What Bitcoin Did - BITCOIN IS HUMAN NATURE w/ Jesse Myers

Episode Date: May 2, 2025

Jesse Myers is the author of the Once in a Species newsletter. In this episode, we discuss why humanity’s obsession with scarce assets may be hardwired into our DNA and how this evolutionary trait could explain Bitcoin’s inevitable rise. We also get into how early humans monetised scarcity, why Homo sapiens may have outcompeted Neanderthals through money-based cooperation, and how Dunbar’s number and inter-tribal trade shaped civilisation. Finally, we explore why Bitcoin represents the culmination of a 140,000-year human search for perfect scarcity — and why Jesse believes we are in the early innings of a species-wide gravitation towards Bitcoin. FOLLOW: Danny Knowles: https://x.com/_DannyKnowles & https://primal.net/danny Jesse Myers: https://x.com/Croesus_BTC THANKS TO OUR SPONSORS: IREN: https://www.iren.com/ RIVER: https://river.com/wbd ANCHORWATCH: https://www.anchorwatch.com/ LEDGER: https://www.ledger.com/

What makes us human, what defines our species, is our fascination with scarce assets. Valuing scarcity is core to who we are, and it's literally in our DNA. And then Bitcoin is the perfection of what we've been looking for for at least 142,000 years. And if that's true, then we're in the early innings of an inevitable species-wide gravitation towards Bitcoin. because it is the perfection of that trend. What Bitcoin did is brought to you by our lead sponsor and Massive Legend, Iron, the largest NASDAQ listed Bitcoin miner using 100% renewable energy. Iron are not just powering the Bitcoin network,

they also provide cutting edge computing resources for AI, all backed by renewable energy. So whether you're interested in mining Bitcoin or harnessing AI compute power, iron is setting the standard. Visit iran.com to learn more, which is iraer. com. Jesse Myers, how you doing? Good to see you.

Doing great. Yeah, great to be back on the show. Yeah, it's been a little while. We were just talking before the show. Last time I saw you was at Sailors Party, and I don't remember that much from that night. So it's good to see you while I'm sober and clear-minded, relatively. Yeah, we talked very early in the night. I don't know where the night took you from there.

Well, the problem was they only did tequila. Well, they only did spirits. They didn't have beer, so I was on tequila all night. So it was, yeah, it was a wild, ride. Great party. But you've just written a piece. We were just saying before we recorded. This is probably one of my favorite Bitcoin articles I've read in a long time. I feel like we used to get more of these kind of abstract Bitcoin articles. Like Chaudemista did is Bitcoin Reformation, which I loved. I used to really like the stuff that Brandon Quitton was writing at the time,

like the Mycelium of Money or whatever that one was called. This one feels a little bit more in line with that and it's something I've been desperate to see because when we're doing the podcast, like seeing stuff like this, like that's a show I want to make. It's not just all like analytical data driven. So I really enjoyed it. Yeah, thank you. Yeah, I mean, I felt compelled to write this is, this one was sort of banging around in my head for like four or five years. And then I finally sat down, do the research to flesh it out. And when I, when I finally did, the rabbit hole kind of opened up and got a lot deeper than I expected. And I, I, I, I, I, I found myself breaking new ground on a topic that spanned several disciplines.

And so the hypothesis that I came up with is, I think, new. And I think, more compelling than what's out there. So, you know, and it touches on a very big, enduring mystery for humanity. And, you know, if I did, it's possible that I cracked something here. And that would be incredible for Bitcoin, because it would put Bitcoin as a part of the answer to one of humanity's enduring mysteries, which is wild. And also, you know, classic that Bitcoin forces us to try to understand it.

And in trying to make sense of what's happening and why it's so compelling, why its scarcity is monetizing, in doing that, we are finding out new things about the world. and about ourselves. And so it would be fitting if this, if Bitcoin helped crack this particular mystery. Yeah, I assumed you'd been working on this for a while because your newsletter is called Once in a Species and it took you, I don't know, 30 or 40 articles

to finally write a piece called Once in a Species. So is this something you've been thinking about for that long? Yes, and longer. Yeah, when I chose the blog name, I knew that I would write this piece And I knew I needed to do it justice. And so it took me a while to really sit down and give it like, you know, my sole focus for a couple months. Yeah.

Okay. So let's start from the start. Where did this article come from? Like, what was the original thought for you that was like that you wanted to flesh out? Yeah. So shelling out is an incredible article by Nick Zabo. If people haven't read that one, I highly recommend that in it, he basically lays out how all the evidence we see in early human cave sites going back at, you know, when he wrote this in

2002, that was going back 75,000 years. That's how far back the evidence for this behavior went. We've been collecting seashells and turning them into beads and making jewelry for that long, and it turns out a lot longer. And so that article explains what the behavioral purpose of that, what the economic purpose of that was. And he lays out very convincingly that this was a form of proto money. It was an early, our earliest form of money that humanity developed.

And that explains why it's widespread in cave sites all over the world and through time. And that blew me away. That article when I read that, when I was going down the Bitcoin rabbit hole, helps explain why scarce collectibles are money and why human behavior lands on scarce collectibles as money. And then with that knowledge, you can kind of, you know, skip and a jump to, Bitcoin is the scarcest best commodity. that we've ever invented as a money, and it is kind of the apex predator, the Darwinian

end point of that process. So that's kind of the implication. You know, and he wrote that, Zobo wrote this in 2002, so Bitcoin didn't exist yet, but when you're reading about the context of commodity money and how shells were, seashells were our earliest form of money, you know, with the lens of Bitcoin, it's easy to see how Bitcoin is an improvement on that lineage. In that article, he leaves kind of a few threads unexplored. He mentions how Neanderthal cave sites don't seem to have any shell be jewelry. And that's very interesting because in all other respects, we're, you know, our cave sites and their cave sites look the same. Except for the one other difference, which is that our cave sites had showed 10x the population density.

So for some reason, we were able to support 10 times as much population on the same territory that the Neanderthals who had previously inhabited those territories were able to support. And he kind of suggests that maybe shell money played a part, and he leaves it there. And so I wanted to build on that and kind of update that analysis because he did that over 20 years ago. And what I found of the recent anthropological findings and then also a neuroscience discovery about Neanderthals and early humans kind of expanded on his suggestions and allowed me to come to somewhat of a new answer that builds directly on Zobo's incredible work. Okay. I think it'd be worth kind of taking a bit of a step back.

And because we've talked about like the history of money and rye stones and shells and all these things on the show, but not for a very long time. And the audience will have changed since the last time we did that. So can we get, can we start with like the origins of money and how different cultures found like money in the form of something scarce in their vicinity? Yeah. Awesome. Okay. So Zabo writes about this. The Austrian economists write about this topic as well. That's kind of like their specialty, really, understanding commodity money and where it came from. And they're the ones that really enumerated how a commodity goes from just a commodity and becomes money in a society. And it's a very elegant, simple process. Basically, there. there needs to be some commodity for that localized tribe or, you know, greater region,

that is suitable as a money that is hard to make more of. And importantly, it needs to be valued, coveted, really, by some small portion of that tribe. And then, you know, as these weirdos who value this thing are collecting it, everyone else in the social group starts to recognize, wait, you know, these seashells are valued by a small portion of the group. That means, you know, they have trade value. I can, I can, you know, trade them with those individuals. So that means seashells have value, you know. And then everybody in the group starts to recognize, oh, seashells have value.

So you go from a commodity becoming a collectible, seashells as a collectible for a small portion of the group. And then the whole group starts to recognize that this thing has value. And that's what they call intersubjective value. I understand that gold has value because everyone else values gold. And so that's this process of, you know, once you reach intrusubjective value, then that commodity has, sort of gains store of value properties where you know that everybody else values it so you can store value in it for future use. And that would be, you know, seashells going from cute little things that you'd collect to something you'd string up on a necklace and wear on your person for use in the future whenever you're in a pinch.

And then the process plays out a little bit further. Once a commodity is a store of value asset, then people start to use it as settlement in trade. It becomes a medium of exchange. And then once that social group is using that commodity as the de facto unit for pricing anything, then it's a unit of account. That's the end state of a money. It's become the money for that society. And so, you know, we have this evidence of seashells being used as store value.

and that's what Zobo enumerates at a great length. And that indicates it was a form of money. It was a value because not only because seashells were valued by the group, but because it would be hard to make another shell necklace. You'd have to go collect the seashells, and then you'd have to spend hours drilling holes in each seashell and then stringing it up. It would take effort and energy and time.

And that's, you know, all of that together means that it's become this precious store of value asset that you could use in a barter situation. And as a stepping stone from pure barter into, you know, I have this necklace that everybody knows has value and I can use it as a currency. One of my favorite examples of that like intersubjective value is the rye stones from the Isle of Yat. And this is like, was a classic Bitcoin a thing that people talked about. It feels like it's been talked about less and less now, but I think it's worthwhile story of the Isle of Yap had these big, I think there were limestone disks that were the money there.

And one of the discs was being moved from island to island and sunk in the ocean. And they knew it was at the bottom of the ocean and they knew who it belonged to. So because of this intersubjective value, they could still say, that's still money because we know it's there and we know who owns it. And it was still used as money even though it was at the bottom of the ocean. I think that's an amazing story. Yeah. Yeah, incredible. And that's like the first ledger money in human existence.

Yeah, exactly. So I want to get into why humans actually value scarcity, which you obviously talk about in the piece. But before we do that, maybe the best place to start is with the Neanderthals. You can give us a bit of an anthropology lesson here and explain what the Neanderthals were. I mean, everyone knows what they were. But give a bit of an example of where they were living and why perhaps they were out-competed by Homo sapiens. Yeah. Okay. So Neanderthals show up in Europe, which is really what they're known for, 250,000 years ago. And they were, there's some debate. I guess the consensus these days is that they're their own species, homo Neanderthalensis. I prefer the version, which is now a little dated of their subspecies of our species, Homo sapiens, Neanderthalensis, whereas we are homo sapiens, sapiens, sapiens. I prefer that specifically because we did interbreed with them.

So everybody, all Europeans today have some amount of Neanderthal DNA, like, you know, 1 or 2% Neanderthal DNA. And, you know, I prefer the version of species definition based on if you can interbreed, you're not your subspecies rather than a species. But that's beside the point. Neanderthals were, you know, the classic cavemen. in Europe thriving from 250,000 years ago. And they were just like us.

You know, we've had this dated understanding of them as brutes, stupid, unenvolved. See, that's funny because when I was reading this piece, that's exactly what I thought. Because I spent basically no time looking into this. So my kind of idea of Neanderthals were they were the big, dumb ones, essentially. Yeah. Yeah, and that's everybody's understanding of it, because that's kind of the first image that was painted of this, you know, when we first found Neanderthal bones in 1856,

that's kind of what they landed on was this was some grisly, ghastly man. I think H.G. Wells termed it this way as, you know, as they were un-evolved and barbaric. But as we've learned more, especially, in the last couple decades, we've seen more and more evidence of their humanity, really. So in the last five years, actually, this was dated last year. So very recent finding that the earliest known cave art is a handprint in a cave in Spain, and they dated it last year and found out that using carbon dating,

this handprint was 66,000 years old. And Homo sapiens sapiens didn't arrive in Europe until 20,000 years later, which meant that these handprints that you see etched in red ochre are Neanderthal hands, and they're engaging in this very human art. This episode is brought to you by River, the best place for bitcoins and businesses to buy Bitcoin.

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and are available for individual and commercial customers located in the US. Speak to AnchorWatch for a quote and for more details about your security options and coverage. Visit anchorwatch.com today, which is anchorwatch.com. So why is it rare for them to engage in art like Homo sapiens? Because you see cave paintings all over the world from Homo sapiens. Why not Neanderthals? Yeah, and that's kind of part of this mystery is we don't really know why. So, you know, obviously we have skulls from Neanderthals.

Their brains were slightly bigger, kind of more of an elongated shape. But we obviously don't have any intact brains. So we don't know the brain structures within. And that's kind of a mystery. is, as we see in the cave evidence that once Homo sapiens arrived in Europe about 45,000 years ago, suddenly then there's an explosion of symbolic behavior, you know, most famously cave art and other, you know, figural art. And also the shell beads show up in, you know, in great numbers. Before that, the evidence, there's, when Zaba wrote shelling out in 2002, there was no evidence of Neanderthals collecting shells and making jewelry at all.

Now there's a single example from a coastal cave in Spain where Neanderthals made a few shell beads as part of some jewelry. And that's it. We also have evidence of them collecting fossils and quartz and that showing up in the Neanderthal cave sites. And so they were capable of recognizing uncommon materials. So intellectually, they had the capacity to appreciate something unusual. But they didn't seem to have the drive or interest in creating. creating lots of art, you know, just this one example of a handprint and a few other limited examples and then these few examples of collectibles in their cave sites. And we haven't

really understood why the Neanderthals didn't engage in that behavior. And then Homo sapiens Sapiens were compelled to engage in a ton of that symbolic behavior is what they refer to it as. What does either collecting jewelry or doing cave paintings, like, what does that symbolize? Is it, is it like the fact that they attribute kind of value to things? Like, what is it? Why is that such an important step? Yeah, we don't really know. There's a bunch of theories.

And I think that deep down we understand that this is something that's special about us. You know, this sort of separates us from animals or, you know, early man. And, you know, so clearly this separated us in some way, but there's not really a causal link. There's not a good explanation for why that gave us an advantage. I mean, people talk about religion, shared, shared myths, and having a more better formed version of language. And in recent years, we now believe Neanderthals had that too, as well as other sort of evidence of technology or intellectual capacity. Like Neanderthals had equivalent level of tools, weapons. There's even a very cute and highly disputed anecdote of lots of pollen being found right above Neanderthal graves at this one location where there's a few graves laid out.

So it's assuming they laid flowers on a grave or... Exactly. And there's some question of that as to like, you know, could that pollen have gotten there in other ways? but it seems quite possible that Neanderthals were capable of that kind of human expression and symbolic behavior of like, you know, honoring their dead with something beautiful and transient in this world. And, yeah, I mean, basically there's not a great explanation to date for why we show up and have this compulsive, obsessive behavior to make art and to collect collectibles.

And basically what I found in my research to dig into this topic, created a possible link of something from neuroscience, potentially explaining why we are different. So I want to get into what happened when Homo sapiens came from. Africa into Europe and then out-competed the Neanderthals. But before we get there, maybe it's worth explaining why this is like the neuroscience part of the article, which is why homo sapiens do value these things. Yeah. And I actually didn't realize that you had studied neuroscience before I read this. Yeah. Yeah, I was, I did my undergrad in neuroscience. I was just interested in it. I realized too late that I wanted to be a business person. And so I just,

completed my neuroscience degree and then got a master's of accounting afterwards. Yeah, so I guess the overview of recent findings there, in 2022, a very cool study was published that I don't think got enough press. I wasn't aware of it at all until I dug into this topic. But in the study, they identified a judge. genetic difference between Homo sapiens sapiens and Neanderthals and other early humans and primates. And it's a, you know, one, potentially one nucleotide difference in our DNA. Can you explain that to me?

Yes. That would mean like in your DNA, there's just one bit of data, one tiny molecule that's different, you know, a point mutation of substitution there. And the result of that is a different protein from that. All proteins come from a section. Each section of DNA creates a protein. And this protein, TKTL1, there's the archaic version that Neanderthals and all earlier humans and primates have. And then we have a different version. and it's because of one bit of data, one nucleotide being different in that DNA,

and that results in a different amino acid, and that results in the protein folding slightly differently, if that makes sense. And that slightly different protein, H-T-L-1, human T-K-T-L-1 versus archaic A-T-T-L-1, that causes... neurogenesis in specific brain regions to be different. And they were able to show this in a lab by introducing this different gene to brain matter versus the one that we have. And the brain matter that had our version of the gene saw like three times as much

neuroprogenitor formation, which is really the kind of stem cells that turn into neurons, versus the old version that we don't have. So for whatever reason, that mutation was a fortunate, lucky one, and we are way better at producing neurons in these specific brain regions. And the brain regions in question is, so it's based. basal radial ganglia, it's the technical term for these neuroprigenitors, but they exist in the frontal, they develop the frontal lobe outermost layers. So kind of, you know, think about the surface of your brain on the frontal lobe, which is the neocortex where thought happens. And when I read this, I

I remembered a little bit about the unusual brain wiring of those regions because that's where pyramidal neurons are involved in association cortices, which just means taking information from various domains and synthesizing that and generalizing that information into abstract thought. So that's what those regions do. And we have a gene that causes potentially three times the development of that wiring in those specific brain regions versus Neanderthals and other earlier humans. This might be a stupid question, but this is just a mutation. We have no idea why this mutation happened, correct?

Yeah, and most mutations happen and they're detrimental and they get filtered right out. That was going to be my next question. Why did this become dominant? So I don't address that in the article, but I think that this was our advantage from the get-go as soon as this showed up. I think this is defining for humanity. I talk about that part, but I think that in the article I lay out how for the last few million years there were a handful of early human species coexisting on the planet. in various portions, parts of the planet, all living their own lives in their own little worlds. And then all of a sudden, homo sapiens sapiens just take over in the last 50,000 years in particular.

And I think it's because of this. I think it's because this difference in our brain led to, which we'll get into, led to very substantial competitive advantages because of what it unlocked. And that that meant that from as soon as it showed up, that would have been an advantage to that tribe versus the neighboring tribes that didn't have that kind of brainwiring overdevelopment and play that forward to spreading

all over the world over the last 50,000 years. So what did this mutation do in terms of like the behavior of homo sapiens at the time? And maybe let's start with the stuff that's not related to like scarcity and money. Start with the other behavioral changes. Yeah. So this is a great point that in the article, I introduced enough information. I tried to keep it streamlined and not address how this probably resulted in a handful of competitive advantages. because if all this was humans having an overdeveloped outermost region of the brain,

which is involved in abstract thought, then you could imagine how that would help you in a number of ways. You might be better at planning. You might be better at logistics. You might be better at, you know, maybe you could develop early religion because you had this. Maybe you could form alliances, just, just because you could recognize the abstract value of alliances, I don't, I actually don't

think that's the main, the thing that allowed that to happen, and we'll get into that. But a whole host of possible advantages of having a superior capacity for abstract thought. Was one of those that you mentioned in the article to do with like a tendency towards art as well? Yeah, so, you know, the art that shows up when Homo sapiens arrive at any portion of the world is this calling card, this hallmark of humanity. And, you know, we can't help but sort of see ourselves in it and we can't help but assign intelligence to the people who made this art. And so I think it's part of our myth, our own ethos of, you know, humanity is connected to art. But there's not necessarily a competitive advantage to art. It might just be a result, an outcome of this, you know, overdeveloped, abstract thought, behavior.

And maybe there is an advantage. Maybe there's not an advantage. But I think there definitely is an advantage to the monetary side of things, which is, which comes out of this overdeveloped abstract thought capacity. Okay, so let's get into that. Because at the start of the show, you mentioned that Neanderthals really weren't known for collecting beads. You said there was one example that we found so far. But homo sapiens definitely were. We've had plenty of examples of that going back a very long time.

Yes. So maybe that's a good place to start, actually. When did this genetic mutation happen? Yeah. Because, like, was that before homo sapiens moved into Europe? Yes. So we can only do this with, like, probabilities, because it could have happened at any point, theoretically,

but most likely it would have occurred sometime between the last splitting off of other archaic humans. and the most recent genetic bottleneck for humanity, which is mitochondrial Eve, which is the woman from which we all come from. So 160,000 years ago, there was a woman in East Africa that we are all, you know, we all come from that womb, ultimately, like every single one of us. I have no idea about this. You have to explain this to me. Oh, okay, yeah. Yeah, so, you know, like early existence of humanity was tribal.

There would have been, at some point, you know, homo sapiens would have numbered dozens, you know, and might have gone up to a few hundred or thousands and then, you know, had various collapses over time as they were competing for resources and living at the very edge of survival. At some point in time, able, at 160,000 years ago, roughly, we can tell that from genetic dating. There was a woman who we got all of our, every single person alive today got their mitochondrial DNA

from that woman, meaning that we all come from that one individual. And there were probably, she was probably part of a tribe that for whatever reason the descendants of the other individuals in that tribe all died out at some point and her lineage was the only one that propagated. So, you know, we can go back in time and say that, well, 160,000 years ago, that was a genetic bottleneck. We all got her DNA.

And then, you know, so it was a small tribe at that point. And anyway, that's helpful for this mutation to try to approximate the dating of it because most likely this mutation was something that she had mitochondrial leave. And that's why we all have it. So every human alive today, as far as we know, has this mutation. And so to date that, it would have happened sometime between the branching off of of the prior fork in human evolution and mitochondrial leave. And in the article, I'd say that 300,000 years ago to 160,000 years ago.

Sometime in that range, most likely this mutation occurred, and then we all got it because of that genetic bottleneck. Okay, that makes sense. So then let's get into the money side of it, which is basically very significant at the time that Homo sapiens move into Europe and start interacting with Neanderthals. So why was it that Homo sapiens were able to come to Europe and out-compete Neanderthals to such a degree? Yeah. So this is the question that there hasn't been a satisfying answer to, in my opinion.

The most recent cutting-edge answer from anthropology was a group of Oxford, PhDs put out the hypothesis that we out-competed the Neanderthals because we were, quote, generalist specialists. And they make the argument that because we thrived everywhere, that's why we succeeded. And that doesn't sit well with you. I poke fun of that in the article because it's very circular logic in my book. And it doesn't include any root cause, a root explanation for why we out-competed.

And so, you know, when we show up in Europe 45,000 years ago, suddenly we displace, we take over the Neanderthals. In a very short space of time, it takes about 5,000 years, three to 5,000 years before we've effectively, driven in Neanderthals to extinction. And granted, we incorporated some of their DNA into our gene pool too. And to me, what's very interesting about that

is the population density question. Why were we able to? This is the Dunbar numbers question. Yeah. So for a long time, we've known that Homo sapiens have 10 times the population density in Europe once they displaced the Neanderthals. So same territory, same

you know, biome, and somehow we're able to support a much larger population. And there hasn't been a good explanation for that. Maybe an interesting place to start with that is from the Neanderthal side. Like, why would they not able to before we get into why Homo sapiens were able to?

I think maybe it's the same answer. Yeah, no, that's good. I like that because it breaks, it breaks down what I do in the article a little bit more piecemeal, which is great. So if you think about a Neanderthal's tribal life, they would have, it would have just been their tribe. Like, if you were a Neanderthal in a tribe, you would only interact with your tribe members in your little territory. Let's say it's like a valley that's yours. and then you would maybe have some skirmishes with the Neanderthals in the valley next door, right?

Like they have a different tribe and you don't interact with them. You know, maybe you, maybe it's part of your lore that they're evil, you know, and they killed your uncle 10 years ago. So you don't go over there, right? Like you stick to your valley and they're similarly afraid of you. and they stick to their valley. And anytime you interact, it's a competition. It's a competition for resources. Maybe, you know, you have these blood feuds where there'd be violence.

But basically that context, that default antagonistic relationship that you would have with all other tribes of Neanderthals would mean that you would want some buffer between you and all other Neanderthals, and you wouldn't view them as your friends or allies. They would just be a competing tribe. And that's, I think, very different from how Homo sapiens would have lived and how they would have competed for resources once they showed up on the scene. And I think that is because of money, that money allows Homo sapiens once they show up And this would have started in East Africa, and I think was the source of our competitive advantage.

Once that mutation occurred in East Africa, suddenly we would have been better at competing as a tribe, and then we would have sort of taken over Africa and then spilled into the Middle East and Europe. But when we show up in Europe, we've already, as soon as we show up, there's suddenly a lot of evidence of Shelby, proto money from that point forward. which means we'd already developed this concept of money. And then as soon as we show up, we have 10 times a population density. And I think it's the money that enabled us to, and I lay out the reasons for this in article, but the money enabled us to have productive intertribal relations

in a way that the Neanderthals wouldn't have had. The Neanderthals only had violence. All early forms of early humans only had violence. But then once you develop the concept of money, then you have this productive medium for transaction, where you can have constructive relationships by perhaps it's paying tribute to the more powerful neighboring tribe. Perhaps it's facilitating trade in a way that you weren't really able to do. in a pure barter context with the overtones of violence always hanging over you. But I think that the nature of that transactional medium allowed for tribes to start to coexist together in closer proximity because of the benefits of that, of being able to develop

mutual security alliances and be a stronger group together. and also the benefits of trade between tribes. So once you have money as kind of this glue that allowed multiple tribes to adhere together and be allied, then that allows you to inhabit the same valley. You can have multiple tribes in closer proximity and coordinating activities, which would then become a huge competitive advantage when you're, bumping into Neanderthal territory, and suddenly your group is made up of five to ten tribes, and you're competing against solitary Neanderthal tribes for resources.

That's an insurmountable numbers advantage, even if you didn't have direct conflict, which they probably did, but even if you're just stripping berries off of trees, you know, or fishing the rivers, like, you're going to have a numbers advantage that Neanderthals can't top. And does having money in these bigger societies basically allow you to then have specialization of labor in a way that Neanderthals never would have done? Yes. Yeah, so that's kind of an outcome of having sufficiently large tribal groups, or multi-tribal groups. So in the article I lay out how, you know, done the... number is this very interesting sort of piece from evolutionary biology, really. In 1992, Dunbar, Robin Dunbar showed how there's a linear regression between neocortex volume

in primates and the size of social groups they're seen to naturally gravitate towards. And that based on that linear regression, And based on the brain volume of Homo sapiens, you would expect us to exist in 150-person groups, which lines up quite nicely with what we gravitate towards. There's a lot of examples of how 150-person groups is a very natural thing that we default towards. And he doesn't really explain why, but that's the Dunbar's numbers.

this 150, we're meant to live in tribes of 150 is kind of the takeaway from that. And a year later, he added that language is an efficiency multiplier that allows us to live in groups of 150 without spending half the day in one-on-one socializing, because we're able to engage in social gossip, and that's way more efficient. and so that's how we are able to manage groups of 150. But he never actually addresses that, well, we actually live in groups a lot larger than 150. And so how is that possible? What makes that possible?

And in the article, I lay out how the concept of money is itself also an efficiency multiplier that allows us to coordinate behaviors. in, you know, social groups that are larger than 150 individuals. Even if we kind of tend to have our, like, our core group of 150 people that we know, we exist in civilization and, you know, even just a city where we are able to coordinate with a much larger group. And I think money is the reason for that, specifically because I think the actual, I argue that possibly the actual constraint for Dunbar's number is that if you live in a tribal group of 150 people, there's 11,000 counterparty pairs.

So, and that's a lot of relationships to keep up with. And Zabo makes a great point in shelling out that, in a tribal existence in a pre-money world, you're able to, you engage in barter and favors, really, exchanging goods and incurring debts. And those debts have to be enforced, right? You can't get away with not paying back your debts. And the social group is what enforces those debts, which means that the social group has to sort of have a rough idea of, who owes what to who and make sure that that isn't forgotten or shirked. And that, I think, is the possible constraint that keeps humans and primates to their neocortex

capacity number for their social groups, 150 for our species. So once you have money, then you're existing in a different paradigm where you don't have to keep track of who owes what to who for everyone in the group. Now you can transact and settle your transactions using money on the spot, which removes that ceiling of how many counterparty pairs you can possibly keep track of in your head. And that allows for boundless growth of how many counterparties your interacting with. This episode is also brought to you by Ledger.

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Bitcoin today. That's L-E-D-G-R.com. I also want to give a quick shout out to the Human Rights Foundation's Financial Freedom Report. This is their weekly newsletter that drops every Thursday and it covers how authoritarian regimes use money as a tool for control and how people are pushing back against that using privacy tools and of course Bitcoin. It's an amazing newsletter, it's pure signal, and you can subscribe for free at financial freedom report.org. So in this article, you lay all this out and basically say the missing piece that people aren't talking about enough is the fact that maybe money was the thing that allowed homo sapiens to flourish. In the academic historian world, is anyone paying attention to that kind of thing? Yeah, not really. I think, you know,

so Zobo puts out shelling out in 2002 and, in my opinion, quite authoritatively, definitively shows that shell money was money, that shell bead jewelry was early money, and it functioned in that capacity. And anthropology since then, still completely unaware, I guess, of Zabo's work. It sits outside of the mainstream establishment for anthropology and also for economics, you know, Austrian economics as a branch is the butt of jokes in the business school that I went to. I went to Stanford. You know, there wasn't any knowledge that wasn't, you know, there wasn't any arcane knowledge that I wasn't receiving.

And yet we didn't talk about Austrian economics at all. It was only the butt of jokes. Keynesian economics has completely conquered the business world and academia and economics as a field. And I think, and I talk about why the yuppie elite dismiss Bitcoin a few years ago, that I think that was just because it served the interest of government for Keynesian economics to win. And so they, you know, government wanted that to be the victor and kind of put a thumb on the scale to help Keynesian economics supplant and overtake Austrian economics a hundred years ago. And since then, we've been operating in a world where Keynesian economics is accepted as gospel truth. Meanwhile, Austrian economics actually explains a lot about the world, especially commodity money.

money and that whole branch of economics. So, you know, there's a couple of things working against Zabo, meaning that his work, I think, was never accepted in the mainstream. Anthropology is unaware of it. Economists continue to have their head in the sand and think that Keynesian economics is true, and Austrian economics is a bunch of wackos. Yeah, obviously, I think differently. And I found a few very funny examples of anthropology being completely unaware of the economic purpose of Shelby jewelry.

So when Zabba wrote shelling out, the oldest evidence of Shelby jewelry was 75,000 years old from South Africa. There have been a bunch of new discoveries over the last two decades. and in 2021, you know, this is all very recent stuff, shell beads were found in a cave site in Morocco that dated to 142,000 years old. So basically doubling the length of time that this behavior has been going on, the length of time that shell money has been part of human existence. And he, the co-author of that paper, is completely oblivious to why these shell beads would have been made.

He speculates, there's a great quote of him speculating, that they were probably about how an individual expressed their identity to strangers in particular, because you don't need to tell your mother who you are. Implying that this behavior of why people would invest all this time and energy and making Shelby Jewelry all over the world, over 100,000 years plus, was simply because everybody liked to look good for strangers. They were 140,000-year-old pronouns. Yeah, it was all about identity, right?

And so I think that that's an example of anthropology, the orthodox of present-day anthropology is to interpret things in terms of self-expression, identity, and meaning to the individual. And economics is just never considered or incorporated into understanding human behavior, which seems like a completely absurd starting point. You know, they've overly siloed themselves into discounting, I think, the driving reason that humans do most things, which is economic purpose for bettering their own lives. I don't know if it makes me completely bat-shit crazy, because when I read your piece,

it makes total sense to me that this could have been the thing that was the game change of a homo sapiens. And the fact that modern academia just ignores that, I can't get my head around it. I don't know why that would happen. Yeah, me either. It's been a really weird feeling for me. me to write this piece, standing on the shoulders of Zabo's giant work here, and also

leveraging Austrian economics and all the work done there. But by and large, being kind of the first to pull together anthropology, this particular finding in neuroscience, and then Austrian economics and Bitcoin to make sense of something that's a complex human behavior that has economic roots. And how is it that, you know, citizen scientists may have found something before the Oxford PhDs? It has been surprising to me. And yet, you know, their current hypothesis about being generalist specialists makes no sense. and here's something that makes a little more sense.

So let's fast forward this to today. You say that the world's dominated by Keynesian economics, which it clearly has been. But maybe the world is starting to wake up to commodity money in a more serious way. Like both gold and Bitcoin have done very well over recent months and years. So what does all this mean for Bitcoin? Is this something we've been waiting 300,000 years for? Yes. So, you know, if what I lay out in the article is true, then the root reason for money is this genetic mutation that happened 160 to 300,000 years ago.

And that mutation caused the overdevelopment of the regions of our brain that deal with abstract thinking. and that that was provided the critical mass of compulsive interest in scarce commodities as collectibles that is necessary for a social group to start bootstrapping that path-dependent process of, okay, people value collectibles and enough value seashells that it starts to become intersubjective value and becomes a store of value and then monetizes it becomes money through that process. But you need enough covetous, obsessive interest from some portion of that social group. And that, I think, came from the overdevelopment of the brain regions that would be involved in that.

So that mutation led to our subspecies having the ability to develop the concept of money in a way that prior early human species didn't have that critical mass necessary to do that, then we developed the concept of money, and that unlocks intertribal coordination. And that becomes the competitive advantage that allows us to not only remove Dunbar's number as a ceiling on how many individuals can live in close proximity, but also allows us. for this competitive advantage that would overpower any competing early human groups that were confined to a solitary tribal existence. So if that's all true, then what makes us human, what defines our species is our fascination

with scarce assets. That's the thing that this brain mutation really enabled that was a competitive advantage. And that means that, you know, valuing scarcity is core to who we are, and it's literally in our DNA. And we also see from, you know, 142,000 years of monetary history that there's been a process that has played out of monetary Darwinism of first we use seashells as money and then over time we gravitated towards. commodities that were harder to make more of. That started with glass beads, cloth strips and other areas, rye stones, and all sorts of local optimums. And then six thousand years ago, gold emerged.

We breakthroughs in metallurgy allowed us to have gold as a viable money. And then gold just took over the world over the last six thousand years because Specifically because it is the scarcest physical commodity that can be used as a money in the world. And so, you know, we gravitated towards scarcer and scarcer commodities, and gold is the champion in the physical world. And then with the advent of the digital age, it became possible to make something more scarce than gold. and that is Bitcoin. Bitcoin is the invention or discovery of absolute scarcity,

and that can only happen once, right? So all altcoins are just copies of that system of scarcity, but there can be infinite copies of the original instance of digital scarcity. Only that system is actually scarce. So only Bitcoin is actually scarce, and it perfected scarcity. So we've had this 142,000-year process of this DNA-based drive to covet scarce assets, and we've been searching for more and more scarce assets.

And then Bitcoin is the perfection of what we've been looking for for at least 142,000 years. You know how once people see Bitcoin and actually understand Bitcoin, almost no one walks away from it. Like it really captures imagination, like nothing I've ever really seen before. Do you think that is because it's hardwired in our DNA to search for scarcity? Yeah, I think that's a possible implication here is that, you know, I think I went down this line of reasoning, this inquiry, because I was trying to understand for myself, Like, why am I so obsessed with this thing?

With Bitcoin, like, what is it about it that is so compelling? And shelling out, you know, helps explain a big piece of that. And then I think my findings here extend that to this ultimate conclusion of like, it's literally our species level advantage. It's in our DNA to covet scarcity because, and you could take the flip side of that of like, think about that from a different angle of like, we are here today instead of all the other early human species because we are obsessed with scarce assets. And that's just a weird quirk that happened in our DNA, a random mutation, but it gave

us an evolutionary advantage. And that is why we are here. And that's why we took over in a very short space of time versus all other humans living in, you know, various pockets of the world. which is to say that, you know, valuing scarcity, appreciating and valuing scarcity is what makes us human. It's why we're here. And then here comes this thing, this crazy new invention in the digital age of the perfection of that which makes us human. So it's natural that we would be drawn to it.

And I think that the implication from this hypothesis is that every homo sapiens sapiens has it in their DNA to gravitate towards scarce assets. And if that's true, then we're in the early innings of an inevitable species-wide gravitation towards Bitcoin because it is the perfection of that trend. Damn, I love that. What a wild timeline. If you assume everything you lay out there is true, the fact that we're living through the birth of this thing is pretty crazy. Yeah, yeah. I took the time to make a whole timeline for the very end of that piece to show all of the events in this chronology and show how the, you know, how the, you know, how the, this mutation must have happened 160 plus thousand years ago. And then we see the first evidence of shell money 142,000 years ago. And probably we'll find older versions of shell money. So it didn't take us that long from when this mutation occurred

to start having a concept of money. And then we see humanity takeover, Europe, Neanderthals go extinct, gold starts becoming part of the competition for money and takes over the world of money. And then we have this 100-year blip most recently of fiat money. We only know a fiat standard. We've all grown up in it and our parents grew up in it. And it's all we've ever known. But when you look at the long timeline of 300,000 years of human history, half of which has money in it.

And then there's just a 100-year tiny little blip that's, you know, this green dot of Fiat money era, it puts into sharp relief, I think, how fleeting that is, how unnatural that is, and how much of a deal. deviation it is from our DNA, our inherent desire to trust our value in assets that are hard to make more of. Maybe it needed that 100 year blip to find the perfect money. Maybe. So this piece is obviously called Wants and a Species.

Do you think this is it, like Bitcoin is the end, it's game over? This is money forever now. Or do you think there could be another iteration? by that, I don't mean some other shit coin. I mean, fast forward 500 years, the thousand years. Do you think we will still be using Bitcoin? Yeah. On that time scale, I think almost certainly, which is wild to think. But basically, for me, I think the only threat to Bitcoin being bested is, you know, if we end up in some galactic civilization where they already had a Bitcoin.

And it has a greater network effect, and we have to switch to that one, basically. I mean, wild timeline. I've loved this. This is honestly one of my favorite articles I've seen in Bitcoin in a long time. So I massively appreciate you writing it and coming on the show to talk about it. Is there anything we didn't really touch on in there that you want to get into? No, I mean, we got into the technicals too, so, you know, thanks for bearing with me on. No, I enjoy that stuff.

Good, good. Yeah, I mean, I think we touched on every facet of it. Obviously, the Dunbar's number stuff and how it unlocks, you know, multi-tribe coordination is hard to articulate, frankly. So I'm probably better done in the article. If people want to read the article, I'll make sure I drop a link. Yeah, it's a once-in-a-species.com. And, you know, I took, I guess I described it as years in the making and I made sure to turn it into a fun read, so it's a 14-minute ride. And I think pretty fascinating. I've gotten great feedback. I'd say 95% of people seem to love it. That's not about it, right?

Yeah, something like that. glowing reviews and then 5% of people probably doesn't jive with their religious beliefs and they absolutely hate it. So there's that too. Yeah, fair enough. I can understand where that breaks. But maybe one thing to actually talk about just quickly before we close out is like this monetization stage of Bitcoin. I feel like I love Parker's analogy of gradually and suddenly. And I probably am saying this too early, but it feels like we may be getting close. to the suddenly stage of this. What do you think, like, if you look out the next short term, like five, 10 years,

what do you think Bitcoin is going to, what do you think that's going to happen in Bitcoin? Yeah, so I love Parker's gradually, then suddenly, and his use of the Hemingway quote. I like to describe it slightly different language. For me, it's gradually but exponentially. And it amounts to the same thing, right? But I think that the difference in terms of like semantics is that people are, I think, widely expecting, Bitcoiners are widely expecting that there will be like a light switch moment

where suddenly everyone will adopt Bitcoin. And I don't think that's true. I think that we are going through an adoption S curve and we're in the very, very early stages of it. I think we're, you know, not even through the first cohort, through the innovators. I think we're, I think we're half a percent into true adoption of Bitcoin, meaning people using it as a savings technology as part of their portfolio. Most people don't view Bitcoin as that. Maybe it's a speculative bet for them. But what it actually is is a savings technology. So we're very early in that adoption S curve.

And as time goes by, as each cycle plays out, and as the network effect grows and people learn about it, we will incrementally go through the bell curve of adopters. And that is an exponential process for the first half in particular. And so I think we, that's how this will continue. to play out is like year after year, some small new incremental cohort will wake up to what Bitcoin is and they will start small and they'll get more comfortable and they'll increase their position size and they'll start telling their friends about it. And eventually you you onboard the world that way. Eventually you make it through the classic cohorts of innovators, early adopters,

early majority, late majority in laggards. And we're still in the, in the, you know, the first cohort is two and a half percent of the world as innovators, and I think we're half a percent in. So we're very early. And so I think that each of those functions of money is itself an S-curve, collectibles, store value, medium of exchange, and unit of account. I think the world, by and large, recognizes Bitcoin as a digital. digital collectible. I think we've gone through that portion of it, or at least the majority.

And right now, I think most of the world has yet to recognize Bitcoin as a store of value, a desirable store of value asset. So we're early, you know, we're early on in that S curve. And we're, that means we're very, very early on in the remaining medium of exchange and unit of account. But I think Bitcoin maximalists are there. Those are the ones. who are already, have already incorporated Bitcoin as their medium of exchange, preferred medium of exchange, and certainly unit of account, I think about things in terms of how much Bitcoin they cost or try to, you know, and I think that's a mark of a Bitcoin maximalist, really. And I think the whole world will go through that process too, but it's just extremely

early in the S-curve for those functions of money. So all that to say that I think, there won't be like a light switch moment five, 10 years from now where everybody will suddenly get it. I think it will just be an exponential growth of the onboarding of the world as we start to really get into the S curve over the coming 10 to 20 years. And it will be exponential and it will feel like suddenly has happened. But each day is just that exponential process continuing. play out. Because of like this article, are you at the point where you feel like Bitcoin is now just inevitable? Yeah, I kind of. Me too, but I would also be nervous to say it. Yeah, I pretty much, pretty much believe Bitcoin is inevitable. It's weird to have written this piece and, you know,

I step back from it and I read it and I think, yeah, like this, this actually, this makes a lot of sense, and it answers a lot of unresolved mysteries about, like, how, like, for example, why do we defy Dunbar's number? There hasn't really been, like, a nice explanation for it. Why did we have 10x the population density as Neanderthals? Not a good explanation for it. Why do, why did we have a lot of art and a lot of collectibles, and Neanderthals didn't? But they had some.

Why did they have some? You know, and this explanation neatly resolves all of those outstanding mysteries. And then I left thinking, okay, I might have actually cracked this thing. This might actually be the answer to why we outcompeted all other early human groups, and it might be the answer to what makes us human. This could be it. Like, this is why I said earlier, like, I don't know if I'm just batshit crazy. And this is not meant in a disrespectful way at all.

But it's wild to me that, like, why is Jesse Myers a bitcoyner figured this out? You know, why am I the one coming up with it? This is, and the only... Because when you read the piece, like, it seems like, I 100% believe it. But why is it taken a bitconer to figure this out? Yeah. And I think that that's what it comes back to. was like an anthropologist is trying to understand the fact set with a limited set of lenses

or limited domain exposure. And I think I might have just happened to be the right combination of familiarity with certain domains, anthropology, just because it's an interest area of mine. neuroscience because of my degree, Austrian econ and Bitcoin, obviously, because of being a Bitcoin maximalist the last half decade. And I think that was what was necessary for me to connect the dots in this particular way. And sure, there was probably somebody else who has a different set of strengths or subject matter familiarity who could have come up who could have connected the dots in their own through their own lenses and come up with a similar answer but um but nobody did as far as i'm aware let me know if everyone if i'm unaware of uh somebody coming to this conclusion

before me well i i think it's a brilliant piece i'll make sure i link it under the video and the podcast. Everyone should go and check it out. And I'd be really interested to hear if any of the academics do read this piece at some point and if you ever get any feedback. Because I thought it was very compelling. It's one of my favorite articles I've read in a long time. Yeah, thank you. Yeah, I'm tip-telling into how to put this into it like an anthropology journal or like broader publication. But that's been a funny process too, learning about how closed off those publications are to outsiders, which is really pretty wild. I also am hoping to get to get this in front of Nick Zabo. So if anybody knows how to do that, let me know. Yeah, for sure. Well, I actually, after the show,

I might be able to help you with that. But I really appreciate the time. Before we close out, is there any way you do want to send anyone? Yeah. So the articles at once in the species.com, I'm very active on Twitter at Cresis underscore BTC. You can just find me with Jesse Myers. Yeah. Appreciate the time, Jesse. Thank you so much for this. And hopefully I'll catch you.

Are you going to be in Vegas? Yes. Yeah, I will be there. Yeah, looking forward to that. So, yeah, we'll chat there. And hopefully that night gets just as crazy as Sailor's Party, too. Fingers crossed. All right, Jesse.

Thanks so much. See you, Danny. Thank you.