TFTC: A Bitcoin Podcast - Rabbit Hole Recap #196: Sanctions on Russian bitcoin miners and the escalating energy and food crisis

Episode Date: April 21, 2022

This week Marty and Matt as they discuss: - TSMC Raises $3.5 Billion to build facility in Arizona - Binance Accounts of Russians with over 10K Euros will be closed in 90 days - Russian Mining Firm Bitriver hit with sanctions - Compass Mining announces they were using Bitriver for russian hosting and all miners will be shut off and liquidated - NY Man running Bitcoin ATMS charged with money laundering - Bitcoin for Local Businesses - Bitcoin Magazine Partners with Ukranian NBA Players for Humanitarian Relief - Flared-Gas Bitcoin Miner Crusoe Energy Raises $350M - CipherTrace Ransomware Report - How Bitcoin Miners Were Airlifted From China to the US - How Democracies Spy on their Citizens - Yellen walking out of G20 meeting - Food supply chain under attack - FBI warns of ransomware attacks targeting US agriculture sector - Global energy crisis - Thoughts on Ukraine, The Martyrmade Podcast Shoutout to our sponsors: Unchained Capital Braiins HodlHodl

What is up, freaks? How you doing today? Had a good RHR rip for you guys. Hell of a rip. Interesting times in the world. You have the power to change the world. You just have to get off your ass. You just have to go shake your rancher's hand.

You just have to go stoke the Bitcoin circular economy. It's up to you. Nobody's coming to save you. I think this is the message of the week here at TFTC. in the interview series too. RHR. We can do it, freaks. We're going to win.

We're going to take some effort. Stop jerking off. Stop doom scrolling. Walk outside. Get some sun on your balls and your vag if you're a girl. Be the change you want to see in the world. This report was brought to you by our good friends

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but beware of rising energy prices brains go to brains.com b-r-a-i-i-n-s.com check out slush pool check out brains os plus firmware check out the content check out insights.brains.com and thank your local brains representative they're doing great things for the mining industry last but not least this rip was brought to you by good friends of hodl hodl hodl hodl is here to leverage bitcoin's native multi-sig properties to bring you a distributed exchange, no KYC, no AML,

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pay you back you get the sats and the two or three multisig at the end of the day so you get made whole go to lend.hoddlehoddle.com to check out the lending platform go to hoddlehoddle.com check out everything else they have going on incredible team there they will be having a baltic honey badger conference this year as well i believe it's september 3rd and 4th in riga latvia um i've been i've been once it was incredible conference one of the best i've ever been to honey baltic honey badger conference back baby back enjoy this friend you've had a dynamic where money's become freer than free if you talk about a fed just gone nuts all all the central banks going nuts so it's all acting

like safe haven i believe that in a world where central bankers are tripping over themselves to devalue their currency bitcoin wins in the world of fiat currencies bitcoin is the victor i mean that's part of the bull case for bitcoin if you're not paying attention you probably should be it's only getting more chaotic out there matt have we hit peak clown world yet marty no i said that's last week i don't know i like it as i like it as a reoccurring segment yeah just start off every show have we hit it yet when will be the day i don't know what i said at the end of last week's podcast is no you have all these people i'm trying to normalize some weird shit and then

You know, the whole Taylor Lorenz TikTok thing, the amount of gaslighting that that woman participated in this week and executed on, tried to execute on the world was pretty impressive to say the least. but it was very interesting like she's what you're um very passionate but passionate about not doxing people like do you think taylor lorenz and the washington post had uh a legitimate um argument when they they doxed i mean i didn't follow it very closely they doxed uh the owner of libs of tiktok right yes some woman i will not say her real name but yeah um yeah i mean i mean doxing is never okay i don't think like uh journalists get a free pass on that what's funny um we don't focus on i i mean specifically that account but i mean this goes beyond doxing but i mean specifically that account like

everyone was getting triggered by that account but they were just posting other people's content it wasn't even really commentary or anything it was just like here's a TikTok similar to Defiant Owls yeah exactly literally just posting screenshots of other people's content

I wanted to bring that up because no the clown world has not hit its top yet I think I mean I guess you know maybe there's a carve out there for journalists who are like um if it's like super powerful influential people um i'm thinking something like the panama papers where you know a bunch of presidents and oligarch

type people were all keeping their money secret and there was this massive uh leak and analysis of where their money was and who was doing it and like that icelandic prime minister uh had to resign because he was hiding all this cash in panama and other places um but if it's like a nim twitter account that posts content yeah yeah well that's what taylor lorenz was trying to say that libs of tiktok is driving the narrative so much they have such influence over the media right i bet you most people didn't even know they existed until she reported on it right

strice in effect I guess the Panama Papers wasn't really doxing necessarily yeah it was yeah it was it was like doxing financial information rather than individual

I guess it was like tying LLCs to people and stuff yeah like Vladimir or whatever Zelensky he was caught up in the Panama Papers a bunch of other people as well i think if you have to ask like most of the time you should side with respecting people's right to privacy yes especially in an environment where everything's very polarized and again like you said libs of tiktok just posting other people's

content which if you go through it is pretty there's a lot of grooming going on on tiktok from certain individuals that you know i know personally myself like i will never participate or support anyone who who tries to out someone who wants privacy uh we call that doxing um but i think it should be a wake-up call to people that do want privacy uh to realize that all it takes is one little mistake and you can get doxxed and to be extra careful about it, right? Because whoever this woman was who was running libs of TikTok, she should have been operating under the assumption that someone was going to try and doxx her. And it seems like it was relatively easy to do. Yes. I just picked up

a book that was given to us by a freak who wants to rename, remain anonymous, extreme privacy. Extreme privacy, what it takes to disappear. You've read this book, right? yeah it's a great one must read i haven't gone through it yet by michael but basil michael bazell he has a great podcast too yeah we've been trying to you've been trying to get him on signal dispatch it's impossible he doesn't there's no way to contact the guy too much privacy can't can't get a hold of him no um and the funny part of that story is always like i've had so many freaks reach out to me it's like you got to get michael on the pod it's like yeah great i know do you have a contact no i'll try i'll try and reach out to him for you okay thanks

it's uh that's i mean he's doing he's practicing what he preaches what he wrote about in this book so you got to respect it game recognized game uh yeah another thing that taylor lorenz did that really shocked me she called and this is actually like pissed me off even though glenn greenwald did blow me off on the the episode we were supposed to do she she referenced him as an influencer while portraying herself as a journalist which is again it was funny but it's also like oh my gosh these people again gaslighting what happened with the glenn thing is he not going to come on i don't know yeah i never got he was sick was he not sick he was sick and then we rescheduled and i got ghosted you want to do your thing what's my thing hey glenn if you're listening

we'd love to have you on the pod yeah glenn if you are listening you got to come on i'm bummed i didn't get that bump into you at bitcoin 2021 no bad blood but again back to it i'm gonna give you compliment Glenn or defend you, not that you need to be defended, but Taylor Lorenz calling Glenn Greenwald an influencer while pretending to be a journalist is one of the most disrespectful things I've seen in quite some time. And you're talking about Glenn Greenwald, who broke a lot of the WikiLeaks stories, who helped Snowden get the information that he shared with the world and whistle blue the NSA getting that out to

a bunch of other incredible pieces throughout the years he's probably one of the only remaining legitimate journalist on the planet and that that bitch

trying to call him an influencer was was funny to see but again we got on this are we at peak clown world no as Tyler goes just said in the comments

clown world forever that'll go down stay humble and stack clowns freaks what's going to be the worst call on this podcast 200k by conference day or peak clown world that's what we have to there's this literally a giant clown

I'm a little bit biased but I think you redeemed me a little bit when you made that call yeah that was a bad call that was a very bad call hand up it was a bad call this is a bitcoin podcast We're here to talk a lot. Oh, shit.

It is. We're here to talk about Bitcoin. A lot has gone on since we met last week. We'll go to Clark's dashboard, as we always do to start. The current price of Bitcoin is $41,510. One CuckBuck is going to get you $2,409. Hovering around a $790 billion market cap. We're at Blockite, $732,899.

and if we waited a bit we would have had 732,900 just a nice even number but no one block short we are 900 and see I always mess this up I can never find it on my computer

900 and where the fuck is it I'm looking for the next difficult yeah 925 blocks away from the next difficulty this is the same spot every time It moves when I have like my screen being different sizes.

They're 925 blocks away from the next difficulty adjustment, which is estimated to be a two and a half upward adjustment. Blocks are coming in nine minutes and 45 seconds on average since the last adjustment. And as of right now, that adjustment will happen next Wednesday, April 27th, 2022.

There are currently 7,734 transactions in Clark's men pool, is sitting at 4,501.91 Bitcoin in unspent value, or excuse me, unspent capacity the unspent value in Cuckbuck terms is 186.9 million

that's down a little bit since last week I think we were up a bit when we last met and then yeah it's Clark's dashboard we're chugging along speaking of Clark can you go to

insights.brains.com please disclaimer Brains sponsored the podcast but I do want to pull up go down to the up up up right there go to hash value and hash price this is something interesting to pay attention to

hash price has risen this week it's at like 21 cents a terahash a day but as we're going to talk about rising energy prices in this podcast later on but this is something i wrote about earlier this week i think this is something to pay attention to is the the rising cost of energy as an input globally in all industries across the world i think it'll be very interesting to see how this affects the mining industry specifically

moving forward if energy prices continue to rise power purchase agreements need to be renegotiated because the utilities providers need to make sure that they're making money and the Bitcoin price stays in this consolidated price range as the hash rate and therefore difficulty continues to go up. In the mining industry, it'll be interesting to see what happens over the next three to six month period. Are people going to have to shut down shop? Are they going to have to consolidate?

This is a theme that I am going to be paying attention to moving forward, and I think you guys should as well. Obviously, energy is a very important input in the mining industry. Electricity price is very integral to the profitability of any particular operation, and with the most important input rising in cost pretty significantly, it should have a downstream effect on the mining industry. There will be blood. yes there will be blood um should we start with the mining topic of the day

uh we have two mining topics of the day um oh the one of the day compass well compass and that stems from uh an announcement that was made yesterday which the u.s treasury came out and sanctioned bit river in russia which is a large uh hosting facility that's using hydroelectric power uh the the treasury department signaled them out specifically and said we're sanctioning you as a and 10 of their subsidiaries yes um i guess they're located in a lot of countries but they're based in russia or they they were operations in russia i think like the parent companies in switzerland well they just did it they did apparently they did like a couple months ago and the u.s is like we know exactly what you just did yeah you're still based in russia so they got

sanctioned uh u.s consumers are not allowed to interact with bit river in any way uh first bitcoin miner ever sanctioned yes a momentous occasion um and so there's many things to talk about here we'll we'll bring we'll touch on the collateral damage and go into a long discussion about it compass mining um it became apparent today was hosting a number of their miners or customers, miners, at BitRiver. So they had to come out today. In Russia. In Russia, and they had to come out today

and tell their users that they have to stop those machines from hashing and delivering the SATs that those machines are producing to their customers. They can't even unplug and mail the miners to their customers. They're going to have to try to liquidate the ASICs and then give the funds, the proceeds from those sales

back to the customers and one can imagine that they're probably not going to get top dollar for that so and it was like very first of all we're just basing this on a uh what appears to be a slack message that was a screenshot of a slack message uh compass hasn't as far as i'm concerned compass has not released an official statement yet um in that message uh the plan to liquidate the miners and get you know the return on that and send it to the users was like a very vague non-committal uh proposition and i question whether they're legally allowed to do that anyway like what that means they're doing business in russia by selling the miners to russians um so i mean i wouldn't hold your breath on getting that money back but hopefully

they get something back yeah i think this is something you actually mentioned earlier this year yeah and you told me not to you're like now that you brought it up the u.s treasury is going to know about it like i don't they don't listen to the podcast janet's listening um yeah i mean ever since the russian invasion of ukraine and the subsequent sanctions i've been wondering about that compass facility because this is specific so like when you use compass you pick which facility you want and one of them was russia um we have some friends that are using that facility and so this is not surprising at all i mean it's to be expected but it doesn't make it hurt any like this is

fucking brutal for anyone who is hosting with them over there very brutal just adds to the litany of complications that compass users have faced over the last year I'm getting a I'm getting a

live update from somebody not your ASICs not your hash alright so I've got it just goes to show it just once again shows the insane amount of risk you add on by using a third-party hosting company that itself doesn't even own the warehouses. They're renting out space from other warehouse providers, in this case, BitRiver. So you just have risk on top of

risk. And I just really don't see the value prop. I know it's a little bit more nuanced than that, but I don't really see the value prop in people choosing to use a hosted mining solution. If you're going to mine, control the ASICs yourself. Use it for KYC free sets. But hosting with a third-party company that uses another third-party company is

just asking for a disaster. I got an on-the-go tip here, live tip on air from somebody who's in contact with Compass' sales team. One thing he said, if there's anything

the compass is saying if there's anything we can do let us know and he's like can we get the fair market value for the miner

it's like it's unfortunately that's out of my hands so anonymous tip on the go and yeah I mean

I read about this yesterday in the what did the anonymous tip say did it say anything we don't know no nothing

nothing that we didn't just describe just confirming what we just described yesterday's man wrote about it so like this is you know the polarization of hash rate is an attack vector for your miner so if you are an

individual miner or if you're a mining company you have to take these political risks into consideration so that's bit river's facility using hydroelectric electricity there but like so if you're hosting you gotta eliminate third party risk wherever you can encompass third party they're leveraging the third party so that's compounded third party risk um even if you're here in the United States, you have third-party risk. If you're a miner in New York State right now, I'd be shaking in my boots.

New York State government is talking about manning mining itself within that state. I got another anonymous tip. What's that? I guess Compass just emailed customers who are using their Quebec facility. uh the owners of that facility have not renewed compass's agreement so on may 4th that agreement will end and anyone mining in the quebec facility needs to has two options to either ship it home

or move them to the ontario facility and it'll be at least a month of downtime once your miners are online again you will receive hosting downtime credits for the time your miners in transit and not consuming power hosting rates will stay the same this will be the default choice and does not require a response tough week for the compass guys but again highlighting trusted third-party risk compounded compass energy provider nation state there's three layers there

so so much trust yeah but again going back to this bit river thing specifically something I said in the bend yesterday I do think should be highlighted like this sucks for everybody involved for bit river for compass for compass users um

and again this is bit river I'd imagine I don't think they're proxies for the russian government i would i wouldn't think it seems like maybe but like it seems that compass users that were hosting they were getting their sats delivered to them and weren't getting cheated out or anything and what you have here is the product of a proxy war you have the united states in russia and other players the un nato involved in a proxy war they're in a dick measuring contest with each other they don't really care about ukrainian citizens about russian citizens or

about american citizens they care about this this superpower struggle that they're engaged in at the top political ranks of the world and you have individuals businesses that i i think it's safe to assume are acting earnestly and um just in in a free market fashion where they they want to build to be good business and operate and provide utility to individuals in the bitcoin network and it's collateral damage for this proxy war that's going on in over in russia and ukraine right now and it's again just highlights a car go to the uh george gavin tweet at the bottom of the the uh in the letter there yeah it's like this is i thought george's small dose of sanity yesterday that he tweeted out was very poignant like i do not support i do not stand with russia

i don't stand with ukraine i don't stand with nato i don't stand with the un i stand with the people in each country who are held hostage by governments that start wars destroy economies and subjugate our lives so this is a product at the end of the day if you get to the core of of what's going on right now it's it's governments just fucking up economies individuality and businesses um because they're they're engaged in this power struggle where they're trying to decide who can control the little man and subjugate the little man at the end of the day that's what they're fighting over and honest hard-working individuals are caught in the middle of this it's fucked up

yeah i mean i i definitely agree um i i mean in this case though bit river might be completely tied to the russian government and it may be down but again i mean like can you imagine like my big concern with warehouse miners in the united states is that they're going to be completely in bed with the us government it's like just an expectation they're drawing all this power yeah um i i think another takeaway here is is really do the sanctions actually hurt the russians russian government in this case or bit river and that is probably no um they can still mine bitcoin they're still going to get get the returns of bitcoin and in this case they're probably going to get a shit ton of cheap

miners from compass customers and other hosted customers right yeah exactly i think unequivocally this probably is a is a non-effect on the russian government orbit river you're giving them more hash rate like i said earlier it seems that the sats that were being produced from the miners that americans were hosting over there were being delivered to them so you have um exactly american-owned hash rate like in russia like delivering sats to americans now i mean bit river the russian government they're probably going to turn around be like all right we're not going to let you guys liquidate these we're just going to confiscate them and now that well that's yeah this is that's why you had that's why like compass customers

this is why i brought it up in the first place way back when whenever it was like the beginning of the war because there was a window there that they could have potentially gotten them shipped back to them. They were not just running the risk of the US sanctioning them, but they were running the risk of the Russians confiscating

them. And it seems like they're going to get the double whammy now. Yeah. Yeah, they get cheaper ASICs and they get to continue mining. Congrats, congrats janet you just gave them more hash rate god again the proxy war man we need to end these

proxy wars every ukrainian citizen russian citizen american citizen watching all this unfold we are more alike with each other than we are with our governments we're fucking engaging in this shit it's fucked up man um and with that being said maybe we'll go to something that I have at the end of the list, which is Janet Yellen leading a walkout at the G20 meeting that happened earlier today, uh, when the Russian representative got up to speak. And it's just another example. And then she had the gall to come out later today after this and say that, uh, Russia's or excuse me, Ukraine due to the incessant bombing of Russia is going to need massive rebuild uh and again going back to what i've been saying since this war started like the

framing from the biden administration that you have the you either get sanctions or world war iii it seems like we're getting both right now uh and the the lack of attempted diplomacy in this particular situation is just completely disheartening like maybe if we put a diplomatic foot forward when this first out out this war first broke out uh you could have prevented the incessant bombing of ukrainian cities and and actually not have to have a massive rebuild i mean it's typical american proxy war tactics here like we did in iraq we did in afghanistan we did in syria just completely destroyed these countries infrastructure and then act like oh man it's terrible we're gonna have to rebuild it's gonna cost a lot of money i think just virtue signaling

about it when you could have put a diplomatic foot forward and realize like hey maybe russia doesn't want nato bases on their border maybe it's not wise to push ukraine into nato and un maybe maybe we should be adults here and have a communication with the other side even though we I may not like them at all. There is a need for adults to enter the room and have hard conversations. And it seems like the apparent adults in the room from the U.S. perspective

are not willing to have adult conversations. They have vapid pageantry-like virtue signals, which Janet Yellen did today by getting up and walking out of the room when the russian delegate got up to speak at the g20 meeting well i mean you said a lot of things there but two things that came to mind is first of all from my perspective um it's more than just virtue signaling right because uh when when these rebuild projects happen there's a lot of large american corporations that stand to make a lot of money um and they tend to have control over

politicians um invested interests all over the place um through legalized bribery called lobbying um but i i mean i think i've been pretty consistent in disagreeing with you in terms of that there was like a diplomatic thing that the us could have done to stop um this invasion i mean i i i think putin has very clear objectives on the black sea and he was going to do it regardless but we can agree to disagree on that do you think you don't you don't think of there was an attempt to diplomacy the war like i've said in the past i'm you know i'm not a uh geopolitical expert no but i play civ and you know you can't really have diplomacy with someone like that i i think there might have been you know obviously we look

really weak in just the global world right so if we look stronger maybe he would think twice from doing it but i don't i don't i don't think putin was gonna stop unless he had control of the black sea well what do you think about the the instigations from the un side of things the nato side of things have you listened to them already like two weeks before the invasion you said it was all bullshit and wasn't even gonna happen and i i'm just saying that was the climate we were in that was the climate we were in at the time it wasn't that outlandish of a statement a lot of it a lot of the history has uh i've been doing more research into the history of what led up to this and again if you haven't listened to the martyr made um podcast that he did on

the history of ukraine russia and nato ally forces over the last three decades i highly recommend And any freak who hasn't listened to it yet, go listen to it. It came out like a month, month and a half ago. But after listening to that and understanding the history, I do think there's a lot of instigation on this. And again, it goes back to what I said earlier. This is a product of a proxy war of dick measuring on the geopolitical scale. Yeah, but it takes two sides to proxy war.

Yes. Have you listened to the podcast yet? no I what podcast is this Martyr made um who does it let's do more raise uh yeah he's a name I'll um he's got if you just search Martyr made on a podcast app it pops up it should yeah here I'll I'll um or I'll put it um but if the argument if the argument is that Russia wouldn't have invaded if Russia had control over Ukraine then yeah obviously oh just typed in marty made i'll pop put it in our the podcast is called marty made maybe that's that'll be no wonder you like it

i just had a i'm gonna put this on our tftc chat um and you put it on the screen we'll put it in the show notes we also had some of the most bullish underrated news uh this week in the mining world which is that the world's leading chip manufacturer tsmc that's based out of taiwan just raised three and a half billion dollars to build a plant in arizona yes so they did a bond offering um we have the martyr made podcast up on the screen we'll share this mile suitor tweet in the show notes um but yes tsmc I mean, this news came out a couple of years ago, I believe, or maybe it was early last year.

No, it was when Trump was still in office. So Trump worked with TSMC to get them to come over and build a foundry in Arizona. They broke around on that. It's going to be a $12.5 billion project, I believe. And they just went out and raised $3.5 billion worth of bonds in a bond offering, which is more than a quarter than the needed funds. is it 12 billion what's what's it say in the uh the article car i think 12 bill yeah yeah so more than a quarter of the necessary capital to build this out has been raised in a bond offering that's a very encouraging site to see they already broke ground they already started building it last year

and so this successful bond offering is a very positive sign that a foundry will be coming is in the process of coming and does seem like it will be completed at least at this point in Arizona. Obviously, we have Samsung here in Texas, Taylor, Texas, not too far from where we are here at the Bitcoin Commons. They've broken ground on their foundry as well.

So we've talked about it many times on this show before. One of the most centralized parts of the Bitcoin stack at this point in time is the manufacturing of the chips that run ASICs. TSMC and Samsung produce, I would imagine like 90% of the chips that produce the hash from the ASICs. On the Bitcoin network,

TSMC is the foundry that Bitmain leverages and Samsung is the foundry that MicroBT leverages. TSMC is located in Taiwan, which we've discussed before as a very politically tense place as well. A lot of people are worried that China is going to, due to Taiwan, what it did to Hong Kong. Many Taiwan listeners of the show will protest that, though Samsung historically has had their main foundry producing the chips for the A6 in South Korea, which is less politically tense than Taiwan, but still geographic centralization over there in Southeast Asia.

So seeing both companies spin up foundries here in the United States is very bullish for a more distributed chip manufacturing process of the base layer of the Bitcoin mining industry, which is exactly what you want to see. Bullish. Bullish. What else do we have here? Let me pull up the list. on the russian news we have binance announcing that if you're a russian individual or live in russia or do any business with russia and you have over 10k euros in your binance account uh your account is now in withdraw only mode and you have 90 days to withdraw funds otherwise i mean they're going to close your account regardless after 90 days

yeah and then binance came out with the new logo yesterday what'd you think of their new logo the swastika and they released on hitler's birthday yeah very happy 420 y'all happy 420 420 used to be one of my favorite holidays but yeah they released a swastika logo on fucking hitler's birthday and just and then their response was even worse they're like we're so sorry like this went through like multiple steps of review before it got released and it's like that makes it look even worse like you might as well have just said like an intern decided to change the logo or something yeah it's like the uh silicon valley thing where it went through multiple things to review the signature that they put on the computer oh the pied piper

yeah it looked like a huge look like he was sucking a dick yeah um but back to the i mean the logo they just backtracked really quickly uh but uh the i mean this is just another perfect example of not your keys not your coins not your asics not your hash you know this is going to happen more and more people are still going to continue to tweet out the engagement tweets about bitcoin's unstoppable but the majority of users will be using it in a very stoppable way and they will not learn unless they get burned so if you don't want to get burned before you learn learn from other people getting burned like this situation yes let other people get burned learn from them and don't let yourself get burned speaking of that did you see mirage on them

vice he was on vice yeah and he was uh he was explaining this i don't know car if you can find the clip it's like a two minute clip um on twitch should be on twitter uh i'm just going to mirage his profile he probably shared it but and he mirage if you're listening i saw you presented at a stacks event what was the vice thing uh it was the part of the conversation that was clipped on twitter that i watch was about exactly this um the fact that many people host or hold their coins on third party exchanges

but like the crux of Bitcoin's value prop is that you have the ability to take possession of it yourself and it was funny seeing the Vice guy sort of come to a realization in real time as Neeraj

was explaining the value prop of Bitcoin in terms of it being a digital bearer asset that you can control yourself that's great i'll find it i'm gonna find it right now we'll put it up was it related to this vice article that's in our list about miners moving from china to us or no i think it was because there was a video component to it that i didn't watch i didn't know if it was particularly in that video but um the the but anyway i don't agree with everything mirage and coin center do but generally they're a massive net benefit for the space and i appreciate them agreed um

speak speak speak this episode should i speak is that what you're telling me to do or are you talking to yourself i'm gonna find this real quick we had a new york man who was charged with running bitcoin atms uh without taking kyc information and he was charged with money laundering he actually advertised that uh it was a private service and he was charging like a 20 percent fee on top and justification was that he wasn't taking private information. Yeah.

He got caught. He was running a lot of them too. And the irony is that he was running them in laundromats and he was accused of money laundering. Well, this gets back again. I can't find the video, but it's what Neeraj was explaining. Like all this stems from the Bank Secrecy Act, KYC,

AML, making this guy a criminal when he arguably shouldn't be when the Bank Secrecy Act was signed into law in the 70s, nobody could imagine that things like Venmo and the digital world that we have today would come to fruition. And this dragnet surveillance system would be thrown on every financial app that you could ever dream of in the future. And this guy should not be a criminal. And people should be able to access sound money privately. It's not illegal to have privacy. It's not illegal to access sound money. At least it shouldn't be if you believe the ideals of this country was founded on. The Bank Secrecy Act

needs to be abolished. KYC AML, we've said it many times, is not effective at all. Criminals are going to criminal. You just put law-abiding citizens in harm's way. You put their information in very insecure databases and you make it harder for businesses to operate efficiently because you thrust an incredible amount of compliance cost on their operations, which is bad for everybody. Criminals don't get caught. Law-abiding citizens get harmed. And businesses can't operate as efficiently as possible.

It's archaic. It doesn't make any sense. It doesn't work, most importantly. And it's making user experience and the ability to effectively run an economy becomes significantly hindered. So let's start memeing that. We've got to abolish the Bank Secrecy Act.

Dragnet surveillance. And yes, the act sounds like it gives you secrecy when you use a bank, but it does the opposite. It does not. Going back to the Binance and... Well, BitRiver really doesn't have any ability to do anything here, but Binance specifically being proactive with this banning of Russian citizens.

Do you think, due to the nature of what Bitcoin's trying to do, that there is a responsibility of operators in the space to stand up for their users and say, hey, this is a bit intrusive, individual? Well, so I don't think Binance is being proactive about it. I mean, if you read their post about it, it seems like they tried to continue offering for a while, which they have been offering since the sanction regime started, right? The sanction regime started in like, what, early March, I want to say, or something like that. And they've been pushing back. And then finally, they got their hand forced. And I will say that the 90-day withdrawal period is relatively friendly for a situation like this. I mean, I'm always hard on Binance.

I'm not trying to be light on them in this situation. But I would say that it seems like they at least tried to mitigate the concerns for their users. i will say that one of the you know big side effects of stuff like this is you know binance historically was never kyc and then they added kyc under pressure and they were doing it in a really fucked up way if you remember binance was doing shotgun kyc on people hold up your face and your id and they were holding funds hostage but the whole kyc regime is basically implemented to enforce things like this otherwise they don't know which users are russian in the first place now binance p2p is heavily used in russia i don't believe this impacts binance p2p by design i know

there's a centralized component to binance p2p but i'm pretty sure it still doesn't impact that but i'm not absolutely positive um so yeah i mean the 90 day period is uh frank i think for some people might think it's a short period frankly to me that seems like a very gracious period that's a that's a long amount of time three months in this type of situation especially from a company that is historically shotgun kyc people with no notice and held funds hostage yeah and i would like to see operators in the space stand up and say hey this is well that's not gonna happen well again go back to what we said last week why and set these ideas

in the people's minds the best example is Voorhees just eliminated Voorhees was like super anti-state anti-KYC

anarcho-capitalist and then he made a lot of money on Shapeshift and then all of a sudden because he was really rich he had something to lose and they put a gun

to his head and he added KYC to Shapeshift yeah I would like to see one of these people with a lot to lose to stand up

and have some backbone and principles say enough is enough i don't want to be part of your proxy war which is essentially what these companies are doing they're allowing themselves to become at the proxy war and like what does that do to russian citizens like how does that make them view bitcoin at the end of the day where the company is operating in the space like hey this is a protocol that was launched to bring financial freedom to the world and you're you're hindering it obviously i understand well i mean i think sanctions in general hurt the people the most they don't really hurt rich people and

governments as much as as as as working class people and everyday people um and i think bitcoin aside just across the board what what it does is it radicalizes people against the u.s and u.s companies yes um and that includes bitcoin companies yeah that follow the u.s regime but it's a broader thing than Bitcoin. It's interesting. Binance isn't even a U.S. company, though. Are they based in Singapore? Yeah, but all these companies,

they're all under the thumb of the United States, right? Like BitMEX, right? BitMEX, the whole argument with BitMEX, them arresting the founders, was that they need to implement KYC just to make sure they're denying Americans usage. So they have to KYC the whole world in order to make sure that Americans aren't using it,

Even though there are terms and conditions says Americans can't use it. That's not, that's not enough for America. So it doesn't matter where you're domiciled. It does to a degree, but it doesn't really, if you get big enough. And especially if you have banking connections, if you have any kind of fee, like BitMEX survived as long as it did because they were a Bitcoin standard company. Everything, Bitcoin withdrawals and deposits only. There was no bank account access. do we live in a free country no don't don't maybe one day we will if people of principle

and backbone stand up and begin fighting for it we live in a free country we've already had peak clown world and it was really a pleasure to see 200k by conference day uh on the more solutions instead of describing the problems bitcoin for local businesses this is a bottom-up approach to a bitcoinized world uh our boys pedro made this uh the inspiration was me and him worked on the bitcoin bazaar uh pamphlet or it was it was just like a single pager for uh the merchants that were at uh the bitcoin 2022 event um and he was like do you mind if i use this to do bigger for uh

specifically uh farmers markets but also for any kind of local merchants i was like fuck yeah do it like that would be fucking awesome and he killed it like this pamphlet is really fucking awesome um he did a really good job with it yeah what's his twitter handle again it's pedro read it out loud I can't see it I can't see either Pedro MVPG

go follow him he's awesome he's also responsible for this great coffee table book oh I have one too I'm supposed to put it in my backdrop somewhere Bitcoin version 0.01 alpha the original Bitcoin code

it's actually fun put it on your coffee table your board you just look it up and you read the code that satoshi wrote when he first launched bitcoin but like this is what i was talking about last week like if we're threatened by cbdcs which i think most of us are um we should feel threatened by the current credit card digital payment apps regime as well because it has a lot of the same

concerns that cbdcs have and people are just using them all the time right now as their main use of purchase like it's complete surveillance network um and the answer is grassroots local bitcoin economies um and we need i'm not saying that we're necessarily there yet but you got to start somewhere and time is of the essence because people need to have an option when things get even worse yeah well it's happening i love to see initiatives like this car was saying uh when he came in before we hit record that him and a group of Bitcoiners went to Three Forks Steakhouse here in

Austin last night and they were able to pay in Bitcoin. They're peer-to-peer. Exactly. And like these merchants like, you know, they're going to get distracted. They're going to stop accepting it if Bitcoiners aren't using them.

Well, I'm trying to do my part. Got my hair cut last week. I didn't mention it when we recorded last week. but paid in Bitcoin. I had my barber download BlueWallet a few months ago, and he just invoices me there, pay him in Bitcoin, peer-to-peer. With Lightning?

He's not on Lightning yet, but on-chain. That's good. I was going to say, I hope you warned him that it's a custodial wallet. No, it's on-chain. We're doing on-chain. Okay. I don't want your hairdresser to get rug pulled.

Hairdresser? I don't have enough hair to have him be considered a hairdresser. It's a barber. A barber. Dude with a trimmer. He doesn't have a hard job when I walk in. I'll just say that.

But anyway, shout out to Pedro for this. He has different languages. You can print it out. He's taking feedback and contributions. So definitely check that out and hand them out at your local farmer's market and local merchants. If you have a meetup,

go bring it to your meetup and let's get these circular economies going. That was a very encouraging tweet to see right before we hit record. It was a freak saying thank you to us for encouraging freaks everywhere to go to your local Bitcoin meetup. Or start one if you don't have one.

Yeah, I'm telling you. We had Cole Bolton, Texas Slim, Parker on the podcast earlier this week. We had the Beef Initiative conference on Saturday in Kerrville, Texas here. And a big part of that conversation was the power of these in-person meetups and this true grassroots movement. It's happening in Bitcoin. Extremely rewarding and powerful. Yeah, and the Beef Initiative is trying to make that happen in the ranching world. and it doesn't only have to be Bitcoin.

It can be other aspects of your life that you want to see more distribution. And you have a conference this weekend, right? Yes. Go to beefinitiative.com. There's a few tickets left. And you're speaking, right? Yeah, I'm on a panel.

Should be fun. But yeah, no, it was really... Car, stay on this. It was cool to see Sean Baker, Dr. Sean Baker, renowned carnivore and Jack Doctor. Let's play this video because he echoing exactly

what we have been saying throughout our conversations with Texas Slim and Cole on the rancher front. A lot of the ranchers are just thrown in the towel. They're getting bought out by big corporations. They can't afford their land. They can't afford to be in business. It's, you know, they're, they're doing it because they love what they do. And a lot of, a lot of them, it's multi-generational. Their grandparents did that or their great grandparents did it and they want to hang on, but slowly by slowly year by year, we're losing them. You know, we had, I think 1.3 million ranches about 50 years ago. We're down to about 700,000 of them in the United States now.

And so it's continuing to happen. If it's important to you as a consumer, you have to find a way to help these guys be successful. And the best way to do it is like what Mike was mentioning. Call them up locally. They're nice people, you know. And they're happy to, they're really happy to provide you the best product they can.

Yeah. So every aspect, if you want to change this stuff, you got to get up and do it. You got to go shake your rancher's hand. You got to go print out these pamphlets and hand them out at your farmer's market. this is truly a grassroots movement and you can you gotta spend bitcoin

you gotta spend bitcoin you don't have to spend all your bitcoin spend and replace but just get it going every purchase should be measured in sats regardless if you use a surveillance card or not yes and I want to just add I just want to add

something here before we leave the circular economy conversation is that I really do feel like a lot of people learn the wrong lessons from el salvador and everyone's willing you know you can have your own perspective you can do whatever you want um i i don't want you to blindly listen to me but to me the perspective of el salvador and the lesson of el salvador is that there was this blossoming grassroots circular bitcoin economy in el zante that started without permission from their government they

didn't ask anybody permission they just did it and they just kept doing it and soon enough what happened was the government had two choices. They could either embrace it or fight it. And they chose to embrace it. It's not a story of a top-down decision from a president to add Bitcoin. It's a story of a grassroots, local Bitcoin economy growing to the point where it couldn't be ignored anymore. I would agree there. Force your government to make the hard decision. Do we go along or do we fight it the incentives are to go along with it so you just have to get that grassroots movement to a point where the political risk of going against it is too high and they're forced to go along with it let's do it here in america that's uh i think it's already happening here too

obviously you just mentioned i'm paying in my barber car was able to pay the steakhouse my hairdresser uh you have oshi blossoming here in austin and beyond you have the beef initiative getting ranchers on a on a bitcoin standard you have mining becoming a significant um industry here in the united states it's it's happening we need to not only have more grassroots action but then vocalize it on the back end. I actually had some very productive conversations with people

on the policy side of things this week. I'm a bit white-pilled this week. I think we can win. We just got to get out. We got to have our voices heard. That's why we do this podcast. That's why we come here week in and week out. And that's why it was encouraging to get that tweet that we got right before we came on air because it

does seem like it is having an impact. Do you think would you agree with the statement the state hates us yes do you think they can hate us and save us at the same time no save yourself yeah that's the thing like people need to recognize that the state hates you we'll get we'll get into a few topics at the end of the show that really highlight this uh but the state can also be afraid of you they hate you but if you're docile and complacent it's easy for them to hate you and force their will on you um but if people in a grassroots fashion band together and have their voices heard and get out and off their

asses and and act by adopting bitcoin getting ranchers on a bitcoin standard getting local businesses on a bitcoin standard that is that is power that the state fears they hate you and they're planning on you being complacent and docile and bending the knee and just giving into their will what they really don't like is grassroots organization and strong-willed people saying hey i'm gonna opt out of this and there's nothing you can do about it and yes they hate you and they want you in that that sad start sorry state but you have the ability to stand up on your own two feet act and band together and say we know you hate us but we're more we're stronger than you and we're going to do this and if you want to fight come and bring the fight but you're

going to look really bad in the process so it's it's again like i was trying to say last week emboldening people encouraging people letting people know that you have the power to fight back i think that's one of the largest misconceptions in the world right now is that you're powerless against this stuff you're not and bitcoin proves that so what was the white pill policy conversation you had uh somebody who um was part of the trump administration was at the esg panel um at bitcoin 2022 and she reached out actually she was staying at the same hotel as I was, uh, and ran into her after the speech. Um, we agreed to connect later and we connected this week and there's, there's people particularly on the energy side of things at higher levels of

the government that, um, do not like what's going on from an energy policy perspective. And it is actually funny to see the, the, um, people have been fighting about back against the energy policy madness for many years are getting very encouraged by the narratives that are coming out of the Bitcoin space about don't bend the knee to ESG. Humans are good, not evil. We shouldn't have this Malthusian view of the future and human population growth and energy consumption. Humans are good. Energy abundance is good. It leads to human flourishing. And so It seems that many who have become despondent at that level of policy decision-making, because they think the wave of climate hysterics is too strong to fight back against, are beginning to develop confidence that maybe this isn't a losing battle. You just need to get strong-willed voices on your side.

I'm pretty confident that Bitcoin mining won't get banned in America. I think the energy lobby is very powerful, and it's good that we have them on our side. My bigger concern is that the only miners, the majority of miners in America will be compliant to anti-privacy miners, and I don't know if we have much support there among politicians. Well, all the mining operations I'm a part of, we will fight hand to nail. Largest mining pool in the world is KYC based in America. Boundary. Boundary.

That's why I like to point my hash at Slushbowl. Disclaimer, I'm a sponsor of the pod. What do we got next? bitcoin magazine partners with ukrainian nba players for humanitarian relief um this is pretty cool they got the qr codes on their shoes it's like if they're done you get a poster moment you could just quickly like they put a bitcoin qr code on their first bitcoin qr code on an nba shoe that's the headline so this is fee i can't even pronounce this i'm