TFTC: A Bitcoin Podcast - #639: Dollar Collapse and Network States with Balaji Srinivasan

Episode Date: July 14, 2025

Marty sits down with Balaji Srinivasan to discuss the sympathy for white American conservatives, the simultaneous disruption of Blue America by the internet and Red America by China, the inevitable collapse of the dollar amid Bitcoin's 100 million X rise, and the emergence of network states as a solution for rebuilding civilization after the coming fiat crisis. Balaji on Twitter: https://x.com/balajis STACK SATS hat: https://tftcmerch.io/ Our newsletter: https://www.tftc.io/bitcoin-brief/ TFTC Elite (Ad-free & Discord): https://www.tftc.io/#/portal/signup/ Discord: https://discord.gg/VJ2dABShBz Opportunity Cost Extension: https://www.opportunitycost.app/ Shoutout to our sponsors: Coinkite https://coinkite.com Unchained https://unchained.com/tftc/ 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/ Newsletter tftc.io/bitcoin-brief/ Twitter https://twitter.com/tftc21 Instagram https://www.instagram.com/tftc.io/ Nostr https://primal.net/tftc Follow Marty Bent: Twitter https://twitter.com/martybent Nostr https://primal.net/martybent Newsletter https://tftc.io/martys-bent/ Podcast https://www.tftc.io/tag/podcasts/

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. Laji, it's been too long. It's good to see you, sir. Good to see you too. Yeah, we were just talking about jumping off points. You have one here. I had one that I wanted to pull up. We'll pull it up in post, but just referencing your tweet from last

night about your sympathy to the white American conservative. And I think this is a good jumping off point because i think this particular topic sort of involves everything that we've been talking about that's right i mean so as context you know five years ago i moved to singapore and india basically split my time between them and i was public about that and um you know i was just talking to some of my friends and the thing is there's there's a zillion different mixed emotions some of them contradictory or what have you it's kind of like uh that that people have about the state of the world the state of the u.s now and uh there's some fraction of people who are like oh everybody who's an immigrant should just go home blah blah and then another group is like i

can't believe you left why didn't you stay and fight and sometimes it comes from like the same person you know like in different conversations where they've got a different mood you know it's like i'm thirsty now and i'm not thirsty at this you know later point almost right and that post was sort of by way of explanation why you know i i grew up in the us i spent four years in america i have obviously many american friends i have an american accent uh i built many american companies i employed many americans i invested in many americans blah blah blah right and um it was really a great country and uh i know i'm saying was in the past tense i know right but basically i i totally get where a lot of people who are maga or trump voters and so on are coming from

and i'm not even saying that as like a leftist who's like condescending or something like that i'm saying that as i would consider myself a centrist or classical liberal ish libertarian ish sympathetic or whatever person so i totally i think i totally get where they're coming from um you know one of the things i have in there is like especially for somebody who was born in like the year 2000 right you and i are a little bit older than that so we remember like actually when you're born you're born in the 80s 90s 91 91 okay fine so if you remember the 80s remember the 90s remember the early 2000s it's pretty amazing country but for a kid who was born let's say in the year 2000 who's now 25 right they're one year old when 9-11 happened they're seven

years old when the financial crisis happened when they came of age 18 years old was like in the middle of me too right you know that thing where the guy walks in the room and everything's on fire that meme right i can only imagine growing up with like ubiquitous social media surveillance and everybody trying to cancel you and yell at you and all the teachers saying like as a white male you're super evil and and all this crazy stuff through your formative years you know and you know you're just like looking back if what happened right they don't even have a memory of what like the good times were right and um so so i get all that and i get why people are angry but being mad is not necessarily the same thing as implementing the optimal strategy

if that makes any sense right and uh being mad may give you the courage or energy to do something but is it the optimal thing and uh you know in general i think you can emotionally align people against something but economically align them for something like as i may have mentioned this before but if you took a hundred people and you said go and burn down that building they could do that easy right it completely paralyzes one guy you know grabs a rock they're a guy grab some matches it's dust in you know a few hours that's like a lot of stuff happening in la you know places around um but if you say to those hundred people go and build that building that's much harder they may not have the skills right because you know you need a foreman and

you need an architect you need even forget like even regulations and code and permissions or even without any permissions even just moving the speed of physics is there a crane to lift the you know the wood that's a very coordinated serial process where those hundred people may not even have the skills right you you know you're plumbers you have electrical work and so so it's like a million x easier to destroy than to build and also less obviously the people who are destroying don't have to coordinate with each other this guy smashing the window whatever their guy is like beating the side of the brick they could hate each other as well they just hate this other thing more you know what i mean right so a big chunk of the you know trump or mega coalition

are people who are against what trump is against but not necessarily for what he's for um and uh it's like you know they're all against wokeness which maybe does deserve to get blown up now maybe it does but then what are they for right and the close analogy that i had was um right after the election, in fact, was to the fall of the USSR. Because in 1991, there was a libertarian and nationalist coalition. Both the capitalists and the nationalists were against the godless communists, right? The capitalists, the nationalists, the religious patriots, and all these different people. And it was an economic thing, because communism was economically inefficient. We know that part. What people don't know is that the Russians actually had gotten down

to 51 percent of the soviet union in the year two years before do you know that no yeah so in 1989 there was a census that was published that showed russians wait a second they're down to 51 percent of the soviet union because the soviet union the ussr was a lot like the ussa it was an officially multi-ethnic celebrate diversity global empire that even stretching across eurasia it had like everybody from central asian like you know uh kazakhstan like you know kind of types to you know middle eastern types to eastern european types to um you know russians right and russians when people refer to it as russian that was the majority ethnicity but it was just becoming it was dropping below 50 so that among other things was one of several factors that led to the ethnic

dissolution of the Soviet Union, long repressed ethnic nationalisms bubbled up after Gorbachev had allowed for glasnost, which was, you know, free speech in perestroika, which was free markets. And the Russians felt that they were being exploited by the non-Russians because they were the ones who were bleeding in all the wars and so on and so forth. And the non-Russians felt they were being exploited by the Russians because the Russians were taking over their territory and imposing the russian language on them over their local language and so both parties felt they were getting a bad deal ethnically as well as economically and the whole thing burst apart into smithereens but for a for a small period of time everybody was super happy and it reminded me

a lot just that that period just reading the contemporaneous accounts reminded me a lot of the honeymoon from right after trump's win to a few weeks later right there's a period where there was like the most positive spirit i had seen on twitter and x in a long time the left was just even if it was a one point victory 49 48 it was like a 50 point victory on vibes right and so it was something where um it was this remarkable remarkable thing and the tech guys and the concert everybody was high-fiving back slapping everybody was great but i knew that wasn't going to last because people had just such a very different vision of what america was what the world was what the future was going to be and so on and so forth

and you know just to talk about that for a second one of the things that happened was right around the time that the luigi left arose and by the way you know that you know why that was predictable why because what once the left well blm yes but blm was on a was on a leash right luigi's not on a leash and that's the difference the thing is blm the blm riots were organized by you know basically the leftist establishment and they could be told to stand down like there's that article in time magazine where they actually told the rioters stand down right so they were like you know rent rent a mob or whatever but after the democrats lost control of the state they basically have two options a luigi leftism and b what's coming next which is

chinese communism right so you've got the violent anarchists who are just shooting and blowing things up these are like the the tesla fire bombers the luigi left right who are just you know schizos right and that's decentralized violent anarchism because it can't do their violence through the american state anymore and then you have like gavin newsom and tim walls who are going to be siding with chinese communism right like newsom went to china said he wants to be china's long-term stable and strong partner and walls asked china to intercede in the iran dispute so um after around the time that happened actually all the democrats went to blue sky off of x and that actually had an underappreciated result which is that it meant that x because the

left moved to blue sky the center of mass on x shifted like 25 or 30 points to the right and you saw that with the vivek tweet in december 25th right when a tweet that would have been considered like a seemingly pro-merit tweet or something like that a few months earlier was seen as now an attack by the right and uh whereas you know when when the left had been there it would have been seen as a centrist kind of thing but then it got seen as something that was actually on the left because the spectrum had moved over so many points and the thing about it is we have to like recalibrate sometimes because as we were just talking about before we got online um we're in this weird superposition of all of these exponentials going through this to the sky at

the same time and nothing ever happens right so it's a bizarre combination of like you have ai and you have bitcoin and you have you have things like for example from from i think it's june 2023 okay so just about two years ago if i'm not mistaken let me just double check june 2023 elon had to personally intervene to allow what is a woman to be asked on x and this is and this is right around the last time we recorded right exactly so so like it took 44 billion dollars and the personal intervention of the wealthiest man in the world because his first round of firing people at twitter wasn't sufficient he needed to go in and personally fire the people who were censoring the question about what is a woman right like he

had to personally intervene that's how far gone the whole thing was that was controversial two years ago on x right that was the that was where the center of mass was on controversy okay from that to now over two years is a move of 50 100 i don't even know how many points you know you'd have to actually quantify that but it's like 50 points to the right i can't even you know right i mean you had grok unleashed a couple nights ago right that's like off that's like way off out there right so the um so we're in this weird time where uh again you have to kind of study historical times where um for example there's a woman i think she is a book called i think it's like four germanies or something like that um yeah four germanies four germanies and it was like uh

hold on uh let me see if i can find it was like yeah so so essentially uh there's there's the book called four germany's and there's another one which was name i'm forgetting now but you know essentially if you lived in a certain part of germany during the 20th century right you lived through the weimar republic and then nazism and then east germany and then if you lived long enough through german reunification and liberal democracy right so you just experienced it all you know you just had the same territory had just these radical shifts in ideology on top of it right and that's kind of how i think about like x where it kind of you know or twitter right actually twitter no longer exists twitter the tower of babel moment is there it's actually very fitting

that it got renamed x because twitter has gotten shattered into a bunch of pieces and there's blue guy and macedon and truth social and tiktok and threads and so on on the left and then there's x and gab and truth and noster and what have you on on the right right and um anyway that that concept of like the same territory and having different ideologies sweep across it nowhere more so than germany in the middle of the through the 20th century and in a real sense formerly twitter now x is kind of like that it's like this central point around which the angle phone internet swivels and turns and so whatever the next transformation is it'll probably be seen there though it's also in some sense losing some

influence to other sons of twitter around you know the world anyway there's more i can say but i just want to like nothing ever happens yet we're also in the middle of the singularity it's a bizarre superposition of those two things actually that's a great tweet right to see polarity is happening but nothing ever happens yeah okay come on i'm gonna i'm gonna post i'm gonna do that one in real time go go go in real time and i'll um you tweet that because i've been thinking a lot about this like i was telling you before we hit record i wrote a newsletter a few weeks ago about nothing ever happens it was right before the u.s bombed iran and while we were bombing around i was like oh my gosh is something happening no let's wait a few

days nothing's happening but to your point we do have the superposition and i think through my reflection on this this juxtaposition it's really i think nothing ever happens at the political level like you want like obviously like you mentioned this election people were very optimistic in november december trump gets in in january we get doge we're uncovering us aid grift and waste and there's a lot of fervor around the potential to to fix that and then eventually it's like no we're going back to um business as usual and i think a big driver of that is just the debt situation like there's no way out of it and the politics has to stay that way but what's happening with ai bitcoin i've resigned myself to like nothing ever happens in

that world i'm just going to focus on bitcoin building tools investing in companies writing about it and hoping that um something happens outside of the political system where nothing ever happened and i can give i can give a lens on that if you want that um suggests why that's probably the right thing to do um which is here's here's a couple of well so first let me close that original thread that original thought right essentially i am really i'm sympathetic to um a number of the conservatives and libertarians and so on who are mega especially the ones who feel they have been forced to be meaner than they want to be right they didn't want to like they tried being mr nice guy they tried playing by the rules they tried uh being charitable and

empathetic and seeing their guy and what did it get them it got them just more and more abused by all these crazy wokes right fine so i get all that however i think that the current strategy of like a throwback i'm not sure there's any strategy that could work honestly because of the debt right but the current strategy is arguably not arguably is reducing in my view the life expectancy of the dollar and thus the empire and just to give you my quick mental model um dollar inflation is global taxation and so what that means is over the course of the 20th century the u.s set itself up as american empire and why to do that there's actually a great book by stephen wertheim called tomorrow the world that documents the exact moment that with memos

that the u.s made the decision to go for empire and it was not actually uh what what people would think it is it was not 1945 it was actually 1939 1940 when the nazis appeared on the verge of completely winning in europe and the battle of britain britain seemed on the ropes because up to that point america was fine with letting the british go and do the empire thing while america was at home just building its strength because empire is expensive but they understood they were smart they understood what a what a cost and time sink global empire was right but then they also understood wait a second if we don't do it well the nazis will do it or then maybe the soviets will do it and then they will capture all this territory they'll cut us off from trade they'll

cut us off from natural resources they'll choke us out and okay well we don't want to do it but they were almost forced into it that's how they saw it right you can agree or disagree with that but there was actually a decision that was made. And that's how the U.S. started playing for global. I mean, here's the thing. You don't become global number one in every category by accident. You don't have a McDonald's on every continent and like the FDA setting regulations for, you know, Myanmar and Uruguay with harmonization. You don't have like the dollar as a reserve currency and Harvard Kennedy School training dozens of foreign heads of state and the U.N. headquarters in new york and in the world bank 500 other things that all got set up that just

does not happen by accident unless you are intentionally going and setting up a global empire and while it's it's very uh common on the left to say empire was bad because americans were oppressing others and it's increasingly common on the right like the buchanan argument we want a republic non-empire or say empire is bad because americans were dying in iraq for no reason right So the left argument is, you know, empire is bad because Americans were oppressors. The right argument is empire is bad because Americans are being exploited, right? Very similar to the end of the Soviet Union, where the Russians felt that they were being exploited and the non-Russians felt that they were, the Russians were exploiters.

And there's some truth to both of those and some falsity as well. But the counter argument to that is actually empire for a time was good, both for the world and for Americans, because the U.S. military was the greatest military the world had ever seen and it maintained order on the high seas and eventually beat down the communist menace that killed so many people and actually the american left the the state department were the greatest diplomats the world had ever seen and just to give them their credit because they definitely do a lot of stuff terribly over the last 10 20 years but when they were working i mean it's hard look you've you've done investments right you've like you've got

companies you've had investors if i'm not mistaken right yes okay like think about how hard it is to do a deal where there's like 10 people signing it's hard right now imagine there's 196 people signing okay that's even harder now imagine it's 196 countries signing that's the level of right that's the level of skill of the american diplomat they got 190 plus countries to sign on the line that was dotted for things like, you know, the World Health Organization or something like that, right? When these organizations were working, that was an absolutely unprecedented level of global nonviolent cooperation.

And of course, you want that 99% of the time, 99.999, whatever percent of time you want diplomacy rather than the military force, right? So to give the State Department their due when they were functional, that was actually genuinely amazing. And you can understand it from a business negotiation standpoint, how difficult that was to get those deals done, right? And because of those deals, you had global market access for Americans everywhere. And, you know, one of the things that actually, it took me a while to like put my finger on

that I thought was so surprising to me about December, 2024 is for the first time, like, you know, my whole life, all of the Americans, especially the white American men that I'd worked with and built big businesses with and expand like essentially our question was only okay when do we expand it to turkey when we expand it to brazil when we expand it to japan right when i work with armstrong or coinbase or you know all the people i've worked with async z and venture capital startups tech the world was america's market that was just obvious right the you know it was not even considered to be something where you were afraid of overseas competition right december 2024 i saw for the first time a critical mass of people

after especially after the vague tweet where americans thought of the world as their competition and wanted to protect their home market rather than obviously think that they would be able to expand into global markets right and it took me a while to realize oh wow gravity had inverted and they feel insecure and they don't feel they can win a global competition so they want to exit that right but we have to understand that the u.s built that game of global techno capitalism right like that is all these multinationals all that stuff was built by by america and that american empire was monetized with the dollar because if we ask the deep question of all right so the shallow question well actually you can ask the question a few different ways so take trump

and the tariffs right let's take vietnam vietnam is sending its shoes to america america is sending back basically printed database entries for those shoes that's that's what the trade deficit is and it keeps going into further debt and those are ious but why does the world accept that the world accepts it because america is the center of the global empire and as the database administrator as the ceo of the world they have root access and in return for maintaining the global financial system with both all the diplomatic agreements and financial agreements from the left and all the military safety and sealant security on the right in return for maintaining that they had the right to print money because basically they managed a ledger and that was how they monetized

this enormously expensive global apparatus, right? And in that printing, dollar inflation was global taxation. Billions of people were basically taxed, diluted, in order to pay for the upkeep of this giant empire that arguably was a net benefit to them. Because it kept the sea lanes and it kept the peace and countries didn't invade each other. And they all had access to these giant markets and phones and later Google and all this kind of stuff. So you have to kind to make the case for it before you can make the case against it i think you know and one of the things that happened though is that empire uh is not the way that people talk about it right most americans you know the best way i can prove it is have you seen the map of like the 750 you know

military bases the u.s has globally yeah like that's not the posture of a people who just wants to sit behind their borders right that is like the the conservative today is only really seeing like one side of the puzzle. They're not really thinking about, in their own way, they're kind of ahistorical, right? They're not thinking about the enormous benefit that America got from taking essentially a slice of every transaction globally. And to be clear, they gave value as well. Maintaining the stability of the world is no small thing. To build this global common market is no small thing. I mean, again, think about how hard it is to just get a deal done between two parties let alone 190 countries right so all that peace and prosperity they monetize it with

dollar inflation and but then of course that's the greatest business model of all time and they started abusing it right and they found they could push it much farther than anybody thought after 2008 especially right and so it went from this unprecedented 787 billion print something that was highly precedented 2008 was unprecedented but then it was highly highly precedented right and the mechanism of printing was set up similarly by the way with 2020 you know like covid lockdowns and like you know there are lots of crazy things that happened during covid like hard borders between u.s states you know like rhode island new york checkpoints and stuff like that or like april 2020 the u.s stopped issuing passports in case of except in emergencies la

times so all that stuff is actually set up for like a digital lockdown in the future it's now precedented when it was unprecedented but anyway so the point being that once you kind of see dollar inflation is global taxation what america's business model was well that's way more profitable than working for a living right like one way of putting it is the u.s did at one point work for a living it manufactured all this stuff there's this great cartoon of you might bring it up it It shows Uncle Sam in 1897, and it's like the Philippines are a stepping stone to China. You might Google that and bring that up, right? So you go to Google Images, you'll see that.

It shows Uncle Sam laden with all these goods. He's going over to China. And China then is the passive market. It's like we want 40,000 trains and 10,000 planes or whatever, right? And America is a manufacturing superpower, and America grew starting as a trade superpower, right? And then because it exported so many goods, all these countries used the dollar to buy those goods. And then gradually it went from a trade to a trade and finance superpower, and then purely a financial and tech superpower, which is what it's become. But the thing is that that is a way more

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sats go check it out at opportunitycost.app that's opportunitycost.app yeah and i think just to build on that i think going back to the angst of the uh white conservative which yes yes it was all in that bucket uh sure i think it's like the like the lack of diversification of that resulted from that empire where you have high finance high tech and then you watched middle america get completely hollowed out in the process and i think the cost of the quality of life of a large portion of the country is what's driving this sort of struggle that we're going yes yes that's right and i'll show you some graphs that actually you know somewhat speak to that um so see if you can put this on screen yeah so that was like when uncle sam was just

exporting stuff all over right and look at that that's 1897 like and the chinese guy is portrayed as just a stereotypical chinese guy but see it says like wanted like a hundred thousand bridges engines cars rails right like china's portrayed as just a passive market amazing history running in reverse aspect of things right and bringing in education steel rails and yeah exactly right so now of course that's that's run completely in reverse and so what what happened was uh to take like a century and a half the um oh here's the npr article and then let me show you one more thing right so this is a rare article where they actually like admit what um what's going on how to spend 1.25 trillion is that a plugin that you have yeah it's a plugin i built called

opportunity cost hilarious unbelievable stuff it was funny that's only half amount of bcc okay so it's august 2010 okay now this is basically how the fed did these mortgage-backed securities so if you scroll down um keep going blah blah blah blah keep going okay wait so can you zoom in on this yeah just top left right in the end they came very close first of all these guys are just like hitting buttons but this is an amazing quote in the end they came very close to their target they told us they were just 61 cents short in other words they bought 1 trillion 249 billion, $999,999,999.39 worth of mortgage-backed bonds. Incredible. The Fed was able to spend so much money so quickly because it has a unique power. It can create money out of thin air

whenever it decides to do so. So, as Zena explained, the mortgage team decided to buy a bond, they push a button on the computer, and voila, money is created. Okay, just a level set. What's a trillion dollars? By the way, even in 2015, 2025 rather, like that was 15 years ago. so that's like two or two and a half trillion or whatever it is today okay but like just take a trillion dollars that's an insane amount of money okay that is imagine you sold a thousand dollar iphone to a billion people in china okay that's what a trillion dollars is you know hard i mean it's insanely hard to sell something that's worth a thousand dollars to one person right sell it to a billion people for that's also just revenue right you know you're going to have there's no

discounts you know like what's your profit margin on that maybe you're making 80 bucks per iphone or something whatever 200 bucks so to make a thousand dollars in profit on a billion people in a second right that's what push a button and get a trillion dollars it's an absolutely it is the most insane business model ever invented of all time in terms of when people talk about a money printer, you know, like your business is printing money, right? Like there's a reason that it's very hard for America to diversify off of the money printer because it is the greatest business of all time, right? A trillion in pure profit by hitting a button. That's crazy. And they tax the entire world to pay for it. Dollar inflation is global taxation, right? Now you can

start to see why i'm very skeptical that the the trump to strategy of re-industrialization is going to work because how many screws do you need to sell to make a trillion dollars a lot i mean like a screw is what like i don't know a cent and actually gonna be a fraction of a cent depending on maybe it's like a big bulky screw like some of these drywall screws how many screws how many bolts how many nuts how many you know ships planes tanks trains like you're talking absolutely gargantuan manufacturing which only china really has a scale for now at this point there's only 77 million mag at 1.4 billion china and the thing is that the u.s is accustomed to office jobs and retail jobs they're not accustomed to like working in the mines and working on the

factories similar. There's a reason. Look, I'm not saying that you can't do those jobs without pollution. I'm not saying you can't do those jobs without injuries. I agree that you can automate and so on and so forth, but they're physical jobs. So they're going to have a higher level of risk than hitting keys in an office, right? And sipping coffee in office. There's a reason that lots of people who are blue collar, they're happy that their children became white collar, right? So there's an honor in blue collar jobs. I'm not saying they're bad. I agree. There's, you know i actually did a lot of stuff not in the factory exactly but the clinical laboratory with robots and stuff like that so being very hands-on i do a lot of real estate nowadays

i do think there's a lot of good and working with his hands i grant all that nevertheless those are tougher jobs in many ways that pay less right often backbreaking jobs even repairing robots is actually not not you know that easy to do so the the romanticization of the 20th century economy without realizing just how much more profitable the push button economy is, is a point of extreme unrealism, right? It's a little bit like somebody who's inherited some gigantic fortune and is accustomed to a certain standard of living and then sort of envies the, you know, like the Vietnamese worker who's like grinding away making, making Nikes, right?

It's, it's like a weird eat your cake and have a two kind of thing. and sometimes people will say to me in comments, oh, you don't get it. We love these high-paying factory jobs. I'm like, high-paying? Why would you say they'd be high-paying? They have to be high-quality. They have to be at a competitive price globally for you to be able to export them to the world. In a neutral market, when you can't impose tariffs in Turkey, in Uruguay, in Hungary, in Japan, when American products are on the shelf next to the Chinese product and the German product, and there's no ability to coerce somebody into buying something or not they just have to compete on on value right same as on the internet by the way anybody can click to anything else

in such an environment which is actually 96 of the world because most of the world is not american only four percent is american in such an environment where it's a genuinely competitive market high pay is only going to be useful insofar as it results in high quality and high competitiveness and the cost of living is so high in america again thanks to all the inflation money printing, that's very hard to do relative to places that have much lower cost of living. So there's like a boxing in over here where the sort of seemingly easy solutions of like imposing 45% tariffs to get back to 1945 have not been, in my view, thought through at all. And there's 50 other things I could say about these tariffs or whatever. And I think they're

just radically under-discussed. It's one of these weird things where, you know, what people detect is change not like for example dropbox today is used way more than the early 2010s but it's probably talked about way more when it was rising than when it's just used all the time you know like uber is probably used a lot more today than it was in 2015 but nobody really talks about uber anymore serious about your bitcoin start acting like it unchained just launched the financial freedom bundle a curated pack that includes a premium bitcoin book a new hardware wallet guide and access to a private macro event with turd to meester legend it's time to take control of your generational wealth go to unchained.com slash tftc to request yours that's unchained.com

slash tftc pretty hot package freaks go pick it up yeah i was gonna say yeah that makes sense and like so your point on tariffs like with the energy like yesterday the copper tariffs because i just recorded yeah jordy visser and we were talking about the energy expansion he's saying i don't think people really appreciate the amount of copper that we're going to need to pull out the ground to electrify the u.s economy to catch up with china's energy generation and then yeah after we post that from like 50 tariffs on copper it's like well we need to expand energy generation copper is a critical part of that it is it is completely insane and unrealistic stuff it is magical thinking it is uh okay let me i could i could say like 10 things about the tariffs in

particular the first is a lot of these tariffs are on like raw materials you know they're on like inputs not outputs you know so you're talking about like materials that may not exist in some quantity in the u.s or you know number two is what should have happened was deregulation as opposed to tariffs deregulation reduces costs for american producers tariffs increase costs basically tariffs are like taxes they have to pay at the port or your goods are seized right and there's surprise taxes which you can't budget for in advance um and it's like a cash expense that went from zero up to like you know on a million dollar shipment it might be 490 000 some crazy amount of money you there's no like lawsuit where i might wait for a year or something

like that's a tax you have to pay right now or your shipments have impounded the port and in many ways it's kind of like imagine i like increase the price of your iphone by like 45 then i said now you have an incentive to go and build apple i mean in the sense you do i increase your prices by 45 now you have an incentive but in a sense of course you don't because the capital cost to go and do that is so extreme and that many of many of these american companies are just they just want a little bit of maple syrup they don't want to go and plant a whole ton of maple trees right and to do that for everything in the economy at once in this broad brush blunderbuss kind of thing it's really this crazy crazy thing it's it's like

completely divorced from reality and it's also having really important effects abroad that people aren't understanding like basically the guys in like malaysia or in uruguay whatever you know just name whatever neutral country you want um spain anywhere right that were exporting to america those were some of the most pro-american people in those countries those were like ceos entrepreneurs right businessmen who had american friends american customers american contacts understood you know they must have flown back and forth to set up you know like business relationships and every single one of those guys globally just got like a bullet in the head right basically they were just rocked they thought this was going to be like a free trade

pro-capitalism administration and uh or even you know basically like trump won they were just completely taken off guard by this and many of them were just bankrupted destroyed or really harmed and what that did is it undercut the pro-american voice in every single one of these countries globally and so you know who won the argument is winning the argument instead unfortunately china the pro-china voice in all those countries so what china did you can go and look headline after headline. China went to Malaysia and they lit up the Twin Towers in Chinese culture. China went and signed all, they made China look like the global champion of free trade. The communists were able to appear to be more capitalist. Now, does that have a stinger

in the tail? Of course it does. You know, there'll be what our debt trap diplomacy or something like that. You know, there'll be some, there's some price you have to pay for entering the Chinese economic union in the future, no question about it. But in the short run, these countries, which many of them, for example, especially Southeast Asia, places like that, the US had courted them and said, hey, you know, you should be with us. They were like a swing vote between China and the US, right? They had plenty of issues with China with like, you know, local regional disputes and so on. And this is like a rubber band snap where they just had to go flying in the other direction. They understood their economy couldn't depend on the US anymore

because the reciprocal tariffs basically say they punish countries for exporting to the u.s and they also start a fight with every country in the world at the same time right go ahead do you find any credence in the idea that's just a purely a bargaining tactic get people no because they're actually there it's not a bluff right these are actually imposed you know there's some there's some skew up and down and it's true that like it was only at the end of the day it was only 10 percent on some countries but that's a lot right to go from when you go from zero to ten percent on a shipment you know the thing is also people don't understand how these supply chains work you'll import you know this piece from here and this piece from there like you know i know this

with with biochemistry it's not uncommon to have a test tube where you have you know some reagent from the uk and some reagent from canada and something from like you know the philippines like you could have a lot of different than something from new england biolabs you all you have that all-in-one test tube right and if you're tracking country of origin of all this stuff first it's a huge amount of overhead and second is you can just radically make it much more expensive and then all kinds of things break in ways that people don't understand like lab tests become more expensive just spare parts become more expensive everything becomes more expensive at the same time that you're uh you know what they want to cut rates to one percent i mean

it's just setting it up for this crazy kind of supply shock you know on their hand i don't know i i think um point being basically that the the idea of replacing the money printing economy with the manufacturing economy has not like with the idea that's going to increase u.s living standards is i think simply not quantitative um the only reason like you if the u.s is no longer accepting foreign trade if it's no longer accepting foreign talent uh not even foreign tourism if it's also not letting remittances go out because there's attacks and remittances that's coming if it's not it's very lukewarm about foreign military intervention and keeping its end of military commitments that's made over decades in treaties you know nato and other kinds of things

if it's threatening to invade greenland and you know fighting with canada if it's sending form letters to japan and korea imposing arbitrary tariffs on them when there's got zero percent the other way it's telling europeans they need to deal with russia on their own and it's while at the same time the administration is fighting with the democrats and the tech guys domestically and even to the point of like the canadian conservatives are alienated like pierre paul of ray was basically undercut and you know canada went to the left over the last you know uh four or five months right uh i don't think that's a good setup right when you put it like that no no and again going back to like the juxtaposition of

the singularity and nothing ever happens it's so much opportunity like i feel like that that extension that i just showed you like i vibe coded that in an afternoon and like that was one of the one of the like most exciting like revelations i've had since bitcoin it's like oh my gosh isn't that cool i can get on this thing you use replit and chat gbt and and i'm a seed investor in replit no well amjad is uh he's really great he's a man she's an incredible dude and it's like amjad's like a perfect example of the type of immigrant we want came from jordan i think so he's doing something incredible and i i think i think replit is just this amazing contribution that really has genuinely expanded the scope of what people

can do on the computer and it's really given um a sense of delight again to like kids and people who weren't coders and you can just prototype anything you can kind of you know it's really i think it's really cool um go ahead you're gonna say i don't mean to go no but to that point it's like it seems like the opportunity set is so wide wider than it's ever been to go and be productive particularly on the tech side um and it would be a great shame to just shoot ourselves in the foot with all this domestic squabbling well that's the thing is i think both are happening at the same time like that's to say to reconcile those two lenses um the internet is to america what america was to Britain. And you can even go, you know, you can say Greece, Rome, Britain, America,

internet. And the analogy I think is pretty strong because America started out British and obviously owes a huge debt to Britain. But it became something else. You know, it became something about 10x bigger, right? With people from all of Europe, not just Brits. And you can have a progression where the internet started out American, but it's like 10x bigger. And in many ways, for example, Britain pioneered, you know, the Magna Carta and equal rights reveal, but also pioneered capitalism. America was simultaneously more progressive and more libertarian. It pushed both democracy and capitalism further. It went from the common law, you know, British common law to the constitution. And now we go one more step. So the internet is even more progressive and more

capitalist than america everybody from every race religion etc is on the global internet anybody can speak to anybody say anything encrypt their messages essentially do whatever they want for the most part on the internet but at the same time it's the most capitalist thing to ever exist more capitalists in any country you can accumulate arbitrary amounts of money you can you know own cryptographic property you can start a business become a zillionaire trade whatever you want right so it's actually even more america than america just like america is more britain than britain and it was born out of america and if i say is the internet american it's like saying is america british well on the one hand of course it is it started in america and like you know i

grew out of darpa and all that kind of stuff big tech companies are american many of them and you know silicon valley's in america and so of course what do you mean is the internet american but on the other hand you can also talk about the non-american internet for example there's the japanese internet and there's a russian internet so they have their own zone so that's one piece but a second big piece is are those american tech companies are they actually staffed by americans actually depending on which one you look at more than 50 percent of their employees are usually non-american or they're immigrants that are naturalized certainly more most of their users are non-american like when you've got something like facebook or google with billions of users

there's only 300 million americans so definitionally 97 plus of their users are non-american they've got three billion users only 300 million americans um most of their revenue depending on the company is non-american right most of their traffic is non-american their data centers are non-american their offices are mostly non-american etc etc right they they started out there but they become something else right similar with bitcoin um that's also it's probably if satoshi i would not be surprised if satoshi was an american he could have been something else as possible but it certainly feels like american culture in many ways but then it's also something which is greater than because i mean the big thing is you know the constitution as amazing as it is

only scaled to the u.s but bitcoin scales to everyone right and this is a really amazing thing where there's so much argument over the judges and are the judges biased for this group or that group but you know you go to a crypto conference in dubai and people from africa latin america the u.s europe asia india nobody's arguing bitcoin's biased against them right that's a really big deal right we've managed to achieve global rule of code that's a huge deal enormous enormous kind of thing right and you know with smart contracts with identity we have property rights we have encryption encrypted messaging we have capital formation that's actually the basis for economic union an internet economic union that's as that's

comparable to the european union or the united states and so in the fullness of time right there's a lot that has to be built but like everything you know once you've got payments on chain you can do accounting on chain if you do accounting on chain you can have companies on chain because you also have contracts on chain if your company's contracts and accounting in chain you can have a stock market on chain you can have trading on chain all that stuff has happened right and that's what i mean by the internet is what comes after america because it scales in a way like you know it's funny i you know i'm not an open borders person in the physical world but and even the digital world i think you need to have digital borders like you know for example

your if you there's some kinds of things that are social networks messaging apps for example you're not going to let every single person into every group chat or whatever right but again to argue against something before you argue for it do you want the steel man case for open borders why not let's give it why not okay so the steel man case is when you set up a tech startup like facebook or google or something like that you want a billion users you want everybody from the x wants every single person from the whole world to use x right they in a sense have open borders anybody from anywhere can go and sign up right and what they're relying on is the fact that their state which is this digital you know this set of algorithms can scale up enough to give

everybody their plot of digital land their account to mediate their interactions between people to tax them when they do commerce there to do dispute resolution and so on and so forth right so you start thinking about these giant tech companies as like digital states with open borders you can start to see well certainly you know they've managed to get to billions of users and be functional despite the fact that they're pulling them in from all over the globe they sort of managed to get the libertarian ideal of tough but fair law or at least close to that go ahead when i think of twitter too i've been using twitter for 14 years now you can draw your own borders with things like list that's what i do that's that's how i consume twitter this list

finance oil and gas energy comedy those are like the borders that i've set for my consumption of twitter that's probably good it's just it's funny it's funny to put it this way for all the time one spends on twitter it's actually effort to make the lists but you know that's actually it's probably people do make lists you can share lists but anyway so let me show you a couple of graphs just to anchor why i think you know the internet is what comes next um so if you can put this on screen yeah and while you pull these up like while you're saying that i want to say ironically um bitcoin being the way it is and americans having adopted bitcoin in the way they have in its first 16 years like ironically bitcoin may be the saving grace for for america or

americans at the very least bitcoin well yes for sure and the reason is let me actually let me show you this if you can you see the screen there yeah okay so i'm gonna i'm gonna show two graphs that are part of my kind of world map, right? There's two simultaneous disruptions. And then let's get back to how Bitcoin is a saving grace. So if you click into the first one, so that shows that essentially Blue America, and it's more than just the media,

but let's use the media as one of the most important pillars of Blue America, basically was doing fine up until the year 2000. They made almost $70 billion. dollars and then they you know they fell after the dot-com crash it was okay and then starting in essentially the late 2000s their revenue just fell off a cliff right from 67 you know 60 billion dollars down to 16 billion dollars like a drop of like 75 at the same time that google and facebook are just going vertical right so the internet disrupted blue america now if you go to the next

graph at the same time almost the same time china suddenly rose and disrupted uh the republicans right if i reverse the colors on the graph the they they disrupted red america right so starting in the late 2000s right after the financial crisis the internet disrupted blue america and china disrupted red america right and what that led to if you think about the world as not just democrat republican but four factions internet democrats republicans and china okay so like a four group thing well um the democrats got radicalized by the internet's disruption of them and they they felt a shrinking pie so they lashed out at republicans with wokeness and they lashed out at the internet with the tech clash okay starting in early 2010s around 2013 the republicans were

mad understandably so they elected trump to lash out at the democrats and also lash out at china with the trade war right so it's actually a forefront conflict that erupted in the mid-2010s as a consequence of the disruption of blue america by the internet the disruption of red america by china right and now we're like 10 years into that conflict and essentially what happened was the tech guys were taken aback because they thought that democrats liked them or whatever right and um it took them a while to understand what was going on but eventually they toughened up and you know they they started hitting back right and disrupted media took about five years to adapt and so on a lot of guys were canceled a lot of companies were bankrupt and then they realized okay they're

not democrats are basically fighting um trying to kill right because they're they feel they can't build search engines or scale social networks but they can write stories and shape narratives they're making the tech guys into the bad guys okay fine we're going to build our own media and that culminated with elon taking x which is like flipping istanbul to constantinople it was like you know x day was like d day you know i was like boom we got all of our forces all the tech because it wasn't just elon right 44 billion dollars that was like larry ellison it was like every centrist center right center left guy in tech and finance all threw in i mean 44 bill is a lot so for a lot of people a mill was a lot but everybody just threw in into that ticket and

they're like okay put it all behind elon that was like boom d-day right x-day x-day open up this beachhead like the invasion of normandy and then troops started moving out and actually uncensored facebook and uncensored instagram unset you know right and you notice those different things because x is like the center of the english language internet right so the internet basically did strike back and it took some time for them to adapt reorganize and go on hit and actually unfortunately probably for freedom uh china also was actually completely taken aback by the trade war you see there's this graph that shows chinese fdi and under obama and clinton and so on that basically it was just soaring ramping right here let me show you this graph you click that

merrick's by the way is a very good think tank it's a german think tank it's got good graphics m-e-r-i-c-i stuttered so going into 2016 chinese fdi was going whoop like this right and then trump began the trade war and just you know in in tech you generally bet on individuals and exponentials and once in a while you have an individual that stops an exponential rather than starts one right so like altman basically started an exponential with ai but trump arrested an exponential over here with chinese fdi right anyway so china was actually totally taken aback by this just like the tech guys you know china had thought america was their partner or whatever they had just they didn't think trump was going to win or what have you um and so they just took

a bruising for a while but then what they did was they eventually uh changed their revenue mix um and now basically they are let me show you this scroll down so you see that if you click into that that that graphic right notice uh north america go down a little bit north america is like further down a little bit further down yeah see 16 right so 84 of china's revenue is not from the u.s so entire cons even if they lost 50 of their revenue to the u.s i mean like it hurts but doesn't kill them right so the entire concept that you can just tariff the u.s to stop china is incorrect because what they did was after 2016 they that's why they did all the belt and road stuff that's been signing all these deals they've been building up these

other markets right they intentionally reduced their dependence on red america just like the internet tech guys reduce their dependence on blue america they basically built their own markets just like you know the uh the tech guys built their own media right so now um you have blue america fizzing mad at the tech guys they hate elon they hate us so much you can't even imagine and you also have red america understandably i'm more sympathetic fizzing mad at china right and so blue america is trying things like well first they tried gensler to block the bitcoin etfs and all this kind of stuff and now actually relatively underreported all of these journalists have these unions which are anti-ai unions right are they really do you know this no but it doesn't shock

me at all yeah so they have these unions at many of the major you know publications which are being on you know they're falling on hard times their traffic has fallen off a cliff since elon has choked off links and so and so forth among other things but these publications the the journos are really concerned that their jobs are going to get wrecked by ai so they have unions that like are banning their editors from using ai and so on and so forth right of course ai used well as a major workflow optimization used poorly it makes things bad but you know like anything a toolist tool so they are in their own way trying to impose protective tariffs right in their own way they're like no you can't bring ai into our controlled zone we will ban it

from our zone right but they're losing control of media to ai and they're losing control of money to cryptocurrency right especially bitcoin on the other side of things the red america is trying to stop china's incursion with this trade war and the tariffs and so on but as i said i think that's not likely to work for all the reasons we just got into right it like if the real version i and i just not to be a negative person i published a bunch of stuff i mean you don't have to listen to me or whatever but um like a you do deregulation you'd reduce costs as opposed to increasing costs right b you for those things are really critical you could you'd identify the 10 customers for example in the u.s of some chinese part and then you'd say okay what factory is making that okay

then we make our own factory that's was was the so-called semi-tech model which worked in the 80s and 90s when japanese competition was ramping up they made an american second supplier alternative to the japanese one and everybody liked it because it brought down the price of that component and it brought it into the u.s right so there's like a smart way of doing this that is not simply just you know attacking you know you don't need to have if china's national security security threat you don't need to put tariffs on canadian maple syrup and french wine you know what i mean it's a completely untargeted nuking of everything anyway point is china's scaling up in robots on the manufacturing side and drones on the military side and i can show graph after graph

it's depressing but it's like if 200 to 300 shipbuilding capacity in the world's largest navy and tomahawk missiles have chinese parts and the u.s military is made in china by this you know govini study that uh the u.s military commission with 400 million um and and on and on like raytheon says you can't decouple from china the ceo of raytheon said that and the secretary of navy carlos del toro 2023 said china's you know one shipyard has more ships than the entire u.s navy combined and hegseth who's a defense secretary on the sean ryan podcast said something like um china's hypersonics can sink all u.s aircraft carriers and you can show each of those things but putting that all together that means that unfortunately china is going to win versus

right america in fact it's already won i mean just one this one alone will kind of make the point i was tweeting about this yesterday i think one of his frustrations with the defense budget it's like we're spending money on manned lights yeah planes that uh when you need to be building drones and i think ukraine's attack on russia a couple months ago or last month was like a sort of moment where it's like oh this is asymmetric drone warfare is here that's right and so if you look at if you look at the tweet i just shared right um just put that on screen if you zoom in on that so famous u.s armaments like the tomahawk missile or the jdam you click in the supplier supplier is in china right so china can just hit a button and when it wants to it can just essentially

shut down the u.s military or at least big parts of it we don't know how many parts by the way because like um if you look at how many look click into that next one that's like look at all those things right so um anyway point being that uh in a sense it's kind of all kayfabe it's almost like if you're really cynical you'd say the defense contractors are getting money out of this for a possible war with china when they've already lost right like they're just getting the spend on it but the weapons will never can ever be used not that you know not that war would be good obviously or be terrible but like there's no there's no realistic deterrent because china knows that it's got all the parts and all the screws and it can just cut off the screws and you can't

make anything that could screw you on the streets anyway point being that means that the pie is going to keep shrinking because like the disruption of blue america by the instrument has only just begun and china's really ramping on the robots and drones so blue and red america are going to see their pies shrink further unfortunately and that's going to radicalize them and the other piece of it is losing the reserve currency bitcoin is appreciated by 100 million x against a dollar did i share that calculation with you yeah i mean i'll tweet about it i think yeah that's right so like i just hadn't seen that number quoted in that way but marty malamy had the first trade which is 0.1 cents per bitcoin in 2009 late 2009 and now it's a hundred thousand dollars plus for

bitcoin that's a hundred million x that's actually insane you know did you see my thing on super bitcoinization i don't think so so normal inflation is defined as like two percent a year right which is like 0.1 0.2 percent a month right and hyperinflation is defined at 50 percent a month but those that's a big gap what if you define superinflation as five percent a month okay so if you take the hundred million x appreciation btc to usd and you take the 16 years over which that appreciation happened from 2009 to 2025 and you work out the compounding rate it worked out to about 10.41 percent devaluation of the dollar against bitcoin month over month every month for 16 years that's insane that's insane right you know what that is i mean you're

a business guy so that means super inflation is already here right bitcoin is this it's this incredible thing because it's invisible people really don't understand what it means for something to go up 100 million x in 16 years it means like you know i think i've said this before another part but it's like you know future historians will have to tell children that bitcoin did not arise overnight like it wasn't just like a step function that just went up that it was actually like there lots of setbacks and stuff in the middle but on on like a historical time scale it's just like as soon as bitcoin appeared the dollar collapsed that's like what future historians will say that's that's why we that's why we built this extension to help people internalize this as

they're going to the internet it's like you should be pricing things in bitcoin and observing how they're changing over time and observing how they're changing exactly that's why your health your your your uh your hat says sats right the sats hat right so yeah like it's it's something where as soon as bitcoin appeared on the scene the hardest money around started attracting the smartest money around right smart money has been going into bitcoin for 16 years in larger and larger and larger quantities and it's still you know it's still going to go so if you combine the internet disrupting blue america with china disrupting red america with the loss of reserve currency and bitcoin going to the moon you have a situation where man the blue americans will be

really mad they'll be really mad because they'll say and i actually don't love this framing but i'll just say they'll say ai took all the jobs and bitcoin took all the money and the tech guys should take all the blame right and uh the you know a lot of the republicans former republicans i do think after maga maximalism after orange man orange coin haha okay i think that's funny whatever right and you know the reason for that is that's not you know being anti-trump or anything but it's just basically saying trump is such a unique figure that i don't think you're going to be able to hold that coalition together after trump right he has such a unique charisma that appeals to people of all different ethnic groups and men of all different stripes and you know

what have you that whatever comes after him i think will be actually a bunch of different leaders who are essentially pro-bitcoin leaders of different kinds like desantis or elon or you know like folks like this of different kinds right um and i think that uh a lot of fighting is going to be over um you know like do you have to surrender your bitcoin to what's left of the federal government you know and so that's why like being in like my that's that'll be what it is in the u.s i think i think actually it's worth doing you know it's worth actually thinking this through and then let me talk about you know ns or whatever um you know there's tons of movies you've seen on like aliens invading the earth and like killer robots and stuff like that and

those are like popcorn you know there's like they're post-apocalyptic scenarios on one level zombie movies alien movies killer robot movies they're genres in their own right oh that's a killer robot movie and you can kind of look at those kinds of scenarios with some degree of detachment because you've seen them before a few times right you're like oh it's a twist on the killer robots but you've actually never seen a fictional um thought process on how like the devaluation the dollar could unfold but you know to my knowledge i don't think i've seen a movie on that i mean i don't know if you've seen it mandibles is the book the mandibles is a good book that's right it is a good book right so that actually should be turned into a film right but

still like people have to use some you know mental model on that right and uh you know the the way i think about this is if you visualize the surface of the earth you know what a neutron bomb is yeah so neutron bomb was invented supposedly to kill people not buildings right like okay so a financial neutron bomb doesn't kill people or buildings but just kills like fiat currency right so imagine you're like an alien you're looking down surface of the earth you see all these people walking around there they've all got a little dashboard above their head which is their score in fiat currency cryptocurrency etc etc okay and what happens is then like the dollar either goes to zero or it's hyperinflated or superinflated whatever over

time to a valuelessness nature and it's tricky to forecast when because the thing is that you have stable coins which are expanding the scope of the dollar we have tariffs they're contracting it's just it's like springs with where you know you don't know when okay fine but let's just say that does happen and then bitcoin becomes a larger and larger larger percentage of the purchasing power well at if it happened overnight what would happen is um like like you know biden was you know he was it was uh uh the president the present president and then he was finally judged senile and it just he was just marked to market overnight so that's that's the overnight because it could also be gradual right so if it happened overnight what happened is all those people on the surface

of the earth like ants have just suddenly stopped moving because every package that was mid-air every person who's going to work was like wait a second i'm not being paid anymore because i'm being paid in dollars this contract is no longer valid you know every dollar denominated contract implicitly or explicitly and by this i include canadian dollars and jpy lots of things are indirectly dollar dependent and probably lots of fiat currencies are indirectly dollar dependent do if they're holding u.s treasuries all kinds of economic relationships coordination relationships just break down and people are like what do i do next how do i put food on the table right and lots and lots of things break at once but then what is not zeroed out right so the knowledge in

your head remains right your house or your your physical goods remain like the shirt on your back remains you know um you're if you're in china china's factories remain right if you have bitcoin your hard currency remains and in a deep sense what remains are like btc and ccp right like that's to say like hard money and you know hard power like factories you know and then hard currency and the good thing about btc is lots of chinese people they they don't respect or fear america anymore but they do like bitcoin and they actually think of bitcoin as a protection in part against their government because the chinese government will just use like a local company's um bank account as like a piggy bank you'll just take money out of it like lawlessly or what have

you because they've got okay you know i just need something to pay for these roads this you know government will take the money out so chinese people the chinese people their protection against communism is the strongest form of capitalism ever known and property rights ever known which is bitcoin so btc also being intangible it's like a cloud whereas china is like the land and that's how i see things shaping up like you know the cloud the land you know the internet versus china that's what i see happening after you know this this whole very predictable meltdown that dalio sees coming that elon sees coming that everybody sees coming it's like this weird thing where the singularity happens and nothing ever happens it's like this

supposition as we were saying the administration even sees it i mean just the way yeah this is shifted frame and saying we're going to grow out of the sort of like hand waving like we're going to turn it on yeah it's completely i mean the level of the problem is first of all it's not even possible because any growth would be swallowed up by this incredible spend thrift kind of thing right um so what happens is essentially like what happened with weimar right which is one of the precedence is the currency got inflated, but there was enough cohesion among the people that it was rebooted into a manufacturing power in the 30s, of course, for ill purposes, but it was rebooted. However, in other countries, the social fabric was not tightened enough.

And so it all fragmented into pieces like what happened in South America and other places with money printing. And unfortunately, in the US, the social fabric of gender polarization, racial polarization um political polarization is so so so so polarized democrats don't even marry republicans they don't vote for republicans they don't talk to republicans on social media they're in their own social networks they've already digitally seceded the only thing they do is they still trade with republicans via the dollar they're still economic in you for now right so when that last piece of fabric phrase then you have basically mutual denaturalization where blue americans just like debanking is like taking away your bank account denaturalization

is like taking away your passport or your citizenship so that's what happened like you know north and south korea right east germany and west germany east germany basically denaturalized those people who went to west germany and vice versa so there's that whole messy messy messy process where the last strands holding it together and i think that you know the like basically my diagnosis is are you how far are you from cars being lit on fire right if you're if you're within walking distance or driving distance of cars being lit on fire which is happening in la happening in san francisco if you're within distance of like luigi left which is in new york and so on that's bad right miami or texas is probably better though

they're doing some firebombing of teslas and so on that's probably like on balance here in the us better i think el salvador will actually be a place where in a reversal of the 20th century a lot of americans are going to seek you know safety right um dubai is becoming huge for brits more than 500 000 brits have gone to uh the uae abu dhabi and dubai lots of chinese people have come to like the chinese capitalist party has come to in a sense come to singapore because there's people that g you know was trying to expropriate or persecute whatever right so those are becoming centers there's various places that are that are rising um and you know so that's kind of that's you know pieces of how i see the world like the future will be china versus the internet

and for a while china will be really really really strong because they just have this totally unified 1.4 billion person super state with this really powerful military and manufacturing base with ships all over tanks, planes, drones, robots, you know, and the lesson they will take from this dollar collapse is that the Chinese system is the best. That's the lesson they will take. Right. And the Bitcoin maximalist will take the exact opposite lesson, which is that centralization is a problem and we need freedom. Right. And so CCP and BTC will take completely different lessons very similar to by the way like the u.s and the ussr taking different lessons from the fall of nazi germany and then the world gets split between them ccp and btc are also in a sense

communism and capitalism so it's like the 20th century again right except this time the battle ground isn't europe but it's america and you know the germans got split into the west german siding with the um with the american capitalists and the east germans with the soviet communists i think this time what happens is the democrats side with the chinese communists the republicans become bitcoin maximalists so it's again communist first capitalist but in a different continent right um you can already see that i said newsom and wallace are siding with chinese communists but republicans are bitcoin maximalists or much more pro-bitcoin so you can see the sort of foreshadowing of that happening let me pause there that's i know it's a lot that's like kind of forecast five ten

years or what have you no no i just sort of reiterate what i said earlier like if that does become the juxtaposition of or the polarization the the spectrum that exists after orange man like i actually again i think it's a saving grace for i don't know if it's america americans individual states states because uh fortunately americans own on a per capita basis more bitcoin yeah and as the price goes up like that then this is i mean it used to be talked about like behind the scenes but i think people are being more overt about it now but there's a ton of bitcoiners particularly in the united states you're just waiting for the price to go up and then that point it's like we're so wealthy that we can begin to exude influence on on the way

it's the thing about it is i think so between chinese control and let's call it american anarchy right what i want to help establish is the internet intermediate or the international intermediate right because certainly of the two i am more sympathetic to american anarchy than like you know chinese communism um however anarchy or crypto anarchy is worse than crypto civilization like what you want is voluntary opt-in societies you don't want tyranny but you don't want anarchy either yeah and um so hence network state right like essentially if bitcoin unbundles the world then what rebundles the world right we've rebounded the world in the same way that you find your friends online like through billions of voluntary actions we've formed all of these

online communities we materialize those into the physical world and crucially we can in a smart way agree to disagree you can have the vegan society and the carnivore society they can both have a million people and they can both be internally consistent as i may have said before they're both better than the mcdonald's diet right an improvement on that diet and then they can just be at a distance from each other because obviously their moral codes are incompatible right but they're probably people are healthier in both of those things than eating mcdonald's slop or whatever right and similarly like you could have the sanskrit society and the latin society you could have the um scottish society and the welsh and the french or whatever right catalan and basque

all these different cultures could have their own startup societies and then they could just trade amongst themselves but they could have their old cultures or new cultures or what have you and you could have totally new concepts for things for example i think uh society that was like 50 percent offline where like the internet just shut off for 12 hours a day could be a very valuable kind of society where it's like sort of mandatory offline time actually a lot of colleges do that in asia they shut off the internet from like i think it's like midnight to 8 a.m or something like that so students can't just play video games all night right it's actually good it's kind of like mandatory lights out it helps them with self-control or whatever right so so that's kind

of the concept of network state right and maybe put that on screen if you want um the network state.com so this book i think is i think it picks up where like the bitcoin revolution is 16 years old and it's risen 100 million x against the dollar and only has 10x more to go what next right well we've started new currencies can we start new cities or even new countries right it starts with community city country right and um you know i talk about this in the network state book never seen one image basically this graphic shows what a network state looks like it's like a physical social network right and um a physical social network let me just send a quick message to the next person so i'll just start and

while you're doing that i'll mention too something i've been passionate about thinking a lot about too is i think particularly here in the united states the focus on the nuclear family needs to be really driven back home i think that's a root a root cause one of the oh yes a lot of the strife is absolutely for sure i mean you need to have um like strong family ties you know but like the whole male female bond has to be rebuilt and so on right and that's obviously gotten crazily generally i do feel bad for the young guys like who have just as i said like they just kind of came of age in this post-apocalyptic social landscape and you know so i'll come back to that point. So this is kind of the concept of the network state, which is a social network that

is actually a real network of friends that crowdfunds territory. And it has, in this case, 1,729,314 people, and it has piece of territory around the world. But those piece of territory are separated by internet. Yet, just like, you know, for example, Hawaii is not part of the mainland US, but it's still part of the same country, right? You can have piece of territory separated by ocean to be part of the same country so this is a piece of territory separated by internet they consider themselves part of the same country the same community and so this example shows something that's actually at the scale of a traditional nation state just like bitcoins at the scale or beyond the scale of most traditional fiat currencies right and i have a visual here

of how a network state builds out so you start with like one and then you know you go to 17 172 17,000 170,000 1.7 million and so you can literally start it from your computer and expand it out like this okay now this was the theory and i was thinking about writing the second edition of the book which you know i did instead so i held a conference and then i was like you know theory and theory theory and practice are the same in practice they are not so i went and started ns.com and so that is a startup society right and so essentially what we have is you know we literally that's brian johnson there with me right so can you see the video on screen yeah so uh so this is something where we've basically taken over big pieces of uh a

you know go son yes it's vitalik i know you guys are bitcoiners but he is a friend you know right you got you know but i'm pretty i think i'm pretty more pro bitcoin than most we've got a gym we've got um uh we've got uh co-working space we've got uh you know folks basically from all around the world more than 100 countries um we've got kids uh we have talks and we have uh this ryan peterson of flex where we have guest speakers and um basically we have uh you know just like you know we have fun outside we have beach got a really you know beautiful uh like kind of forested island here right and we have cafe people play chess and just you know cool things happen right and essentially this is you know we've got like you know outdoor seating we've got buffet

and it basically takes care of that's what i call it like a startup society society as a service right and it is essentially um you know we just work hard play hard bonfires parties right this is a cool drone shot boom ns.com right so um basically the the concept there is just like bitcoin you know we know how to do internet companies and we know how to start an internet currency can we start an internet community right and so i'm trying to develop a template that can be used to bootstrap a community from the cloud right and if you are like a presbyterian or you're catholic or you are um you know you're i don't know like you're into just about any subculture you're mormon or something like that right i know it's more

in the subculture, you know what I mean, right? So, you know, you could have a religious sub community. You could have something that was based on language like, you know, French Canadians or something like that, right? And any kind of theme you have for a community, you could take this template that we're building at Network School, and then you could apply it to your subculture. Now, you know, I'm, I think, very clear about who I am and what I stand for. So I'm a tech guy. right uh but i'm sympathetic to many you know small c concerted values and so on and so while what i care about is like human self-improvement and nootropics and robots and drones and math and science and so on and so forth you can take many aspects of what we're doing and you can

be like a cafeteria catholic and take some pieces and swap out other pieces you know and you can turn that into a traditionalist seeming society that has minimum necessary technology and so on so forth. Or you could, you could dial it up even further, you know, that you could, you could make it speak a different language. It's like a chassis, which you can customize. And so that's why I'm doing network school. And so, you know, for those people who are watching, if they're in Asia or they want to visit, go and apply at ns.com. And it's my way of trying to have a constructive solution for the disorder that i think is coming and crucially it's entirely voluntary right this is how we rebuild site like bitcoin essentially takes away all the coercion of the fiat system

is which you and i all know is there right so then once you're free men right once you're sovereign individuals i think we want to start forming sovereign collectives the reason is it's like there's a burning building there's like a fire alarm and that's what bitcoin is and we all get out we don't die right but then you don't just stand out shivering in the rain forever you want to rebuild that building or a building of some kind maybe not the exact same one maybe not one with exactly the same fire hazards and so on we want to rebuild a building right or a few buildings and so that rebuilding process is what i'm focused on and trying to build a template that then you know it's open source anybody can clone a copy it and you know i want to uh i want

to prove it out first before i say hey this formula works but if we can get it even to like several thousand people we're at several hundred already so if we get to like several thousand people let alone tens of thousands that's a formula for creating a city from the cloud which i think is a pretty pretty important thing that's what i mean look you know if you if you're really wealthy from Bitcoin, especially if you and a group of friends are really wealthy from Bitcoin, that's a valuable thing to do. That's what the early Americans did, right? That's how the Massachusetts Bay Colony was founded. That's how the Virginia Colony was founded. That's, you know, Sam Houston. That's, you know, the land grant colleges in the Midwest, right?

There's that pioneering spirit of building something from nothing where you have your group of guys and you go and do it. And it's actually all these abandoned ghost towns in the U.S. that are being deindustrialized. There's all these abandoned college campuses in the U.S. where this has happened. And then further in other places like Japan, because the declining population, there's all these abandoned farms and abandoned towns, right? So the falling population and the rising Bitcoin mean that basically there's a lot of territory where if you're willing to go in with a frontier mentality and you have Starlink and so on, you can go and set up there. Now, I will say one thing. You know what the single most important thing that I learned

in doing this? What's that? the network state is about real estate about as much as um cryptocurrencies about fiat currency what i mean by that is the usd btc ratio is like the metronome of the whole space even though cryptocurrency is supposed to be sort of in a sense transcending fiat currency that is also a metric of its progress against the legacy establishment right and bitcoin exchanges and banking interface and all that kind of stuff the political aspect was actually much a bigger deal than you thought right and so the network states about real estate basically means that i'm an electrical engineer but i'm also an electrician i'm a chemical engineer but i'm also

a plumber like the amount of real estate stuff that i've had to do our last 15 months 18 months is a lot right which is great i'm learning new stuff um but it's it's about it was a in retrospect it's not surprising but it's kind of like when i was at coinbase i was amazed at how much time i had to spend on fiat banking and ach wires and so on and so forth right that was necessary fine we do it because it's necessary we get pretty good at it right so and also one other thing i'll say is that basically with ns.com we're incredibly pragmatic we don't need you know first you have a community then maybe you have a special economic zone and then maybe some country somewhere not necessarily on the first node probably not on the first node maybe

it's the Marshall Islands, maybe it's Palau, maybe it's, you know, Mauritius, who knows, like some country somewhere, as some deserted island, some peninsula, and they may sell it to you for however many Bitcoin, right? That's a dream, right? But that could take a long time that could take years or decades, it's fine. First, you just build the community, you don't need to jump all the way to the end in one step, right? And crucially, there's a more friendly vision in some ways than the citadel vision. Because you're not talking about like, defending a citadel against hordes of zombies like mad max right or at least hopefully you're not instead you're actually recruiting from the world over there people who share your values and there's

a lot of people who share your values the key thing is also that this is um in a fundamental way just like i think we reclaim free speech we can reclaim democracy that's the last thing i'll just say there which is um do you see what happened with starbase they're right on the edge of the border and it seems like they want to i mean they made their own city they made their own city but basically are they succeeding yet i heard rumors of secession i don't know if they're succeeding but they incorporated so go and uh go and click this and look at this right so in star base texas you have a model for democracy that is 97 percent democracy not 51 percent democracy right because they combined voting with the feet to move to starbase voting with the wallet to

build up starbase and then voting with the ballot to incorporate starbase right so that is you know ever heard the term effort post right so that's an effort vote that's like a real vote right that's not like a okay you know let me let me spend a lot of time online complaining and then hit a vote one sort of that's like that's like the true true true vote where um you are voting with your feet your wallet and your ballot and that is how we start to move from the two-party system to the thousand community system yeah no and i i really like this last sentence because it's something i read a piece a year ago and i've reread it like three times uh about like the great decentralization and return to borders like the holy roman empire yeah and i could definitely

see that happen i guess my i'm gonna call it skepticism but like my like does that have to happen via the sort of creation of these digital communities that then go meet and meet space or going back to my point about the nuclear family and like local community and physical space going from there? Is it just having families, extended families, communities in the same physical location coming to the conclusion that they need to sort of not inoculate themselves, but be more independent from the federal government, the state government, get all the way out of the city? I think there's a value to that decentralization, but I also think, and I'll close on this, which is in many ways, Bitcoin is a version 3.0 that combines the best of gold with the best of fiat.

Because it's got the best of gold in terms of immutability and so on. But like fiat, it can be sent electronically. It's like liquid and so on. It's like global, right? You've got a lot of advantages of both. And so the same way I think we want to have for the network states, some of the advantages of both city-states and nation-states, and some of the advantages of decentralization where you've got local tribes, but some of the advantages of the global scale of massive

markets and audiences, right? because you do ultimately you prosperity comes there's many kinds of things where you know there's maybe an audience of a hundred thousand people around the world for your product but if you your critical scale to produce that product you you know if your limit is just one country you know or just one tribe you wouldn't be able to produce that product right so there's lots of things that there's a there's a value to scale and i think that we can sort of rebuild that With the concept of like a federation, a loose federation of startup societies and network states, what I call the network states of the Internet. And I think that could be like the vision for rebuilding over 10, 20, 30 years after this fiat crisis.

Yeah. No, I mean, it's crazy. It's all coming together like the sovereign individual thesis. And yes, I think Starbase, the Starbase example is one example. got our own city like we want to attract talent in the sense like and if that begins to replicate that's essentially what rhys mogg and davidson wrote in the 90s was eventually it's going to get to a point where you have cryptocurrency you have asymmetric drone warfare you have artificial intelligence you have a hyper polarized population that's mad about immigration all this stuff and eventually what's going to happen capital is going to flee because it can because it's protected by cryptography and you're going to sort of have these concentrations of capital in physical

locations that understand what's going on and try to attract that capital that's right um so on that note let's wrap this is really good you've got to go we're 15 minutes over so i appreciate it okay thank you very much sir it's always been a pleasure peace and love okay greeks thank you for listening to the show i hope you liked it if you did like it please make sure you subscribe rate review the show it helps us out a lot and also if you like these conversations i've come to realize that many people listen to the podcast they don't know we have another sort of layer of this media company we have the newsletter the bitcoin brief go to tftc.io make sure you subscribe there a lot of the topics that are discussed on this podcast i write about five days a week in the newsletter

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