This week in Bitcoin- 8-23-2019- Contrarian bet, safe haven, hyperbitcoinization, gold, Amber, Bakkt


Hello everyone
this is adam meister the bitcoinmeister
the disrupt meister welcome to this week
in bitcoin today is August the 23rd 2019
strong happy unique bestow your wealth
in bitcoin having height uncommon stable
one big quid equals one bitcoin affected
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best guest in the space right here your
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we’ve all got the conviction here alex
is back yeah alex Penske he is back from
australia and we got anders coming in
from california i am so pumped we’re
just gonna jump right into this show
right now the big news at the beginning
of the week you’ve probably forgotten it
by now people because you’ve been
inundated with my god this week was
filled with like nonsense blockchain
let’s start a blockchain for this
country type of news it was like
straight out of 2016 but there was
something pretty legitimate beginning
the bat announced that backs of bitcoin
futures and warehouse to debate to debut
in September and we knew it was coming
now they’ve given this day anders what
do you think about this well it seems to
be like it definitely all good news I
don’t think there’s anything bad about
it and as I understand it it does allow
institutions to get in in a way that is
secure for them that they couldn’t do
before I guess it has to do with the
with the way that bitcoin is is held or
being yeah held in custody
in a way that is safe and probably
hopefully insured and if that is the
case it’s extremely positive so it’s a
thing that it but I I don’t personally
care too much about it because I for me
I see their they having as you were
watching upon yourself in the beginning
that the having hyper it is what
I believe is is the strongest driving
force of a price of Bitcoin and and I
know you often Adam say if the prices is
not really important and of course
that’s we’re here for mass adoption but
price does something – mass adoption as
well it is what gets people – you know
they talk about it on CNBC and TV shows
and they pay attention and then they
want to get some because the Fillmore
starts so it does have a positive effect
on adoption a higher price also a higher
price means that the developers
basically get funded because some of the
developers simply hold bitcoins
themselves so a higher price means that
they don’t have to do other things but
can focus on developing and also there’s
as I kind of see it as an outsider to
the developer community
companies like block stream and others
have been founded by people with a lot
of it coin and they can then you know in
the same situation because they become
more wealthy the the founders of the
company or their companies themselves
afford to fund it coin development so so
I think price is super important and and
growing up is great and I think having
is the main thing that drives it I think
the work from at 100 trillion us either
I think the quant mathematician in
Poland I believe all the the work he’s
done there at analyzing the structure
flow model for Bitcoin has been
extremely precise and China just had
have put a lot of confirmations to the
thoughts that I had earlier and then
actually making some things more precise
yeah backed is great but having is what
it’s all about
hey I like that attitude right there and
I like how you brought up the price in
terms of funding the developers of
course I’m still gonna stay one Bitcoin
equals one big boy and I’m offended by
selling of course but the the having
height obviously will bring up the price
but this back type institutional hype
perhaps brings up the price also I get
for me it’s all baked into the cake with
the back thing I knew it we’ve all known
it’s going to be coming for a while and
now they give us September so Alex
what’s your thoughts down in Australia
about that looks similar and is in terms
of net effect I think well there’s a
couple points I’ll touch on I think
first top of mind is you guys were just
talking about price and stuff and price
is inextricably linked the economic
model of Bitcoin is inextricably linked
to its security you know speculation is
a network effect you know and the way
Bitcoin is designed is this fundamental
economic monetary system you know it
it’s recursive you know the stronger the
price the greater the security the more
the incentive and more people want to
get in you know the more volatility the
more speculation etc and it’s sort of
this snowball effect that and that keeps
growing so you know you can never really
discuss Bitcoin without I I think what
you’re sort of getting at adam is people
people start to you know spend their
times think spend their time thinking
about tea leaves and trying to analyze
that shit with respect to price and not
understand that the the fundamental
element of price is just this discovery
of what this thing is worth and as that
price grows it’s just the reflection of
the network becoming stronger and
becoming broader etc now you know tying
that back into backed you know how that
helps I mean I don’t know like so from
what I understand backed his actual
physical settled futures so
that’s sort of different to what’s been
proposed in the past or what exists etc
um you know I have heard people talk
about you know these ETFs being a form
of centralization of you know the the
actual asset itself and so you know I
don’t know if I’ve got an opinion there
yet because I haven’t really spent time
looking into it but you know if you
think about it logically if you’ve got
you know a hundred billion dollars worth
of Bitcoin being held via and some other
ETF or some other instrument that is not
actually Bitcoin
one could argue that you know that
that’s a you know that that’s some form
of centralization in the in the broader
ecosystem I don’t know if that has an
effect and you know again seeing
bitcoins progression nothing moves in a
straight line you know we sort of ebb
and flow within you know pockets of the
whole Bitcoin ecosystem being a little
bit more centralized at times then being
less you know centralized etc you know
we saw that with mining right mining
sort of went through this phase where it
felt really centralized you know it’s
sort of dissipating so yeah so I don’t I
don’t have a direct opinion do I think
it’s going to bring you know more
capital into the space yes that’s fine
and at the end of the day I mean this
this whole thing is about you know a new
monetary economic system which is
inextricably linked to capital coming
onto the system so whatever long-term
thinking baby think about the long term
here what what’s what’s going to happen
this is we’re just here all right
everybody remember check out these guys
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frickin like button all right Andrews I
want to get into a subject matter that
also was discussed throughout the week
it seemed like there was a lot of
frustration on Twitter from well a lot
of blowback I guess people talking about
these crypto funds that diversified into
all sorts altcoins and had people people
who are handing over their money to
these crypto funds for them to buy them
the smart altcoins and lo and behold if
you just
how Bitcoin just put it on your tresor
forgot about it
it beats it beat the alt coins so Anders
your thought on the future of all coins
diversification for the sake of
diversification and Bitcoin dominance
right well like I always said and you
know my opinion since since a few weeks
after or one month after I sort of read
into Bitcoin I I realized that the rest
was part of her crap and you should stay
away from it and that’s was actually the
reason I started this meetup in in Los
Angeles to try and educate people to you
know the dangers of anything else but
Bitcoin sugar you can search dangerous
related to Bitcoin there’s nothing
nothing is safe about the success of
patron although I think it’s a very high
chance of success but but they’re all
coins are I think if you study it a
little bit very clearly people that are
scamming in business that don’t do their
due diligence and they use phosphorus
you know each coin is either a you know
a fast coin like light coin that had
like a faster but my more privacy coin
like Manero or it’s like Oh like and
then there’s aetherium there’s a raw
computer and at the end of the day it’s
about racing funds and put it in the
founders pockets but not really
generating anything that has any value
and I know you know I’m used to getting
some hate for that but I I think a lot
of people also have been happy that that
when people like me know both me and
other people have been saying this that
they have avoided losing money buying
all coins now when it comes to
diversification yes you I think it’s a
good idea to diversify but definitely
not in anything else then
Bitcoin when it comes to cryptocurrency
because of wit money is a
winner-takes-all game and according to
Gresham’s law which makes a lot of sense
in the end the strongest money the best
money is the one that is the only one
that has value the wrist will just be be
used in Houston use and so you don’t
have it anymore because you don’t want
to have it you want to keep the one in
your hand and your back pocket that has
the best value so if you want to
diversify I would personally more
consider something like QQQ which is a
Nasdaq ETF and Vanguard Reed they have
things called B and Q or something that
I think is simple so that’s away from
the crypto sphere like so what I’m
saying is bottom line I wouldn’t touch
anything else diversification wise in in
the crypto sphere only low outside and
you’re spot on and is your spot or just
gonna throw something in there while
it’s on top of mind so I think you know
to really sum that piece up is you know
aside from the Gresham’s law in the fact
that money is a convergent network and
that all of these other things are
effectively currencies they’re not
equities they’re none of that sort of
stuff so what ends up happening is all
the liquidity converges into you know
the the the acid or the good or the tool
that acts as money that’s the the
primary one right so aside from that
fact even you know even if we took that
out of the equation for people looking
to diversify you cannot diversify with
assets that are all correlated in nature
like the definition of diversification
is to pair or to group together assets
that are uncorrelated if everything
moves in the same direction so all these
idiots who went and who went and
diversified their crypto portfolio with
crypto they didn’t actually get the
benefit of diversification which is
lowering risk they actually increased
the leverage in their portfolio so they
don’t sleep on the opposite range they
didn’t do any
they had no idea what they were doing I
wrote a big article about this about you
know why Amber for example is a Bitcoin
only product cuz I always get asked that
and they’re like oh you know what if
people want to diversify across coins I
said that’s just stupid you know you
can’t diversify across coins if if we’re
gonna allow people to diversify it’s a
different asset class that does
something completely unrelated to a
Bitcoin doz yeah come on I agree and
also I think when it comes to this as
Adam you were talking about in your
question about these hedge funds or
hedge fund managers or crypto fund
managers they created these funds big
because they can make good fees on
splitting investments between different
cryptocurrencies and and that’s why they
have to argue that it does make sense to
support financially this other crap
coins out there and and they’ve just
become so hilarious when there’s still
to this state when it’s I think so
obvious and logic that these other block
chains and and and coins it’s so obvious
that they’re gonna end up very close to
zero and and they still argue that no it
it makes sense to diversify and and they
attack people like us for you know being
toxic because we we call them out on
their on their scams you know and but
and that’s why to this day I very
proudly call myself a proxy medalist
because I’m a toxic maximalist and I’m
proud of it because I’m doing that for
the better of people now they something
that you said they have the buzzwords
though the buzzwords lure in the 80
percenters they’re gonna always have
this with the next Bitcoin this is the
best thing this is the private Bitcoin
so of course it seems like you are
diversify into something completely
different but again they are they are
totally correlated with Bitcoin
Bitcoin goes up it brings all the rest
of them up Bickley goes down different
it’s it’s silly to me at this point but
again there’s a lot of newbies that have
yet to get into the space that are going
to that are used to diversifying you
know they may that’s how they were
taught to invest and they think these
these things are actually different now
we’re talking about different assets
something else that’s been in the news
this week is gold of course in the last
two weeks to tell you the truth gold has
been going up it so I guess and Alex
what’s your thought on gold look it’s
still it’s one of the you know you just
said 80% is right so but most people are
gonna be still but most people still
perceive gold as the safe haven asset
right and at some point in time the this
is this is a multi generational shift to
really you know start viewing Bitcoin as
that safe asset so I know there’s a lot
of talk these days about you know is
Bitcoin becoming a safe haven asset and
and I don’t know like I’m skeptical that
it is becoming a safe haven asset at
this point in time um you know from a
viewing it broadly speaking like I don’t
think most people will still view
Bitcoin as a as a safe haven asset at
this point in time I still think it’s a
more considered a speculative asset
amongst people but where I’m going with
that is that the investment opportunity
for Bitcoin whilst there might be a bit
of a flavor of safe haven I think the
bigger investment opportunities that
it’s an emergent asset class not not
just the safe haven today where it was
gold is it’s not an emerging asset class
gold emerged over the last five thousand
years so Gold’s that boring safe haven
asset that um you know that people will
you know go to when they think that
shit’s hitting the fan around the world
and I mean we’re seeing that right we
Hong Kong you you name it you can
basically point to just about any
continent now and there’s a big drama
going on and people are wondering what
the hell to do so you know the US dollar
because it’s still you know again money
this convergent network effect the u.s.
dollar is still considered as a safe
haven asset so you know capitals flowing
in there people are also you know
thinking maybe I should buy some gold
you know you see silver rallying as well
and you know maybe a small percentage of
people are starting to view Bitcoin as a
as a safe-haven asset so they’re putting
some capital there and that might be
part of the driver but again you invest
in Bitcoin for a very different reason
is because it’s an emergent safe-haven
asset versus an established state haven
asset where gold is alright Anders I
know you’re gonna have enough to say
about what he just said sure yeah yeah I
want to continue on that I think I think
alex is is right about that bitcoin is
still emerging gold is seen as safe
haven by people because well I all the
people who haven’t you know filled it
kind of in and a Bitcoin yet they still
see the safe haven like right now
personally I would see gold as extremely
unsafe Haven because I would feel that
within the next five to eight maybe ten
years there’s gonna be a switch between
the valuations of those two so I
wouldn’t feel safe at all in gold it’s
nice and shiny but that’s not what
really gives it its value I think so
right now bitcoin is the emerging asset
and it is I think because if you look at
the properties all the way down and
compare gold to to Bitcoin we we all
know that that bitcoin is a better asset
in many ways the ways that it cannot be
seized you can send it to the other side
of the world instantly and and all these
things so so it it is a better safe
haven asset it’s just still yet an
emergency haven asset but correctly it
won’t take more than eight years and the
two have swapped places in my opinion
maybe gold will hold on a little bit
value but it will be bigger than gold
market cap y-yeah yeah and as I a
hundred percent agree yeah I’m not
saying you yeah you don’t but it’s a
temporal thing you know it’s it’s like
right now in the psyche of you know most
people and where most of the capital is
in the world gold is still you know that
piece you know and but bitcoin is so
much more superior it’s not even funny
but there’s only one element that um
that gold beats Bitcoin in and that is
the fact that it’s physical but I’m you
know I mean you’ve got those what are
they called um the open Dimes that’s
basically physical bit right and I think
that’s more superior to gold as well so
you know really then you get think about
like if you want to go through customs
in an airport you want to walk with
something physical or do you want to
memorize correct because if you just
memorize your seat you can’t carry 500
million dollars in your memory I mean
when someone that originally I was like
I was blown away I think that’s that’s
pretty awesome
yeah me and Gigi have talked about this
a lot is that you know bitcoins
redefined you know how really define
money redefined location redefined all
of these things like you know when
someone asks you where’s your Bitcoin I
mean you know what you can’t answer that
question it’s an impossible question to
answer because it’s not anywhere but
it’s everywhere
right it’s on the blockchain all the
nodes when someone asks you that
question though you’ve got one an or me
ask you that question
you gotta give them an answer that makes
sense I just like it’s on this device
that’s I just yeah yeah
again yeah but fundamentally
fundamentally that is um you know it’s
not the case right so it’s just it’s
just such a profound you know
reinvention it’s it’s a profound
reinvention it’s a profound change in
the way we understand money you know
it’s like when you hold gold it’s here
it’s now you know you can identify the
location you know what it is but you
know but Bitcoin so much more powerful
in that sense because it is so much more
meta and I’m and yeah so 100% that this
is this is an emergent monetary asset
that is superior in every form than
anything that we’ve ever had and you
know the benefit that we have now and
this is sort of what I tell people you
know buying Bitcoin now is kind of like
being that caveman 5,000 years ago when
everyone was still using shells and
rocks and stuff like that and you know
you were trading your shells and rocks
with these other people who found this
yellow shiny rock and they thought the
yellow shiny rock was useless because
everybody else was using shells and
stones and crap so they were like oh
yeah I’ll give you this rock and give me
that give me the shells and some dude
was smart enough to to collect as much
of this yellow shiny rock as possible
and what ended up happening was it
emerged as the the best object or the
best tool that we could collectively as
a society use as money and and now here
we are with a with a much better you
know 2.0 you know like a real zero to
one innovation on that yeah this is
where the game is that this is
absolutely where the game is that if I
can say just something in an extension
of that what what I like to do to say or
look at when I looked at their different
money’s like we came from the shells and
the stones and and then came to Gold and
now to a Bitcoin there’s there’s a
couple of properties that that money has
and Bitcoin has infinite value on all of
them exists not one where and yes okay
privacy is maybe not there 100% yet but
well if you use wasabi wallet with point
join and then that’s the other thing as
well you can use I don’t recall the name
of that you can actually already now
create some privacy but when you go
through that so actually all the way
through like traditional money
properties Bitcoin has maximum value and
nothing else has that that has the
network effect and security safety and
scarcity which is
hundred percent cap again that Bitcoin
has and at the same time it Sun
confiscate able and it’s censorship
resistance so it’s you can’t make a
better money than Bitcoin yeah correct
I’m I mean let’s just for that for the
listeners let’s um let’s list those
attributes so so money performs three
functions its money should perform first
and foremost be a store value then it
evolves into a medium exchange and then
it becomes a unit of account so that’s
sort of the life cycle of money that’s
the functions of performance but for a
money to perform those functions it
needs certain attributes so it needs to
be it needs to be durable it needs to be
divisible it needs to be portable it
needs to be homogeneous meaning it needs
to be the same needs to be recognisable
needs to be scarce so they’re sort of
the attributes that an ideal money has
and yeah like you said Bitcoin is a ten
out of ten on all of those whereas
everything else is some sort of scale on
that and I mean you know we’ve got ten
out of ten
yeah I think you know gonna beat that
then what the thing you can say that it
like let’s say if you’re like coin fan
and you go but yeah like when it’s like
we copied the code like it’s exactly the
same like okay small tweaks so it’s kind
of also ten out of ten but here’s a very
important difference and that is the
network effect you know the Bitcoin
already has that light point just never
even has been close to and that’s why
you can forget it like you cannot take
over something that has ten out of ten
all the way down with like one percent
of the users you can write yeah you’re
very correct yeah you have to bring to
the table that is an order of magnitude
better generous it’s an order of
magnitude better when you’re infinite
value all the way down on portable
durable divisible fungible etc spot on
spot on yes so we had a zero to one
innovation to get here and now that like
at least and this is sort of what I tell
people I got there will not be I mean I
don’t know whether in five hundred years
we come up with something better I doubt
it but you know maybe sometime in the
next millennium or two or whatever you
know
we don’t blow ourselves up we may come
up with something better but as far as I
understand converting energy to you know
a you know digital immutability and
digital scarcity that gives you you know
that the maximum you can get on all of
those and is coupled with this
immaculate conception that bitcoin is
like it’s this thing that is complex and
as you know grown in the market exactly
the way it needed to your generation my
generation no other generation at least
for the next 5 10 15 20 100 generations
is going to come up with something
better um the same and that’s why I can
say count that like button my fellow
caveman before how that like button you
guys that are watching this my elite
friends I forgot to say hello to all you
but man this is Benna elite shows so far
I want to bring Alex before the show you
a tweet well I think it was yesterday
we’re talking about a Bitcoin being the
contrary in bet I think this is a nice
time to bring up what you meant by that
well I’m writing an article at the
moment which is um it’s called ten years
on and Bitcoin is still the contrary in
bet like if if we you know if Bitcoin
was supposedly some sort of startup
right you know it like when investors or
VCS or you know people in the
marketplace generally go and look at
startups they’re like look at this
amazing startup it’s been around for
this long it’s gotten through these
challenges it has all of these
evangelists around it like raving fan
customers like you look at all of those
things um and in a normal mental
framework in a normal mental model
people would think that bitcoin is the
greatest success in history but the
general view of Bitcoin is like you walk
around on the street and you mentioned
the word Bitcoin to people and we do
this a lot because of the you know the
kind of product that we have people
think it’s dead people think it’s you
know it’s it’s you know there’s still
this idea that it’s a scam or a ponzi or
that it died I didn’t Bitcoin crash
isn’t it back to zero like it’s still
the general consensus amongst people is
that
this thing is gone when in reality when
you look at the facts it is you know if
you wanted to to put it in the mental
model or in the framework of startups or
anything else other than something is
contentious as the creation of a new
money um Bitcoin is like a big great
success we’ve ever seen you know I don’t
know of any product that’s got raving
lunatics like us jumping up and down on
YouTube telling people to bash like
buttons and you know warring with each
other on Twitter and all that I mean
imagine if a product had that kind of
consumer base it’ll be the greatest
product in the world you know the
closest thing I can think of is Apple
but I can guarantee you you know people
are willing to die for Bitcoin not
willing to die for Apple so like this is
this is the one of the strongest stories
I’ve ever seen and again you know it’s
still the contrary in bet because people
there’s this broad consensus like I said
earlier that it’s dead or that it’s you
know scam or whatever now what that
means is the upside potential is still
extraordinary whilst it is the contrary
in bet it is extraordinary and I put a
tweet up a couple weeks ago which sort
of said that you know one of bitcoins
greatest advantages is that so many
people still hate it and will hate it
for a while to come which keeps it the
contrary in bet and that is where the
upside is that so what I’m referring to
there is when Bitcoin becomes the thing
that everyone once or that everyone is
already holding and that everybody
already agrees is the thing that we’re
all using it is no longer the contrary
in bit but at that point in time it’s no
longer the thing you’re buying for for
the purpose of you know increasing your
net worth or whatever it’s not the
Bitcoin has evolved from being this
emergent store of value of this emergent
monetary unit to being an established
safe haven monetary asset so this this
whole lifecycle thing is really
important and right now it is the
contrary but because of
the point in time where it’s at and it’s
just see how something’s so successful
can still be a contrarian bet it’s it’s
just fucking phenomenal and I know and I
love that Wow
pound that like button people that is
that is inside we’ve got the insider
information you really put it out there
nicely
Anders what’s your what’s your thoughts
on on the reply to what Alex just
pointed out they’re not about this you
know that you go out in the world today
most people think it’s failed it is true
yeah it’s it’s true that it’s it’s
actually amazing that ten and a half
years on something that is so I think
logically fantastic idea still has not
been accepted by each and every seven
billion people how many we are on earth
because it makes so much sense and it’s
actually not so difficult to understand
if you if you opened your mind but the
problem is that the teachings we have
from society from school from media from
pride like unaudited federal reserve’s
that are teaching us another thing of
course that and that has given people a
point of view where it takes longer time
to get them to open their mind and smell
the roses or you know see see how simple
and logic it actually is that it is just
a better mind that’s where the advantage
lies for people like us right so you
know I have a saying in life yeah I have
a saying life which is if you want to
win be the contrarian don’t run with the
crowd and I love and this is why I love
Bitcoin so much is because I’m
fundamentally contrary and I’ve always
been one in my life
I always do the opposite of what people
tell me all that sort of stuff I mean I
sometimes take takes things to an
extreme but I love Bitcoin so much
because if you go in the you know in in
the normal world bitcoin is the contrary
but everyone thinks it’s dead in the
finance world everyone thinks it’s our
you know it’s bullcrap you know we’ve
got a financial system ready you go into
the blockchain world they all think it’s
crap because they’re more interested in
their bullshit means you go in the coin
world you know the etherium guys they
think they’re the real deal so all the
shit coins think that it’s you know crap
everybody all of these groups all think
that it’s it’s the one that’s missing
and you know for those who are who can
and there’s there’s a distinction
between being contrarian and being
stupid and and that is taking doing an
analysis from first principles so when
we look at Bitcoin you and I don’t just
magically believe in it because we also
believe in unicorns and you know fairy
dust we we have actual facts and we have
first principles that guide why we
understand Bitcoin the way we do so when
you find something where the first
principles add up and you have a
consistent strong applicable narrative
and everybody else is thinking the
opposite you have the greatest
opportunity upside possible and and
that’s why you know I Alex it reminds me
of I started investing just a little bit
when I was from when I was 12 years old
I bought my first star and and people
mostly said you should go and talk to
the you know advisor in the bank which
star to buy but I’m like if whatever
advice I’m gonna get there and everyone
else got it further that that’s I’m just
I’ll be going with the flow and I’ll be
you know seven steps behind them that’s
not gonna be advantageous you gotta do
your own analysis and and your own
thinking and find out what so
and what’s not a winner and I think I
mean I personally started believing in
Internet in like 95 90 yeah I think 95 I
started an Internet company in 96 and it
was the same situation as now that you
know people didn’t believe in the
Internet in the 90s like a lot of people
some people that a lot didn’t because
why would we need a news website because
we still we have newspapers
I’m never you know I’m just gonna read
my newspaper why would ever go to a
website for news well you will read your
newspaper if you want yesterday’s news
and the website is for today’s news so
what am I trying to say with that yeah I
think what’s important what I’m or what
I’ve always tried to do and what comes
natural to me is if something new comes
along look at the properties of that
thing like analyze it and totally ignore
the fact that it has 0.001 market share
at this point I’m only look at how great
it is and if it is like orders of
magnitudes better than what is now it
doesn’t matter if it hasn’t taken over
the world yet then it will highly likely
unless there’s something you know
structurally in the way of that
happening
and and that’s where I think the
eighties 80% us as Adam speaks a lot
about and which is totally true I agree
with you they tend to not believe in
something becoming successful until it
actually has to be complete which is
going along the the thoughts you have
with the contrary and Beth there I think
yeah
they feed on radius is overrated as I
say sorry yeah totally yeah well let’s I
want to talk about something that
involves 80 percenters something they
don’t have low time
reference as a way of life Alex yes I
was I was catching up with a friend over
the weekend and we’re just having a
conversation so she’s sort of like she’s
interested in you know the environmental
movement and you know being a collage
achill and all that sort of stuff and
you know I could sense smart girl but I
could sense undertones of things like I
you know um you know the it’s the
corporations and all that sort of stuff
that are screwing up the environment B
you know and and she sort of almost said
like the corporate capitalist sort of
structure and and I had to correct her I
was like look it’s got nothing to do
with with capitalism it’s got everything
to do with the the time preference that
society has at the moment capitalism at
its at its core is actually the closest
system we have to something that is
natural because capitalism
you know optimizes for power laws
capitalism optimizes for production for
value for input for work whereas the
crony capitalism system that we have at
the moment optimizes for you know when
you’re at the top you know you don’t
stay at the top by innovating or adding
more values there at the top by
regulating and getting into you know
powers with your mates so that way you
can put roadblocks in front of you know
those that are potentially better than
you so what what I sort of explains in
her was what Bitcoin gives us and why
again it’s such a contrary in view to
everything that we have in the world
today is Bitcoin optimizers for a more
for a lower time preference type of
lifestyle or a lower time preference
type of economic system because your
wealth and the purchasing power of that
wealth you know at a point in time will
become fixed you know did the work you
put in is measured in this unit and that
unit is fixed in society now yes you
know there might be fluctuations and
stuff like that but broadly speaking to
what I’m talking about is you know at
the point of high per Bitcoin ization or
you know where where bitcoin is the
you know the network upon which you know
we’re all sort of operating in at that
point in time when you don’t have to
I’ll explain it this way at the moment
we have that the monetary system where
the economic system is designed so that
you’re incentivized to go and spend as
much as you can and to chased yield in
every single way that you can because
your wealth is depreciating by about 50
percent every ten years so what you
inherently get is a system or a model
where consumerism
is optimized or is incentivized people
just go and spend all the money they
have because you know that they they’re
incentivized to consume because of
inflation and because they’re you know
their wealth is depreciating and then
those who may not want to consume
instead of producing you know what
they’re going out and doing is they’re
going investing money blindly into
anything that they can possibly invest
in chasing yield in places where you
wouldn’t normally chase yield and we see
malinvestment we see stupidity we see
all these zombie corporations you know
going around the world we see you know
ghost cities like we see in China we see
all these distortions in an economy
because we’re incentivized to have a
high time preference we’re incentivizing
we are incentivizing now over the future
whereas if you can swap that around with
something like Bitcoin where you
actually fix the UM the the unit through
which we measure people’s value input ie
the money you create a society where
that incentive doesn’t exist anymore so
those who want to store their wealth
they don’t have to chase yield anymore
they can store their wealth those that
want to work and have input guess what
now
you don’t have to go and blindly spend
all your money you can optimize you can
buy it what you want what you need
primarily first so it’s it’s a you know
the way I look at economics it’s you
know it’s just the fractal of biology
it’s a fractal of physics everything you
know functions on incentives you know
a physical system is something that has
inputs and outputs and you know like the
best analogy I give to people is more
biological example is the instant of
mechanism for life is pain and pleasure
now you you you do things you you get
pleasure you do more of those you do
things you get pain you get you know you
do less of those and we start to
optimize and grow around that an
incentive an economic system is very
similar is that the incentive and the
disincentive is like pain and pleasure
pleasure and pain and I’m what ends up
happening is the way you set the
framework up then takes us down a path
and in the beginning it might not seem
too bad but you take that out ten years
twenty years fifty years hundred years
200 years here we are now where we’re
all blind consumers and we’ve built all
of this you know financial so-called
infrastructure where you know for the
average mum and dad like I was catching
up with my mom and having um breakfast
two weeks ago and she’s like she’s
panicking she’s like you know I’ve saved
up all this money I’ve you know been
working I don’t know that should we put
it in a property should we go on the
stock market everything’s you know going
up and down we don’t know what to do and
I’m like man that is so messed up like
the fact that people don’t know where to
store their wealth because they’re too
scared to keep it in a bank that I
wanted to devalue they’re scared of
negative interest rates they’re scared
of assets because they’ve been over
hyatt like the world’s gone mad and and
that is all as a result of this high
time preference there’s now now now now
now now now now now at the expense of
the future so to loop this all back with
this girl who is a bit more an
environmentalist then what I sort of
explained to her is that the way to fix
a lot of these problems of you know
crazy you know shit that’s happening
with the environment like where we don’t
care about the future of that is to
adjust at the core the time preference
for society and when we have a lower
time preference we will do things that
are more ecologically sensible instead
of nonsensical because we are all
collectively converging towards a you
know a bias that is long term as opposed
to short term so yeah
you know what though I think the
bye-bye-bye hyper consumerism it’s just
too tempting
I think the 80 percenters will always be
that way and that most low time
preference isn’t going to be their thing
but Andrews what do you have yeah well
III think well Adam that once Bitcoin
which is what I believe happens within
10 years takes over as the money that
everybody has around the world it will
be the mother the world reserve currency
and and enroll consumer money called
what you will it because it’s
deflationary it it will teach everyone
including the 80 percenters they will
see how if they wait one month buying
that thing it’s become cheaper they will
see if they wait one year actually their
money has become even that much more
worth and the reason that happens is
that you know you have this much money
in the world which is the 21 million
bitcoins then you have this much GDP the
money doesn’t rise but GDP you know
production of goods and services keep
rising and that’s why the value of the
money keeps going up because each unit
and buy more of all the production
that’s that’s what’s meant by the
deflationary and I have no doubt that
this is such a strong mechanism that it
will change people from high time
preference to low time preference will
be going from consumer society to a
saving Society
I think it can actually productive
productive I think that some what we
what we what we vote what we move away
from is we that kind of a model
optimizes production as opposed to
consumption and in that that’s the
important thing right is because what
you want to do in that type of
environment is you want to acquire more
wealth because your wealth is going to
you know appreciate so what you want to
do is you want to produce more you
be a better producer you want to you
know you add more value you want to put
more input into society and that’s a
strong fundamental incentive of that
system so yeah 100% I think it will
where today we think it’s a you know the
the chance of saving your way to you
know financial independence at
retirement like that you can actually be
you know retire on the savings you did
throughout your life it’s it’s pretty
much a joke today it’s non-existent but
again become very much possible even for
you know lower middle class and to some
extent for people as long you know if
you can keep your spending at a low
enough level then that if Latian arey
affect your money has the way that to
become worth more even for someone who
doesn’t make that much money you know if
it five years to give it 10 years 15 20
years you know people will learn that
they through being you know saving
instead of spending that can freely
accelerate and they can become
financially independent I would I want
to say what ESCA Alex one question here
you brought up shit word hyper Bitcoin
ization and and the big believer in that
are you a big um I’m okay
there’s two parts of that question I
guess is number one is the timeframe
question you know I’m I don’t think I
personally don’t believe ten years is
realistic I personally think is gonna
take a hell of a lot longer because I
just think that this is a this is a
multi generational shift and then
secondly I don’t know whether we end up
in a world where you know it is just
Bitcoin I actually think we’re more
likely to head in a world where we’ve
got parallel economic systems
functioning you know we’re we’re
you’ve got I kind of call it that the
four that I kind of say is you’re gonna
have us slash NSA you’ll have you know
the Chinese Social Credit System you’ll
have labor Anzac box and you’ll have the
one free society you know runs on
Bitcoin now you know long term what does
that look like you know will the people
from the others jump ship you know and
come across the Bitcoin maybe but maybe
they’ll be stuck in their own matrix
there’ll be too deep in their own matrix
that um that they won’t jump you know
we’ll have this parallel system so I
feel like that’s the more pragmatic and
realistic approach but you know yeah I
think it’s gonna be although I can hear
that birthday you believe in this I
think it’s gonna be so obvious for
anyone living in any of those other
systems and storing their wealth in
either a Chinese currency or USNS a
currency a leaper or whatever that it
can is so much better because we aren’t
gonna reach you know the knowledge and
understanding of Bitcoin is spreading
like rings in water and yes we’re still
at a very low percentage of the global
population but we do have tremendous
speed still when you look how much is it
chief from you know in 2008 it was one
person and then in 2009 I don’t know how
many people ten hundred fifty maybe it’s
funny in the beginning of 2000 it’s so
there’s by an order of magnitude every
year yeah yeah so and an order of
magnitude every year is a lot so yeah it
means that means ten years from now that
means everyone in the world has the
knowledge and understanding maybe that
would be some left but I mean if all it
takes is you know more than 90% and then
it the effect will be so strong that
that there’s no doubt I think in there
won’t be you know you can’t ignore it
anymore and it’s just it’s gonna happen
you can fight it like fighting I think
it’s my
in fighting Bitcoin taking over because
its superior is like fine keep fighting
the gravity of a black hole that’s what
I like to say because that’s that’s
impossible you can’t fight the gravity
of a black hole and I I don’t think you
can fight Bitcoin taking over and I
think it has that kind of speed as you
say and maybe it hasn’t felt that like
as that much the last couple of years
but since we’re getting tore a size now
in a mound of people you know having
that speed now it really starts picking
up yeah
look III agree to the extent that you
know I’ve called the coin a black hole
many times and you know it’s just
something that sucks liquidity it sucks
up capital it sucks interest it sucks
your public life up it’s you know it’s
my it’s my personal black hole here Here
I am it’s it’s technically my birthday
today and I’m in the office at 6:30 p.m.
and I got another podcast after this so
literally this is all I do
and I’m sitting here first day thirty
minutes past midnight now it’s like one
and a half hours past midnight yes
exactly so I I agree with you I just
feel like the the existing system I just
don’t think it’s gonna be that clean I
think the process is gonna be far more
protruded so even if we do end up with
some form of hyper mechanization where
everybody is on a Bitcoin type standard
I think that is probably even further
further further away I think that the
Bitcoin economic system can probably
sustain itself on you know and I’m just
pulling numbers out of my butt here but
you know half a billion or a billion
people and it can be a parallel
functional economic system through which
you know a subset of the population
completely you know is able to operate
on you know and they can be anywhere
around the world whilst the other
systems the only way they’ll survive is
by literally creating firewalls and
roadblocks and all of that sort of stuff
around within their jurisdiction so that
the people who are inside those
they just don’t you know they don’t get
to peer into you know this big 20
because and and that’s sort of I hear
you yeah I don’t think it’s and I mean
yet again just let me say this like you
know we very much agree on that’s
probably you know that’s where it’s
gonna end up and talking about the
timeline is not something worth maybe
discussing to hard but I think that but
reaching a level where say half a
billion used Bitcoin and half Bitcoin if
it’s just going to be impossible for the
these other jurisdictions to to keep
Bitcoin out because it’s exactly the
same as alcohol during the 20s in US
prohibition you had plenty of alcohol
the last 50 years in u.s. I don’t know
how many trillions of dollars have been
spent on fighting drugs all possible
drugs you ever wanted has been available
in u.s.
I don’t know from personal experience
but I mean I see movies and TV and you
know you hear things so you know I mean
it is right you know it’s a problem it
keeps being there look I I agree I agree
I agree but you know just always err on
the side of never underestimate the you
know the stupidity of human consensus
when people are operating you know from
from a place of um you know unfounded
fear which is where they’ve been
operating for a long time so yeah that’s
a good argument right there though I
have to give you that remember Allah
Anders there are some dudes out there
that are very passionate about your
hyper Bitcoin is Asian in ten years and
you can follow Anders he is linked to
below so is Alex and I want Alex to talk
about one of your passions and that is
amber act we haven’t covered that yet we
got it yet well really briefly so again
this whole low time preference thing
amber is is a dollar cost averaging app
so you know that there’s no longer a
use for people not to buy Bitcoin when
they can sit in automatic purchase of
$20 a week 50 bucks a week $5 a day it
doesn’t really matter and it just
accumulates Bitcoin for them so it’s
actually it’s it’s a low time preference
product for a low time preference money
for a low time preference human being so
anyone out there who’s trying to you
know practice becoming a more you know
sensible low time preference human being
and wants to start accumulating and
collecting this asset have a look at
amber app that’s our website you know
and that’s really the the fundamental
thesis behind that is just now is the
time to collect Bitcoin now is the time
to you know get as much of this thing as
you can because you’re not gonna be able
to buy as much in the future and that
that’s basically the one thing that we
all can guarantee like we can’t we can’t
guarantee the timeframe we don’t know
whether it’s gonna take 10 years 50
years hundred years to hype a bitcoin
eyes but that that’s the trajectory
that’s the trend and the one thing you
know we can all agree in say is that
bitcoin you know in the in the future is
gonna be worth a hell of a lot more than
it is now in you know dollar nominal
terms so you know the best strategy is
just close your eyes and just keep
buying simple oh oh one quick thing
about Amber app I have many people the
growing audience from Australia it’s
only available in Australia correct
correct it’s only available in Australia
at the moment I’m hoping by the end of
the day I’m actually I’ve people from
South America from South Africa like all
this cool stuff have reached out and
said look you know when you’re launching
here you know can we partner can you
help you and all that stuff so my plan
is by the end of the year to announce
the next couple jurisdictions that we’re
going to launch in so I’m so exciting
times men you know coming into 2020
we’re going to be trying to get
available in as many places as possible
around the world all right
value your wealth in Bitcoin Alex thank
you so much for making your your
appearance your return to the show and I
really do love that for different
parallel systems that you brought up
there that I’m going toward that path
that you talked about now Anders what
are your conclusion Airy thoughts he or
anything you want to bring up talk about
well first of all I want to say I think
it ballocks that I think it’s great what
they’re doing and I wish them a lot of
success because it’ll be good for them
it’ll be good for a lot of people I
believe it’ll be very good for whoever
actually starts using the product so
great to you have that word spread you
will command a my pleasure
and then yeah if people want to follow
me I’m on twitter with the Anders you
put it below Andrus underscore a and D
ers underscore and then I recently I
heard one guy from ether was on tone
show I don’t know if you saw that Adam I
heard that I know there’s a lot of you
know you can’t see everything but so I
found that a little bit interesting I
started their website and and they have
something that the world’s leader in
social investing which means you know
people can follow each other so if one
guy is doing really well on his
portfolio then other people can say okay
listen I take $1,000 and copy whatever
he does
and since investing is you know has been
my passion since I was a child I can’t
wait for ether to launch starts as a you
know that you can buy that in u.s.
because right now in u.s. you can fight
with that you can you can only buy
cryptocurrencies and for me only Bitcoin
is interesting there you know the rest
all right then each horror thing is very
interesting because I believe I’m going
to be here in Israel talking to a guy
I’m the host of a fireside chat chat in
September 10 public a Tel Aviv event
here in Israel I think I’m gonna be
interviewing a eToro guy so this is good
to know this social invest that is very
interesting thank you for for
yeah and you speak Alex in Australia I’m
gonna be in Australia October 17th
until like November 20 something so all
your Australian lives I’ll be seeing you
guys in person in October
Alex any conclusionary thoughts on your
part nah man look thank you for having
me on and is pleasure to meet you as
well man if I’m up la way I’ll let you
know we’ll catch up yeah and then
likewise Adam when you’re down this way
but hit us up I’ll be I’ll be a Baltic
honey badger and um in September and
then I’m gonna pop over to Palm Springs
for crypto Springs actually and as you
come into crypto Springs or not that
could be a good idea it’s not too far
from here that’s um end of September man
so that’s around the corner from you
intercept MBE shit you should come along
oh okay yeah so whoever has some info on
the tickets and locations etc yeah just
chuck it type in crypto Springs comm I
think men and just jump in there you’re
right why not you’re seeing online these
dudes are in motion you can meet them in
person in Southern California wherever
all right this is great stuff I love it
I love it dank I know
yes yeah I just also want to say thank
you for having me on I really appreciate
it I don’t think I said that me and
again this you know this is real when
you were up at 1:00 in the morning or
with it all of us are up at 1:00 in the
morning with this stuff at times doing
interviews doing weird things through a
blog post this is real this is the
future and as Alex point out earlier it
is amazing that on the street people
think this is dead we’ve got the insider
effort when you watch a show like this
you get the insider information knowing
that this thing is huge like Apple would
kill to have fans like this to have
passionate people like this and that
that’s definitely saying a lot so this
is Jay and this is just the beginning
people just the beginning so on that
positive note I have that adam meister
the bitcoinmeister the disrupt meister
subscribe to channel like the video
sharing this but you’ll tell that like
bang that Bell foot button we do this
this week a Bitcoin every single Friday
I do a new show every single day
Saturday is beyond Bitcoin show I’ve got
the conviction this is the system a new
show every day thank you very much
everyone again shabbat shalom we will
see you soon

9 thoughts on “This week in Bitcoin- 8-23-2019- Contrarian bet, safe haven, hyperbitcoinization, gold, Amber, Bakkt

  1. Right on! You’ll be rewarded for quality products with utilitarian value and punished for cheap and superficial products and services. How many different types of M&M’S does the world need.

  2. Sovereignty – Do you Know Who You are? 2 of 7.wmv – https://www.youtube.com/watch?v=AJZ5_SqZhG8&list=PLtfDJdWNxgpmSb3rsv-CX-BqD_fTyjz05&index=2

  3. Fantastic show! Thanks Adam, Aleks and Anders for sharing your Bitcoin knowledge and insights. Like button pounded!

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