The Wolf Of All Streets - Bitcoin Will Replace Countries | Edan Yago, Sovryn

Episode Date: September 14, 2021

Edan Yago from Sovryn makes a bold assertion: “Bitcoin is the first time in 2,000 years we have had a revolution in human rights, specifically in property rights.” As explained in the episode, Bit...coin will not just change the lives of individuals, but it will reshape the way humans interact with each other on a geopolitical level. Right now, Sovryn is working at the forefront of Bitcoin development to turn these ideals into reality. Edan Yago: https://twitter.com/EdanYago Sovryn: https://twitter.com/SovrynBTC ーーー Sorare: Where fantasy meets reality. Collect, trade and earn weekly prizes on https://thewolfofallstreets.link/sorare. #OwnYourGame ーーー If you enjoyed this conversation, share it with your colleagues & friends, rate, review, and subscribe. This podcast is presented by Blockworks. For exclusive content and events that provide insights into the crypto and blockchain space, visit them at: https://www.blockworks.co ーーー Join the Wolf Den newsletter: ►►https://www.getrevue.co/profile/TheWo...

Transcript
Discussion (0)
Starting point is 00:00:00 This episode is brought to you by SoRare. Stay tuned for more information on them later in the episode. What's up, everybody? I'm Scott Melker, and this is the Wolf of All Streets podcast, where twice a week I talk to your favorite personalities from the world, so Bitcoin, finance, trading, art, music, sports, and politics, basically anyone with a good story to tell. Now, today's guest is making his triumphant return to the podcast as a fan favorite from the Bitcoin development community. Not only does Adan have an amazing backstory that shaped him into the entrepreneur and builder that
Starting point is 00:00:32 he is today, he's also on the forefront of Bitcoin's cutting edge development. He's a core contributor to Sovereign, so I plan to dive deep into how Bitcoin will evolve as an asset and why Adan is motivated to work day in and day out on improving the most important asset of the 21st century. Adan Yago, it's a pleasure to have you back on the show, man. Dude, it's so fun to be back. Thanks for having me. Yeah, I mean, this has been scheduled. I feel like we've had this coming for a while after we hung out in Miami. So I'm glad we finally made it work. So before we get into Sovereign, I wanted to see what your thoughts were on the recent price dump that was perfectly, magically timed with El Salvador's adoption of Bitcoin as legal tender.
Starting point is 00:01:08 What did you think about that? I hope it was the IMF and the World Bank. I mean, how awesome would it be if we've reached the point that they are attacking Bitcoin because they realize that it's now war. Sovereign countries are adopting Bitcoin. 12 years. It's 12 years since Bitcoin got started, and it's already legal tender in a country. There are several other countries that are looking at making this happen. I mean, if I was the IMF, I'd be dead scared.
Starting point is 00:01:35 So, you know, these price dumps, their noise, the long-term signal is unbelievable. There's never been anything like this in the history of mankind. I think it's interesting that you jumped right to the IMF and World Bank, because I separately did as well. In fact, I said on Twitter, I'm not much of a conspiracy theorist, but this is just too perfect after we've seen the IMF and World Bank already criticize the move. And we know that they control the currencies and the politics of many nations. Yeah, it was super perfect. It was, I mean, actually, I tweeted out that same day. The minute the price started dumping, I tweeted out, today's conspiracy of the day, IMF are
Starting point is 00:02:12 attacking Bitcoin with all their might. And then 20 minutes later, I saw Naeem Bukele, the president of El Salvador, tweet, thank you, IMF, we're buying the dip. I mean, that was really an astounding, astounding move by him. I mean, he seems to be really baiting the beast, right? Yeah, yeah. But, I mean, you think about what it takes to be the first country to do this. What kind of leadership a president needs to have. Now, I'm not a fan of politicians and I'm not a fan of
Starting point is 00:02:48 states and statism. And for me, the dream for Bitcoin was never that it was going to be adopted by countries, but that it's going to replace countries. I think that Bitcoin is the first credibly neutral government and it's going to be the first world government but um i have to tip my hat to el salvador and what bukele has done it takes tremendous courage to be the first in this way and honestly there are very few opportunities where a small country the size of el salvador and the positioning of el salv Salvador can become a world leader and get the leverage to actually, you know, go from being a violent sort of written off country to becoming a world leader. And the fact that they've grasped this opportunity is phenomenal. And to me, it's like the final tick in Bitcoin scalability, because what Bitcoin has is the world's greatest scalability when it comes to sovereignty.
Starting point is 00:03:51 Right. Bitcoin makes individuals sovereign. It makes it's now started to make, you know, the corporate treasuries sovereign. And now countries themselves are using Bitcoin to claim their own sovereignty. And that is a really interesting thing that, you know, the same advantage that Bitcoin gives to the individual, it's now giving to countries which have been cut out of the power loop. They don't have the yuan. They don't have the USD. You know, they've lost a lot of their sovereignty over the last years. And this is a way for them to reclaim it. So this is a very, very powerful tool. I've never heard the term or the idea of it being scalable for sovereign scalability.
Starting point is 00:04:36 It's really powerful when you think about that and that it is truly scalable on every single level for sovereignty. Really, it's something I didn't think about. I think what else is really interesting about El Salvador that's kind of being missed in the news cycle, their currency is the dollar, right? This is not Venezuela.
Starting point is 00:04:53 This is not Argentina. This is not a company with a hyperinflated local currency that has no value elsewhere. This is a country that uses the US dollar, which is considered this most stable currency in the world, a global reserve currency. Doesn't that make this even bigger news? Yeah, I think it's really interesting in several ways. I mean,
Starting point is 00:05:12 so there are a few countries that have had to abandon their own currency. You know, typically, it's very weak countries. And when you do that, you give up a lot of sovereignty as a country. Now, what El Salvador has said is we've given up that sovereignty already. How do we regain it? The traditional path, we would go and create our own currency again, right? But what El Salvador has said is that there's now a way that anyone, including a country, can gain monetary sovereignty. And they don't have to create their own shitcoin. And so that's what they've done.
Starting point is 00:05:48 And it creates a model for so many other countries in the world. And if you look at what's already happening, just in the week after El Salvador's law went into effect, Ukraine, Panama have both announced that they're introducing new laws. Paraguay have introduced a new law. And there are several other countries that I know of that are preparing laws of this kind. There's other countries that are looking to do legal tender laws. There are other countries that are looking to eliminate capital gains taxes for Bitcoin. They've already, you know, there's that video that we've all seen of that guy, you know, dancing on the hill, right?
Starting point is 00:06:32 And it's just one guy alone. And then, like, he's, you know, he's not an attractive guy, sorry to say, right? And then his even less attractive friend comes and dances with him, right? And it's like, well, this isn't going anywhere. And then suddenly it's everyone right it's that that courage to be first uh what's nice about the space the crypto space the bitcoin space is it is made out of pioneers we've all in a way had the courage to be first we've had the courage to be first to adopt bitcoin we've had the courage to be first within our families uh uh to adopt we've had the courage to be first to adopt Bitcoin. We've had the courage to be first within our families to adopt. We've had the courage to be first to adopt some kind of new application
Starting point is 00:07:09 or new wallet. We are all pioneers and now countries are joining us. Why is sovereignty so important to you? I mean, it's so important, obviously, that the project is called Sovereign, right? So clearly this is a key, key facet and driver in your life. So talk about why sovereignty is so important conceptually. And then we will get into sovereign, the coin and project. So I actually haven't spoken about this ever. But a few months ago, at least not publicly, a few months ago, I was in hospital, I was, i had to be resuscitated twice i went in for a very simple procedure the doctors made a mistake and i ended up uh you know the recovering from from a near-death experience in three surgeries and um hospital is a horrible place it's a place of incredible misery but the moment that i remember
Starting point is 00:08:07 as most miserable was there was a guy who wasn't even that old must have been in his 50s a cross like in a bed across from me and he kept on shouting at the nurses that um they didn't control him and it was such an impotent rage because they totally controlled him they could tell him that he needed their help to do everything to eat to go to the toilet everything this man had no control over even the most basic functions in his life and And the result was pure misery. Now, for me, that was an incredible, it was weird because I was in hospital and I spent a lot of time thinking about Bitcoin. But the reason for me, the connection was,
Starting point is 00:08:56 I think that there is nothing as dehumanizing as being powerless. And the opposite of being powerless is to be in control of your own fate. And for me, that's what sovereignty is. It's having control over your own fate. And the way that starts is you have to be in control of your health, right? And Bitcoin doesn't fix that, although I think it may lead to a world where we fix it. And we can talk about that in a moment. But the next most important thing is being in control of your finances being in control of your wealth being able to have ideally
Starting point is 00:09:31 fuck you money right and and that reminds me of something my great-grandmother told my grandmother and she told my mother and my mother told me which is um uh there there are many many things in life and and money isn't one of the important ones, but it's the way you get all the others. So if you're not sovereign when it comes to your wealth, right? If you can't be in control of your life, you're not going to be able to help your family.
Starting point is 00:09:59 You're not going to be able to decide your future. You're not going to be able to make the choices that express who you really are. And that's why you really are. And that's why it's important. And you touched on the idea, which is a big idea, that Bitcoin could replace governments. Bitcoin could be a government. You just said Bitcoin could improve our health. Could you talk about these sort of larger issues that you believe in that maybe other people have never touched on or thought about? Yeah. So I, in a way, think that pretty much everyone has missed the big story about
Starting point is 00:10:27 Bitcoin and crypto. I think everyone's confused. I think Bitcoiners are confused. I think people in Ethereum are confused, right? So Bitcoiners, for example, think that Bitcoin is primarily a store of value, right? They think that the most important thing maybe is scarcity. Like there's a bunch of different narratives about what's important right but the whole store of value digital gold thing has become like a very big meme in bitcoin ethereum have like a whole bunch of other memes some of those memes are just aping into bitcoin's meme right so the the ultrasound money is just like a like copying bitcoin's meme But they also have like other memes like world computer, right?
Starting point is 00:11:07 So everyone's trying to figure out what is actually the core innovation here. And I think the core innovation is actually quite simple. It's very narrow, but extremely deep. And what it is, is it's the first time in 2000 years that we've had a revolution in human
Starting point is 00:11:26 rights. And specifically what I mean is it's a revolution in property rights. So up until Bitcoin, there was no such thing as digital property rights. You look at the internet, it was supposed to be this tool for freedom. It became a tool of surveillance capitalism. Why? Because nobody has any rights to anything on the internet. The only people who control anything are the land barons, the Facebooks,
Starting point is 00:11:50 the Googles, the Amazons of the world. You are just a fucking serf because you don't own anything there. And so we have no freedom on the internet. The most free place became a place where you get kicked off of Twitter because you said something about uh you know a vaccine that you didn't like right um why why did the internet become such a rotten place it became a rotten place for the same reason that the soviet union became a rotten place because there were no property rights property rights are at the basis of every single right in the world in fact i would go so far as to say the only type of rights that exist are property rights are at the basis of every single right in the world. In fact, I would go so far as to say the only type of rights that exist are property rights. You have property rights over your body. No one's allowed to attack you. No one's allowed to coerce you. You have property rights over the things you create or through what you create, you acquire. People can't steal from
Starting point is 00:12:38 you, right? You have property rights over your body. It means that you're allowed to move around and you have property rights over your thoughts and what you say doesn't mean that you can walk into my house and shout at me but it means that you in in your environment can say or think whatever you want every right is a property right and until bitcoin came along there was no way to have rights in the digital space and the digital space is so huge for us. So that's a very, very big change. And it's why we've seen in 12 years crypto go from nothing to a $2 trillion economy, because nothing creates prosperity like property rights. But it even goes deeper than that, because this is a new type of property right in an even more exciting and
Starting point is 00:13:26 fundamental way. Up until now, all property rights were protected through violence. Either you had to protect your property and your body yourself, or there was someone you were protecting protection money to, we call that taxes, and they had big men with knives or swords or guns, and they were supposed at least to protect you. But with crypto, you get property rights that are borderless. They exist everywhere in the world at the same time. So they're enforced everywhere. It's not just enforced in one little country. And they don't rest on violence. They rest on maps. And the crazy thing is they're even more secure as a result, right? Like even a government can't take your Bitcoin away from you. Like they can't brute force your address.
Starting point is 00:14:10 And so we have an entirely new realm that's opened up for us, the digital realm, an entire new frontier for economic activity where we can connect everyone in the world. We have a new way for them to protect their freedoms, like freedom of speech on the internet, by creating systems that have property rights for what they say. And we've created a way to manage property rights without violence and without borders. So that's a huge fucking revolution. And the magnitude of that change, it's crazy to me how few people are talking about this very, very simple idea that all blockchain is, is digital property of something that he discussed. And this really takes that even a step further. Because even real estate, you pay property taxes. Like you said, it's sitting in a city that an army can march into and take it away. How many times have we seen things that you own and have property rights to in the real world removed by brute force? So that said, you say this is the first time we've had the rights to
Starting point is 00:15:26 digital property, but you could almost make the argument it's the first rights you've ever had to any property at all. Yes. Yes. It's the only time that even a weak person, even the guy who was in the hospital, right? He may not be able to control his bowels, but he can control his private key, right? That's how powerful and equalizing it is. It is in many ways, I don't think there's ever been a technology that's equalized between people as much as this. Like the guy who's living in a shanty town outside of Lagos in Nigeria has as much access to property rights as you and I do, right? That's crazy. It really is. So that means that Bitcoin obviously is way more than the store of value in the narrative that we've
Starting point is 00:16:10 seen solidified, as you mentioned. What else then can be built on Bitcoin to improve on this idea? Because I know that that's what you're focused on with Sovereign. And a lot of people just see it as it stops at digital gold, right? You store it, you never use it, you never sell it, you pass it on to your kids, which, by the way, is fine. But to you, there's obviously so much more that can be done here. Yeah, I don't think it stops with digital gold, right? I think it starts there.
Starting point is 00:16:41 I think that's where it starts. I think on top of that, you build everything, right? The first step to prosperity is giving people property rights and sound money but then the question is okay now what do you do with that and so um i think that uh there's the ability to generalize that principle and i think one of the the exciting things that Ethereum have done is they've shown, like the Ethereum system has shown, at least on a theoretical basis, how you can generalize this idea of property rights. So if you think about what NFTs are, right, a lot of it is nonsense right now, but that's because it's experimentation. So it's good nonsense, right? But it's a general, it's an attempt of us sort of like the, you know, we're living through this
Starting point is 00:17:27 really, really exciting time where we're just sort of like touching the edges of innovation all the time and keep pushing them further. And so NFTs are an additional attempt to think about how do we push forward this idea of digital property rights. Now, where I think it gets exciting is when we start connecting it to the way that we live our lives. And so what Sovereign's mission is, is to basically be an operating system for giving people sovereignty. And where it started is by bringing decentralized financial and economic tools to Bitcoin. So it extends upon Bitcoin, which to my mind, there's nothing that comes anywhere close to Bitcoin in terms of credibly neutral property rights. But it now lets you use your Bitcoin. So you can lend your Bitcoin, you can borrow Bitcoin, you can trade with your
Starting point is 00:18:17 Bitcoin, you can create Bitcoin-backed stablecoins. And that is going to be really interesting in the context of El Salvador. So we can talk about that in a moment. You can do perpetual softs, like anything that you'd want to do through a centralized intermediary, you can now do without the intermediary. In other words, you can now continue to use Bitcoin in a sovereign way, even when you're using it. And one of the reasons that people have been huddling their Bitcoin, including me, right, and not using it is because the one thing that we're not willing to give up, you know, I've gone to all the efforts to get Bitcoin.
Starting point is 00:18:50 I'm not going to go through another intermediary again. But now you've got a trillion dollars worth of assets in the form of Bitcoin that are being unlocked by sovereign for the first time, because all of those people who don't want to go through intermediaries now don't have to ever again. So, so that's step one, but step two is, you know, and then it's going to step three and step four, but, but like what comes next is starting to introduce other use cases, the ability to get out, to, to, to have a mortgage and, and, and to manage property rights in a digital way. And so one team that is working with Sovereign is working on introducing mortgages.
Starting point is 00:19:31 And I think we're going to see before the end of the year, we're going to see at least one jurisdiction which has moved its registry into the Bitcoin blockchain. Pensions, right? Why would you want to trust your government or a company that could go bankrupt with your pension, right? You can create pensions which are uncensorable, permissionless, and will last for as long as Bitcoin, which is to say for as long as any computer exists in the world. And then you start thinking about things like DAOs. And effectively, what Sovereign is, it's created a system of governance called the Bitocracy, which is based on Bitcoin, right? It's secured by the Bitcoin
Starting point is 00:20:10 miners themselves, but they have no view into it. You can start creating nations. These nations can have countries, they can have land or not have land. Panama are already talking about creating a DAO out of their country. And this is all stuff that's going to happen. It's like, it's crazy science fiction stuff. And it's going to happen. Some of this is going to happen this year. And some of it's going to happen over the next 10 years. But this is all stuff that's happening. It's unbelievable. The question then, I guess, and you've somewhat answered it, but Ethereum does a lot of that. Right. Obviously, I mean, an NFT effectively is what you're discussing, not as a JPEG, but the idea of transferring something that's provably scarce and is one of one, you more expensive, are potentially faster, obviously. And we're seeing a number of layer ones sort of proliferate in the market.
Starting point is 00:21:09 Why does this have to happen on Bitcoin? Yeah. So I think there's a few reasons. One of those reasons is what I mentioned earlier, which is scalable sovereignty. Bitcoin has better scalable sovereignty than any other system. Partly it has scalable sovereignty because of proof of work. So proof of work is a really interesting idea. It forces the miners to spend money all the time, right? It's like use it or lose it, right? If you are not hashing with your mining rig, your mining rig is useless. It's a waste of money. So you basically, in many ways, proof of work is proof of burn, right? You have to like burn money to make money. So you basically, in many ways, proof of work is proof of burden, right? You have to
Starting point is 00:21:45 like burn money to make money. That's like being a farmer. And being a farmer is the most honest profession that has ever existed. You go out on the sweat of your brow, you make something, right? You know who corrupted farmers? Landlords, right? Land barons, right? They extract rent. They don't do anything. They just get money right from land that they own that's what proof of stake is and in proof of stake you have a bunch of ease you stake it stake it and forget it right it's lose it use it or lose it or stake and forget right and stake and forget makes the rich richer whereas proof of work forces anyone who wants to be a miner to continue competing and working. That's two different dynamics. It's the dynamic of everyone's a
Starting point is 00:22:30 farmer, everyone's equal, or it's a dynamic of users and land bearers. So that's one reason. The second reason is that Bitcoin has created something which is not a technology. A lot of people are confused, I think, about what's going on because we're so used to seeing big tech companies grow. It's been 20 years of tech has led everything, right? But Bitcoin isn't a tech play. Bitcoin isn't even software, right? Software is something which gets upgraded all the time
Starting point is 00:23:01 and you have to think, am I using the right version? And there constantly need to be people in charge of making sure it's working. Bitcoin is something totally different. It's reliable. It's the same way for you today as it will be for you in your retirement and for your grandchildren, right? It doesn't change. It's instead of being software, it's permaware, right?
Starting point is 00:23:24 Now, this is extremely important because right now, crypto is all us. We're kiddies. Right. We're young people. We're men. We're gamblers. We're, you know, we want to get rich quick. That's 1% of the world's wealth is interested in it.
Starting point is 00:23:40 99% of the world's wealth is interested in wealth preservation. Right. Where is all the world's money? It's in real estate. It's in long-term bonds. It's in gold. So if you want to build an economy that is stable, you need to build on something which is stable. You can't build something stable on unstable foundations. And the problem with Ethereum and all of these other systems is they misunderstood the basic fundamental of what we're building here, which is digital reliability, reliable property rights forever. And so those
Starting point is 00:24:11 are basically the two reasons. It's just a fundamental misunderstanding what we're trying to build. Do you love sports collectibles or fantasy sports as much as I do? SoRare is blending this together to create an entirely new gaming experience powered by its community. SoRare cards are officially licensed NFTs for over 160 clubs, including Real Madrid, Paris Saint-Germain, and Liverpool, and all built on Ethereum. You truly own your collectibles. They are productive gaming assets that will generate rewards if you're a good fantasy player like me. Join SoRare and connect with your favorite teams, live the game with passion, and earn weekly prizes. You can do all of this at the wolfofallstreets.link slash SoRare. That makes sense. You talked about the idea of Bitcoin-backed stablecoins, which I definitely want to dig into more because there's a lot of controversy around our existing stablecoins,
Starting point is 00:25:01 right? And how they're backed and whether they're going to be solvent, if there's a bank run, there's a lot of reasons that people are skeptical about stablecoins in general. So what does a Bitcoin-backed stablecoin look like and what are the advantages? David Sherman Yeah. So let's think about a country like El Salvador, for example, right? Because that's probably going to be one of the first big consumers of Bitcoin-backed stablecoins. A country like El Salvador has two currencies. It's got the USD and it's got Bitcoin. USD sucks. They don't control it.
Starting point is 00:25:32 It's controlled by the Fed. It can get sanctioned. The banks can cut them off. The banks, you know, IMF can put pressure on them, et cetera, et cetera, et cetera. Bitcoin sucks. For day-to-day use, it sucks. Too volatile. Right? So how do you get past this?
Starting point is 00:25:48 Well, you marry those two things. You create dollars that aren't printed by the FED. You compete with the FED instead, and you create dollars that are backed by Bitcoin. So the way Bitcoin-backed stablecoin works is in one way or another, you collateralize Bitcoin. So you basically have a smart contract that takes your Bitcoin, right? It holds the Bitcoin for you, and it lends you back dollars on the basis of your Bitcoin. And those dollars are always going to be worth a dollar because they can always be converted into a dollar's worth of Bitcoin. This is not a new idea. This is exactly the way currency worked until 1971, right? There was gold and then the paper notes that were circulating
Starting point is 00:26:27 only had value because they were redeemable for an equivalent amount of gold. So this is basically bringing the idea to digital gold. Now, what's really important here is that that never gets corrupted. So today, there's not really anything like that anywhere in the world. On Ethereum, there started to be something like that, which was DAI. But DAI is now 52% backed by USDC, which is, you know, I mean, like now it's backed by these fiat stablecoins, which are less reliable in many ways than bank dollars because they're not bank dollars. They're just like an additional derivative of the dollar. So you have to create this in a principled way. And if you do that, it's game over.
Starting point is 00:27:10 And the reason I say it's game over is because the biggest challenge in crypto right now is how do you get regular people to use it? Absolutely. And I think the way you do that is by giving them sound money, which is backed by sound currency, right? So the money is what you use on a day-to-day basis. That's going to be the stable coins and it's going to
Starting point is 00:27:30 be backed by sound currency, which is Bitcoin. It's an interesting concept. I've made the argument that I banged my head against a wall trying to convince a lot of my friends to buy Bitcoin for years unsuccessfully. But the thing that got them into quote unquote crypto was when they found out they could buy USDC, park it on one of these C5 platforms and get 10% a year. Because as kids, you could put money in your bank account. We all grew up with savings accounts in our 40s. For the 1980s, you made 10% on your money and it was very easy. So selling the yield concept is extremely easy for people who don't even understand Bitcoin. So what you're describing is really taking that a step further and having something more solid behind it than simply a
Starting point is 00:28:11 dollar. Yeah. And it's working. I mean, the last time I spoke to you on this show was before Sovereign had launched. Now we're four months after it had launched. In those four months, there's now $72 million that are being managed in the sovereign protocol, not including over a half billion dollars staked in the protocol. There's tens of thousands of users. And what are they there for? They're there for borrowing and lending and trading with their Bitcoin without an intermediary. So sovereign is very, very small in comparison to DeFi protocols and
Starting point is 00:28:46 Ethereum, but it is designed to do something, I think, very, very different. It's designed to provide an entire financial system, which can be used by regular people and can be used by people like in El Salvador to create a truly alternative financial economic system that regular people would be interested in using and regular people can rely on and regular people can create pensions in which their children can inherit. And I think that is the future of what we're building. You talk about being the future. And obviously, the argument there is that it's not the present yet, right? Because you talk about it being for ordinary people. Ordinary people are the ones who like to buy Bitcoin on PayPal or the Cash App,
Starting point is 00:29:28 if they're even considering Bitcoin at all, right? They want to use a trusted source. They probably want to put their Bitcoin in a bank because they feel like it's secure. So how do we jump that divide? How do we cross that gap where we go from, wow, this is like, I have to go sign up and get this wallet, know how to do the transaction, right?
Starting point is 00:29:46 It's still for techies and people who want to go deep down that rabbit hole to where it's a button click or two for your average person. And they use this just like they use all of the other systems that they trust. Right. So it's a million little things. It's not just one big thing, right? So it's Cash App starting to provide lending. When Cash App provide lending, I'd be willing to put good money that they do it with Solveit, right? Banks in the US are allowed to offer Bitcoin lending. We expect to see that in other countries as well. It's countries adopting it like El Salvador, like we were talking about. The previous company that I was running from 2014 was a remittance company.
Starting point is 00:30:28 And what we were doing was we were sending money around the world using Bitcoin to Nigeria, to Brazil, to the Philippines, to South Korea. So people interact with it that way. Ben Felix, Just to give you an example, one of our customers, just to give you an example, one of our customers was a Nigerian living in Tokyo who was exporting secondhand Toyota parts to Nigeria because they were much more valuable in Nigeria. And he couldn't get money out or he couldn't get money in except using Bitcoin. That's real-world use case.
Starting point is 00:31:04 He couldn't give a shit about Bitcoin. He just wanted to close pipes. That's interesting. You ran a remittance company and it actually was just a news story for El Salvador. Obviously, we all know that remittances are a huge percentage of El Salvador's GDP in any country like that, that just the introduction of the Bitcoin wallet and people starting to use them will be basically a $400 million haircut for MoneyGram and Western Union and these companies. They'll lose $400 million relatively immediately if there's any level of adoption because it will replace those predatory remittance systems that charge you 20%, 30% fees to send money across borders. That's
Starting point is 00:31:46 amazing. But can't we expect that they're not going to go quietly into the night and allow that to happen? These huge companies and countries that are seeing that amount of their GDP replaced, it's good for El Salvador. It's their country, but these companies and the other countries that are on the other side of those transactions? Well, I mean, Western Union is a really great example. Western Union is a company that has been around for almost 150 years. And do you know why it's called Western Union? Because it started out as a company in the West of the United States that would deliver mail on horseback. That's how it started. Then it became express. Yeah. Then that technology became obsolete. So it switched to telegrams and they started doing telegrams and they were wiring messages. And then that technology became obsolete. So they were like,
Starting point is 00:32:38 okay, what do we do now? We'll wire money because we're in the wiring business, right? So they've always been delivering something, but as technology has evolved, their business model has evolved as well. So Western Union, I think they're an amazing company. They're going to be around for another 150 years maybe. But they're going to be around for 150 years because they're going to adopt Bitcoin and they'll start delivering something else. They'll deliver stable coins, right?
Starting point is 00:32:57 Right. I was just going to say, they're just going to deliver stable coins. Yeah. And so are banks. I mean, we're not going to... ACH and Swift and all of these outdated systems that we've been using for 30 or 40 years. They're going to disappear and be replaced by stable coins. And if and so it's going to be an adapt or die situation. You can fight it as a country.
Starting point is 00:33:15 You can try to fight it. I mean, look what China did. They kicked out all the Bitcoin mountains. You think that's going to play well for them? Right. I mean, they are killing. They're cannibalizing their future. China has done this before, right? China- Ban everything. Exactly. Ban everything. Exactly. Right. That's what China does. I mean, but generally they replicate it, right? Ban Google, build your own Google, ban Facebook, build your own Facebook, whatever it is. And now they're building central digital currency.
Starting point is 00:33:42 No, that's because they had one good leader in a list of bad leaders. Deng Xiaoping opened China up. China was open to the world for business for a long, long time. And then it decided to close its borders and become very, very insular. And 100 years later, British warships were sailing up the Yangtze, right? And they had to cede Hong Kong because China dropped out of the world and it became an obsolete country. From becoming the inventor of everything, it went to a poor country.
Starting point is 00:34:15 And then Mao tried to copy everything and that didn't work. But Deng Xiaoping came along, opened up the country. The country started to flourish again. And now what are they doing? They're shutting down tech companies. They're arresting Alibaba CEO. They're kicking out Bitcoin miners. They're getting rid of online gaming and limiting it to three hours a day. And they're shutting down again. And if they keep doing this, right, China is just going to end up again where it was 25 years ago. You have a choice. You can either be part of the world and
Starting point is 00:34:47 part of the prosperity of that world provides. You can respect property rights and accept, you know, and have a flourishing society as a result. Or you can try and fight progress and progress will leave you behind. But for them, it'll leave them behind in future generations and they won't personally be blamed, which seems to be generally the MO for any politician anywhere. Right. And that's the reason that nothing really gets done is because everybody's worried about themselves and their job and not worried about what's going to happen 400 years down the road. And that brings me back to one of the things that I said, which probably may be sounding ridiculous at the beginning, right? Which is that, you know, Bitcoin doesn't fix health, but it might help. And what I mean by that is, I think everyone who looks around the world today has a feeling of nihilism or
Starting point is 00:35:35 pessimism and just sees a world which is getting worse, right? We've lost a sense of adventure. We've lost a sense of innovation. Things seem to be stagnating or going backwards. I mean, Australia became a penal colony again, right? It literally became a giant prison. We have a virus. It's dangerous. It's not the most dangerous virus we've encountered by any stretch of the imagination. I mean, HIV is much, much worse. The world continued with HIV, right? Now we have COVID. The world has panicked, lost its mind, and given up on personal liberties as a result. I think anyone who looks around the world now knows that things are sick. And the reason they're sick is because the systems we have in place, the institutions we have
Starting point is 00:36:18 in place, were designed for the world of the Industrial Revolution. But the Industrial Revolution is over. We switched over to a digital world. The problems we have are now global. Global warming, COVID, internet censorship. These are global problems. No national government can deal with them. Our institutions are no longer able to deal with the reality on the ground because they are designed for a previous reality.
Starting point is 00:36:46 They've become stagnant and sclerotic. And as a result, our societies have become stagnant. Academia was taken over by these industrialized governments. And as a result, science has slowed down. The medical world and pharmaceuticals were taken over by government regulation and the FDA doesn't allow anything to, I mean, didn't even allow COVID testing, right? So obviously you're not going to get breakthrough medications, right? And so the question is, how do we fix this problem? And we don't fix this problem by voting these politicians out and keeping the old system. We fix this problem by replacing the system with a system which is designed for the digital age. And I think Bitcoin is the first true example of that because Bitcoin creates rights, human rights, in a global, borderless way without violence.
Starting point is 00:37:35 It's a system designed for the digital world. This is why it's so exciting. So you talked about what you have built on Sovereign and you talked about, I guess, some of the things that can be, but what's the ultimate vision? So what does this world look like where Sovereign is at the core and Bitcoin is the reserve currency and that's how we're operating? So I can't say what Sovereign's ultimate vision is because I don't get to decide, right? Sovereign is a community. Sovereign is governed by its community and sovereign is created by its community. However, I can't speak for myself. My view of it is that we are going to go through, things are going to
Starting point is 00:38:19 get worse before they get better. And we're seeing that right now. This whole COVID thing is things getting worse before they get better. Inflation is going to happen before things get better. And we're seeing that right now. This whole COVID thing is things getting worse before they get better. Inflation is going to happen before things get better. Woke culture is going to get worse before things get better. Government regulation is going to try and shut down crypto and Bitcoin before things get better. Things are going to get worse before they get better. But when they start getting better, it's when we come together with new systems of governance and new ways of working as collectives to create the futures that we want for ourselves and for future generations. And the way we're going to do that is we're going to use the tools that we've recently invented and embraced. Sovereign, one thing which the entire community agrees on is it's designed to be an operating system for sovereignty. It gives
Starting point is 00:39:06 you sovereignty over your Bitcoin, it's going to give you sovereignty over everything else. I expect that sovereign is going to have the opportunity to govern pieces of land. I believe that what we are going to be doing as people is creating new types of digital nations, which will exist mostly in the digital realm, but will partially exist in the real world, just like our lives will. And I view Sovereign as a platform which is going to become a governance system for a nation, not a nation state, but a digital cloud nation, which has boots on the ground. And that is sort of the level of intensity that the community has in terms of thinking
Starting point is 00:39:56 through carefully how we do governance and how we build the scalability of the system, because we are trying to pioneer an entirely new way of living and i i know that what i'm saying sounds extremely abstract and difficult to envision and anything new sounds that way uh and and i don't think we'll be able to cover it all in this conversation maybe we should have a conversation just about what that world looks like absolutely because i think from conversations I've been having with people in the sovereign community
Starting point is 00:40:27 and also outside of it, that they're starting to form a really concrete idea of what this looks like, how we get there. There are people like me thinking about it, but also people like Bilagi Srivasanand. I think Vitalik, to an extent,
Starting point is 00:40:39 has been thinking about it. And there are other people in the space who are thinking about it as well. And an idea is starting to form around how we create new political structures that are going to ensure freedom better than anything we've had before, that are going to ensure equality on a global scale and are going to be able to deal with global problems. And I don't think it's going to fix everything, but I think it's going to end this period of nihilistic stagnation that we have of our global system not matched to our global reality.
Starting point is 00:41:12 You talk about the idea of things getting worse before they get better in that context, which I think everyone can agree on based on the path that we're seeing kind of humanity barreling down along. Isn't that a bit disheartening? Because that means that this will take generations. I mean, a vision like that, you probably think can happen in our lifetime. But I look at and I see the way that people interact, how programmed people are by politics and polarized left and right. Historically, that's the kind of thing that takes generations to eliminate. Yeah, that's true. Your average 40-year-old now is not going to think radically different about their lives when they're 70.
Starting point is 00:41:50 So I call bullshit on all of that. Okay, please. Please, I'm just going based on what I've seen in the past and the people that I know. And it seems people are programmed and deprogramming them would be a major challenge. Yeah. How the new generation coming in and thinks differently. I would agree with you, except Facebook is boomer tech right who's on facebook now people's parents and their grandparents exactly how long did that take that took 15 years it took 15 years for us to go to
Starting point is 00:42:16 the point that only young kids would use facebook to all everyone had left Facebook who was young because it had been taken over by old people. Bitcoin, 12 years from nothing to legal tender. And all of the pieces are aligned. The governments are over-indebted. Everyone understands the system doesn't work. We have digital property rights and a $2 trillion economy, which is growing exponentially, right? So it's a $10 trillion or $20 trillion economy, three, four years down the line, right? We have more and more people living more and more of their lives on social media and particularly in games, which means that virtual and digital
Starting point is 00:43:03 environments are becoming more and more important to everyone. We have people doing play to earn in the Philippines, right? And then going and spending that money in stores, like in physical shops, right? It's not just this is going to happen. This is happening now. It's happening faster than any of us would ever have imagined. And we've already been reprogrammed.
Starting point is 00:43:26 The reprogramming has already happened. And what I mean by that is you look at the polarization in politics, you look at the nihilism in the world, you look at the lack of hope. This is not a society which believes in its current system. This is a society that is just waiting for any alternative. And the alternative is being built out around it. I agree with that. The velocity of technology is so insane now
Starting point is 00:43:50 that it's hard to compare it to previous generations where maybe it would have taken three generations to deprogram things. And you make a great point about gaming and the metaverse because I think that's a lot closer than people believe. I think that my kids will probably be largely interacting for better or for worse in the metaverse, not in the real world. Yeah. I mean, like it's going to happen, not just to your kids, it's going to happen to you and I, like, uh, you know, I mean, we are, uh, we're going to resist
Starting point is 00:44:21 initially, but I'll give you an example. I, uh, I mentioned earlier, I was, I was, I had been hospitalized. I came out of the hospital. I needed to figure out how I was going to get healthy again. And I tried everything that I'd been doing previously, you know, like the, the, the workouts and it just, I didn't have the emotional or physical energy. And then my brother got me a VR headset and now, you know, half an hour, an hour a day, I am doing, I'm boxing. Like I found a boxing game. I burned 600 calories a day, right? Fighting virtual guys, right? I'm spending a significant chunk of my life. I'm online with you now. I exercise online, right? It's happening to us as well. So yeah, I think this is, I think we're not used to rapid change
Starting point is 00:45:10 because first of all, our brains aren't designed to think exponentially. And second, change has been suppressed for a long time, but it's bubbling under the surface. And I think, you know, this is going to happen as quickly as the iPhone is about. What does that mean in terms of price for Bitcoin? I know you're not one to make wild predictions based on timeframes, but I mean, if you really
Starting point is 00:45:35 believe that all of this will happen and Bitcoin is finite and deflationary, what does that mean for the price of a Bitcoin and for the accessibility of it to your average person when the price, obviously we know it can be divisible into sats, but what does that mean for the price of a bitcoin and for the accessibility of it to your average person when the price obviously we know it can be divisible into sats but what does that mean i i i tend to say this i think that every generation has a single decision that they need to make like broadly speaking and if they make that decision uh their lives are going to be fine for our grandparents this generation it was just go to college you went to college you got a college degree you were fine you could you could be a gambler you could be an alcoholic you could fuck up anything else you wanted in your life you had a college degree you were fine yeah for our parents generation was buy a house you bought a house in the 70s or the 80s it didn't matter if you took like the biggest fucking mortgage in the
Starting point is 00:46:21 world you just pay that mortgage 30 30 years. You end up with fucking money that you can give to your children, right? You're rich. You're a millionaire. Just one decision. For our generation, that one decision is buy Bitcoin. Buy and hold. Forget about everything else, right? You can just hold some Bitcoin. You want to trade, you want to gamble, you want to play to earn, whatever else you want, that's on the edges. So long as you're holding some Bitcoin, you're going to do fine. Because Bitcoin, in some ways, is real estate. It's better than real estate. No one can take it away from you. It's reliable. It doesn't end with the store of value, but it starts with the store of value of tomorrow.
Starting point is 00:47:03 And there's hundreds of millions of houses in the world, but there's only 21 million Bitcoin. So my actual price prediction, millions of dollars. What do you make of Fidelity saying a billion dollars of Bitcoin in 20 years? Yeah. I mean, that's going to happen if there's hyperinflation in the dollar, which could potentially happen in its death throes, right? As we move towards this system, which is 10 years from now, right? This cycle is going to start completing proper, right? Then, yeah, I mean, eventually you'll have like these dollar notes that are worth nothing. They'll just be like, you know,
Starting point is 00:47:37 like Venezuelan banknotes. And then you could have a billion dollars of Bitcoin, yeah. But I'm talking five years from now. I'm talking like a million dollars five years from now a Bitcoin. I'm totally unsurprised. Me too. That's 20x. Yeah. That's a Tuesday. We did almost that last year from the bottom to the top. I think people, it's sort of like you said, people don't think exponentially. If you think about the percentages and not about the numbers, it's not a wild prediction at all.
Starting point is 00:48:09 Yeah. People seem to be astounded that I think we can get to six figures. No, I mean, that's almost, it's baked in. That's just math. Yeah, right. Yeah. So before we're finished, what else can we look forward to in the future? What are you most excited that you're building right now?
Starting point is 00:48:27 So there's a few cool things that are happening on Sovereign right now. So one is Sovereign is introducing this really cool new way of creating sub DAOs, right? Because, you know, I said earlier, Bitcoin is going to be like the first world government, right? The reason it can be a world government is because it doesn't do anything except provide sort of reliable property rights and in the form of money right you don't want a global government to like prescribe to you like the speed at which you can drive on the street right you want it to have like just say like don't no murder that's a pretty that's a rule we can all agree on right so that's kind of
Starting point is 00:49:05 what bitcoin does now sovereign is now creating like these sub daos where each one can have its own token which allows the people who in that sub down to control that sub down and each of them are producing value for the parent now so like the bitcoin back stable coins that's a sub now the perpetual swaps that's a sub now the um bitcoin cit, that's a sub-doubt. The perpetual swaps, that's a sub-doubt. The Bitcoin citadel, that's a sub-doubt, right? Bitcoin citadel number two, that's a sub-doubt too, right? And so it's creating this way you can have this pyramid of governance where the part that governs the most governs the least.
Starting point is 00:49:39 And the parts that govern the most govern the fewest amount of people. That's, I think, the future of the full structure. Yeah. And so that's something that we're starting to see emerge now from Sovereign. The Bitcoin-backed stablecoins are emerging. In terms of products you can use, within, I would think, probably less than two months, you're going to be able to take out a loan on your Bitcoin and pay zero interest rate. So that is a product which is being built by a sub DAO, like a group of people who are working as a sub DAO, and they're
Starting point is 00:50:09 going to create a system which gives you zero interest rate, perpetual loans in your Bitcoin. And that means you never have to sell a Bitcoin ever again. You want to pay your rent? Just take a small loan from your Bitcoin, you pay your rent, and the appreciation in price, basically, you can buy a fucking house just from the appreciation in the Bitcoin. Just make those little mortgage payments once a month. And then I think by the end of the year, we're going to be offering mortgages to people in in parts of Central America through Sovereign. I've been in Bitcoin now almost 11 years. And this is the most excited I've been in about 10 of them.
Starting point is 00:50:48 How do people get invited to the Citadel? I don't know, but I think you go sign up for Sovereign's email and you'll get an email when there's an invite rate. I get the information. I mean, you just, you pass over it like casually, you know, one of the sub-dows is Citadel 1,
Starting point is 00:51:08 one is Citadel 2. What does that mean? Come on, what does that mean? We all hear about the meme of the Citadel. What does that mean? What does the Citadel mean? What I believe it means is intentional communities of people who come together
Starting point is 00:51:18 and have autonomous self-governance. And I have been involved for a long time in the Free Cities Project. And look, I don't want to do a Cardano and talk about things that haven't happened yet, right? So I'm not going to, but I can say that people are working. I can say that people are working on things
Starting point is 00:51:40 which I think are very much closer to reality and much closer to be instantiated in a way that you and I will be able to use them. And pretty much anyone imagines. Okay. So tell me how many months down the road we need to reschedule. So I can get a third conversation and more information on all of this. Six months, four months. I'm serious. I'm going to put you back on the calendar. I'm going to do this again.
Starting point is 00:52:04 Let's let's make a bet, all right, that I think I'll have something interesting to say about this within four months. I'll take that. End of the year, basically. Maybe just that. Okay. All right. I'll take that bet and we'll put it on the books to see if... But I don't want to even be on the other side of that bet because I know you and I know that that's definitely going to come to fruition if you say it. So, but, but sure, I'll take it just to be a sport. So where can everybody follow you and check out Sovereign and become a part of the community? So the most active place to be part of the community is in the Discord channel. So the Discord server, so Sovereign Discord server. Really easy place to follow is Twitter. So Sovereign BTC. So Sovereign is S-O-V-E-R-Y-N BTC. And you can sign up for the email for updates at
Starting point is 00:52:54 S-O-V-E-R-Y-N Sovereign.app. And you can follow me if you want at Idan Niago. Thank you so much for doing this. I mean, and I'm glad that we finally got it back on the books. You're one of my favorite people to talk to, both on and off camera, because it's inspiring and you think big. And I don't think that people do that enough. You know, you speak about these concepts that seem so insane and crazy,
Starting point is 00:53:20 probably to your average person. You speak about them casually as if it's happening tomorrow. It's happening tomorrow. I mean, like tomorrow is the rest of our lives but it's definitely absolutely love it we will definitely get another one on the books you know i'm a huge fan so thank you for taking the time thank you for having me i love your conversations and and they're they're always such fun thank you so much do it again soon

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