Explaining Bitcoin to a Curious Friend

Welcome to the Business to helping you enrich your bitcoin, the hardest money on

I'm your host, Josh Friedeman friend Anaya, who is actually I did this interview for an of called Bitcoin is Better, class families about bitcoin. I'll be sure to include the in the show notes. Luke Broyles and others have channel and I think you might The entire focus of this who are not yet bitcoiners and about bitcoin. I'd love to get your feedback so feel free to leave a was interesting or what I or better. We're going to get to our this. Anaya, welcome.

This is going to be one of a Is better of talking with just about bitcoin. Any questions they might have. We've already had some of looking forward to hearing I don't want to steal too much additional things, but would who you are so listeners know Yeah. So my name is Anaya. Like Josh said, I'm a fitness graduated college, looking for some. Been thinking a lot about So yeah, just looking forward I can. Learn about it for sure.

And for listeners, context, two or three times probably bitcoin, but to my knowledge, on bitcoin. Right. So we'll probably talk about You have brought some to kick it over to you to is you want to start with.

Yeah, so the first one's How does it work? Explain it to me like I'm five Okay. So I guess the simplest you can go kind of further of money or maybe a system of or corporation created. And most of our money today is So this money is not only not corporation, but it can't be And so it's basically a money anyone else in the world. It's free, open, and there are about it, but once you do as well. So I don't know if that but hopefully a five year old bit of that.

Are there other things, like, that would be helpful to know Okay, so if it wasn't, who was If it wasn't created. Okay, who was it created by? Let's start there. Yeah. So you may have heard the name name of the person behind bitcoin. We don't know who that person a group of people, but satoshi launching before it launched, he started bitcoin.

And basically what bitcoin is communicate with each other sure that everything on the So at first it was him and over time, it's grown to where network which has made it much But that's been a long process So it officially launched at getting towards 2025. So we don't know who satoshi Some people have theorized, Nakamoto. And basically, if anyone hints they might know who, a lot of really want to hear much about it. And part of that's because a of ride on the coattails of satoshi.

But also today, it doesn't is, because bitcoin is what it that today. So it's kind of taken on a any changes to bitcoin in the majority of the network, the world, have to agree that So basically nothing is going doesn't want it to happen. So it's is that, that's why It's technically possible, but ever take bitcoin over. And the more security there the less and less likely it becomes. So like even if the United other countries, it would just over the network, get the like 10 or 20, 30 minutes.

So that kind of goes down like than is worth talking about now. But that's a little bit about matter all that much who Yeah, yeah, I just was like, based money. Would you say it like that? Yeah, yeah. So I'm trying to think of the it's a bunch of. It's, it's the largest all of these computers are by the rules and they are as it's supposed to operate. So then that's where it comes into. And I don't know if you have a mining, basically what mining is.

Yeah, there are a couple First of all, there is the are issued. You may have heard that there And that's like all the way the last bitcoin, or actually be mined. And right now the block reward So it's, you know, every 10 And so whoever, whatever 3.125 bitcoin. And frequently these days a pool because let's just say miner operating in your home, They the best use case for Is honestly just like it's, that specializes in this and it produces a lot of heat.

So I have interviewed people the heat from bitcoin miners greenhouses, different things But like a single miner would mining power on the network mine a block with your miner. So usually what people do is And so whenever a miner from to finalize this next minute 3.125 bitcoin, the block everyone in the pool. So the more people you have in to win a block.

And so it kind of all evens But the block itself is a And like I said, on average And it's, you know, whatever be kind of next in line based pay, they will be finalized. And then there's, you can go For anyone listening right of the blocks or all of the be finalized in a block. And if you want to pay more you can get your transaction And if you're a little more conscious, then you can pay bit more time for your So that's what, that's what And I don't know if you have want to go to the next one.

Yeah, so it's like a block is just like. That's a good point. The block reward is kind of would get or a miner. There's a person behind every computer. So right now, since bitcoin is over $300,000 that the miner Also though I'd mentioned fees has fees associated with it the last, like in the last where the fees from the Than the block reward itself.

So like, I guess the reason I years there's something called of a programs time where the originally it was 50 bitcoin You know, I've said before 2009, I could have used my new bitcoin network because it's have mined bitcoin and a day or two. But I had no idea about it And now there's so much more it doesn't even make sense for or a PC, to try to mine the hash page should be so uncompetitive. That's why you have to have So you do have the block fees attached to it.

And really the fees are based I mean, it's a total free The Bitcoin network is always to someone over bitcoin, then, then you can do that. You'll have to pay a fee. And sometimes the fees are to transact on the network at But sometimes the fees are So it sort of, you know, as to how high the fees are. But in the future, people greater than the block reward And so I don't. I think that should probably Some people, like, one last okay, when, when the final or so, what does that mean for bitcoin?

Will it still be secure? Will there still be people And what really, what mining new bitcoins, but it is fees for that. And by that point in time, the the fees will be so much even after the last bitcoin is and people will just continue So I think that probably I don't know if there's any to go to the next one.

So what makes Bitcoin like, trustworthy? Well, so a couple things. First of all, like I said, network in the world and all are paying attention to make operating by the rules. And if someone's not playing participate. So that's one positive thing Another thing is that Bitcoin anyone can see the code. Technically you could get the your liking. That gets into a different conversation. But you know, you could create have done that in the past, to use your version of Bitcoin.

They'd rather use the version using because they can it. So you'd want to use the, the So those would probably be say is just it's already network and you can verify the at the code. I mean, you and I are probably particularly techy and if we be able to see too much. Yeah, but you can verify also run your own node and the rules you care to enforce.

So if someone else did try to or play by different rules in they were doing because rules, which is the rules So I think that's probably the is trustworthy and secure. Some people are concerned by What I would say is that probably seen that humans are to excessive money printing Like our, we don't need to have been so many new dollars years, and anytime someone has they're going to. Well, the rules of Bitcoin are It's following its code and million Bitcoin.

And so at least when it comes you can have confidence that see in the code that it will Whereas when it comes to the politicians, they might say they get into office or to get office, they. They can kind of do whatever So I would say that the nodes on the network is much it is today, than people doing whatever they want when Gotcha. So you talked a little bit What is. Like, what does that look like? Like one bitcoin. Like, how do you. What is that worth?

Yeah. So right now, first of all, It's been volatile to the volatility does give some That said, bitcoin has just coin. And right after it did that, as of this recording. And then the next day, it fell back up over $100,000 again. So that's what it's worth. Right now. The question that a lot of be worth in the long run? And that's the big question.

Yeah, I don't know if you want now, one bitcoin is worth What Bitcoin will be worth is Some people think that it will A lot of those people haven't bitcoin. One of the critiques that I've United States will shut it to the dollar. With the new administration seems like currently that's were feasibly possible. But like I was saying earlier, and they can't control it, as used to governments being able But the reason they can do our world are centralized.

And so whoever can call up we want you to do. Or there are going to be some But with bitcoin, that's not all these nodes running around No one country can shut them And we even saw back in 2021, 2020, yeah, I think 2021, when of the miners, not all of in China. And quickly they started world because you can just So I'm not too concerned about any government. But then it's like, what is to anyone, that anyone can around the world? What is something like that worth? No government can shut it down.

And that's. I mean. I mean, I think there's a ton Actual numbers. A lot of people believe that across the next year. This is traditionally the year having, which just happened in The most significant time for And then following that, the a significant correction where 80%. There's some question as to time. And, you know, it's anyone's 200,000 to well above that if strategic reserve asset.

And then other countries fall If the United States wants to Republicans in the Senate have a lot of other countries are Thousands. There's only 21 million. And so, like, what does it clamoring to get a piece of There's no more can be created. So it's like, that's one of about bitcoin, which is it's you can't create more. Even with something like gold, you can go out and find more gold. A lot of times people know The gold price is just not into the earth and getting it.

So I think that we could see in the next year or so. Now, it's also possible that I don't think World War 3 is tossed around. And so if we go into some or something like that, And you know, bitcoin might But there are a lot of people years, maybe even less than million dollars per coin, where it is right now.

And I would tend to be in that camp. How and when exactly, it's But that's sort of the, the, also. And some other people have percentage of the total assets And then what, you know, where So, for instance, would you and is significantly or would you rather hold real but also has taxes that you you have to worry about, tenants. Potentially has a lot of other Would you rather hold digital, estate that has a bunch of headaches.

And so a lot of people think taken from real estate, some Some people might say instead I'm actually going to put a So take money from equities If bitcoin siphons a little each one, it's going to grow significantly. That's not even talking about like that. And so there's a lot of One of the memes that circles divided by 21 million, which of everything. Like, there's no reason that a high astronomical number. There's going to be 21 million think it's worth.

But if nations start piling wants to get a piece of the pie. There's only so much to go around. So I guess the last thing I'll think the number was there's in the world to have about 0, 28. So you know, some, somewhere a bitcoin and that's just And so like if the average is better, is focused on families, if the average 0.2 Bitcoin, which is like for a lot of people.

You know, 0.1 Bitcoin right But if you can start getting a it in long term savings, then probably be a whole lot more So how do you have access to Like how would you be able to You know, we have like debit you get that money? Money out There are a lot of Most people listening to this If you have cash app, that's a bitcoin. And then right now, you know, people place money in as a First of all, it is a store of Right.

You're putting your time, your is, do you want to put it into That may be volatile, but you you're always going to have available or across the years, You know, in dollars. When I was born in the early it is today. So probably more than that. And so like across 30 plus of what they used to be. And if inflation continues to kind of like optimal in 2% target is what people, I Reserve likes. If it stays higher than that then the value of your dollars Yeah, so a great thing to do can.

Some people dollar cost month, whatever, maybe it's can turn some of that into bitcoin. So also there are a couple used or would recommend that you use it on a day to day Just as of the recording of I don't know when this will be who is the CEO of Strike, he app, which is a way that you You can turn it into dollars. He basically lives, he has bitcoin and he has enough volatility. But over time, you know, his But he just released this pay your bills so you can save.

And also Strike has this has this feature where you can and have some or all of it And so, you know, just there when bitcoin hit the cycle low like 16 something. But it was, it was in that, you know, well, well less than And I was just like, where do buy bitcoin? I bought bitcoin and it's more held it there. And so, you know, you think know, $16,000. When, when Bitcoin is worth That $100 is more than 500 now. And so that's crazy. Like over the long term, if the value of bitcoin.

But you can pay your bills Just with the bitcoin in the Strike. Another great one is Fold. And Fold has a debit card similar features. But you can save in bitcoin your card in the form of like you would a normal debit card. So those are a couple kind of interface with it in and kind of easily transfer it's most advantageous for you.

Another one, you know, I host a podcast called interviewing business owners And frequently it's, you know, sheet or they might be There are some other things more clever that may not be you can accept bitcoin in your business. Or like, you know, if I were to sell me something, if we in bitcoin. And so there are practical And that, that's where it kind the second, I guess, level of that's like cash today. Like, everyone pays for things Dollars are our medium of exchange.

And that is the future, I There are some things that You know, the base layer, a every 10 minutes. And so you're not going to pay Maybe the fees are really high. So it's like, you know, costs You have to wait for 10 Like, that's, that's not practical. No one's doing that. It used. The network was fast enough enough.

There was not as much and it was a little more chain, kind of the base layer But now there are what you to be developed, like the The lightning network is a way forth, basically at the speed So it's a lot easier, it's a hardly any fees involved. That's how a lot of the medium With bitcoin, there's some that are being developed right now.

And then the final one is a And the unit of account is You know, when someone says, And they say it's the latte, They don't say it's, you know, But when you get to the level bitcoin, then that's a because people are thinking in sats. They're not thinking in cents, are just little tiny amounts Every bitcoin can be broken sats. And so, like, you don't have I don't know if. I think you probably know that I think It's a thousand sats Or a thousand sats for a dollar. So 10,000 sats for $10.

Yeah. So the math is a little bit $100,000. But you, you know, you could to having to pay $100,000, know, impossible. So that's a long tangent, but that's. Some of those are some of the And I would highly recommend if you wanted to kind of be an easier way. One other thing about Fold is get a percentage back in So those are some potential use if they were interested. I have both apps. I use both to some degree, but them more in the future.

So. Any other questions or maybe Oh, I know you mentioned fees Or trading their bill or Like, why would, why would you Isn't it better for you to That's the crazy thing about everyone has different reasons Some people are not nearly as So you get to the you want to sell because it was $400, and whenever it it's like, close enough you're But I agree that, like, with long term, keeping it in very likely be incredibly So there are, yeah, there are these leveraged positions

down, they make a whole bunch that are never selling. But the more people that learn the potential in bitcoin, the And each, you know, each high. There's this whole new group okay, I discounted this when I time, or two times ago, or 10 But now it's clear to me that so I should start taking it And every time that happens, buy bitcoin with the intent of 10, 20, 30 years or passing it And when that happens, the decreases. You know, like, so let's say end up getting purchased.

And they're like, people say, It might be more than that means there's only 6 million

Well, there's also a bunch of not available. Like, Satoshi has about a those have not moved since he earth. And so those probably won't move. And so, like, There are about probably won't move because reason. And so you're getting to this available to be traded or tiny. And that's the bitcoin people That's the bitcoin they're for.

And at a certain point in I have this bitcoin and I And that's when the price this crazy crunch because there's not enough to go I mean, there's always enough you know, let's say you got in $1,000 a coin, you bought five Well, those five are probably You're saying, I went from a There's no way I'm going to it's going to go so much higher. So. Yeah.

Why do people buy and sell? Who knows? Everyone has a reason, but at to do is to buy it, to hold it term. Yeah. So I don't know if we've Do you have some additional or some additional things that this conversation? No, I think you, you pretty Even the questions I didn't So it's starting to, I think now. Yeah, I think I'm starting to Well, any, you already know and shares, who's not yet A So you are going to get your this recording. And it's a good step in the, the right direction.

But I would just would like to if you have money that you can a great way to do this. Even now, you know, $100,000, but they've said that, you they've set it at a thousand. People were selling at 400 it went up to 400. You know, I'm just sort of But people, people have sold of their ways across the long term. So anyone who does, especially have a lot of extra money, if term savings account or what bitcoin could do for your the long term.

So, and I, I'm going to kick thoughts you may have before No, this was good. I'm probably, definitely gonna have. I can't think of any more into it and actually start definitely have more questions But that'll be offline, of course. But this is great. Yeah, I learned a whole lot more. Well, now you can hopefully there are going to be more and across the next year as the And now you probably know more Maybe that's a little more because you've actually couple previous conversations it.

And I think it's a little now. Hope my answers have been Yeah. Great. Well, Anaya, thank you so much It's been a pleasure. Yeah, thanks for having me. Well, friends, it's a wrap. Thanks so much for listening show. Remember to check out the and leave feedback about how I'd love to hear what you have As always, keep building, keep living and leading. Well.