The Breakdown - Bitcoin Is Optimism, With Alex Gladstein

Episode Date: December 31, 2022

This episode is sponsored by Nexo.io, Circle and Kraken.   Today’s guest is Alex Gladstein, chief strategy officer at the Human Rights Foundation.   Find our guest on Twitter: @gladstein - Nexo is a security-first platform where you can buy, exchange and borrow against your crypto. The company ensures the safety of your funds and keeps innovating with products like the Nexo Wallet - a non-custodial smart wallet that allows you to create your Web3 identity. Get early access at nexo.io/wallet. - Circle, the sole issuer of the trusted and reliable stablecoin USDC, is our sponsor for today’s show. USDC is a fast, cost-effective solution for global payments at internet speeds. Learn how businesses are taking advantage of these opportunities at Circle’s USDC Hub for Businesses. - Kraken, the secure, trusted digital asset exchange, is our sponsor for today's show. Kraken makes it easy to instantly buy 185+ cryptocurrencies with fast, flexible funding options. Your account is covered by regular Proof of Reserves audits, industry-leading security and award-winning Client Engagement, available 24/7. Sign up and trade today at kraken.com/breakdown. - “The Breakdown” is written, produced by and features Nathaniel Whittemore aka NLW, with editing by Rob Mitchell and research by Scott Hill. Jared Schwartz is our executive producer and our holiday theme music is "Spike The Eggnog" by Two Dudes. Music behind our sponsors today is “Back To The End” by Strength To Last. Image credit: Vasil Dimitrov/Getty Images, modified by CoinDesk. Join the discussion at discord.gg/VrKRrfKCz8.

We now have a different incentive mechanism, and it's interesting to see companies out in Africa cooperating. Like, I think the Bitcoin system just has different incentives. You've got companies cooperating, and because everything's open and it's one standard, it's very, very different from the monopolist kind of capitalist structures we've had in the past that trend towards monopolization and rent-seeking and exploitation. This is a system that trends potentially towards cooperation and lowering the cost for people. So I think that that's my biggest takeaway this year as I've started to sort of notice this incentive design of Bitcoin, like maybe really, really paying off in terms of empowering communities and maybe even nations in the future. Welcome back to The Breakdown with me, NLW.

It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world. The breakdown is sponsored by Nexo.io, Circle, and Cracken, and produced in the video. distributed by CoinDesk. What's going on, guys? It is Saturday, December 31st, the last day of the year. And today, we're closing out our end-of-year interview series with Alex Gladstein. Before we get into that, if you are enjoying the breakdown, please go subscribe to it, give it a rating, give it a review,

or if you want to dive deeper into the conversation, come join us on the Breakers Discord. You can find a link in the show notes or go to bit.combe, or go to bit.orgly slash breakdown pod. All right, guys, well, for many of you, Alex Gladstein needs no introduction. He's the chief strategy officer at the Human Rights Foundations and one of the clarion voices helping bitcoiners understand, see and experience how Bitcoin is impacting communities around the world, especially those who are living inside unstable monetary regimes or under

autocratic power. It was another amazing year of Alex's writing and contributing to our understanding of Bitcoin. And in this conversation, we talk about his experience at the Africa Bitcoin conference, his recent time in India, and why so much of the energy around Bitcoin is coming from emerging markets and the developing world. All right, Alex, welcome back to the breakdown, sir. How you doing? Great. Happy to be here.

Happy holidays. You too. You too. Listen, I'm always excited to chat with you. And I think this year is a particularly opportune time to reflect on the year that was in Bitcoin in particular. And, you know, you obviously have been out there kind of living, exploring, and discovering Bitcoin in all of its various manifestations. So I'm really excited to chat. And by way of starting

really, really broad, if you had to summarize Bitcoin's year in 2022, what would you say? Well, for me, it was global adoption. And I think that continues in 2023. I've seen stuff that you know, that you people wouldn't believe. It's true. Especially when I went down to the African Bitcoin Conference in Ghana, just staggered by the variety of communities and businesses and entrepreneurs and innovators and developers building on Bitcoin and focusing on Bitcoin from countries that like most Americans don't even know exist. I mean, it's really just incredible meeting people from Somaliland and Benin and Cameroon and DR Congo and, you know, people coming to this conference and then going home to cities like Mogadishu where they're going to continue to work on their projects was pretty mind-blowing. I mean, it's safe to say that in all the world's most like crazy conflict zones and dictatorships, there are thriving Bitcoin communities.

And I just that I think that speaks so strongly about what Bitcoin is. that it's just this tool that people can use even when everything else around them collapses. And I guess that couldn't be any further from the narrative in the mainstream media, which is that Bitcoin and crypto, quote unquote, are this like malignant, cancerous thing that must be destroyed and rooted out and they've ruined all these people's lives. So it's amazing to actually go see the, get the signal, because there's a lot of noise. Let's put it that way. Yeah.

Well, I wanted to dig, this was great because I wanted to dig more in with you around the conference, because I haven't chatted with you since you got back from that. And you could almost feel, for those of you who kind of pay attention to your content and your tweets and things like that, you could feel that sort of excitement emanating from you. You know, I think you would go into anything like that with optimism and enthusiasm, but it felt sort of differentiatedly so. So I'd love to hear more about some of the specific types of things that you saw. You know, how much was this? entrepreneurs building sort of new technology that helped expend and extend sort of the utility of Bitcoin versus people who are just sort of solving problems around local application and use of Bitcoin for their own communities. Yeah, I think there's a surprising amount of both in that case, let's say, African builders and maybe that's a proxy for Latin American builders and builders from Southeast Asia, from South Asia, from the Middle East. They're like, you know, part of this big global community.

So they're like in many ways, they're reading the same news and listening to the same podcasts as Bitcoiners in America, in the United States and in Europe, which makes this kind of really neat kind of global construct. But at the same time, they're doing stuff that like we are just clueless about. You know, I met a guy there whose team has made it possible for people to use Bitcoin without internet, without data, using a, uh, using, uh, uh, a text message protocol called USSD, which is very popular in Africa. So basically you can have like a candy bar phone or like an old phone or even,

you know, a lot of people have feature phones in Africa or smartphones in Africa that just, but the data is too expensive. So a lot of folks out there who have the power to call and text. And that's how they do their banking in many cases through mobile money already, right? And now they can just like text a number and it spits out on their phone like a menu of options and it allows them to like move Bitcoin around. and it's done over the lightning network, and I thought that was kind of mind-blowing. Now, it's kind of early days for that stuff, but I think it's going to rapidly develop and

grow. I also met a lot of people just building businesses around the blazingly obvious use case that it's very hard to send money into Africa and within Africa. You have 41 central banks. You have a lot of restrictions on money coming into Africa. the whole banking system there is colonial, is still colonial, and was created by colonialists, by foreign powers, for the express purpose of intermediating payments instead of making them easy or connecting people, it was to divide and to extract rent. That's like how the whole financial system there was built. So you have some absurd percentage of value of fees when you send money from one African country to another going to European or American companies.

It's crazy. So when you have that world around you and you have it so difficult to send money to places like Somalia or D.R. Congo from family of friends or clients in Europe or Asia and the United States, you start to really see the obvious use case for Bitcoin and for stable coins, let's say. So you meet a lot of people who've created businesses around, you know, receiving the Bitcoin or the stable coins and then being like the off ramp into local fiat or whatever. that's huge. So that's a massively ballooning business. I think you're only going to see that get bigger and bigger. Whether it be in Nigeria or, yeah, I mean, some of these, you know, smaller countries, but countries that may have big use cases. Like I met this entrepreneur from Somalia and he's got 30,000 clients and he's, you know, average amount of value for each remittance for these clients is 50 to 100 bucks and they come in in Bitcoin or stablecoin and

and he he helps convert that for them, right? And yeah, they could do P to P to P to P. And we're certainly out there to try and encourage these circular P2P economies. But, you know, for a lot of folks, you know, look, they're still in the Fiat system. And I just think it's interesting that Bitcoin actually improves the fiat system in many ways in some of these places, like this product that was launched there. And it's something that a Nigerian entrepreneur named Bernard Para created where he has an integration with Mpesa that allows. American or European entrepreneurs, like let's say Jack Muller's who announced a partnership on stage there with Bernard, which allows any strike user in the United States to instantly

settle money into any Mesa users, mobile money wallet in Kenya. Like, that's amazing. So that's the kind of stuff you're starting to see is like people starting to understand and take advantage of Bitcoin's like incredible utility as a cross-border payment tool and Lightning Network being like a really key part of that. It's just you start seeing how it connects. different fiat pools, which are otherwise separated from each other with bureaucracy or rent seeking or exploitative companies or whatever, we can just brush all that nonsense aside and we

could just connect directly with an asset that is 24-7 liquid and instantly travels and isn't somebody's liability. I think that's super, super, super powerful. So seeing a lot of that, seeing a lot of innovation, and then seeing a lot of communities. I mean, I met a guy who we actually just announced support for it today. His thing's called Bitcoin Mountain. He's in Cameroon, a country in central West Africa on an enormous volcano called Mount Cameroon. There's been a lot of conflict in that area. This is a country racked by strife between the English and the French-speaking communities of that country that dates back to all kinds of colonial nonsense. And a lot of people in his area have fled. There's a lot of displacement. But he's staying there to build a Bitcoin

community based around education about Bitcoin and entrepreneurship and things like that. So I was very inspired by that. And you just see a lot of that. I mean, there's Bitcoin communities in Eastern Congo. There's, you know, communities in Ethiopia all over. So again, just really impressed and stunned by the impact that Bitcoin's having in Africa, for sure. So obviously, you kind of you walk through sort of the technologies and use cases and how they are similar or different than, you know, what we might see in sort of developed countries in the U.S. or in Europe or something like that. But how much do you think these sort of narratives, the community conversations, the discussion points around Bitcoin, how similar or different are they in those communities as opposed to,

you know, your average conversation on Bitcoin Twitter, for example? Sure. And I also went to India the month before. And I think that's another really important place for Bitcoin. I mean, it's going to, it's basically the world's largest country. It's about tied with China, but it has an higher growth rate. I mean, I think Indians are going to be the best Bitcoiners. I think Indians are going to really build out over the next decade plus a epicenter of Bitcoin because they are suspect of government programs, number one. They like cash, number two, and they love gold, number three.

So they're kind of just like sort of perfectly set up to become Bitcoiners. I think that what you see there, though, also similarly, in Africa is like just so many scams and so much nonsense and so much hype that the actual hard work of building out the Bitcoin communities is, is Yeoman's work. I mean, it's brick by brick. It's like teaching one by one. It's teaching people about the value of this thing and teaching them about what money is and teaching them about how we can have a better world in both places. Like, you're seeing the hard work being done in a slow but steady way. And it is easy. to get distracted by the siren call of all this like token creation and issuance and,

you know, those companies are going to have marketing budgets to go into these universities in Lagos and in Bangaluru and to recruit students to work on their token projects. The same thing happens at Stanford, by the way, and at Berkeley and all these universities, the United States and Europe. But that's just part of the journey. Like, you're going to have the siren call of that easy money, like, get rich quick. And overwhelmingly that was not what I encountered. The people that I met with are not interested in getting rich quick.

They are interested in building long-term generational wealth for their communities and for their nations. They are not interested in making tradeoffs. They are interested in ground-up education with grassroots communities, getting men and women and girls and boys from different backgrounds and religions involved in this thing. And they're not going to stop and they're going to be very persistent. I do think that they take a lot of solace and inspiration when they get shoutouts and when they get acknowledged by kind of more prominent Bitcoin personalities, let's say, in the West. For example, Jack Dorsey being there at the Ghana conference was amazing. I mean, he spent three days there. He was very involved.

He was very present. He was front row in the deceits. Like he was listening to everything. He was much more a listener than a speaker. And he deserves such enormous credit for that. And he brought a big team from Block. and they were all there learning and really just kind of diving in with the community. And that is such a rich thing to do.

Like that's going to provide so much like information and education for his company and for builders at Block that they need a lot of praise for doing that. And Strike did the same thing. Strike brought a whole bunch of people. Paxville was there. There were quite a few companies created by, you know, American founders that were there in spades. And I think that's very important is you just got to get out there.

and learn about what's happening there, and that helps you, I think, kind of put everything in context. So, so important. In an ecosystem where innovation is the norm, it's the basics that are in the spotlight. Nexo is a company that has never put the safety of clients' funds in question. With over 50 global licenses,

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Millions of people around the world count on the Krakken mobile app as the easy, safest, safest, and most flexible way to start building their crypto portfolio. Cracken's industry-leading security keeps your funds and information safe, and their award-winning client engagement teams are available for support 24-7. Download the Cracken app on Google Play or the Apple App Store or visit crackin.com slash breakdown to join. So India is one of the places where there's the most fluid and large conversation or large-scale conversation about a CBDC, right? The Reserve Bank of India is very, very against crypto. It's explicit that it's CBDC is an attempt to take the best of crypto

and do it in such a way that people don't have to deal with crypto. How much does that color kind of the experience of that community there? Maybe same question for Nigeria and other places where CBDCs are relatively advanced. So Nigeria is, again, noteworthy, largest country in Africa, it's going to be the third largest country in the world in a few decades. People call it like the United States of Africa. It's an incredible place. And I think that there you have a government that's also pushing a CBDC really hard and that has gone to great lengths to try and restrict its population from using Bitcoin and cryptocurrency. So for example, they've really tried to cut off the banking sector's connection to cryptocurrency exchanges. So they've really tried to

sever those on ramps and off ramps. So everything in Nigeria is basically done on P to P markets now. And I think that shows the resilience of this thing. in many cases. But it also shows you that you're going to have hostile governments that are going to try to go after sort of non-governmental digital currencies. Same thing in India. I would note that the Bitcoin community in Nigeria is much bigger than the Bitcoin community in India.

Bitcoin community in India is very small. It's growing, you know, I think it's growing quickly, but it's like it's starting from a small place. I think there is a massive crypto community in India, but much more focused on trading tokens. there's not a big cryptocurrency, Bitcoin community there rather. So interesting to see that. So I think they need a lot of support. In Nigeria, though, it's like pretty significant.

Like I was sitting in a room in Ghana. I was doing a workshop. There were about 35 people in the room. And 20 of them were Bitcoin and or lightning engineers from Lagos. And I'm like, wow. Like there must be more Bitcoin engineers in Lagos than San Francisco at this point. It's pretty amazing. So that's due to a lot of hard work by fellowship programs like Kala, Kala, KLA, KLA, and others

who are, you know, churning out Bitcoin debt. and getting them placed with companies. I think Kala had about a dozen people in their last cohort and 100% of them got placed with Bitcoin companies. So I think you're seeing a lot of that. I think Jay-Z and Jack Dorsey's B-Trust initiative is going to go a long way towards supercharging that, not just in Africa, but also in India and Latin America

and other parts of the world. So very excited to see that happening. But yeah, in general, these Bitcoin communities are, they're a little smaller, but I wouldn't, you know, I wouldn't underestimate them. And I think one of the big things you learn from being out there is just how massive Binance is. I mean, finance is like the absolute elephant in these places. Like it dominates financial services through the like sort of finance tether stack.

I mean, I think you have in some countries a much larger exposure than Bitcoin, for example. So like in Nigeria, tether on finance is probably traded at much higher volumes by many more people than Bitcoin is. other countries it's not so much the case, but certainly in Nigeria, that's the case. Turkey, that's the case. So you see a lot of reliance on finance and on tether. That worries me. I mean, I think I want to give credit to this company and to this product because they've provided financial services where the legacy system has failed across the emerging markets.

But, like, I don't think necessarily that their intentions are good, especially in the finance case. Like, they're self-interested. They want to, like, colonize and take over these places. So I'm a little worried that there's so much reliance on these two things. So the more we can get people learning more about Bitcoin and self-custody, I think that's going to be better and better and better. But wow, is it amazing to see like what kind of footprint they have?

And certainly Tether, I mean, wow. I mean, this thing is a humanitarian tool right now. I mean, it's inarguable. This is a, I mean, I feel like it's actually, we'd probably be catch up, you know, on the show once every six months or so. And one of the things that we could almost just track over time is this discussion of where sort of dollarized assets fit relative to Bitcoin in terms of both global adoption sort of of Bitcoin, but more broadly just of people actually being able to solve their problems with better financial tools sort of from this ecosystem. So it's interesting to kind

of hear that update from the ground there. I mean, it's out of course, I mean, they exist at the pleasure of the U.S. government, right? So U.S.D. and Tether and, you know, BUSD, let's say, which is a Paxos-created thing. I mean, these are, these are virtual dollars that are really cool because people in Lebanon, for example, or in Nigeria can hold a dollar on their phone without a U.S. bank account or an ID. Like, that's very powerful. But let's not, you know, fool ourselves here. They exist at the pleasure of the U.S. government. They're ephemeral. They are temporary. They are short-term fixes. Long-term, you know, I think we got to be investing in moving to this like global Bitcoin economy. That's that's on a solid foundation. Like, these things are

very risky in that sense. Like, they need to be credited for the fact that they've helped so many people in the last few years. But man, they could go away in an instant. How much do you see people sort of being aware of that fact. And, you know, I've seen or encountered some number, not necessarily the mainstream, but some number of people who have a pretty clear sense of what Bitcoin is sort of useful for in their lived context, but also who are in a dollarized ecosystem, right? In Argentina, for example. And so, you know, play that game because that's the game that is to be played. And that's what it allows them to interface. I mean, people don't have the luxury necessarily of thinking about like the risk of tether, right, collapsing.

That's like they just need dollars. So, and oftentimes that's ruinous, right? People are going to learn their lesson, right? So apparently, from what my friends told me in Argentina, for example, people were like skeptical of tether. So they were using Terra. They were using UST. And they all lost everything.

So, like, quite a few lower to middle class people in Argentina and Turkey in these other countries, these large, large countries with tens or hundreds of millions of people. people, you know, they were using UST because they didn't trust Tether for whatever reason, or it was the cheapest thing they could get or whatever. Well, they all lost everything. So, you know, I think you learn over time. And, you know, over time, people are going to learn more about self-custodying Bitcoin as, like, an important thing for them and their family and their business. But that's just something that takes a long, long time. Like, for now, Tether and stablecoins are playing a huge role in the emerging markets. And this needs to

be acknowledged. Yeah. How discordant has it been over the last couple months for you to be in these contexts, watching people sort of solving problems that matter to them in their real life with Bitcoin while watching simultaneously the sort of implosion of FTX, the larger ecosystem that falls with it? I mean, it must be almost like mentally fracking in some ways. Yeah, it's amazing. I mean, you know, you've got the mainstream media calling Bitcoin dead again, people associating Bitcoin with FTCS saying it's all a scam. People who know better actually, you know, man, a lot of these people, they're feeling really good right now because it's sort of, they feel like their thesis has been vindicated. They feel like FTCS collapsing means that Bitcoin isn't working. And man,

it's just incredible how wrong they are. Like just to focus on that one use case of moving money from the United States to Nigeria, it's not just that it's faster and easier. to do it over a Bitcoin rail and a lightning rail and cheaper in that regard. Like, think about the fact that when you do it this way, you get exposed to the black market or the street rate of exchange versus the official rate. So in a country like Nigeria, you're talking about getting 600-something Naira to the dollar instead of 400-something. So if you use an official product, the government is going to steal and essentially steal

and only give you the official rate of exchange. same thing is happening in Cuba and all these other places. So if you use like an official way of moving money from one country to another, all these bureaucrats and thieves take 20, 30, 40, 50, 60 percent in some cases of the value and your family or your clients get like, you know, whatever, a small percentage, not due to any sort of technical inefficiency, but due to the control over the monetary system and the control over the rate of exchange. So when you're trading Bitcoin between different fiats, you get the real price.

of the fiat in that country. And this alone is so, so important and yet is completely either, usually probably, you know, to be fair, like, people don't know this. Like, they're just ignorant about it. But in some cases, like, you've got people who are just so doubled down on their position that Bitcoin and all cryptocurrency is useless that they'll be willingly blind to this, actually. It's kind of amazing.

I think that at some ways, at this point, saying that, that Bitcoin has no use case is tantamount to admitting that you do not care about the developing world. You know what I mean? Or emerging markets. It's like, like it really, I mean, it really isn't some level. It's if you're saying you could with a straight face say, I guess, maybe that, no, I can't even justify it. Anyways, the point is just, you know what I'm going.

No, and like the people that I've been going back and forth through the years, most, most of the smart ones have at least acknowledged that yet they're like, fine, in some cases. Sure. Okay, fine. Right. In these other contexts that aren't you here in the U.S. Right. But then what happens when those cases come home to roost? Like what happens in the United States or Europe, you have high inflation or what happens in these places where all of a sudden maybe you get to platformed or all of a sudden your fundraiser gets shut down like we saw happen in Canada, you know, or what happens when you do something that really, you know, provokes the people in charge. Like look at WikiLeaks did. I mean, the use case remains the same as it wasn't 2011. I mean, bank accounts get shut down by the government. You can use Bitcoin, right? that remains the same as it was with WikiLeaks. Like, remains the same today.

I mean, I just don't even know where to begin with these people. Like, it's almost like they forgot the whole thing with Ukraine and how many people were helped by this technology when Russia invaded Ukraine. That's gone out the window. They forgot about that. They forgot about Venezuela. They've forgotten about all these cross-border payment things. They're willing to throw all this out because they now see that, like, oh, FTX was a scammer.

And by the way, it's like, of course he was a scammer. Like, every bitcoyner knew that he was a scammer, or at least most Bitcoiners did. The guy was anti-proof of work. He was trashing Lightning Network and all this stuff. And it was kind of plain to see what he was interested in. And the media just laid it on thick with him until the day he collapsed. It's like, okay, okay, you've been critical about SBF since the collapse. Who cares?

I want to see what you were saying six months ago. That tells me more about, like, kind of how I can trust you. And most of these platforms were knighting him as some sort of, you know, new JP Morgan is completely ridiculous. So we'll see. I think that like how people in the crypto industry talk about Bitcoin and how they support Bitcoin continues to be a massive way to determine their authenticity. Like you have people who run crypto businesses with tons of tokens who treat Bitcoin

seriously like Jesse, you know, at Cracken, et cetera, et cetera. And that helps you differentiate them from people who don't. People like clowns like SBF who at who were in back and forth. with Bitcoiners a year ago, two years ago, about proof of work and about lightning. And he went out there and said that Bitcoin would never be used for payments. That was on the front page of the FT. This was like a year ago. And we were all like, who is this clown?

Like, how is this being possible? So, of course, no, like, we didn't know that he was perpetrating like this much, like, theft. And we didn't know, like, how many billions of dollars of tokens he had over at Alameda that he was just, like, sort of gambling away with customer deposits. And we didn't know that he had $500 million dollars of base. customer deposits deployed into VC stuff. These things weren't known, but like there were plenty of red flags, right?

But, you know, we'll see what happens in the next cycle. But I do think that, like, it's relatively easy to see in the wider crypto space who should be taken seriously based on how they treat Bitcoin and how open-minded they are about it. So I think that's a nice little way to, like, kind of put our hat on as we move forward into 2023. You can kind of like parse what these actors are saying and, you know, how open they are to what's happening in Bitcoin. And God, in the no-coiner land, it's like these folks are just so clueless.

I mean, people that I've had actual debates with, I mean, on your show even, who are smart people are now just saying they're reverting. They admitted that Bitcoin had a use case. And now they're saying it doesn't. And, man, I'm not going to name names, but these are some famous people who have lots of followers who are now just like back to their old prop of this thing's like bad and useless. And man, it's amazing to watch this happen. I actually think back to that conversation, holding aside who you're speaking of. So you had a conversation with Ben Hunt on this show in late 2020. And I actually think about it quite frequently because it was a long conversation.

Yeah. It was a good faith conversation. Neither of you guys came in with sort of clause out or anything like that. And really what it came down to, if you sum up the entire, like, I don't know, however long it was, hour, hour and a half, two hours. It came down to Ben saying, if Wall Street gets its dirty little pause on this thing, it's useless. And you say, no, it isn't. Like, that's just factually not true. You could never get over that impasse because the context that you were coming from is like, do those people playing their financial games with Bitcoin make it useless to all the people

that you just experienced in Ghana, you know, from all over the continent? And he's, his answer was Yes. Yeah, well, he's not here to defend his peace, so I won't go into that. But the point is that, like, it was amazing to think about those debates that we have over here, which are kind of like these very sheltered debates, which are about a thing that neither Ben nor I rely on to survive, right, or that we need to interact with the wider world. And then I just transpose that or I compare that to what I saw in India or in Africa. And I'm just like, man, we're living in two different worlds. That's exactly the point that I want to make. I didn't want to kind of put Ben on blast in terms of. of his point. It's more just the fact of what you saw as this was happening, as he was and other people like him were remaking those points, I think is sort of just the contradiction right there. Well, and this is a larger point about the world. And the world is split into two. The haves and the have-nots. You've got the golden billion who live in Europe and the United States and Japan and its allies. And they enjoy like a more stable financial world and they enjoy a better

kind of like arrangement of productivity of labor and of manufacture of goods. And this is just sort of the dominance of the world today. Like some countries just benefit from the system. And the vast majority of people suffer in the system. You know, they are on the other end of that. And this is a system enforced by, you know, groups like the IMF and the World Bank. And you have powers that be and you have everybody else. And for everybody else, Bitcoin's really exciting because it gives them a way

to communicate without benefiting the powers that be. And it gives them a way to do commerce and to transact with each other in a way that doesn't ask for permission from those powers that be or that doesn't somehow benefit them. Like all of the existing banking systems in the world exist to benefit the powers that be. That's literally how they're built up and how they're designed. You've got all these countries borrowing and basically paying over time money to these banks that loaned to them in the West.

You know, those banks are making money off these. poor countries. And again, in countries like Africa, you can see in the payment systems, they're making money off the fact that it's, like, very expensive for Africans to transact with one another across borders, Latin Americans, Southeast Asians, et cetera. So the world is very unjust in the way that it's structured currently, at least from a financial, economic, political point of view. And Bitcoin is really growing in the areas where people have a tougher time. And I don't know if Satoshi could have predicted that one. I mean, it's kind of amazing. But, you know, I think they predicted a lot of things, but I don't think they predicted

that. And I don't think they predicted this other thing, which is so incredible that's happening, especially in Africa, is that the way that people are going to be able to monetize stranded energy and turn it into Bitcoin for economic activities, just remarkable. Like, I love seeing what's happening with gridless, this company out in East Africa. They're helping electrify villages that have hydro with microhydro. This is something that block and still Mark invested in recently. that was a big round. Eric Hursman, who's helping lead that effort is like just an awesome person and really sees the benefit here in helping communities get cheaper energy.

What's so cool about this is it doesn't require like a government subsidy. There's not like, it doesn't require taxpayer money to like fix this problem. People are bringing their own capital from elsewhere to come into these villages to set up these mines because they're making money too. But guess what? It means cheaper electricity for the village. And that's like the whole incentive mechanism of Bitcoin. both in the energy market and in the financial market is so interesting.

Like, I just think it has different incentives. I think it's fair to say that the current world, wherever you stand is broken, the incentives suck. Even if you're pro-capitalist, you have to acknowledge that, like, quote-unquote, capitalism is wreaking havoc in the global South. Like, this is just what it does, right? And maybe you want to say, well, it's not real capitalism. Well, fine, that's fine.

But the reality is that we now have a different incentive mechanism, and it's interesting to see companies out in Africa cooperating. I think the Bitcoin system just has different incentives. Like it's, you've got companies cooperating. And because everything's open and it's one, one standard, it's very, very different from the monopolist kind of capitalist structures we've had in the past that trend towards monopolization and rent seeking and exploitation. Like, this is a system that trends potentially towards cooperation and lowering the cost for people. So I think that that's my biggest takeaway. this year as I've started to sort of notice this incentive design of Bitcoin, like maybe really,

really paying off in terms of empowering communities and maybe even nations in the future. That's a pretty good note to end on, but I think for the sake of consistency, I'll ask you one more question, which is just what does a successful 2023 look like for Bitcoin? Yeah, well, I think more global adoption, more growth. I think that if you saw more developers contributing from Southeast Asia and South Asia and Middle East and Africa, sub-Saharan Africa and Latin America, more events, more conferences, more Bitcoin meetups, more communities, more products coming out of these places. I mean, that's really going to be, you know, what determines whether it's a successful year. And I think that we're really well set up for that. And I think that anybody in Bitcoin or cryptocurrency that's not paying attention to these trends owes themselves a pilgrimage to going to one of these.

Bitcoin conferences in these countries and seeing for themselves, like, what's actually happening? Like, it will, even if you're jaded and knowledgeable about the industry, I think even the most jaded or bullish, but, you know, whether you're bullish or bearish doesn't matter. But even the most knowledgeable industry participant who's been in crypto for 10 years, or he's been studying it from the desk of a financial services company and been thinking about, how do we introduce this to my colleagues? Like, for anybody in that sort of situation, you really owe it yourself to going to one of these events next year and getting out there and seeing what people are doing with this thing.

It is very inspiring and energizing. And I think that's where I stand today is just extremely energized from what I saw. So really looking forward to 2023. Amazing. Alex, always great to have you on. I think your level of energy relative to the average guest on this end of your shows, I think tells the probably listeners all they need to know about. Fired up, man.

Let's go. Yeah. The excitement versus something. So great to have you as always and look forward to our next catch-up. Hell yeah. Thanks for having me on. All right, guys, back to NLW. Now, if you've listened to all of these interviews, this is not a group of sad sacks who are wallowing in whatever the problems of this year were.

It's all people who are looking forward, who are firmly pointed straight ahead. But I still think there's something so clear in Alex's energy compared to everyone that I've spoken with. That is just so different. We talked about it on the show, but I really do think of what the contrasts. must have been being at the Africa Bitcoin conference, seeing all of these people who are using Bitcoin in real ways in their real lives to benefit themselves, their families, and their communities, even as all this bullshit with SBF and FTX are transpiring.

It could not be more discordant, and it could not be a more clear reminder of what really matters as we close out 2022 and head into the new year. Certainly, if nothing else, it's a reminder for me of what got me excited about this space in the first place. And I'm so excited for a chance to have more conversations like that one, as well as with the people that Alex was meeting with directly. I'm incredibly appreciative of all of my sponsors, of my supporters, of my listeners throughout this year. And I can't wait to get to 2023. So one last time for 2022. Until tomorrow, be safe and take care of each other. Peace.