TFTC: A Bitcoin Podcast - Rabbit Hole Recap #182: CBDCs are treasonous and prices are rising

Episode Date: January 13, 2022

This week Marty and Matt: - inflation running rampant Marty Bent, - Argentina rolling 12-month inflation - Turks diving in - Legal defense fund - Strike in Argentina - Bill Miller is bullish - Kazakhstan update - electrs v0.9.4 - bluewallet v6.2.16 - mercury wallet v0.5.6 - tdex v1.2.2 - foundation passport v1.0.8 - hexa wallet v2.0.67 - samourai wallet v0.99.98b - fidelity bullishness - Rep Emmer no CBDC - ESG is a plague Shoutout to our sponsors: Cash App Unchained Capital Braiins HodlHodl Bitcoin 2022 - use the code TFTC for 10% off

welcome back to tales from the crypt it's your boy marty bet we're turning into a rap podcast so we're just going to do beat we're just going to just try to create like unique beats and become a producer of music we're tired of the bitcoin stuff just kidding matt and i just ripped our abbott hole recap it is january 13th 2022 almost midway through january already what's going on in the Bitcoin world hope you guys enjoyed this rip it was brought to you by our good friends at the Cash App Cash App just enabled Lightning Network payments

you can pay an invoice over the Lightning Network via Cash App we tried to do a live demo on air it didn't work out but it worked for me yesterday I swear to God Cash App's the best place to stack stats send stats, receive stats, or sell stats if you so please if you haven't downloaded the app yet

make sure you do so using the code stackingstats S-T-A-C-K-I-N-G-S-A-T-S You're going to get $10. $10 is going to go to our good friends at Owls Lacrosse. That's Owls Lacrosse. This group is also brought to you by our great friends at Unchained Capital. We're moving into the same building as Unchained, the studio. I'm recording ads from a transitional studio,

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their vaults. They have all the incredible content on their blog. Unchained is here to be a partner for your generational wealth. Go check them out. TFTC sent you for that concierge package. You'll get $50 off. This report was also brought to you by good friends at Brains. Brains is the team behind Slush Pool, which is the oldest Bitcoin mining pool in existence. The first to ever exists still around today. Not an easy task. They're also the team behind BrainsOS Plus firmware, which allows you to download firmware onto an ASIC that is compatible with the BrainsOS Plus firmware and then helps you stack more sats with your hash. If you have an ASIC that is compatible with BrainsOS Plus and you're not using it, you were leaving sats on the table. It's as simple

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lending product. You go to lend.hodlhodl.com. That'll allow you to join a marketplace, which will allow you to put Bitcoin up as collateral to get stable coin liquidity. Again, this is non-custodial. It is a two or three multi-sig. You hold one key, your counterparty holds one key. HODLHODL holds the third key. Obviously, with this lending agreement, you can't have control over the Bitcoin throughout the duration of the loan, so you don't run off with the stable coins and the Bitcoin. However, you do have one key, which gives you visibility into the wallet so that you know that your funds are not being re-hypothecated and that if you're paying your loan back at the end of the day, you're going

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ticket, go now before the end of the day tomorrow and you'll have cheaper tickets. If you use the code TFTC, you're going to get 10% off. You can use that code from now until the conference, you'll always get 10% off. But if you want to take advantage of the lower prices, make sure you do so before tomorrow afternoon. Again, January 14th, the conference is April 6th to 9th in Miami, Florida. They're going to have industry day, the first day for enterprising Bitcoiners who are looking to build business or career relationships. Days two and three are General Conference. And then day four is the Bitcoin Music Festival that will be headlined by Logic and many other artists. Last year's conference sold out. This year's is on pace

to be three times larger. It's in South Beach at the South Beach Convention Center. As always, Matt and I will be doing a live rabbit hole recap from the event. Again, join us. Use the code TFTC, get 10% off, and I'll see you in Miami. Enjoy. Okay. you've had a dynamic where money's become freer than free when 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. Are we live yet? I think we're live. What is up, freaks? It's your boy Marty Bent here. How is there no way for us to tell on our side? I was looking at restream here. Well, car counted it down.

There is like a lag there. The black background is fucking fire. I did too. The abyss, the abyss above us up here. What is up, freaks? We are back again. Rabbit Hole Recap, January 13th, 2022. First month of 2022. It's almost halfway done. We're here again to talk about Bitcoin. I was just telling Matt before we went live that I'm very excited. I think there's going to be a lot of lively discussion this week. I'm feeling pretty jacked up considering a lot of the things that are going on as it pertains to the mining industry, particularly around the subcommittee that's being called in Congress that is questioning Bitcoin mining's validity considering its energy usage. um there's a lot going on bitcoin legal defense funds a lot of software updates but first we got

to check in with matt matt you look like you're struggling over there you're gonna be able to keep up i'm a i'm just a little bit hung over from uh amazing nash bitcoiner meetup last night uh always love always love kicking it with bitcoiners in person offline with discussions that are not recorded and broadcast after the fact um and then i told marty i spent like the last i told marty and car spent the last hour and a half assembling my new desk um so we're getting there slow and steady hey as long as you're getting there as long as you're making progress one little bit at a time pun intended let's just jump right into let's jump let's jump right into it we'll go to clark's dashboard the current price of bitcoin is 42 690 cuck bucks we are

block height 718,520 nice even block height there we had a difficulty adjustment between right now and the last time recorded last thursday that happened i believe on saturday or sunday it was an upward adjustment of 0.4 percent blocks were coming in nine minutes and 37 seconds on average as of right now we are due to have another difficulty target in 1192 blocks which is estimated according to Clark's dashboard to be January 21st, 2022. So that would be next Friday. If we stay at this pace, it's going to be an upward adjustment of 3.9%.

It's because blocks are coming in at nine minutes and 37 seconds on average. Blah, blah, blah, blah, blah. Whirlpool unspent capacity is, wow, above 4,400. 4,404.87, if I believe last. week when we met it was 4 380 or wasn't the three thousands last week or four thousand no it was 4 389 i can't read anything matt matt just admitted he can't read freaks uh so no i still got my i have like a big screen i have a big monitor in a box sitting right

next to me and i have like the little laptop monitor like out of reach far away so i'm gonna have to rely on you i can do the reading i can do the reading for for the freaks and for you out there uh big week i think it's a big week i mean we still have this price consolidation and like a mini pint's hilarious how it'll go down to 39 and people will be freaking out then it pumps a little bit to like 42 43 people like oh we're going back up but uh it seems like bitcoin as being very reflexive to and correlating very tightly with traditional markets we've had jerome powell and crew the fed out and about um posture there's no way the fed's gonna raise rates substantially i can't believe people actually believe that well that people don't

believe it that's the thing people do i mean the markets the markets show that people believe it i mean it's not just bitcoin that dumped like all assets dumped stocks dumped yeah um significantly right uh so like obviously it's not priced like it's being priced in as if as if rates are going to go up uh and markets will crash as a result uh but that it just it just does not seem like that's going to happen leading into midterms we have so much fucking debt on our balance sheet like i just they're trapped in a fucking hole yeah well that's the whole end game that the fed has arrived at they just have to play this public posturing game where they oh we're going to raise we're going to raise we just uh we have to say that to make it seem like we're actively

trying to manage and keep um keep as far away from from the economy as possible but what is inevitable due to the amount of money that's been printed and the amount of debt that's been accrued is that they always need to keep rates low keep printing more money yeah for like We're in it's a new paradigm. We're just going to, you know, the rates will be low and negative until hyper Bitcoinization happens. You know what else is interesting, Marty? I had a friend text me yesterday and the last time he texted me was a year ago because he texted me through Signal. the last time he messaged me on signal was a year ago uh super hyped about the bitcoin price passing 33k and i just think that's like crazy it's it's crazy looking back at you know how 33k felt a year ago and now we're at whatever we're at 43k a year later and people are like the end is nigh bitcoin

is dead that is uh exactly what i wrote about in the bent and when i'm trying i'm looking it up now i believe yeah it was the 10th so 13 12 like i would love to listen to rabbit hole recap this a year ago today i wonder we need to start clipping old ones car i'm putting this in the tftc chat like caps odell was about to come out everyone's so bullish caps what a difference a year makes um i don't know why this i think caps might have to come out again soon why do you think that just i just feel the caps beating on the inside of my head just want they just they want to be let loose the well we need them i miss i miss caps odell on twitter i mean you're at odell all caps

i think if you're going to stay true to the character that you've built around caps odell he needs to be let out of the cage every once in a while scroll down a little bit car speaking of the uh right here you start here so this is the fear and greed index which tries to measure the the amount of fear or greed within bitcoin markets at any given point in time this was january of last year january 11 2021 i thought this was great yeah the greed index was at 90 and at the same price was around forty thousand dollars forty one thousand dollars and earlier this week go down car but january wasn't even less price wasn't it like 30 like that's what i thought it was like 33k or whatever a year ago i went and checked uh yeah i mean it went up pretty

quickly but from 33 to 40 but that's the funny part right it's like it was extreme greed it's extreme fear at ten thousand dollars higher yeah exactly so we have extreme fear now the the fear index is at 10 whereas last year the greed index was reading 90 um you have fear on one side of the spectrum and fear on the other side so when we were blowing through that everybody was being greedy and now that we're hovering around forty thousand dollars everybody's freaking the fuck out like oh my gosh is bitcoin going to die and like i said in the newsletter on monday this is what normalization looks like of bitcoin just seeping itself into the culture people and it's like yeah price anchoring right exactly we get anchored on a price and then you know sellers

get exhausted and then we move forward wow smash odell's in comments let's go um would you smash odell that's one i haven't seen in a while that account so cheers um do we get like anchored to the price right and then it gets normalized and we go up but really the answer to marty's question is yes bitcoin is dead we're going to zero yes everybody get out while you can hit hit hit the hay let's call it a night it's all over it's a forty thousand dollars the government's coming after it elizabeth warren's on the war path it's just kroger kroger put the yeah yeah we'll get into that that ties into the stuff too uh she's too preoccupied with kroger bitcoin will be fine yes bitcoin will be fine so another thing tying up like

the normalization and the price anchors thing that's actually the price chart with the most signal is you look at a bitcoin chart and you look at the yearly uh the yearly lows year on year what you'll find consistently over time the the low per year within a within a calendar year of trading has consistently gotten higher and higher as you've just said higher high watermarks um and at these troughs and these bullnop air cycles in Bitcoin. It just happened really fast. You always get good engagement on that tweet when you send that one out.

Yeah, let me look that up real quick. But I mean, it's hilarious how, like Matt said a year ago, people were, oh my God, we're going to 33. We're going to get 200K by conference day. And now we're re-approaching that from the other side. not even really 200k by conference day still in play yeah the uh the 200 the 200 week moving average i believe i saw today is only at like 18 000 so we're still above that metric as well and if you're looking to measure bitcoin as a good long-term store value i think looking at that

200 week moving average metric is a good way to do it that lines consistently up and to the right you want to pull up the car you want to pull up the type in meyer multiple by bitcoin worldwide and pull up that meyer multiple chart because the meyer multiple uh is is is basically what where bitcoin sits on the 200 day uh moving average this chart's interesting i looked at it the other days you're going to scroll down to the actual chart yeah that's pretty interesting chart i'm not really a chart guy but you're a big trace mayor guy though so it's not really a trace mayor guy either but i agree that the 200-day moving average is an interesting metric

this is showing how high bitcoin is in comparison to the 200-day moving average trace is has his line there where he says you know what is it like 2.4 or whatever if you buy under 2.4 it's it's a good time to buy where that line is but it's interesting look at the like all the all the peaks the recent peaks they almost always happen around that line right the the median which is or the average excuse me which is around like 2.4 like matt said so what we're looking at makes me just like people are trading on that yeah we're looking at the mayor multiple right now on buy bitcoin worldwide.com it's currently sitting at 0.88 which is very much below average from this point forward we're just going to call this the marty

multiple to uh marty multiple trace has become a disgrace well hey he he did create the mayor multiple i'm not i would feel dirty taking it from the marty multiple is pegged at 69 right cheers btc pins it's nice nice yes it is i can't i can't find the 200 a week moving average chart right now i forget it was tweeting about that today but i saw that floating around out there but it's a good one to look at if you're again like everybody trying to basically define bitcoin and using short-term price volatility to to thrust definitions on the type of asset that bitcoin is is a fool's errand if you ask your uncle marty and it's just like not wise again bitcoin's like a brand new asset i hate comparing it like i said this weeks ago digital gold yes

it's easy to sort of for people to create metaphors and analogies to compare things to but reality of the nature of bitcoin it's digital nature it's distributed nature uh puts in a whole other class and these comparisons and analogies are nothing more than interesting mental frameworks to help people understand they don't equate to full understanding by just being able to repeat them i would argue that was a weird rant i just went on but stay on one stack sats freaks uh what else we got going on here in the world i mean we mentioned it in the beginning or with you bringing up elizabeth warren yelling at kroger for increasing prices or the price gouging which is again a very dangerous sign we said this a few weeks ago when jen saki

was speaking on behalf of president biden saying that it was greedy industrialist in the meatpacking sector of the economy, particularly never leading to price increases. We've had Elizabeth Warren coming out and getting in fights with Kroger, which is a, for those who are unaware, a shopping market. A grocery chain.

A grocery chain in the Northeast. They're not even like the top grocery chain. Their market share isn't that high. Someone posted the market share chart of the different grocery chains. yeah i think kroger's very native to the northeast i don't think it gets i think they're like nine percent or something of the grocery market but they were like these grocery giant but elizabeth's like these grocery giants are like kroger and she called out kroger

specifically do you think she like went to kroger that day and was just like pissed off the meat was expensive yeah i think kroger is native to where she's from is she connecticut or new york where is she from not probably she's definitely not new york i think she's boston yeah she's massachusetts yeah yeah definitely up in massachusetts i have a buddy from mass that uh a college buddy from mass that uh admitted to voting for her like i don't know like six years ago or something and literally every single time she said something he's like tried to disown it since then but every time she said something we just you know posted in the group chat and tag him you voted for this you voted well now she's coming after bitcoin mining we'll get to that

But with the Kroger comment, she's trying to thrust the problem of inflation on, again, these greedy industrialists like others in D.C., particularly the Biden administration, have tried to do in recent weeks. And it's funny that this beef that she's starting with this innocent grocery chain is coinciding with U.S. producer price inflation jumping 9.7% in December. So that data point came out today as the highest year-on-year increase on record, which is, again, this is producer price inflation. So prices for people that are putting together raw materials and ingredients to give end products that then get sold. So the prices are going up for the producer. They're eventually going to get passed on to the consumer. So this is a leading indicator of even higher inflation. The fact that it's happening at the producer level around 10%,

which is pretty fucked up. We have someone in the comments saying, I've not verified this at all because my computer is all the way over there and I can't reach it. That there's 16, that Kroger owns 16 plus different store, grocery store brands around the US. I don't know. I'm not a grocery store specialist, but I also don't.

don't i uh if you if you think kroger is overcharging go to another store yeah that's what the that's what the market is supposed to do yeah yeah optionality big on optionality seems like they're trying to take it away though every day you gotta you gotta fight for it especially here in the united states i'm too lazy to buy beef directly from rancher now i'm crying about the price of kroger i uh i actually grilled i had a bunch of people over i don't really care about kroger a couple days ago and we grilled uh beef from two local butchers um so go go go go to your local butcher when you need meat or a local rancher if you have a rancher go shake your rancher's hand highly recommend it the beef's better you get more fulfillment and you

you get to again shake hands and look that the person is actually slaughtering raising slaughtering and packing the meat that you and your family are enjoying it so you got to get a reconnection with this part of life that's a part of humanity right now that's why we're living in this clown world so many individuals out there completely disconnected from reality and hard work and uncomfortable truths a lot of a lot of people who just like to eat food at the grocery store don't want to think what's happening down chain marty you still own that cow i do i do it should be uh up for slaughter at the end of the year are you ever going to take custody of the cow yeah i'm going to take custody of the meat of it's the cut up parts of the cow after

after it's it's lived a long and happy life and it's been slaughtered to feed me i think it'd be hilarious if in you know your other studio where you're in your backyard if you just had like the cow like grazing behind you as you're recording that would be cool i don't know if the wife would be happy with that due to the smell the upkeep start eating the bamboo you know it's just a lot to go maybe when we get like a bigger place we'll have a ranch we'll have multiple cattle yeah i hope to one day i hope to one day have multiple cattle it's not a real citadel if you don't have cows on it yeah yeah you need to have cows grazing around natural gas in the background mining bitcoin tarot guns it's it's all going to happen it's going to be a beautiful incredible

cypherpunk future but getting back to inflation which is helping to drive us there because people are looking for alternatives and the only viable alternatives to escaping the monetary policy that most of the world is subjected to right now, which is dovish, KMZ monetary policy. Like Bitcoin is the only thing. So this 9.7% jump in producer price inflation year on year is essentially a tax that's been levied, almost a 10% tax on producers that they did not opt in for. They did not vote for. They have no control over. They can't go to Jerome Powell and say, stop doing this he does not have to listen to them and i tweeted out right before we went live here like an hour ago you literally don't have any power within this u.s dollar system or a similar fiat

currency system that's being run around the world the only power that you do have is opting into a better monetary system built on sound money in the digital era the digital age which is bitcoin So we had 9.7% producer price inflation in the U.S. today, and it also came out Argentina rolling 12-month inflation is 50.9% in December. This is transitory. It is transitory. So it's not only happening here in the U.S.,

Argentina, which has been plagued by hyperinflationary crises multiple times in our lifetimes. Many times. It seems to be going through. strict capital controls too. The one thing is like, yeah, like Bitcoin does provide us an escape hatch because we can opt out of the fiat system and move to Bitcoin. To a degree, so do other hard assets, less hard than Bitcoin, stuff like real estate, stocks, gold. I'm like very happy. I'm obviously very grateful we have Bitcoin to go to instead of those. I'd rather go

to bitcoin but in argentina is a perfect example where they have strict capital controls so they make it as difficult as possible to get into any of those assets whether that's and in this case it's actually easier to get into bitcoin in argentina than to get you know a lot of times than to get into uh foreign equities or real estate stuff like that like the access is is significantly better yes matt alborg at usefultulips.org he's written a great piece on argentinian money changers they're black market money changers i forget what they're called i want to say flavelas but i know that that's like a it's like a like an area of a city like in rio favelas favelas it's favelas it's not there's no l

yeah yeah but that's not that's not the money changers that's the slums in rio yeah whatever there's a great article on usefultoolups.org about this particular black market and yeah then they're saying it's 50.9 inflation if you really want to get the the real inflation rate you probably want to go to one of those money changers and see what the cost of money is there because that'll give you a more accurate reading there so it's um and strike just opened up in argentina too we have that on the list i guess while we have argentina on the mind i mean i would say i mean in a bitcoin world if you want to really know the value of something it's it the value of the currency is how much you can get you know actual bitcoin for and and get it you know in

self-custodial way yeah um that that that's the value of money yes is the is basically its price in bitcoin because that's the closest thing you have to a to a free market yeah any argentine listeners out there have any stories from the ground on what's going on with the inflation particularly please reach out i mean how many times can one country go through i mean this i think there's a third or fourth in the last 30 years like how do you even how do you even try to create an economy over generations just having that happen to you like in one generation it's happened three or four times um it does seem like argentina is a pretty resilient country i mean it's still a very vibrant culture and um

in spite in spite of their shitty money yeah exactly imagine what they would do if they had adopted good money um soon yeah it's good to see strike so strike was available in the united states el salvador argentina is their third market um obviously the fact that argentina has constant hyperinflation issues mixed with that remittances is a massive market there. People sending money from the United States back to Argentina, from other places back to Argentina, making an ideal fit for something like Strike. It's interesting with this rollout, there's no banking relationship. They don't have a bank on that side. And what's happening is you're either you're either going to so they're using tether for the u.s dollar portion which i believe

is very is similar to how they did in el salvador um and basically the ways to onboard or off board into the app is um either remittances someone sending you bitcoin from abroad uh or uh they have all these cash points they have all these these places where you can you pay cash um and you're able to load that up either as tether or bitcoin to to strike and vice versa so tether getting more more ingrained in the app there i mean that's the way to route around the bank account issue yeah i mean look there's there is a lot of obviously tether has third party risk i mean you have to trust tether um obviously strike has custodial risk if you're holding things on strike so you have to trust strike so if you're holding tether on strike you have double custodial

risk because you're trusting tether and strike but you know if you have double digit inflation and you you want you want access to basically a dollar asset um then that could be a risk that you're willing to take right yes it certainly can be and especially if you're just using it for for a few minutes you just need it literally for the rails of moving money because you're not able to be a swift or the traditional rails in argentina you can't even send a 200 visa payment because the capital controls are so uh strict on u.s dollar access yes they're not allowed to take they're not allowed to take more than 200 out of the bank at once per week yeah it's fucking crazy like the capital controls are extremely fucking uh strict

So now Argentinians can either use Bitcoin and they can hold their wealth in Bitcoin, right? I believe Sats are my stable coin. I know they're not for everyone yet in this adoption phase, but they could. Or they can hold a U.S. dollar type asset in respect of Tether. And they can instantly transfer that around the world at low cost using Lightning. So they have choices. And depending on their situation, they will make the choice that fits their threat model and life situation the best for them. What are your thoughts on the potential emergence of synthetic stablecoins on Lightning?

um i mean i'm i'm involved with the bounty program that hrf and strike uh put out which is a bitcoin to anyone who can come up with something like that that doesn't require a token that is essentially a a open market protocol where people can go uh long long bitcoin or i've reversely basically just peg themselves uh to bitcoin um i think that's a very interesting concept uh it'd be nice because you know you it's all bitcoin based and it can be an open protocol so the market could get very liquid uh rather than having something like tether where it's literally just a centrally controlled company that's breaking u.s laws that is holding you You know, billions of dollars, apparently, that you can't verify that is actually backing the whole system.

It's long been a ticking time bomb. It's amazing to me that they've lasted this long. So obviously, you know, in a world without Tether, Tether blows up. We need an alternative. And before anyone says, you know, USDC or one of these, you know, super regulated American-based stablecoins is an answer. uh i mean they are i mean even tether has some blacklisting they do but like the amount of kyc requirements and stuff that's going to happen on these regulated stable coins is going to make it completely impractical for anyone who's trying to get around capital controls uh like is the

case in argentina yeah they're gonna have to they're not gonna be able to send us like stable coins created by us like like circle or or coinbase they're not gonna be able to be using those because you'll have to you'll have to get the okay from coinbase and circle they probably don't want to get involved with these these sanctions and that's another thing noting that like circle they're doing like a big a big advertising push in airports i don't know if you've realized this recently but newark and austin both ends of my flight uh back to and from home over the holidays circle was just blaring advertisements in the airport, which I thought was interesting.

What was it for USDC? They were doing it for USDC and Bitcoin. Yeah, I we have someone in the comments, X frog saying, asking, they're sending tether over lightning. I thought Argentina strike is using the ERC 20 Ethereum token version of tether. I'm not absolutely sure if they're using the Ethereum token version. I think they are. They're not sending Tether, period.

The users got Tether as a balance for their USD balance. And similar to how Strike is working in America and El Salvador, when you send that USD balance to someone else, what is happening is the dollars are being sold for Bitcoin instantly and Bitcoin is being sent over the Lightning Network. And then on the receiver side, if the receiver is a strike user, that Bitcoin is then immediately being sold for U.S. dollars. And if that is in America, that's like fiat in a bank account. And if that's in El Salvador or Argentina, my understanding is that it gets converted into Tether. I don't know what the decision making was for why they chose to use the Ethereum token version of Tether. There's obviously a liquid version of Tether. There is a Tron version of Tether.

Tether's on a bunch of different fucking chains. The original Tether was on Counterparty. I don't know if people still use that one, like the Omni token version of Tether. But my first thought when I'm thinking about that is maybe it has something to do with those cash points and just the fact that Ethereum Tether is probably the most supported Tether

if you want to convert cash into Tether to fund the Strike app or vice versa. I thought Tron was more supported. Tron Tether. Tron has more volume because the traders like it because the fees are lower. That begs the question too

because ETH gas fees will be high. I don't think we can confirm that it is ETH. It could be liquid. It's definitely not liquid. It could be. No, I mean, look, let's be honest, right? Like the overwhelming majority of people that are using this are just going to, it's a custodial US dollar balance, right? Like it's when people

use Strike, they're not withdrawing their dollars really. Most of the time they're not, they're just leaving it as a US dollar balance in the Strike app and using it as a neobank. Does that have custodial risk? Yeah. Do you also trust Tether? Yeah. But there's no trust in Ethereum in that situation because at the end of the day it's a centralized database so what chain you use what chain you use tether on um is both irrelevant to the adoption of that chain and is irrelevant to the security model of the tether itself very good point they're just rails there's no way to like self-custody tether like you're always trusting tether the corporation to not blacklist you or take your money or exit scams.

So there's this idea that you could ever hold cold storage or self-custody tether is bullshit. No, the risk freaks, if you're getting into it, we do know there is utility for stable coins in certain parts of the world because people do not want to stomach the short-term price volatility and need a stable savings vehicle. We would say stats are very stable. However, people do need to buy things and interact in the daily economy where they

live um but hopefully there's synthetic stable coins on lightning network that will come to market lewis lou uh was was teasing that today i'm very interested to see how they get brought to the lightning network specifically is it going to be a contract for difference discrete log contract that you just have a bunch of those that scale up and get enough liquidity that they can be parceled and used as stable coins. We shall see. That seems the most likely.

Like some kind of contract for difference system. Yeah. But look, all this stuff is like, like it's great. Like I completely understand why people, and we've talked about this

in the past that, you know, as fiat starts to die around the world, the weaker currencies are going to die first and people are going to try and escape to the,

to the currencies that are, fiat currencies that are felt to be stronger so in the near term you're going to see a lot of people trying to escape to the u.s dollar the u.s dollar will fail last because it's a global reserve currency um or it'll be one of the last to fail like it'll be like the u.s dollar yuan um the chinese yuan um but ultimately you know this is a a short-term thing right because long term you know you don't need why would you why would you peg your bitcoin to shitty money exactly just hold bitcoin this is just a i think this is something we've been clear about throughout the history of the show we brought up stable coins and it have conceded not even conceded just

recognize that they do have utility for certain parts of the world it's just transitionary bridge use case as we transition to a bitcoin standard slowly but surely over time it may happen faster Like you said, weak currencies are going to die first. We're seeing the Argentine peso, the lira in Turkey, whatever currency Kazakhstan is using. This is a crazy Wall Street Journal headline. Turks pile into Bitcoin and Tether to escape plunging lira. Yeah, this is in the Wall Street Journal. I wasn't able to read it until you provided us with the archive link.

but I mean it's happening obviously Erdogan very let's get into it the weak currencies are going to fall first we're seeing with the lira, we're seeing with Argentine peso and why are they failing as miserably

and terribly as they are at this current moment and similarly in Argentina and Turkey you have government regimes, whatever you want to call them, in Turkey you have Erdogan in Argentina I don't even know who's president there now, but they've, like Matt mentioned earlier.

Isn't it McCree? Maybe. The point is they're using very granular top-down control of the money markets, particularly trying to control them and finding that they have no control because when you try to exert that much control on these systems, it drives people to lose confidence in them. Because why do you need to exert that much control if you had control in the first place? it's sort of a cascading doom loop if you will like 50 argentina producer price index close to

10 i mean getting close to double digits in certain parts of the u.s economy like it's how much better than argentina is that so like what i'm trying to get to is the u.s dollar will be less but still the u.s dollar will be last to fall but like it's And it's one thing I worry about, especially in the hyper-connected, hyper-communicative world that we live in today. And monetary inflation, particularly high to hyper-inflationary events, again, are two parts. You have the mechanical part of it, creating more monetary units that dilute the individual share of the whole pie. If they're not acquiring a commensurate amount of units with the percentage that the supply is being expanded by, that's one part of it. which most people just focus on is price inflation

and as compared to the amount of money that's been printed. But the second part that people don't talk about enough is the social aspect of it. Like once people start to lose confidence and you have this weird feedback loop, I think, does it happen quicker? The long-winded winding road I'm taking right now is just to ask that question,

even though the lira in Turkey, the peso in Argentina are blowing up spectacular right now and we believe that people will find solace in the dollar like the dollar is not doing it's doing better on a relative basis but uh an absolute basis it's not doing so hot itself uh as well um and so like the dollars are shit coin they're all shit coins they're all cuck bucks and then yeah it's like how bad could this get like you said like the fed's never gonna hike rates that's becoming glaringly obvious like well they might hike rates just not substantially 50 bps yeah i'm just saying like we should we should make that clear

because when they like barely hike it people are gonna be like oh i knew i knew it i told you they were gonna hike it yeah but it's gonna be they'll hike it and if they do hike it they're gonna have to do when they run to negative they're gonna have to do an intra meeting like intervention because the markets are going to shit their pants and then they'll capitulate again maybe that's when you start having the psychological aspect kick more into gear is if they do hike so that's the question i think the threat of hiking is a better strategy and you just never do it because yeah but how many times can you bluff before like people fucking start to figure it out well Well, so we have the game theory of monetary economics,

which is you either overtly default. If you're a country printing all these treasuries, you have two ways out. You either overtly default, say, hey, we're not going to be able to pay this back, which is politically untenable, or you inflate away the currency. Obviously, we've chosen to inflate away the currency.

And then within that, let's inflate away the currency. Then you have another game theory. What's better? this bluff and never hike or do we just hike and pull back at which point it becomes more than glaringly obvious that you can never hike and so then you have the feedback loop there or if you bluff and bluff and bluff like no we just two more weeks two more weeks two more weeks can you extend it um even further going forward with that strategy i would argue the bluffing is probably a wiser of the two strategies.

The emperor has no clothes. No. Buy Bitcoin. That message that car just pulled up from Nicholas or whatever, I didn't hear about that. Did you hear about that? The three largest German banks want to offer a Bitcoin service?

I mean, I saw the headline, but who knows how legit it is. If it's custodial, it's bullshit. if you can't withdraw it's absolute bullshit yeah the Germans don't seem too keen on freedom these days it's still I guess it's a

solid boost for public appeal or public opinion or something but I didn't hear about that story yeah I mean there's like you always have to dive deep into these stories because like yesterday Bitcoin magazine tweeted out like Arkansas is offering

uh individuals particularly in the tech sector that move to arkansas to work remotely from arkansas they'll appease them with ten thousand dollars bitcoin i was like all right it's like does this actually happen i wanted to write about it and then i went and found out it's just like one little county council in northwest arkansas is offering is offering people ten thousand dollars come move there in bitcoin or not in bitcoin cash or bitcoin and then on top of that they're like offering bikes that's pretty cool i didn't know about that yeah yeah i went uh in arkansas northwest arkansas if you want to move to northwest arkansas arkansas uh and you want to like work remotely in a beautiful area this is how they're pitching it this northwestern arkansas

council uh they have a budget i believe of up to a million dollars to disperse uh ten thousand dollars worth of bitcoin or cash to individuals in the tech sector so if you're looking for a good way to stack uh you're looking for some beautiful scenery northwest arkansas we'll have you they'll give you ten thousand dollars worth of with the bitcoin as well why the bike because apparently they have it like the most bike trails uh yeah i wonder if they got the bike sponsored yeah i think it might be like a bike voucher but yeah no it's pretty hard to get a bike nowadays there's bike shortages everywhere so yeah could be worth it it looked beautiful the the area um where what northwest arkansas what is that border no idea nebraska i don't know not even gonna try

not even gonna try you did just try but i didn't try that was me taking back my try um but this is this highlights a map of the united states this highlights the um I mean the sovereign individual thesis and it's weird with this particular thing it seems like Bitcoin is just trying to attract

a certain person I don't think they actually really care about about Bitcoin so yeah we'll give you Bitcoin if you're in the tech sector we think tech people like that but again

everything works in Bitcoin's benefit free press Matt can't read anything so I have to read all the lists what's next legal defense fund this was uh very cool to see this is freaking awesome come through the bitcoin dev mailing list uh jack dorsey jack at squareup.com um went to the bitcoin dev mailing list to announce that himself alex morcos and martin white have created the bitcoin legal

defense fund uh which they may intend to use to defend bitcoin contributors in the space who are being sued um in relation to their work in and around bitcoin mostly from craig right yeah mostly from craig right so it's basically he's a fraud if you if you um very prominent individuals in the space alex morcos free freaks who are unaware uh is is one of the gentlemen behind chain code labs in new york city who've been doing incredible things to educate people uh bitcoin developers specifically and then on top of that he's been spending millions of dollars and tons of time out of his own pocket to support bitcoin development for when did chain come out like five years ago now four years ago quite a while quite a while i mean even before that um respect

i think he was sponsoring the bit devs meet up in new york um himself and suhas but yeah there's some of the the quiet unsung heroes of bitcoin in the background that are doing incredible things to make sure developers can do what they do best here as you can see in the second or third paragraph the first activities will be to take over coordination of the existing defense of the tulip trading lawsuit against certain developers alleging breach of food fiduciary duty and to to provide the source of funding for outside counsel. Which is the CSW lawsuit. Yeah, so these are all the troll lawsuits where

CSW is suing people for hosting the Bitcoin white paper. So it's good to see people stepping up and saying, hey, we'll front the bill on all this litigious activities that you guys are being subjected to. It's more than just hosting the white paper. I mean, he's going after devs for

developing Bitcoin. That as well. Saying that they're responsible for for him not having his rightful coin I mean if you had if you have your rightful coin

Craig just use your private key man sign the damn message move the damn UTXL if you can't do that you're a fraud yeah you're a fraud put plainly

we talked about strike getting into argentina we talked about that for a bit simple lightning.com what is a bolt what is a blip this is a great so great piece this is um this is kiera bickers and uh vivek's new project um where they're basically the idea is it's going to be a newsletter that tries to explain complicated aspects of Lightning in a more user-friendly, approachable way. And the target audience is mostly developers and contributors,

but I think it could be helpful for all Bitcoiners, especially if you're trying to focus on Lightning and if you have an interest in Lightning. So definitely go check out, what is it, simplelightning.com? Yes. And subscribe. I'm happy you put this on the list this week because I didn't even realize what a bolt was

until I had a conversation last week with somebody working on the Lightning Network. A bolt is what a BIP is at the Bitcoin Core or the Bitcoin Consensus layer. So it's a basis of Lightning technology. So if you want to add, you have an idea to add an improvement to the Lightning Network specifically,

it is called a bolt. And then it gets numbered. Bolt 12 has been talked about on this podcast a lot recently. There's many other bolts as well. Bolt 9. obviously there's many bips but what I learned

the conversation I had last Friday was that there's a lot of contention around this a lot of people Luke Dasher mainly thought

the lighting network stuff should just be bips as well did you did you know about that sort of discussion going on they actually like

go into it a little bit in this in this piece I think they have a whole section of bolts versus bips yeah how's a bolt different than a BIP.

Bolts and BIPs are forms of development proposals and Lightning a proposal only becomes a bolt after two independent implementations have successfully tested interoperability in Bitcoin. A BIP is more of an opt-in proposal standard for implementers to ensure interoperability. So this is interesting.

Lightning, you have many popular implementations and creating interoperable consensus between them is very important you do have that at the base layer too but bitcoin core is by far the most dominant implementation of bitcoin obviously you have bitcoin knots and others as well um but i think the the way that lightning network is very interactive

it creates interoperability being a very high threshold um for all these improvements I mean, there's massive differences between Bitcoin and Lightning, right? And like Bitcoin is like a broadcast system that is consensus critical that all participants on the Bitcoin network are able to agree on a certain amount of consensus, on certain consensus rules. Otherwise, there will be forks in the chain and people will be operating on different chains. And then Lightning is a link-to-link protocol. it's a you know you're you have channels open with other peers that you are choosing to have those channels with um so we have all these implementations that are all doing their own kind of take on lightning and they it's ideal to have them be compatible with each other so that

you have this larger lightning network but at the end of the day i wouldn't say it's necessarily mission critical right with bitcoin it's uh consensus is is key yeah now it'll be it'll be interesting to see how this all plays out apparently there's a lot of conversations about specifications too i think that's frustrating there's frustration between some of the implementations because specifications aren't being aren't being published so that some teams can build certain things they want to build and there's there's this is weird dynamic between the multiple implementations right now l d is the most popular um you have c lightning ldk ldk now um which i'm assuming on that note yeah cash app we didn't put

that on the list we did it so let's talk about i mean cash apps rolling out lighting network payments i have access to it have paid i think they're using ldk for that on their side i wouldn't wouldn't be surprised i mean spiral btc has been working on ldk for years it's within the the block family of businesses i don't have it in my app yet do they accept lightning deposits or only withdrawals i think it's only withdrawals no deposits yet uh not to my knowledge let me check real quick which is interesting because you think deposits would be no i guess deposits are a bigger issue in terms of compliance yeah with channel balancing and stuff no not even channel balancing just like they don't necessarily know who the sender is

well when they're sending when you're withdrawing they know all the invoice data they know what node you're sending to they have a lot of information there the real question is when they add native lightning support to their millions of square point of sales that you see everywhere um like i was you know yeah that's gonna be so easy for them to add that at this point yeah that's what car has up on the screen the newsletter really explaining or articulating just that as well i mean i think everybody's waiting for that when the square turn on the ability for merchants to to either accept bitcoin or take a automatically take a portion of revenues and convert that to bitcoin automatically i think

the capability to implement that is there i mean at the coffee shop that i go to every once in a when i'm craving nice coffee their pos system within the last three months or maybe i'm just noticing it within the last three months is flashed a cash app qr code that can easily scan and pay i've used that so they always they already have the cash app qr code so that means that if you have bitcoin and cash app you can pay in a custodial way with bitcoin basically uh you know if that's you selling immediately yeah you'd have to sell them and pay but what i want to see is like the like proper native lightning support right so like you can take any lightning wallet if i can chose a qr code you either scan the qr code or if you have an android phone you just tap

the phone and pay with nfc um seems like we're very close to that and that would be absolute game changer yeah i mean that's obviously merchant adoption has been a meme in Bitcoin throughout its life. That was the big meme in 2014. Roger Ver and all the early Bitcoiners thought if we just get the merchants accepting Bitcoin, like that's how we win. And like, yes, it is a way to win.

But how do you do that historically? You get somebody to, the way they were doing it back in 2014 was literally getting people to download Bitcoin wallets on their phone and then having like the cashiers like learning how to create invoices and do this very drawn out process

where a lot of phones and a lot of buttons and a lot of time was involved. Obviously, we've had things like BTC Pay Server and OpenNode come to market, which have done a great job of allowing people to implement Bitcoin payments into their point-of-sale systems. We have it on our website.

It works very well. We love BTC Pay Server, but I think this, turning it on at Square, at Square Merchants, having a merchant be able to just go into the interface of their Square portal and say, all right, I want to accept Bitcoin. You have the optionality of,

all right you just want to accept bitcoin we could do it for you in a custodial fashion here's how you spin up a wallet not even custodial maybe you can have something you can create a private public e-payer in the system yourself do that save your they have their hardware wallet project that's separate right which is this idea of trying to do maybe like a two of three multi-sig where cash app square owns one key your mobile device has another key locally and then you have a third key if they fuck around with you you could yeah that's a hardware wallet a very cheap hardware wallet um yeah but that's even like higher on the tree like this is just like getting a software wallet and the po system is like low-hanging fruit implement that allow somebody

to upload an xpub i expect like the way i would see the implementation happen is like something like open node does which is just fully custodial like this will probably be the mvp the first thing just fully custodial and the merchant will have like a little sliding bar that they decide like if i receive bitcoin i want to either you know keep 100 of that bitcoin is bitcoin in my wallet or i want to keep 50 of it or 20 and whatever the remainder is gets automatically converted into your local currency um that'll probably be the the first implementation right yeah i would imagine well and like on top of that would be even better i think is even more bullish and would actually have more of a profound impact is giving the merchants the ability to quickly

convert dollar revenues into bitcoin because that's another problem with the merchant adoption meme isn't uh necessarily that they're not willing to accept as a most of the time people aren't willing to spend it and so i mean yeah it'd be dope if you had two slider bars right like you had a slider bar like if someone pays fiat pick how much of that automatically gets converted to bitcoin and then if you pay bitcoin convert pick how much of that gets converted into fiat yeah that i mean the amount of like my parents that's one thing my dad sufficiently orange pilled coffee shop wants to automatically every month convert 10 to 15 percent of the cash to to bitcoin right now it's a very manual process set up an outside

exchange account move funds from the business bank account to the exchange to buy the the amount of bitcoin it's a very drawn out and clunky process imagine if just able to do it automatically at the point of sale i think you'd see crazy amount of merchants around the country do it like hey you know what let's put five percent into into bitcoin then you just have that constant buying pressure all day every day let's do it square product team if you're uh if you're looking for like some ux feedback let me know i'm here matt you look like you're about to murder somebody there i'm just uh i don't know like all this stuff has seemed very obvious for a while and there's just slowly and steadily just like checking all the boxes so yeah um but lightning

support seems like a big deal um yeah it worked worked very easily here we'll try to do i think the point of sale thing will be a bigger deal and it is coming i mean they're not idiots car great ux team car let's uh let's pull up a lightning invoice i'll pay from the cash up we'll see we'll do a live demo um we can't deposit lightning right no i'm just gonna have to pay an invoice just go to tftc.io slash contribute

we'll launder some money to the business one of the promises I made to myself is I'm never going to KYC again why'd you say that

Cash App's the last I've never to KYC to Cash App and the I don't use it anymore I like barely use it

I use it I use it every I use my cash card every day honestly you don't have like just a normal credit card no

no we should use cash let's donate let's donate five bucks I basically just use cash on my Amex

you have to change yeah alright live live cash app let's see how long I'm trying to just not use the credit card

unless I absolutely have to alright it's being initiated so that's the weird thing with the cash app flow like it like checks the invoice um reports it to all the regulators and then pays it oh i might not

have any signal on my phone here at this the studio recorder we'll try it it's a connection error um that's why you don't do um demos live on air wait you don't you had reception you had enough reception to open to open the app right do you not have any bars does it say no i try it again. It says it's going through. Keep this up, Karpar. We'll see how long it takes to go through.

Should we just sit here quietly until it goes through? We could do that. We could talk about Bill Biller. Legendary value investor. Still has not come through. We're a minute and 15 seconds into the invoice being paid.

This is a pretty underwhelming demo. Yeah, Bill Miller, Bill Miller, man, fucking manages a $2 billion plus fund. He's rumored to be worth somewhere between like $500 million to a little over a billion dollars. He came out swinging in an interview that was apparently recorded early December that 50% of his net worth is in Bitcoin and 50% of his net worth is in Amazon. pretty crazy yeah i mean that's insane the uh the payment failed on this end so yeah invoice isn't gonna get paid i mean and he's been in since 2014 he said he said he's been buying since 200 so yeah he bought a bunch whence is convinced him yeah whence is whence is was the most most potent orange pill in the early days yeah he wrote from 200 to the 2017 bubble apparently he sold it all tying the top

pretty well no he didn't sell it I don't think he said he sold it did he I thought I've read in his story that he

he did that trade wrote a massive trade from like 217 sold I thought he was just saying that he just he didn't buy again until

30k until we hit 30k when it came back down yeah I don't think he sold but maybe no I mean this is

just incredible to see i mean expect more of this it's pretty obvious once you come to understand the fundamentals of the bitcoin network everything that's going on in the mining industry the utility enables as a distributed system the the asymmetric bet that exists right now like bitcoin is better money people need better money they're having an inflation tax waged on them that's getting to be immaterial costs there's going to be more bill millers we said this last year when Paul Tudor Jones came out swinging and advocating for Bitcoin pretty aggressively. Bill Miller's feeling comfortable to do the same.

He's a bit bearish, though. He was recommending people just put 1% of their portfolios in to not go 50% like him, which is pretty bearish. I mean, he's bearish because he only has 50% in Bitcoin. uh the the what he was saying what i got from the interview was he was saying that wences told him and everyone else in the crowd to put one percent of bitcoin he did that bitcoin increased substantially he became a way larger part of his portfolio because he didn't sell then when it fell from like 69 to or 65 down to 30 he bought at 30 again stopped at 50 percent and now he's basically telling people if you you know if you're a high

net worth individual and you don't have any bitcoin you know dip your toe in at one percent but uh everyone most people who start at one percent if they stay humble will eventually you know start to start to near the hundred percent bitcoin portfolio allocation 100 100 if you're not 100 you're bearish no take your time big investors you know take your time yeah yeah fuck these guys i'd rather if they took took took longer you know let the let the little guy get in yeah we're gonna keep pushing off the etf keep pushing off the etf also we don't know if bill miller actually custody of his own coin i assume he probably uses zappo because that's wentz's company that

got sold to coinbase um zappo was in the news but not your keys not your coins miller why was zappo in the news this week uh they were in the news because they left new york and they're gonna stop serving u.s customers and they got rid of their bit license yes they just i thought that was a pretty pretty boss move he said uh screw you new york we're out that's their own by coinbase now yeah they are which is interesting so i guess they have some autonomy from coinbase and i imagine coinbase wouldn't want to yeah i mean i have no idea how that works yeah um we talked about kazakhstan but it was interesting because bill miller like it wasn't just the typical digital gold spiel uh he was like he was talking about like censorship resistance he was talking about

he talked about executive order 6102 that you know the government can't easily come in and seize bitcoin and stuff and he was talking like someone who understands the importance of self custody so i'm really interested if he was just being a hypocrite about it or just naive and ignorant and doesn't realize or maybe he holds his own keys you know and uh look at you being all judgy he could have he could be running a full node connect to sparrow he could have a team of like 15 you know people who are like handling his whole operation i'm i'm just as as these financial boomers uh start to understand the value prop of bitcoin we need to make sure or we we should i think it's it's it's imperative on us to make it clear that those kind of properties

of bitcoin are only uh are only there if you use bitcoin in a self-sovereign way right like you can't like there's damage being done when someone watches a bill miller interview and then goes and thinks that if they just like buy bitcoin on coinbase and keep it there that executive order 6102 can't happen like that's like that their bitcoin can't be seized like obviously it fucking can very easily yeah not your keys not your coins there's there's a spectrum of going full coinbase full zappo custody to running your own node on tour uh using a hardware wallet you constructed from uh everyday parts that you can find the computer um completely offline there you can unchained exists. You can do collaborative custody.

You can set up a multi-sig with friends and family. At least have some control of your keys. Do not just keep it on Coinbase. Especially if you're rich. Sailor. When are you going to start custodying your own Bitcoin? You got to do that in-house. Bring it in-house.

He might custody his own personal stash. I wouldn't be surprised that. Look at you being all judgy over there. Man. I was channeling my inner Adele. uh talked about kazakhstan last week obviously there's been an uprising there again no comment on whether or not it's a russia influence uscia influenced chinese influence i have no idea

honestly probably there's probably there's i shouldn't be laughing it's fucked up but there's probably uh influence from all the agents all the major agencies right now over there yeah there's definitely fuckery going around i don't know what the fuckery is but we do know that there are food cash shortages spreading as kazakhstan continues to throttle the internet i i thought this article was interesting because um you know obviously all well all the bitcoin haters are like oh look what happens when internet gets cut in a nation like you can't spend bitcoin or you can't mine bitcoin easily like uh like this is a fault against bitcoin but like you cut internet in a modern country and you just knock them back into the stone age like you just fuck it every single

aspect of society is dependent on internet nowadays um and it's not that's not a unique situation with bitcoin no it's a i mean it's if you're the internet goes off if they shut the internet off the grid off like bitcoin's not going to help you the dollar's not going to help you But the Bitcoin can still help. So if you're in a situation where only your country cuts the internet, Bitcoin is independent of that country, right? So if you find a way to connect to the internet at some point in the future, you're going to have access to that Bitcoin. Obviously, that value should be independent of your government or whatever. In this case, there are some ATMs that are still operating.

The government has put capital controls on their on the cash machines as well. Right. So they have full. They're squeezing they're squeezing their people from every fucking side. And I still think, you know, in that kind of situation, you know, Bitcoin is a massive tool for people. It's just going to be more difficult to use. um obviously things like guns and ammo are also very useful in those kind of situations and soap and food independence soap cigarettes alcohol bullets water apparently soaps uh water is pretty important yeah water is very important hopefully it doesn't get to that or in kazakhstan it's getting to that point hopefully it doesn't get to that point in other parts of the world if you're in kazakhstan and you're a freak and you're struggling through this our hearts are with you it's fucking again i i can't speak to anything that's going on there on the ground i just honestly don't know um don't want to sound

like an idiot but i hope you guys are staying strong it's fucked man when geopolitics affects the little guy it's a thing it's all these geopolitical games over money war the war machine whatever it may be what is at the the center of all this the the money printer the global money printer that governments and central banks can't stay away from take that away from them and i think they'll have a harder time doing all this bullshit that they're doing um before we get to shout outs i just had to say um i want to address something that's been eating away at me all week last rhr i brought shame to my family and i wanted to clear the air i'd like to sincerely apologize to ben the carman for shooting him off camera shooing him off camera

last week he's a gem in the bitcoin community does not deserve this kind of treatment from anyone let alone someone who can never fully comprehend the genius that lies in his coding ability i mean no ill will and i hope this apology will make that clear to my family my community and to Ben the car man and seeking to make my amends known to all and forever my wife and I would like to announce that the next bent bitcoiner our next child will be named Ben is our hope that this act will bring a peaceful resolution between myself and the council of Ben's I know I can never undo the damage done in shooing Ben the car man but I'll seek every opportunity possible to rebuild the bridges I single-handedly burnt down thanks for hearing

me out freaks uh that was something i was forced to read because somebody paid for a shout out obviously somebody from the council of bends it seems like i do not apologize i do not apologize i will read the shout out but i don't apologize wasn't there a last sentence there that you didn't read uh thanks for hearing me out freaks that was the last one oh it didn't say now i'll continue to the shout outs no i didn't i didn't did you help somebody with us and i might have had a little bit of advanced notice next shout out hi marty matt don't get me started on how much i love your content yeah i won't i won't uh i have shit coins from long ago when i was younger and dumber i'm seeking the best way to convert them to btc in the most non-kyc way my idea is to use

the exchange within the Atomic or Exodus wallet as they both require no info to use. I think they use Shapeshift or Changely. I'd be glad to pay their extra fees for no KYC Bitcoin. Does this work? At the very least, it must be better than one of the big exchanges. Also, taxes on these swaps as well as mining rewards from Compass Mining are significant. How does one balance the need for privacy while also trying to not take chances with taxes is the idea to break heuristics while still paying the appropriate taxes i don't mind paying the taxes i just recoil from the privacy infringements thank you both for your massively important work thank you freak for listening thank you for the shout out thank you for the kind words and i don't have a year position

getting out of shit coins into bitcoin and with the path of least resistance in terms of having to provide personal identifying information changely or shapeshift I'm pretty sure it doesn't

shapeshift KYC didn't they oh no no shapeshift removed KYC because they like they're using like they're like a DAO now or something right

I don't know yeah um when it comes to taxes pay your taxes yeah when it comes to like mining income

talk to an accountant yeah talk to market his income pay income taxes on that I think like if unless you get audited i don't think you have to share your addresses if you're mining um i think you still have privacy you just have to tell the government hey i made some income and i'm gonna pay taxes on it i don't even think you have to declare it as like bitcoin the dominated revenue

either i'm not a tax accountant i'm not a lawyer yeah talk to your account yeah don't talk don't take it don't take advice from uncle marty on this stuff that's what i understand though pay your taxes freaks hello Marty and Matt I hope your 2022 is going well I really appreciate the work you both do

to San Diego Bitcoiners the San Diego blood the San Diego Bitcoiners meetup has a very special

event planned on Saturday January 29th yours truly will be presenting buying Bitcoin privately with BISC so it could help out

our last shout out guy your podcast often emphasizes the importance of privacy and the evils of KYC and a surveillance discount. Just went over it a little bit. I hope to use my experience

with the platform to show how easily it is to reduce personal identifying information risk and starve the centralized rehypothecating price manipulating honeypots that we call exchanges of income

they make off of our data. Hashtag geton0kyc RSVP at meetup.com slash sdbitcoiners That's meetup.com slash sdbitcoiners or DM me. cheers gents

Corey San Diego at infarmacist at I-N-P-H-A-R-M-A-T-I-C-I-S-T and then he has his message signature as always and you can verify it it's a

H-T-T-P colon backslash backslash signatures.corey with a C C-O-R-E-Y dot L-O-L

slash shoutout dot T-X-T and you can verify verify at keybase.io slash verify great thanks for reading that no you're welcome

shout out to the San Diego Bitcoiners I fucking love how strong like meetups are becoming around the world it's super powerful yeah it is I mean we said first episode of the year last episode of last year I forget which one it was

one of the most promising trends of 2021 and that was the proliferation of bit devs and bitcoin meetups all over the country all over the world and it only seems to get be getting stronger um also dispatch this week on tuesday is focused on uh kyc trade-offs i got laser huddle did you say sunday zelko and stefan lavera coming on on tuesday wow tuesday i thought you said sunday no dispatch um be here you got a weird time zone because of

stefan you're doing no no all right sweet i think it's i think it's 5 p.m eastern 2200 utc be there be square freaks be there be square kyc trade-offs um what else do we have on the list we're done shout outs we've got software updates electris version 0.9.4 has been released blue wallet version 6.2.16 has been released mercury wallet version 0.5.6 has been released t-dex version 1.2.2 has been released foundation passport version 1.0.8 has been released hexa wallet version 2.0.67 has been released and samurai wallet version 0.99.98b has been released if you're running any of these softwares just be aware that these updates are available to you you don't have to rush to download any of these as there are no pressing bugs or vulnerabilities

the samurai one is samurai if you update it to 99.98 a uh whirlpool crashes sometimes so you need to upgrade to 99.98 b nothing crazy no no funds at risk right no yeah just a world very annoying and i think they like had they released a code like sorry for the crashes or something i don't think that's the exact code but uh i had a great conversation with christopher allen and wolf mcnally wolf who i was not previously aware of but the team for blockchain and I highly recommend you freaks go check that out if anything just to get back to basics on just like low level Bitcoin stuff and things that we need to be thinking about from a design perspective as we scale particularly we're talking about interoperability between

lightning network implementations earlier but go deeper than that or more fundamental than that between Bitcoin wallet software, things like derivation pass and having somebody download a treasure, being able to communicate with a cold card, with a ledger, with a blue wallet, whatever it may be. It's not as straightforward at the moment as one would expect. And the team at Blockchain Commons being led by Christopher Allen is working on bringing some of these standardization specs to market so that we can build

these wallet softwares in parallel and have users be able to interact with each other as time goes on. It's something to think about now because if you develop a bunch of tech tech debts and a bunch of wallet providers go in different directions, it could be a complete shit show in the future.

Cheers to that. you have any thoughts on wallet standardization is that a weird thing like is it like taboo to standardize yeah I have respect for Christopher so I'm not going to

I don't know I just I don't know if it needs I think sometimes people go a little bit crazy on wallet standardization why come on get into it get into it it's early days right so exactly that's it's it's a permissionless system you can build on top of it like we should be experimenting with novel different ways of using bitcoin like maybe it's a little bit too early to be standardizing and maybe we should

not have like a centralized standardization body in bitcoin like that is a little bit I agree with that. Dangerous. But if you get into, the way I look at it, if you get into the Gordian principles that they talk about, you just want to make sure that people don't lose funds. The way I view it, standardize. If you're going to have a wild software, make sure it's able,

especially if you're going to recover from seed, to easily find that seed and be prepared for a specific derivation path. I don't see that as constrictive, is it? i mean it can be in certain situations but in general like yeah i mean like it's like there's been a lot of benefits from bit 39 standardization on like seed phrases um that you can recover if people use similar derivation paths you can recover using that seed into other wallets and stuff like that um there's obviously benefits there um i think there's just a part of like what the approach is necessarily um i think you know people should be

open to uh innovating and playing with things like you know i don't know i i don't know if seeds are the end all be all of bitcoin um really they might be but they might not be what do you mean by that like what could you say what would you see arising outside of seeds well i mean for starters you know seed backups don't work for lightning what do you mean by that like you can't they just they for lightning you need to constantly update your your state yeah which is why most lightning wallets use some kind of cloud backup system because you have to constantly update it um because your channel state's constantly changing yeah that makes sense so is everyone going to be using lightning in the future or is that just a meme we say i don't know

what do you think do you think i don't know are you getting there here no no my no my point is is just like i feel like it could be a little bit early to you know like i like the idea have wallet developers uh playing with things and and do try and do novel things you know i do too i'm not saying people shouldn't be able to do that i'm saying there should be no so i mean christopher once again a lot of respect for christopher like he decided to do like a whole twitter thread about how moon was dangerous because it wasn't it was a non-standard practice right now moon with two u's is like a very novel wallet that is trying to do novel things and is like thinking outside the box like does moon need to be standardized as well

like that's their prerogative right let them try and figure out novel things that interact with lightning and on chain i agree with that is there a trade-off though yeah the trade-off a lack of standardization no but there's a trade-off of like of having like a sufficient quote-unquote center when i think standardization i think like moon wallet like if i create a seed somewhere it should be easy for me to recover on moon wallet and then to send to another wall there's no seeds in moon wallet no okay that's like one of the main complaints how do you back up um you have a backup file and you have a app generated password for that encrypts that backup file so you save the app generated password and then you save the backup file either on the cloud

or you can save it you know the hard drive no yeah you can save it locally you can do like the share thing where it goes to another app like you can save it like signal has it's like little note to self thing that's like an encrypted basically like little cloud storage thing you can save it there you can save it wherever you want um it's a pdf you can print it but it's encrypted so you also need the code and like are funds at risk of loss because that's a non-standard thing sure yeah in some cases um but uh i just think it's like i i just i we're we're to think that we know you know everything about bitcoin and like what the best bitcoin ux is um right now it's like i just it's i don't think that's the case like i think there's going to be a lot of interesting

novel ways of doing bitcoin using bitcoin and i think options are good for users i do as well i don't think any standardization precludes options things can be made into standards and i think but christopher specifically i think isn't is experience particularly with writing specs for tls which is what ssl runs on is very interesting because that's gotten to a point where there weren't there weren't great standards set early on and they've gotten to a point where there's like very few developers in the world can actually maintain that because they they know everything sort of interacts with each other so the way i took his explanation of that experience bringing it to bitcoin is like all right how do we avoid

that does standardization help that like i said i haven't listened i haven't listened to the conversation yet um what the hell man i mean look there's a lot of standard bodies and and in that in that sphere that is just very centralized but like we were like uh who was the one he did mention um he did mention the mozilla thing what's it web three yeah mentioned that i was like i don't know like you were like we were going off on them uh like a couple episodes ago like seven eight ten episodes ago um because they came out as what they came out as anti-Bitcoin, right? Anti-proof of work. There are real concerns of having centralized rent-seeking standardization bodies that bully the majority of the industry to do certain things

and then can get easily captured. And Bitcoin is supposed to be this beautiful, permissionless system. So there is a balance there. And I don't think it's a black and white thing no no i agree with you 100 like i don't want these large i don't want like a standards body like a bunch of suits like deciding yeah i'm thinking of something like bitcoin design guide just applied to like what options you should give users when it comes to like seed recovery and being able to spend do you think every bitcoin wallet should be backed up with a seed i don't know that like that's my point like i don't know but like that's but yeah again i think we're coming to it from different angles like i i i think you're you're

thinking i'm saying this and we need standards so like everybody has to do it this way i'm saying like if you have wallets that have allowed people to create private public key pairs with backup seed phrase with a certain derivation path like for those users they should be able to recover that seed on anyone i mean which means being prepared for all those different derivation paths the way i understand it at least um yeah i mean i guess i i'm thinking of that specific chris christopher thread about moon wallet or like you just attack them for being so-called non-standard yeah with your use yeah it'll be interesting it was one thing i didn't push push back when i got buried the uh the wc3 or whatever the hell it's called w3c right w3c yeah i uh and like that thing

too like so like that happened right and like so he did that tweet thread and i got tagged by a bunch of people um because you know i like moon wallet like i'm a fan of moon wallet i use it all the time two years um so so what did i do like i was like i can put you in touch with dario snyderman the lead maintainer of moon wallet and i was like maybe have like a productive conversation or whatever and that just like never really materialized like i created a group chat between the three of us and just um you know i kind of felt the vibe of it's like my way or the highway oh really just didn't like that vibe okay well it's good to know i did not know this information did you see weirdo robert moon wallet question mark spelled with two o's

it's a good troll it's a very good troll um no i'm very interested to see this conversation evolve the way i came at it um just like thinking about like something like that happened last year with like trezor when they pushed an update that completely borked hwi that people have been working on for a while um just creates a headache i believe multi-sig funds were at risk at some point for certain setups i don't think that was because of hwi though right those are two separate things i think the same trezor update affected uh both i mean i would say like there's probably better argument to be made about hardware signing devices whether those are hardware wallets or whatnot because

there there are massive advantages uh that like you get a cold card and you can use it with like sparrow specter electrum bitcoin core like it's dope that you can just use it with a bunch of different blue wallet right like you can use it with a bunch of different software wallets so there has to be more collaboration there um but i think like you know the next five six billion people to use bitcoin are going to be using mobile wallets agreed and i think there is a lot of room for experimentation and you know novel strategies in the mobile wallet space like if you think we've hit pinnacle mobile wallets right now like you have not used mobile wallets like we are not anywhere fucking close to it yet no we will get there though i mean most people are

going to be using bitcoin mobile first yeah just like most people do everything mobile first exactly in this world so prepare no i'm very interested this is uh an interesting conversation i'm sure will be continued um that being said the tools that they're building blockchain commons are really cool seed tool actually creating uh the u the qr code standard and the ur standard that they're creating is is really cool too um it really makes psbts a bit easier on certain devices so go check out the conversation uh on to more bullish things Alex Gladstein got his hands on a piece of a deck that Fidelity or a report that Fidelity sent out. And Fidelity seems to think that there's going to be more nation state adoption of Bitcoin

in the Fidelity report. They said, we also think there's a very high stakes game theory at play here, whereby if Bitcoin adoption increases, the countries that secure some Bitcoin today will be better off competitively than their peers. Therefore, even if other countries do not believe in the investment thesis or adoption of bitcoin they will be forced to acquire some as a form of insurance in other words a small cost can be paid today as a hedge compared to a potentially much larger larger cost years in the future we therefore wouldn't be surprised to see other sovereign nation states acquire bitcoin in 2022 um the long wind way of saying the the epic goldstein tweet from a few years ago or the only one i fucking love that tweet the only one of my

favorite tweets on bitcoin twitter the the only winning move is to play um even though i messed up the bitstein tweets i was doing the the reservoir dogs mexican shootout or bitcoin consensus this is bitcoin consensus oh i like that one too well i like that movie that movie is a fucking classic i think it might be my favorite tarantino flick um reservoir dogs it makes me always like just miss that we like missed like the great period of American Diners. Oh.

That movie. Don't say that. Yeah. We were never able to smoke in diners. It would be great to have like a... Just like unlimited coffee

for like 50 cents just chilling smoking cigarettes. Eating eggs. Banter with... The American Diner is still pretty strong in like outside of cities

but like there was a there was definitely like peak diner that happened before we were born oh yes and like i feel like that movie very very much highlights it the shout out to jimmy's diner in in williamsburg it shut down during the covid pandemic but that was that was a good a good diner i used to meet many a bitcoiner at for breakfast

i love i'm a i'm a big diner guy myself you know who i met this week i met kyle from pleb lab Austin Bitcoin Club finally he made the trip to Nashville yeah great dude yeah incredible dude part of the reason I'm hungover how many people showed up last night

I mean he doesn't drink so it's not his fault I was having a great time with him was that the largest turnout what at national national everything prices people like are such you know uh people with such fair weather friends of fans like it was i mean there was like 160 people there but it's you know price really we even see that with like we saw that with new york bit devs like even though it's a highly technical conversation like price really does change uh whether or not

people come out um but there was like yeah like i said there was like 160 people there uh it was a good it was a good crew hell yeah hell yeah rider dies proper rider does it's always going to be a rider die that's where you learn the most too is in the bear market you can actually focus on these interesting interesting topics um speaking of interesting topics uh rep Tom Emmer from the great state of Minnesota introduced a bill prohibiting the bank from issuing a central bank digital currency directly to individuals.

And he has long thread under this tweet that goes in to something we've been describing on this podcast for some while, which is this would be a terrible thing to happen if the Fed were to issue a CBDC and take over for commercial banks and essentially be the only way that Americans interact with the monetary system

Can you read the thread? Because this is pretty crazy coming from a sitting representative. Especially the privacy parts. Read that part. As other countries like China develop CBDCs that fundamentally omit the benefits and protections of cash, it is more important than ever to ensure the United States' digital currency policy protects financial privacy, maintains the dollar's dominance, and cultivates innovation. CBDCs that fail to adhere to these three basic principles could enable an entity like the Federal Reserve to mobilize itself into a retail bank, collect personally identifiable information on users, and track their transactions indefinitely. Not only does the CBDC model raise single point of failure issues, leaving Americans' financial information vulnerable to attack, but it could be used as a surveillance tool that Americans should never be forced to tolerate from their own government. Requiring users to open an account at the Fed to access the United States CBDC would put the Fed on an insidious path akin to China's digital authoritarianism. Any CBDC implemented by the Fed must be open, permissionless, and private. This means that any digital dollar must be accessible to all, transact on a blockchain that is transparent to all,

and maintain the privacy elements of cash. In order to maintain the dollar status as the world's reserve currency in a digital age, it is important that the United States lead with the posture that prioritizes innovation and does not aim to compete with the private sector. simply put we must prioritize blockchain technology with american characteristics rather than mimic china's digital authoritarianism out of fear representative tom emmer hell of a rant and i've got a very pleasant surprise for you uh there is a blockchain technology that uh has american characteristics i love that term american characteristics stays true to the ideals

this country was founded on it's called bitcoin baby it's been around since january 3rd 2000 love it that's pretty crazy isn't that pretty crazy coming from a congressman yeah it's pretty incredible um tom emmer has been like a good advocate too it's good to see this coming out of minnesota as well um somebody in the comments that fly over country i don't like the term fly over country right it's drive-through country yes these are uh these are good people doing good things in the middle of the country uh and yeah i mean it's heating up like this is actually incredible like having this on the floor the fed cannot create a cbdc we do not want to compete with china because that's what the cbdc will lead to if it's done in this fashion you

have complete surveillance you'll have complete control over money and that is not true to the American characteristics that we would like to uphold and so like drawing that line in the sand with this bill is massive props to Rep Tom Hammer because this is true we either get the child Chinese social credit surveillance system exported here or we're we're able to break free and it's interesting because you have this posturing like we're going to have a U.S dollar digital currency but it can't be issued by the feds it's got to be free it's got to be open it's got to be permissionless like what if it does become something like a synthetic uh contract for difference a cfd on the lightning network like what if that's the the only one we allow if we

pass this bill which i doubt it gets passed do you do you think it has any chance of making no i mean it has zero chance probably but uh it's still it's still you know an important precedent i think even if it has no legal bearing i mean it's all written there right yes the narratives are shifting the conversation is happening that's important i mean you have like the focus on privacy and the calling out a single point calling out a single point of failure and the privacy aspect is pretty big it's pretty big but i think i think people don't talk about financial privacy you know no but he's definitely thinking like taking a cypherpunk adversarial approach to this digital monetary system talking about like single points of failure like when

was that a a common uh saying single points of failure outside of like military talk before people started talking about like these distributed systems yeah i mean i i mean i haven't i definitely haven't heard any congressman talk about anything close to that no they are trading a lot though see those uh they're killing it they're crushing it is amazing traders it has nothing to do with inside information whatsoever uh speaking of countries spying and being despotic i think there's one thing i could probably i don't know if i the thing is like this whole thing like uh in a post-bitcoin world you can't stop politicians from trading so the point is moot if the idea is that uh

like i saw some people on my feed like advocating for for politicians not to be allowed to trade like that they need like a basically like a blind trust or something where they have like a money manager that is managing their money for them that they don't have any control over um but to me that like in a post bitcoin world like if we actually have censorship resistance free financial markets um like all is fair like there's no there's no way you can stop that kind of trading no I mean, you just have to create better incentives. Like, how does that trading happen, right? Like, you're at the back end of the bad incentive network

as insiders. The front end is insiders in the form of lobbyists are able to pay for access to the proximity of the politicians who they can then hand basically lobbyists' written laws to to get pushed into law. The money printer allows that to happen and bribing allows that to happen.

And the incentives of getting more cheap debt incentivize that to happen. And then that's happening. And then the politician is just piggybacking onto that bad incentive structure and saying, hey, I know what's going to happen. So I'm going to put some chips on Pfizer here. Yeah.

Does Bitcoin fix this? Maybe, we'll see. no that's what i'm saying bitcoin doesn't fix that right no i mean i think bitcoin cements inside like is is is does insider trading exist in a free market yeah i mean no it's just a market pricing things yeah like insider trading is a term that's created by regulators yeah i mean insider trading what is it really it's it's uh it's pricing in events in the future exactly it's uh the efficient market hypothesis at play if you believe in the efficient market hypothesis insider tradings

uh necessarily is the most efficient market when people who know the information make a move immediately um yeah again you fix the incentives the incentives are all that lead to insider trading i would argue um get back to a world where cash flows and actually creating valuable useful products uh is more important than than just pumping the price of your stocks i mean i guess like you have like all these assets that are like basically just monetized uh significantly because the money's broken so if yeah uh if most people are just holding their wealth in bitcoin long term because they expect to you know it to appreciate in purchasing power then all of a sudden you start to see real estate and stocks get demonetized to

a degree and then in that situation we're kind of all just aligned on pumping the price of bitcoin yes we're all insider trading but i don't know if bitcoin fixes it won't it won't fix shitty people it doesn't doesn't fit yeah it doesn't fix corrupt politicians but again you can fix the incentives that enable these politicians to be more corrupt than they otherwise would had the framework of operation been changed via the inability to access cheap debt that is enabled by money printing. And from there, again, externalities, ripple effects, blah, blah, blah, blah, blah. But speaking, we'll see if that comes to fruition in the future. i do i have an inclination that it certainly helps again but it's not going to solve the

problem what do you think about bitcoin goblins question do monopolies exist in a he did quotes free market and they certainly form yeah depends yeah obviously i mean there will be monopolies in a free market that i think that's fine that is you know that is capitalism that is competition If someone can break that monopoly, then by offering a better product or being more efficient, then they will break that monopoly and they'll have a massive incentive to do so. My bigger issue is basically state-sanctioned monopolies where you don't have a free market and the state is basically granting monopoly powers to different companies or actors, which

i think is more of the case when you see things that closely resemble monopolies like kroger in uh in america right now yeah well we i mean we've talked about this in recent weeks like particularly as a in relation to like meat processing it's not a monopoly in the sense it's an oligopoly where the the government via strict regulation over how food is handled has essentially allowed this oligopoly to develop where very few less than five companies control something like 90 of the meat uh in the country yeah that's all government done yeah similar like if it was a proper free market there'd be more competition there yes and like we have some guys in the comments saying like monopolies mean zero competition at the definition like it's just

literally one player um obviously we're talking about the shades of gray in between yes i mean standard oil is i mean they were essentially a monopoly but they had to get broken up uh into a bunch of oil and gas companies but there were competitors outside of them as well again you get into the nitty-gritty of economic theory what what is described in the textbook but as matt described there's often gray areas in the real world that don't allow that that perfect theoretical situation to play out in the wild human nature man it's it's one one funny thing always creating these variables that you can never predict because you can't model the human mind while we're on corruption amnesty international is out verifying that el salvador

the government of el salvador is using pegasus spyware against journalists which isn't a good look matt matt car and the name of the pegasus spyware app that they installed was called chiva well no i'm kidding hey and well don't be surprised if it is um this is not great um they're spying on journalists they're they're hacking their phones it's there's two organizations here that verified this yeah the access now in the citizen lab the other link if you click the joint investigation car um yeah this one is more in depth but um um yeah i mean i think bitcoiners should be rightfully upset about this uh i think salvadorans should obviously be um concerned but in places where journalists are attacked

uh that is not usually a good sign uh places where you don't have free press um historically have resulted in repression by the government yeah i mean we covered the hong kong protests pretty heavily in late 2019 leading into 2020 people seem to have forgotten about that particularly after the whole covid thing that conveniently got brushed under the rug but one of the main strategies they used to eventually subdue the spirit of the hong kongers was to defeat the press i mean they've pretty systematically dismantled freedom of the press in hong kong over the last three years and now china's just got full reign over hong kong um and so it's obviously a tactic used by

authoritarian regimes and so if it's happening in el salvador yes it's great that el salvador are very vocal and loud advocates of of bitcoin but um matt carr and i were discussing before we record about this topic particularly like yeah you can't hold anybody who who advocates for bitcoin on a pedestal or ourselves included um yeah the hero worship from the bitcoin community is getting a little bit out of hand here um bitcoin will be fine i'll be fine whatever um just my two sats uh it's uh and i mean unless we didn't even talk we've never talked about it on the show but like bukele like took all the he took a bunch of money from china for uh their new soccer stadium i think a new library too um so he's taking chinese money he's holding the

country's keys in america and he's spying on like took kicked out a bunch of judges packed the court spying on journalists beware beware freaks because I mean that's again I worry about

the mining because this is a good transition to the mining stuff too like people just setting up for narrative failure in the future

again who's to say how President Bukele's his tenure as president ends maybe it's a good note maybe human rights at the end of the day wind up uh increasing this uh this report for amnesty international seems to prove a data point in the other direction we won't know until we know but again don't hold these people up on a pedestal

don't create these narratives like look at this president in this country adopting bitcoin it's great i think it's a data point should be acknowledged and discussed but don't bet the whole house on on this being like the the picture of of bitcoin certainly part of the story and everything that's going on but despotic regimes will use bitcoin to their advantage as well we've seen it in venezuela um very visibly they've confiscated mining equipment plugged it in for themselves mine for themselves trying to scam people other bitcoin for passports um all that all that stuff um so bitcoin is money for enemies anybody can use it anybody can leverage in into it just because somebody does doesn't mean uh you need to worship them hero worship as matt

matt describes it yeah hero worship uh i think it will end up disappointing in the long run and Similar in the Bitcoin mining industry, hero worshipping like green, quote unquote, renewable energy and saying that Bitcoin is going to incentivize and create cheaper energy generation, which I think is true to a certain extent. But I think the lengths through which the mining industry, particularly North America, is trying to stretch their necks to say, no, it's 100% renewable is just a bad strategy and only setting up for a narrative failure in the future when that turns out not to be true. And everybody goes, the Bitcoin mining industry, you told us it was going to be 100% renewable. It's like, well, it's not. And so therefore, Bitcoin's a failure. You guys are liars. We just don't set ourselves up for failure in that way.

Just own it. bitcoin uses a lot of energy using energy isn't bad it's a good thing it makes us more energy efficient and it can help lead to an overproduction of necessary electricity for the grid which could lead to cheaper electricity but there will be more energy used and there's something that the world has to come to grips with it's okay bitcoin use a lot a lot of energy it's going to use more in the process it's going to make us more energy efficient it's going to usher in a sound monetary system. And, uh, we think that that'll be a very, very much so a net benefit for the world. Um, but whether it comes to presidents or the energy, uh, the source of the energy

that you're using for your mining, don't set up bad narratives to try to appease people. And so, yeah, this is again, Bitcoin mining. this is what i said earlier that we can't say uh the fed will never hike rates why do you say that because like they're gonna do it a little bit right and people are like oh your narrative failed yeah exactly exactly um yeah this is i mean obviously bitcoin mining is going to be thrust into the conversation over the next two weeks in the u.s particularly elizabeth warren is calling a subcommittee particularly about the bitcoin mining industry and its energy consumption uh she's painting it to be this this massive

polluter that's leading to the oceans being boiled and we're destroying the world because the bitcoin mining industry is using so much energy it's and i believe inefficient is and wasteful is the words and the descriptors that this committee is going to be running with uh nothing could be further from the truth as you can see from this chart the bitcoin hash rate heat rate uh over time i thought the title of that chart was bitcoin hash rate house rate bitcoin hash rate heat rate which is the jewels uh the the jewels per terahash um the amount of heat needed to create a terror hash um via bitcoin a6 has gone down significantly over time in 2010 It was 13,333.33 joules a terahash in 2020, two years ago, that dropped down to 36.75%.

So the amount of heat necessary to produce a terahash has fallen significantly over time, which basically what that means is that the actual process of producing hashes that could potentially allow you to mine a Bitcoin block have gotten significantly more efficient with the heat that they're using. So Bitcoin mining has only gotten more efficient over time as it's consumed more energy. And then again, the energy it is consuming, very strong economic incentives in Bitcoin. It's going to be cheap energy, which is usually stranded or wasted or does not have access to greater connectivity yet. And this is a good thing.

People are going to hit the hill and talk with congressmen and try to like points renewable this, renewable that, green this, green that. and I just say we own it. Bitcoin uses a lot of energy. It's going to use more in the process. Hopefully we can bring more cheap and abundant energy to the rest of the world. Beware though.

Bitcoin is going to be dragged in front of the hill in the next two weeks displaying themselves to Elizabeth Warren. Why do you use so much energy? What would your response be? You're on the hill.

Elizabeth Warren screaming in your face. Bitcoin deniers hate the environment you just stop there yeah just walk out you just you like take your Kroger brand pineapple juice you just like drop you leave the plastic bag behind recycle

last point I had for this rip in the same in the same vein I just want to pull up is alex epstein thread on esg we're gonna link to this in the show notes but he does a very thorough dismantling of the esg narrative and highlights i think we should be leaning into this like divesting from fossil fuels is immoral and the world needs more energy like energy demand is only going to be increasing from here like all this divestment from natural gas nuclear oil specifically is actually a detriment to humanity. It's increasing electricity prices

and it's hurting the poor the most. We've been saying this ad nauseum at this podcast for quite some time now, but I think Alex Epstein did a very good, much more eloquent job of explaining the ills of ESG in a Substack post that he wrote that he also turned into a Twitter thread so we're gonna link to that go check it out these people are using fear spells um and they're they're making humanity worse off we should start leaning into this instead of trying to hide behind like renewable energy like that's what we're going to find is bitcoiners like the whole renewable energy meme it's going to die because it's undeniable that this stuff is unreliable not scalable and making people worse off reducing the quality of life for for people

who are subjected to regressing to less energy sources like be if be better than the narrative of the day go to where the puck's going and the puck is going to it is blatantly obvious that esg and environmental arping is doing more harm than good so let's just beat them there own it uh and and tell them hey we're going to be hashing thank you for it there's like a middle ground what do you mean like do you think like no i won't use the term renewable because i i i can agree with you that there's a you know some logical issues with the term it's more of a narrative term but you don't think there's use for solar or wind energy i do i do i just think it's more an individual scale like what they're just more expensive than people make it seem

But it exists as an option for people. Yes, for individuals. I do not think wind and solar should even join the conversation when it comes to creating baseloads of energy for grids. That's where the ESG, the Build Back Better, the Green New Deal is trying to transition baseload energy, which is just the base amount of energy needed to supply energy and electricity to residential grids

that we're using right now. like this the grid that is providing the electricity that is powering are set up here today uh i don't think should be backed by wind and solar because again they're unreliable intermittent sources i do think like yeah i do think there is a mix that makes that could make sense in certain areas where yes i'm not saying like no wind and solar allowed but it's like the conversation where they're trying to force it is wind and solar and hydro are the only base loads that we're allowed to use and that's just very dangerous well i mean so my thought is like so i guess solar specifically right because uh solar specifically is interesting to me because

uh usually if we're talking about nuclear are we talking about wind or we're talking about hydro this is like kind of things that like either a large corporation or a state sanctioned large corporation or the state itself kind of needs to develop an infrastructure wise right but is there not like a individual sovereignty aspect of of solar or like diesel generators or or i guess not gas wells if you live in a place but um but like so so what i was so what what brings this conversation about is so dread was posting he had an m30s uh what's minor in jamaica that he had plugged into a dryer socket because it was 220 and he said this single rig makes more money than the average jamaican makes um on a daily basis and then someone was like

yeah but you're in kingston and you're paying 50 cents a kilowatt hour um which is if you don't know energy to the freaks that don't know energy prices that's like fucking insanely expensive compared to america yeah now that jamaican who lives in kingston like they can't set up nuclear energy they can't use nat gas they can't do hydro or wind or any other kind of power situation but they could get they could source solar panels and like is it going to be like the best uh most reliable energy source like no but there's like an individual sovereignty aspect to it right that they can just buy the solar panels deploy them and they don't have to ask permission from anybody yeah no i i'm completely fine with that i think that makes sense and people should do that

if they can um if you're desperate like yeah like if you if you desperately need to like if your infrastructure is failing you there's there is there is there not a sovereignty argument to solar yeah there definitely is um but again when it comes to like grid we're not talking like sovereign right now that's let's make sure the lights are out of my house for me like with my off-grid setup here but like trying like what these people are trying to do esg and these environmentalist movements trying to get us off natural gas nuclear oil and coal right like they're and i'm not saying like the the the solar is necessarily environment more environmentally friendly or something i'm just saying like from from a purely individual

sovereignty point of view there's there's an argument there yeah for solar specifically yeah i would prefer natural gas well like i would look for land yeah but i mean there's just no natural gas wells in kingston jamaica no no not kingston jamaica yeah you'd probably be better off with wind or solar there or maybe even hydro to find a waterfall yeah i mean hydro is harder to do on a small scale but you can do it on a small scale yeah well oil for the wind and just Go get that whale fat, put it in a... Don't kill a whale, freaks. That was how we got most of our lamp oil

for quite a while. We were killing whales. And soap and perfume, whale fat. If you find some whale fat on the beach, I think it's still the key ingredient in perfume. It's much more valuable than gold, apparently. We don't need more volcanoes. Yeah, it's the other thing too, like geothermal.

I think this stuff too, like go poke a hole and not available in kingston jamaica no no well i'm just thinking generally um well that's the thing about mining right with mining the whole cool part about bitcoin mining is that like it doesn't have to be where like geography yeah but like when we're talking about like our lives and we're talking about like trying to be more sovereign and more independent yeah i feel like i i feel like i feel like marty bent gives solar a little bit too much shit when there's like there's some massive sovereignty aspects there yes and i i would agree i can come off that way but again i had to stress that my i had no beef with winter

solar like in and of themselves even though i do think they're marketed very disingenuously uh i'm against baseload electricity on grids being provided by unreliable energy sources like wind and solar because these are nuanced conversations like yeah you can have i don't care if you have a fucking solar panel or wind turbine in your backyard like just don't try to force a fucking city to use that as their only source of electricity because it's going to lead to rolling blackouts um yeah we should just have little mini nuke reactors in every house that's other thing too i think i saw a stat this week like since 1971 funnily enough when there was a nuclear regulatory body put in place not one new reactor has been approved or something like that

i mean i used to be when i was growing up i was like a big uh like i love popular mechanics and popular science magazines and stuff and like if you read the ones from like the late 60s early 70s and stuff they like were they were expecting like a reactor in every household i hope we get back to thinking that way but like that's a perfect example right i mean first of all that might happen but like flying cars stuff like that like when people try i think it's it's important that we're all humble i mean just going back to like our earlier standardization conversation about bitcoin like that we're all humble enough to realize like we can't really fathom how bitcoin will be used in 10 years um if you ask me in like 2014

you know to envision some of the things in bitcoin today i had no fucking idea if you asked me like three years ago some of this shit i could have not i couldn't have fathomed um so and that says someone who's like obsessed with it and paying attention all the time constantly thinking about that shit still caught off guard so there's a lot of things that we just can't even um fathom yeah i said fathom like three times so i was looking for a synonym but yeah we literally can't but we literally can't fathom that like and i hope i want to make this clear like i'm not calling for like a standard board or anything like that i'm thinking again what you're describing is like leaving the option for creative human thought and innovation to come

to bitcoin which i completely agree like i don't want to pigeonhole to anything where i'm coming from is like all right we do know that people have used bitcoin in a certain way up to this point in terms of creating private public key pairs and with certain derivation paths like just make sure the man in the coma is able to wake up one day and recover without having a heart attack. I think there's a balance there.

The poor guy gets out of a coma and then he has a heart attack? Hey, you can come out of a coma. Like, damn, I was forced to huddle for 15 years. That poor dude,

the price was just, the purchase, the price appreciated so much. The purchasing power appreciated so much he had a heart attack. Yeah. The man in the coma.

He's always getting the shit out of the stick, man. You got people trading protocols around him. His girlfriend's probably cheating on him. I feel free, man, in the coma. Count Bitcoin's famous. Cheers to you, Count Bitcoin.

What do we got to riff on here? Anything? I'm thinking. Bitcoin 2022. Ticket prices go up at the end of the week. January 14th. I'm going to try and only chill it when that happens. That's tomorrow. what is the code the code is tftc yeah you'll get 10 off so if you use code tftc you get 10 off and

we get 10 fig right yes if you use code open source you just get the full 20 off and we don't get anything so you have a choice you can either support us or support yourself and do not share the code open source on twitter otherwise they're going to remove it from me and we don't get any cut from that um i'm pretty excited about the whole bit devs type situation we're doing on the first day the industry day it's going to be very good very technical we're not going to understand anything like it should be that's the way to do it um i think we might have some breaking news here what uh it's not breaking news happen as we're recording uh so breaking I'll put this in our group chat

car you can pull this up so it seems like in Jack in October Jack Dorsey tweeted squares considering building a Bitcoin mining system based on custom silicon and open source for individuals and businesses worldwide if we do this we'd follow our hardware wallet model build and open

and in collaboration with the community first some thoughts and questions with the tweet that Jack sent out in October that was quote tweeted a couple hours ago by thomas templeton who said in october we announced that we're considering building a bitcoin mining system out in the open and alongside the community and we've decided we're doing it i thought we'd share some more details on how our initial discussions are going and where we're headed next we want to make mining more distributed and efficient in every way from buying to set up to

maintenance to mining we're interested because mining goes far beyond creating new bitcoin we see it as a long-term need for a future that's fully decentralized and permissionless this is the long thread um why don't you give us the the tldr well i was like i was learning along with you guys um so it looks like they're isn't this like why we have a producer like car read through it and tell us what the tldr is here's any performance and open source and our own elegant system integration ideas i guess it's just the idea phase they want to fine-tune for availability reliability performance of of machines uh i guess so i want to create the cheapest machines the last the longest will be reliable breaking bitcoin mining manufacturer wants to make cheap

efficient machines well breaking uh seems like square's mining initiative is moving forward yeah i guess that's that's more it's more than an idea which we could use we could use more more competitors in the bitcoin basic landscape specifically i will say two things and i've said it similarly in the past when we've talked about on both rabbit hole recap and when steve lee came on and dispatched we discussed it um first of all i would love to see uh more like retail focused types of rigs right so like the new generation of rigs are basically designed designed for warehouses they're like industrial appliances um there's a world i think that you can have a very efficient the same type of efficiency for for the rigs that are just you know lower power uh that

are more retail focused um that are designed you know with good firmware that you can just put them in your put them in your house um decide how much heat you want coming out how much sound want coming out stuff like that um and that's kind of to me that's like the step before we start to see them like every water heater in america has a bitcoin miner in them um i mean the second thing is i mean their goal is to build it out in the open which is you know very respectful respectable and uh this idea of like an open source asic manufacturing is very interesting and intriguing and hopeful and optimistic. It's a great thing to see. But at the same time, we have literally witnessed the exact opposite from the miners, mining manufacturers that have

dominated the space, which is very proprietary, closed development cycle, try and keep everything tight-lipped so that you don't really know when the efficiency gains are going to happen. That's their competitive advantage. So it should be interesting to see a big player like Block, formerly Square, come in and try and do this in an open way. And whether or not that'll be successful or not is, I would say, still up in the air. Agreed. Agreed. You'd have to. I mean, it's the whole meme, ASIC commodification.

Is the industry getting to a point where we're close to that, at which point open source hardware may make more sense because there's just such a lack of design space from which to innovate at the Silicon level. Who knows? Like we described... Sorry, I just got a text from my wife. She's all mad-faced.

I don't know what's going on. I don't think she's mad at me. That's what they always say right before they realize that she actually is mad at you. I mean, back to the ASIC conversation. asics are not easy to make they're expensive to make if you make mistakes they're expensive mistakes 21 co like that is one of my favorite like fucked up in asic run like their heat sinks just weren't so bad weren't big enough and every literally every chip that they invested a shit

ton of money and burnt up literally the majority of people and companies that have tried to build asics have failed miserably yes it's been a game of just absolute ruthlessness slaughter yeah yeah butterfly labs I mean like even like the bigger players

can't produce like great ones like Canaan and Minerva and then what was the Blockstream one oh yeah

whatever happened to that Dragon Dragon Mint oh Dragon Mint but didn't they buy another ASIC

manufacturer or something recently I don't know most most people in organizations that have attempted

to create ASICs have failed miserably yes this has been very expensive very expensive mistake oh yeah someone brought up the one that pomp was shilling and invested in coin mine um that i would say is a little bit different angle because that was for retail and the idea was you would mine shit coins with it and then because there was a gpu and then you could auto dump it for bitcoin and it was a little bit different because they made a very strong profit on each machine they sold uh they just were not

worth it they're just very overpriced um and not profitable yes spondulis fucking crazy there's so many yeah asic minor asic minor was a company it was tradable on havelock yeah i mean and there's rumors that there's actually people in this city in austin working on ASICs, the Houston Bitcoin meetup a couple months ago. Chad from Winstone was teasing that. So we'll see. I'm highly skeptical. This is the first time anybody's trying to do it in an open source, out in the open way. I'm very interested to see if that leads to any innovation, because maybe that's what the market needs, is just literally opening up the design space in a visible fashion so that people can see, outsiders can maybe see

something oh maybe you should tweak this i mean like the nice thing about block in general formally square in terms of uh cash app in terms of spiral in terms of tbd in terms of this initiative in terms of their heart on initiative is they have a shit ton of money uh they're well capitalized they have very easy access to financial markets they seem to have leadership including dorsey and the Bitcoin team underneath him, um, that are very ideologically motivated. And they're in a unique situation where like they can burn a shit ton of cash. They can burn a shit ton of cash and try their best. And if it fails, uh, you know, the company will still be massively successful. They'll still be the number one finance app in

the app store. You know, they'll still be the number one point of sale terminal, um, in the country uh that that kind of situation is a very unique situation um and i'm very grateful that they're they're using it for for the betterment of this mission which is bitcoin yeah and uh btc pins funny you ask i wonder if they're sponsoring the pod actually they do they happen to be honestly honestly if you're a freak and you don't know their response to the pod at this point like not going to make it yeah I mean

like you said like they could they have the cash to burn I think if anything that's the interesting thing like if they fail but the progress if they do make progress

by doing it in an open source fashion maybe somebody could pick up the baton there even and run with it to create better ASICs

which would be a net benefit for for bitcoin yeah so i mean just looking at the actions of of what's going on a block whether it be a cash app uh tb decks whatever it may be uh the the bitcoin legal fund now like it seems like jack dorsey and team are all in on bitcoin which is a great thing to see um what else we got what else we got i don't know marty have we been going for two hours and 15 minutes now no two hours 18 minutes oh two hours 18 minutes um i'll keep saying i think the uh the covid narrative is unraveling everybody's everybody's getting it

that's good the the line down the street from me to get testing is annoying people are definitely in a mass psychosis having to sit in their cars for hours to get tested the OSHA mandates just got shot down

which is a great thing I think sanity may be returning to the world but you're talking to an idiot who called top in the clown world

in the summer so it seems like things are turning yeah well we still haven't hit the top move to a free state

ignore the noise love your fellow freaks stay humble stack stats Matt is just Matt is just like ready to leave he doesn't want to hang out

two minutes two hours and 15 minutes in two hours and 18 minutes in 18 minutes and you're just sick of me already man jesus i'm kidding uh i need to eat some food i do have to eat as well freaks thank you for joining thank you for joining the live chat if you join live if you're listening at home we really appreciate it if you're listening via podcasting 2.0 compatible app thank you for for the value for that you're providing us we love it um thank you for the shout outs uh even even to the person who um tried to make me lie i'm not apologizing for shooing ben carmen that was fucked up that you shoot ben if he came back in the room i'd shoo him again i'd shoot him again fuck themselves but that shoe was only only that's something

and neil would do no marty's marty's act on their own their own plane we could shoo neil shoo ben shoo yeah i mean it was just like ben you're you're just sitting in the shop for two years he didn't bring the he didn't bring the the cut spot that we needed um on one of the freaks should come out the shoe oh post on twitter our bar our boy paul miller already did did he really yeah he's a good friend of ben too and he said i'm gonna start using this because ben is a very annoying person and nicky he gets to a point where people want to be polite and like don't want to like tell him you just shoot you just get you watch your mouth don't talk to ben about don't talk about ben that way what did when did where did paul post it

on his twitter oh i gotta car will pull it up we're gonna pull it up before we leave i was chilling with paul yesterday too i'm gonna be chilling with paul today yeah see there that's so fucked up shoegate hey shoe freaks go retweet go retweet shoegate or ben come in we'll make another one i dare you to i dare you to ben he's over there right now he's in this building still um we're gonna wrap up though ben's not gonna make it in time to get shoot away. Love all you freaks. Enjoy your life. Peace and love. Love you, Marty. Love you, Carl. Love you, freaks. Love you.