it's so you know big. No, no it's the people, the humans that do things, that have the power and the ability to effect change and that includes you, it includes me, it includes your viewers, you know, who can or choose to or not to send an FOI and get more information and hold their governments accountable or, you know,

develop apps or new standards, you know, go around and, you know, if you know a lot about code, you can look at the standards that you just mentioned and start auditing code that's open source and you know put your badge and say look I've audited this here's my here are my findings you know maybe there'll be a demand for that you know and as people start doing that you know well you know coder John audited this and he agrees so this is a good wallet people will start trusting coder John because he's very impartial and does a good job at what he does and in assessing and finding risks and that's how a decentralized regulatory system

would work. Now my paper talks a lot about other things as well measures that can be taken for enforcement you know having some kind of bonds in place to ensure that the entity issuing the certificate is held accountable and to make sure that you know there's consequences to the person who receives the badge, if they act wrongly. So there has to be some degree of consequence, but I think that is just a wide open field just waiting for solutions. And I think we should grab a horse and gallop in that field instead of hiding behind the veil of government uh and waiting for that that you know quote unquote entity to to make our lives better

if not you then who um no i completely agree and i don't think what you said would come off earlier what you said would come off as um uncouth or disrespectful to this audience it's objectively true most people are lazy they want to they want to and i've been guilty of this myself i've been lazy and have abdicated accountability to the government it's an easy thing to point out and says you're making this problem but as you've very uh eloquently described on this podcast if you get up off your ass and actually take some action whether it's the form of requesting information from the government or self-policing within an industry to create standards um and uh marks of approval that people can abide by like it's it's something

that can be done it's wide open empty canvas it's just taking the initiative and the action to actually effectuate it into reality and on that point too talking about the web of trust social graph like that is beginning to manifest on nostre things like zap.store um which are which is basically an app store where you can download um apps the source code to apps and what's budding there is a web of trust of people that have downloaded it um that are connected to you and you can have that social signal okay if matt odell and jack mallers and nvk are downloading this app from um this apk um i think it's safe for me to download this file and you extend that like open source github has been created on nostre too that

was announced at nostriga um a few weeks ago so now you do have that ability to to push code to an open source distributed github via nostre and then on top of that you have the social graph of the people reviewing and producing the code so you can begin to actually see these types of solutions coming to market they're they're being built right now it's just whether or not individuals take action to to help build them or leverage them to make decisions when they download software or or make decisions based off of others that do that the easiest decision for anybody to take is to download those apps i have it on my phone um and it's it's great works well and you know even if it's not you know it doesn't have all the functionalities of another big app

store. You know, I feel good at night knowing I'm using it. I use a de-Googled phone. I feel good at night knowing I'm using a de-Googled phone. I use Linux. I feel great knowing I'm using Linux. It's actually, you know, as easy to use as Windows or iOS. And I know just by using it, I'm effecting change in the world. And that's magical. You know, whether or not I donate to the project or devote my time to learning to code, which I would have to do if I was going to audit code. Even if I don't do that, your viewers can do really, really simple things, and it's just using a software.

There's nothing worse for a developer, I imagine, than creating a great app and nobody uses it, right? So just using it and getting the hell out of X and starting to use Nostr, I don't have an X account, never used one, I just have no interest. I think we're a ways away from people realizing the urgency of having to switch to alternative apps like you've just mentioned. I hope it's going to happen. It may, things may need to get worse before people realize it.

That darn convenience is, you know, really, really sweet. You know, I think you mentioned you use an Apple product. So I'm pointing at you, right? It's very convenient. It's easy to use. I get it. I get it. But you're also probably leaking a ton of information and really allowing, you know,

individuals to know more than they should about about your your goings-on and so you know it there is hope I think the Bitcoin community specifically the Nostra community is doing amazing things I'm really excited by it all and what people can do is just use it and yes it's not as convenient in certain cases but you're gonna feel good at night going to bed knowing that you're you You've used an app that was created by somebody with the same values that you share. So the question is, how does that propagate to the average individual? And hopefully, just with podcasts like this, you're doing a great job.

You're doing the dirty work. You're moving it forward. Kudos to you. You are a reason why I opted to go public. have a perspective that hopefully adds some value. Maybe wakes up one or two people who watch this and if that's done then great. I'm gonna pat myself on the back, go to bed and feel good about what I've done. And it does feel good to change the world one little thing at a time. And I personally don't think it's

gonna be done by voting. I don't think it's gonna be done by big huge changes. it's going to be the small steps that mean the most in the long run that's how millionaires get millions it's not by making a million dollars in one day it's making 10 bucks here and there and it all adds up so yeah i really um want to thank you for for the work that you're putting in and um in these podcasts and also the the projects that you back well i want to thank you for agreeing to come on the show and having the confidence to go public and have this discussion in the first place because it is the most invigorating conversation i've had on this show in quite some time um and i i really cherish the fact that you

decided to come out and come on the show first and have this discussion because i think it's an extremely important one number one and number two i've had a number of these types of conversations in the past and what i like most about your perspective and what you're putting out there is like it's actionable it's actually a white pill like we can do this there's little low-hanging fruit that you can take advantage of to actually affect positive change in your world and i think this is a message that more and more people need to hear um so i just want to thank you for coming on and being open to doing this in the first place i think this is a very important conversation and feeling very fired up now uh after the last hour and a half speaking with you about this

very eloquent and um level-headed and it's just an incredible perspective considering your background and what you see on a day-to-day basis that's right so you you've heard things from you know a lot of the the speakers in the podcast world but um and i guess people would have to trust you that you've done your due diligence on me because they can't see my face or know my name um but i've seen it from the inside and um you know i am concerned about the trajectory and not just the trajectory but the the attitude that people around me have um you know within my government um and i think you know i think um we can only do what we can do and um we will win i hope so you know for for your kids yeah as long as we have a

fifth column actors like yourself uh who actually care and it's good and it's refreshing like there is still hope in the world there's people like yourself that exist in these positions and different places around the world that do still have a soul and are actually cognizant of the effects of particular policy and regulations that get thrust on individuals around the world we all have a soul and every single government bureaucrat every single elected official even dr fauci has a soul um and it it's it might be very deep very very deep in his case i i you know my personal opinion, but he has a soul and he has a conscience. And it's looking past the veil of a uniform or title or government function and looking at the humans. And it's trusting them and

forgiving them that will affect the most change. If people go up to me and say, well, your government did this, and that solidifies my position. I can't atone for what I've done. I'm being attacked. You know, the best cure for fire is water, and so it's looking past the veil, seeing the human, you know, behind the veil, and kind of opening your arms to them, or putting out a hand for a handshake, and I think that will that will go a long way and sending an foi send your fois freaks do it i've got a couple of mine that i i want to send um the uh i won't say it on there we'll see if it's successful announce it later but thank you so much for doing this hopefully um anybody listening to this

uh takes this message to heart and really decides to act i think many people will um i'm sure we'll be getting messages notes on nostre about people submitting fois and uh even on x this will be syndicated there but um hopefully if you ever want to come back on and feel compelled to talk about anything else in the future you have an open invite just let me know and um no i feel honored to have had this conversation with you and um again feeling invigorated and more hopeful than i was just a couple hours ago so thank you it's my pleasure i'm speaking at the adopting bitcoin in el salvador as well um awesome and um i'll be happy to meet people there you know without this mask and uh so they can see the human behind you know this current veil that

i'm wearing right now all right get to adopting bitcoin freaks now i may try to come that's all we got today thank you and uh like i said hopefully we can do this again in the future peace and love freaks