If you understood how much of your stuff is tracked right now inside this system, and you think it isn't. All of these connected systems are all part of that centralized control you are inside of that. Where are you safe in a centralized system that takes all of its control you through manipulated money? What is safe? Good luck?
Over the last five years, the dollar has crashed to a point that it buys you fifty percent of those groups. So what you're afraid of has already happened. Are you thinking this is something more drastic coming that is going to happen sooner than later.
We know for sure money is being debased. We know for sure you have a decentralized, secure protocol founded by energy that can't be changed. Bitcoin is repricing the world through the free market. It's the first global free market
that's ever existed. Bitcoin would be the only thing remaining of value if we've never lived in a free market and our actions inside the other system are trying to get rich in a zero sum game where somebody has to lose because we won every single asset we're trading, than that system is really just a bet on how much is somebody else is going to lose because I'm going to win all on a centralized system and there's no way to fix them. The rate of improvement of AI,
it will never be this slow again. It will never be this dumb again. If you don't use it, other businesses are going to use it to provide more value and it's going to remove labor at a staggering rate.
All right, jeff Man, we had such a fun time hanging out in Abu Dhabi back in December. It seems like a world away at this point, and we had this conversation where we went outside and hung out for a little bit and I had a video guy there and we tried to capture the conversation and it just didn't come out. The audio just wasn't good enough. And since that time, it's been not even ninety days yet,
so much of the world has changed. We were talking about bitcoin AI and AI agents, and since that time we've seen just the rise of this takeoff, and we've seen now multiple at least I've seen sure you have as well, multiple instances of AI agents going out and completing tasks autonomously and using bitcoin lightning to do transactions. I don't know if you've seen.
This, Yeah, yeah, I have.
Yeah. At that conference, I made the case that I think maybe one of the big use cases of a medium exchange might come from the machines, because they need a money that we that they don't have a they don't have a solution for at this point, and bitcoin
seems to maybe solve that problem. Being personalists for example, high frequency transactions things like that, what do you think about how fast that space is growing and maybe it's necessity or you know, needing bitcoin or something like that to work.
Yeah, And that was our conversation. Was fantastic, and I think that's a part of it. But but I don't think that's a key part of that medium of exchange. I think ultimately, ultimately built bitcoin is repricing the world through the free market. It's the first global free market that's ever existed. And like, if you want to talk about prices falling now or what, like, really what it's doing is it's lagging the It's the canary in the coal mine to a deflationary spiral of it out of
a credit system that would would reset everything. And so in that event, bitcoin would be the only thing remaining of value. And you know that I know that, and so then when when that, Because that that credit system that we live in cannot be allowed to deflate without a complete collapse, you're going to see a massive liquidity or as that big print or the big distribute, yeah, exactly, or anything that we want to talk about it or
lynn Alden that nothing stopped sys train. All of this is the same thing, right that the existing credit based system requires manipulation at exponential rates to offset the productivity that should flow to us in the form of lower prices through through AI and everything and everything else that we're building. So so taken, yes, I do think there is there is a case that some of these agents will use kind of lightning, and this is a medium
of exchange. But the bigger, I think, the bigger change, the far greater change, is all prices are falling relative to bitcoin and and so essentially the energy backed system that's that can't be broken is repricing the world, and most people are pricing that energy backed system from a piece of paper that's being manipulated.
That's happening, We're witnessing it. I think I remember, man, it wasn't that a few months ago one of my friends called me at night kind of panicking and he saw something on the news, and what is this, like, the Dollar's going to crash? Am I going to wake up one day and the money in my bank's going to buy me, you know, fifty percent half as much goods as it does right now. And I said, well, that's
already happened over the last five years. The dollar has crashed to a point that it buys you fifty percent of those goods. So what you're afraid of has already happened. Whereas people think it's like this imminent thing though, where it's going to happen, I think it's happening. It's like a process more than an event, maybe unless it's like the gradually and then suddenly part which at some point diminishing returns I guess fall off of a cliff. But
I mean, are you seeing this? I mean, obviously it seems to be accelerating, especially based off of where we're at right now at the time of this recording March tenth, But are you thinking this is something more drastic coming that is going to happen sooner than later.
I think it's exactly what you just described. This has been, So it's interesting to watch people talk about bitcoin and everything and the existing financial system through a light switch moment rather than what's happening all of the time. We know for sure money is being debased. We know for sure you have a decentralized, a secure protocol bounded by energy that can't be changed. So both of those things are depending on your reality is what you're actually seeing.
And so if you've been in bitcoin for five years, you know what's happened over the last five years. If you've been in bitcoin for ten years, you know what's happened over the last ten years. If you're in bitcoin five years from now, you know it's going to happen, and it's going to happen in a faster rate until like, yes, depending on what country you're in, there's going to be some missed, some massive dislocations and repricing events that could
happen a lot faster. Right, that's just a failure of a currency that could I suspect the US currency is not going to fail anytime soon. So it's going but but it might print a lot more right and get away with it, and which would lead to a significant rise in at least in that currency's point of view. To Bitcoin. It just it fasts andates me watching people grapple with the one thing, like every day there's a new thing that they're saying. This is the reason when
fundamentally nothing has changed for the last fifteen years. You knew one system was insolvent, it couldn't resolve resolve this problem. You knew that the system transition was underway. And so if you're mostly outside the system, if you're in bitcoin, these these dips just provide opportunity to accumulate more.
Yeah, I guess just you know, not everybody has that certainty, right, Not everybody has that level of conviction, nor does anybody have the ability to tell the future either, And so I think then it probably comes down to the level of conviction and certainty that you have around that.
And so so let's let's dig a little deeper on there. And because that's where the why this is, I think this is why it has It doesn't actually say anything about bitcoin. Bitcoin is just a ledger that every ten minutes there's a new block that is bounded by energy. You're you're grappling with something that is imposing a discipline on a world without discipline, because it's because it's like this.
So the conviction is driven by this. I would I would venture to say the only conviction you would have to what you should spend all your time on is can Bitcoin stay the centralized and secure? Because if it, if it can or if it does, and you're waiting your probability probabilistic waiting of whether it does or not, it's actually the only thing that matters. And what we
just described, there is nothing else that matters. If and you could say, I believe governments are going to attack it, I believe quantum is going to break at I believe, and all of those are beliefs, and you could assign a different probability. But if it stays decentralized and secure, it actually doesn't. It makes no difference. It is reprising the world.
Right, Yeah, I think obviously we agree on that. I think back to just people not developing that conviction. We're still seeing a world where people are pushing XRP not understand the difference between you know, XRP or Solona or or whatever. Right, So for you to say, if it stays decentralized and securest most people don't even know what that means. They don't even understand what decentralization is and why bitcoin might be different than any one of the
those other assets. And so I think you first have to come to that realization first, right.
I think we're saying the same thing, and you've gone really deep on this subject. I've gone really deep on
this subject. I've probably spent over ten thousand hours trying to disprove what I just said, spending all my time in it cannot stay decentralize and secure against natural centralization that we've always allowed through human So we have to be would I say to that is, if currencies have always been centralized, whether it's gold and then repriced, then we must be part of the thing that allows them to be centralized, and so it could. Can Bitcoin withstand
that is really the ultimate, the ultimate question. Can it withstand us? How many of us know, how many of us run nodes? What does it look like? And so I went through the same thing that everybody would go through, and the cognitive dissonance of of there's no way this thing could do that, And then we're then coming to a greater appreciation of why I believed it would stay the centralized and secure. But again, I think we're saying the same thing. So it doesn't say anything about bitcoin.
It says the cognitive dissonance that's going on in every single human mind in trying to understand something that's never been in existence before, Right, that's really what's happening. Yep.
So you as a as a futurist, as a technologist, I mean you understand. It's just like it's really hard for people to imagine the future because typically we can only imagine better versions of what we have today. So when you have something completely different that we don't have, we try to then compare it to something. Well it's sort of like this, well it is, but it's not. And it was like that's well, it's sort of is not. So then it's very hard to understand, well, what is
this thing that we don't know what it is? It's all these different things and will become something we can't even imagine today. But I think to the point that you were making earlier, you know, you're ten thousand hours in. That is what separates those who have put in the work.
They can build that level of conviction, which then allows them to I think number one take larger position sizes, but then number two sort of have the ability to sort of ride out these volatility waves in ease and even dare I say, look for them opportunities opportunistically.
You know.
I remember it was this September of last year, which is not that long ago. I had I think Big One was in the mid sixties, sixty eight thousand. It dropped down to like sixty three thousand, so I had a little bit of extra cash. I moved the over to exchange to go ahead and get a buy and then it dropped to like fifty eight, and I was like, ah, buy a little bit more. And I'm like, I think
it could drop to fifty. So I put a buy order in at fifty and it never got filled, you know, it never went down right, and it ran and then it you know, went to a hundred and then one o six and then one ten. I'm like, oh, man, I should have just got out the fifty eight.
You know.
If it drops back down, if it gets back into that eighty range, I'm backing up the truck.
You know, and like here we are.
So it's like we can sort of look for those moments. I'm curious what you think about just you know, obviously there's that right if it just saysy centralized and secure. And then there's the big print. And it's not just the US big print. I mean right now we have just in the last week China is now doing a big print and Germany and the EU just announced a big print for their security and stuff like that. So
what's happening all over the world. But at the same time that's happening also the way technology is evolving is changing the world, right, So like sort of bringing it back to AI, which is sort of like the general markets, like big Darling sort of thing is we have like AI has been that big thing, Open AI, the way they're raising money, things like that. Then all of a sudden we see like deep Seat come out in China, which I think change the way we value traditional assets
in a way. Like number one, they're able to produce an asset know this AI model way cheaper with way less GPUs, which then disrupted all the forecasts of Nvidia and tech companies. But also what it did is it disrupted the Nasdak. Well maybe some of the money will move from the US markets over to the China markets, So maybe the Nasdaq index is overvalued. Maybe the companies listed on the nas Deck overvalued, maybe all these AI companies are overvalued, Like whoa, what do we even know?
And then it sort of laid open and exposed all these assumptions that we have because of this fiat system that we have, and so it almost looked like all of a sudden, we do need some sort of a new measuring or unit of account there.
Yeah, so.
This is the kind of way it. It boggles my mind that this is still so misunderstood because it's the same thing I wrote about six years ago. It's exactly the same thing. You would have exponential rate of technology improvement. The natural state of the free market is deflation, So that productivity in a free market because we only use the things that give us more value. So obviously we're going to use the things that give us more value and they would be coming at us so fast, which
the output of that had to be deflation. And then and then in a free market, prices fall to the marginal cost of production. So, what's the marginal cost of production of a line of code that I used to say it all the time on your calculator app zero because it's a line of code, right, what's the marginal cost of a line of code created by other lines of code AI zero, what's what what does that look like?
As it moves into physical goods, as it moves into robotics, and this AI is actually tackling all the physical goods almost zero because because those companies are going to compete everywhere to be able to put this, and then the cost of all those physical goods is going to fall at the same rate, and so that productivity means faster and faster product and people are measuring that productivity through the system that's stealing the productivity to try to make
GDP go up. So it has to concentrate, it has to centralize. It's so if the natural state of the free market is deflation, if prices fall to the marginal cost of production, if if if this is true, which we know is for sure true, if you can nod your head, you can do all the research you want on that topic, then unfortunately, what it means is you've never lived in a global free market. All of the things you're pointing at and giving strength through your actions.
This leader, this leader, this person's going to fix it. They're all centralizing functions and they have to be because it cannot let that system, that debt BAEd system, that credit based system which we live in and price everything from it. Won't let it collapse because you won't let
it collapse. So every single conspiracy theory, all of those things are inside that system because they have to be inside that system because you won't let it collapse, right and and so so once you understand that, you you stop giving your time to You know, it's going to be a chaotic journey from one system to another as people have a hard time grappling with what I just described. But you stop giving your time to the system that's stealing your time and energy.
So you're saying the more that you participate in the system, then you're reinforcing that system.
Yeah, everything within it, every single we know, you know, a whole bunch of your listeners or know, gold gets co opted. It gets co opted by derivatives it's got and and and if that ever got reset, then it would say sink the system. So what they're really saying is with with and then But because it centralizes, it always gets repriced and and people cheat. People have always cheated on money, and so it always allows that you can't audit how much gold China has in the reserves.
You can't. If we said we were going to audit Fort Knox, I don't think it'll be a true audit, and then you can't audit what everybody else says. Whereas bitcoins, blockchains getting audited every ten minutes, it doesn't care. So this centralized. So what we're saying with some of these assets within the system, is it really And I had
to deal with this myself too. The cognitive distance I was dealing with it is if we've never lived in a free market and our actions inside the other system are trying to get rich in a zero sum game where somebody has to lose because we won. Every single asset we're trading within that system is really just a bet on how much is somebody else is going to lose because I'm going to win all on a centralized
system and there's no way to fix it. And so that's what really pushed me into exploring it is a bit going different? First is it could it remain decentralized and secure against that power that you knew would have to try to attack it? And then where do I want to contribute my time? Because the free market isn't
a zero sum game? The free market is a cooperative game where everyone wins if you and I make a trade, Like look at what we're doing right now in this riverside app, which costs you a fraction of what it would have cost to reach this many users right ten years ago, a fraction, and now you talk to this many users, and you can build a business by yourself effectively that by providing value to a whole bunch of people.
The output of that exchange is more value for you and me, more value for everybody listening from the output of the exchange that's giving value, and so it's all around us and that is not a So the free market is is the the only thing we've ever found that allows us to exchange and actually in a cooperative game where everyone wins and and and we always but there's always people trying to cheat it, right.
That's the that's sort of the downside of human nature, like always taking things too far. So it's like, then mine naturally once productivity gains or deflation, I suppose, right, so instead of carrying eight eight bricks one at a time, I make a wheelbarrow to carry eight bricks at once. So we want to get more output for less input. But then we take things too far and then we start trying to figure out, well, then how could we cheat the system there?
We want our house to go up in value, we want our asset to go away up in value. And this Yeah, if you think through the logic, if we're part of the system that is choosing more value, how could that be true unless you lived in system distorting currency units? And then most people turn to the same current, the same things that have always stored value in those cheating systems, to try to protect their value from the cheating.
Yeah.
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Now one thing that I see as we move from one system to another, you know, I talk about you know, I'm back to the Abu Dhabi talk. I talked about sort of bitcoin's price in the future of twenty thirty to forty fifty. I mean I looked at it from a venture capital lens of like, what are the markets that are being disrupted, how much value can be taken from those markets, and how much could it grow? And so then you know, I signed some values to bitcoin
that seem unreal and you know, astronomical unreal. And the typical reaction to hearing that bitcoin could be worth ten million or fifteen million or fifty million is like, yeah, that means the dollar's worth zero. That means it's you know, a million dollars for an egg or something like that, which in Zimbabwe, eggs were you know, a million dollars, right, a few a million dollars, But like from a venture capital lens, I think that's like a like that that's
a big misunderstanding. Right, So it's like bitcoin is pulling value from other areas and other assets, and so like the dollar doesn't necessarily have to become worthless for bitcoin to rise in value.
Right, So I think the best way to frame this is or away I frame it, whether it's best or not. Is this, If you divide the nine hundred trillion dollar balance sheet by twenty one million, you got forty three million dollars terminal value a bitcoin today's purchasing power. Right, and we know tomorrow there's gonna be a ton of printing and that nine hundred trillion all the assets within because if you if there wasn't printing, all the assets
would collapse to zero. Right. Your house isn't worth what you think it is. Your house is only worth because the debt underneath it is deemed solvent, and it's insolvent, so it requires an input of massive manipulation of capital of of money, which will increase the nine hundred trillion higher, So your house will be worth more a relative to
those currency units. But if you did the calculation again in two years, with more printing and the different value, then bitcoin would appear like it'll be a higher purchasing terminal purchasing power at that time exactly. And then the other thing that's happening at the same time, which would just actually probably more more powerful and hard to see, is that forty three million dollars per coin purchasing power is a terminal value again based on it stays decentralized
and secure. You can do your own work, whether you think it will or not. But if it says decentralized and secure, then every year, all of that productivity gain the global free market is accruing to it because prices fall against the forty three million of purchasing power right now forever. So so it's and it's way bigger than people believe. Because if so, people are still right now we're talking about deep seek. Have you seen Manus? Yeah?
I did last night. Yeah.
So if you've played with that and everything else, you could create a team of agents doing this work for you to just don't do any path And these things are coming at a rate that every I don't know if you remember this. In my book, I said that that we're measuring we used to measure AI improvements in the year in decades, then years, then then months, then minutes, then seconds. We're getting into the months, and what's coming
is the adminutes and then the seconds. That rate of improvement is at is such a staggering pace that people can't comprehend what it actually means. But if you just keep on coming back to saying the natural state of the free market is deflation, prices fall to the marginal cost of production, period, then all of that productivity gain. You take your forty three million dollars per coin today, all of those productivity gains are flowing to you as well.
Because you shouldn't be measuring inflation from zero. You should may be measuring it from global productivity. And most people are measuring global productivity through the debt based system, and they can't see what's really happening because it has to extract. It cannot allow prices to fall, so it extracts that productivity and centralizes it.
So what you're saying is rather than measuring it against a manipulated denominator like the US dollar, then you should measure it against something outside of that system, like bitcoin. And then you get a completely different answer exactly.
And then if you just said so, that's why for me, I say, I keep on referring to Bitcoin as a decentralized, secure protocol bounded by energy. Right, So if you understand those words, each of those words decentral so nobody controls it secure, it cannot be broken, so it doesn't can't change, can't be broken, or it can change only if people determine who are nodes to change it in their best interests. Protocols are winner take all, so there is no need
for any other coin. There is one Internet. You choose to be on it or off of it, and so protocols are winner take all, and they come in layers. They add more functionalities in layers, unlike technologies which winner take most. So what's happening is Bitcoin is evolving in layers and adding more functionality layers, and it's getting more decentralized,
more secure all along. And so even most of this talk has only been on layer one, which would for a long time if you couldn't do anything on layer one, if it couldn't, if it couldn't scale, you would have all of these other coins by nature saying I have a better bitcoin, I have a better So it would be natural that the free market would would look at it because it would be so confusing to understand protocols.
But that protocol bounded by energy if as long as it stays to the centralized and secure reprices.
Everything, yep. And if you look back through technology and how it reaches you know that it reaches adoption diffusion over different stages in a cycle. It seems to follow the same repeatable pattern where in the beginning technology doesn't scale, and so you try all these other different paths, and then it does scale, and then it gets rid of
all those other pasts. And so we've seen this in many other avenues, but in this case specifically, you know, to the point that you're making, you have all these alt coins that became faster and cheaper and more private and smart contracts, et cetera. But then once we've achieved been able to achieve the scaling on Bitcoin, then it sort of makes all those other chains irrelevant.
Yeah, yeah, I can't. I can't still think of anything that I like where bitcoin is going that anything I would use. Actually, what you'd say is, I'm going to use a high cost database, right like his centralized controlled database, because that's what a blockchain it is. I'm going to use a high cost database to centralize. I just can't see any single thing.
Did you see the piece that David Marcus put out the other day, I think it was just maybe two days ago, talking about what they're doing over at light Spark and you know the building on layer two, on Bitcoin layer two, and he basically said, you know, he ran if you know who David Marcus is for writing in the audience, I mean, he's like the payments He's the guy, the payments guy right from PayPal. He was
the one that was behind Libra at Facebook. But he basically went into why Libra failed and how many people have asked him if he would launch now that they're sort of a clear runway from regulate regulator regulation standpoint, if they would do a Libra two point zero, and he just said, no, the market has moved on. There's
no need for Libra two point zero. And one of the reasons that he gave is there wasn't really the ability to do it with bitcoin back then, but there is today number one, so to the point of scaling what we're talking about. But then he went on to say,
you know what the nations want is no government. Well, each nation wants to be able to settle in their own currency, and no nation will settle for settling on somebody else's privatize, centralize database, and so there's only one option that's decentralized that will give them this neutral ability to do this on. Then they talked about how they're building on top of bitcoin, and he's inviting everyone to
come build with them and stuff like that. But I thought, you know, the guy who understands payments very very well, sort of laying this out, breaking it down. I love it when I think it's funny, I should say, when I see all these people online and they're smarter than Larry Fink about money, and they're smarter than David Marcus about payments and whatever, right, And so to hear him lay this out and and break it down, I think it was pretty insightful. But it's saying exactly the things
that we're saying. It wasn't ready then it is now, and there's just really no way forward for the world to work globally without this decentralized layer that nobody can control.
Yeah, there is it. It's called cheating and global conflict in war.
Well, I'm saying there's no way to really keep moving progressing.
Yeah, exactly.
I know I'm agreeing with Yeah, that would be devolving, right.
Yeah, so so, and that's actually why I get back to all of the things inside the other system that most people are complaining about, are ensuring that. So you can feel the chaos, you can feel that. And I watch I watch people to take sides within this debate and screaming at it, and they don't know that that side on that system they're making it stronger. Use the example of it kind of Marches on Wall Street in two thousand and eight, burn things down, turnover cars, go
home and sleep. Where did the money come to fix it? All from them?
Yeah?
Right from them? And so now I ask yourself, what are you doing with inside the system? And how are you sleeping it? Like like you like all of these things that are like it's feeding on your fear and you think there's an enemy on the other side of that fear inside that system, or you're a savior on
the other side of that fear inside that system. There isn't. Yeah, it's all it's it's it has to be a different system the only thing that can And so you can tune out, you can just that I understand what I'm asking to do the work on bitcoin and actually understand how different this is. And that's a lot of people aren't ready to and I know you've done a lot of work to help people understand that. But as they do,
they'll just they'll understand that. Here's why, here's why I believe the stays the centralize and secure because the people centralizing, trusting ets, trusting all of the other central briers aren't running nodes. The people, the people who know this are never going back to a corrupt system.
So the people that are seemingly participating with bitcoin, but through these centralized mechanisms like ETFs, they're not helping the network statey centralized insecure.
So there's a whole bunch of people that are worried that this is centrally controlled because government's for it and everything else. They don't realize how powerful the kind of voices and I'm not saying mine, but you know these people, you know these people all around the world, and they're running nodes, globally distributed nodes, and they are not going
to allow this thing to be centralized. Right, So when that when that day comes that that that system says you're going to do this because we want you to do this. That might be a really bad day for the centralized system. That might be hypergrap picization.
And in that event, and to your point, I mean, we've we've gained plan this out so many nights, late nights, maybe over over some drinks, maybe maybe not at many events, were sitting around game planning this out, like what are the ways that we can think of attacks here? But it seems like almost any one of those events leads to just a fork.
That's it. Yeah, that's which is like great.
Then you take your centralized coin over here, you take your new raised cap limit to forty one, but you take whatever it is that you want over here, and we'll just stick with old bitcoin over here. And that's why it doesn't work.
Yeah, Just like so if you were if you were planning that attack, if you were trying to if you like, if you were deep deep state trying to plan that attack, you probably wouldn't try to attack it for another five six years. You would you would you would love bitcoin to go way up in price to resolve your underlying debt problem because it would it wouldn't resolve the debt, but it would result it would you would have an asset that would be worth a lot more so that
the balance sheet would look better. And then you would and then all of the that you'd hope that a whole bunch of the bitcoiners had sold into your centralized thing because they were they were actually the entire time pricing in the US currency, right, and they were Now they got rich, and now they were part of this, and now they didn't care they weren't running nodes, and then and then and they got you didn't have the same kind of cipher punk ethic that is that is
driving this thing that more and more people understand that these are structural changes in the world. One is a centralized system where every everybody's kind of in a control system. One is decentralized, where where where we we have freedom. And once you understand that, which I there's a whole bunch of people that don't, right, but more or learning each day, and as they learn, as they go from okay, I'm just going to accept a little I'm going to
take a little bit of bitcoin. I'm going to and as you learn that path and then you become part of the network, You become one of the nodes in the network. Right, You're never going to change.
Now what about you know what we see what we just saw this last week with President Trump and finally we got clarity. We got the executive order, the US Strategic Bitcoin Reserve. You know, there's a plan to add more you know, balance neutral, whatever, cost neutral, whatever, it is,
all these different things. And there's plenty of people that are out there, more so probably some of the crypto people that are like, oh yeah, you bitcoiners, you're like everybody else, you're you know, begging for the government to buy it.
You know.
My take is that, well, I mean it was always coming for everything, so it's gonna work its way. But but back to the point of staying decentralized and secure, and now you have, you know, the biggest government to get the central know, the US dollar coming into it. So how do you think that affects things?
So so, just like it affects when you make a choice you personally to move into this network. You can't be debased anymore. And you're participating in the first global free market ever. So what does that look like to you? And I know what it looks like to you because we've had these talks many late nights too. Your life gets better and better and better and better, and you worry less about all of the chaos everywhere else. Right,
And that's true for every single person. You have a globally distributed open network that any single person, whether you're in Africa, whether you're any anywhere, you can make that same decision and your life starts to get better through that. As long as you're holding. For if you're trading, that doesn't exist. But if you're if you're holding, then that's then that's what happens. And you start to learn more about why this is just such a better choice for
you now in your business. If it was the same, if a choice for you in your business, and then you'd make the business choice. You do the same thing, and you'd start converting your balance sheet. Over time. In a city or a state or a country, the same choice is happening. I can either I can either tax my citizens in this and then by the time I go to pay their's taxes on their services, I can't deliver the services because the money is broken underneath. Or
I can deliver more services forever. I can make my country richer. Not only that, I can send a signal that to the world that we're open for a business on a free market, we're not freedom matters. And so if it's true, if freedom does matter, free markets are far more productive than centralized markets because there's more ideas competing,
and there's more ideas competing for our value. So the thing that built the US in the beginning is and what created the constitution and the wars that they fought for, was every that equal you could move from Europe be free, and that's what created the productivity boom that was the US before money got captured. So that's just happening on bitcoin right now. And so of course governments that understand it, I would say it does the US government understand it.
There's people within it that do. There's people that win within it that are trying to capture it, But just like there's people within bitcoin that understand it and people that were pricing it through the US dollar. So there's just such a complicated topic that I think each person is kind of understanding it from their own thing, and so I don't pay any attention to of course they're
going to do it. I suspect at some point they will decide whether they want to try to cont sure it or if they are a free market, right, and we'll see in the nodes will decide right. Right.
The one thing in the game theory that I love to kind of always throw out to people who are doubting this is just that by capturing it, by changing the hard cap, by doing any of those things, you
basically make it worthless. And so anybody who was able to capture a large percentage of this would at least at this point be doing it to acquire more US dollars to build wealth, whether you're a micro strategy or even if you were the US sovereign wealth fun hoping to pay off your debt one at one point, right, And so by making these changes, you're essentially making it worthless. So really that'll only be done by like a hostile actor.
It's it's even but and you know this how antifragile it is. Imagine how many attacks like if you really think through it. Because obviously the NSSAY is known about pitcoin for a long time. They all of the major governments all over the China's tried to stop at US has tried to stop at all Operation Chokepoint. Imagine how much this is in the highest levels trying to stop this thing. That brings freedom back to the world every individual, and you have no say so. Yes, there's going to
be a ton of attacks. There still will be a ton of attacks. But every single person who's attacked it has not just attacked it. They could have done better themselves and for their entire thing, the ftx Celsius, every single person coinbase, if they just owned it, that owned the bitcoin instead of sold all the shit coins, they would have way more bitcoin attacking attacking it. The cheaters always lose against this, right, every single and that's what's
so fascinating. A cooperative network benefits the honest.
And then we have it playing out on a global, global scale. I mean, just today, the last couple of days, we've seen the EU announced they're going to finally roll out their central bank digital currency, and then they're coming out and bashing Trump directly saying that by doing these cryptocurrencies, like you're threatening their sovereignty somehow.
Right, Yeah, and this is it. That's actually why I can't even listen to all of this because you you know, you we're listening to people like Laguard and all all these people that their only wealth, their only value to society is being at the top of a control system that's sucking value from society. Why am I paying any attention to that? Why am I? Why would I feed
that anything? Right? The just the more you do in bitcoin, you realize, Okay, yeah, a lot of people are going to get caught in it, a lot of people are going to The chaos that it's going to ensue is is staggering. But yes, because that system must it must it must have you locked into it, yep, to to retain its power over you. Yeah.
Yeah, I mean I remember years ago seeing a quote from the Guard saying, you know how any basically any new technology was a threat to financial their financial stability, which it is because it, you know, creative destruction creates those new ways. I want to jump into another topic, and maybe the last topic here there. You know, there's a lot of talk with you know, Michael Saylor and is now strategy acquiring all these bitcoin and what are
they going to do with it at some point? And there's just talk of like maybe a bitcoin bank, which
he never really confirmed or denied. But I saw this post surface the other day of holf Finny, one of the original developers on on bitcoin, and it was in one of the old message boards, and he talked about, you know, this future with bitcoin banks and how you know you would have holders of large amounts of bitcoin and they could launch their own banks and then launch their own currencies on top of bitcoin, and almost painted this sort of like free banking two point zero sort
of narrative. I'm curious how you view the future in regard to banking. I mean, banking sort of seems to have mainly three functions, right, storing, you know, transmitting, and then lending. But how do you think of maybe what he had talked about, this future of bitcoin banks, you know, having bitcoin on the balance sheet, creating cash on top of it and things like that.
So complicated topic, but it's this is the layering approach to bitcoin. So Bitcoin layer one, open, decentralized protocol, boundary by energy, but slow transactions. Right, the reason that's decentralized and secure is the slow transactions.
So it slows a relative term.
Yeah, so let's say five to seven transactions per second, so it can handle global banking for eight billion people. So then Lightning network Liquid are a whole bunch of different kind of layer twos emerge at first Lightning on the layer two looks like kind of a back like because it's a project, it's just on top of bit,
why you don't need another coin. But in the first going, it doesn't work very well, like forty percent payments failure fail You need your own liquidity channels and everything else, because you just look like it is almost a garage network,
right because it's just emerging. And today where you have probably ninety six percent of payments work each time every time, and it'll be ninety nine point ninety ninety nine and there's six hundred and fifty million people right now using Lightning liquid it's a staggering it's growing faster than the Internet it did in the nineties, and people still look at it like they looked at it five years ago.
So what David Marcus was really saying is this is matured to a place that now you have a layered approach. That you have this layered approach. The next next thing privacy. Privacy. Lightning gives some privacy, but in a world where everyone came after this, it's not sufficient. It's not sufficient because they would attack tack those nodes at some point they're centralized. You can only use this bitcoin rather than this Bitcoin
and they would attack it. So you had to develop massive privacy within within the technology, but in a layered approach that you don't have to have another coin, so you can extend the decentralized, secured nature and it can't be centralized and changed. That's that's why we invested in Fetti and Fetiment protocol. It's built on top of these intraoperable with it's complete privacy, and it gives you essentially a free banking error on top of bitcoin that that
is completely private. So you and I, you and I two other people could run a run essentially nodes on top of this, in and out of in and out of lightning. We could have a circular economy ourselves. Right this is being used right now in Venezuela because of the dictatorship in Venezuela, and it can't be found. There's all of the communication is completely private, all of the all of the transactions are completely private, and it's growing
really fast. It's being used and has some of the most scary places, and we can feel this authoritarianism, the centralizing of the system accelerate all over the world because the money is broken where where where This technology has already anticipated that problem a long time ago, built the built the like they it completely withstands anything here and is growing the other way, providing freedom to the world. Now it's early because and why is it early because
most people don't know it even exists yet. But it's all integrated.
Then, I mean you would put your bitcoin in and then you would get back, so that like the Bitcoin bank, you put your money in this bank and then you get back a representative token that you can spend that's faster and cheaper and more private.
Yeah, so e cash is built into bitcoin in this way. That and then and then now, what would you have to worry about. You'd have to worry about if let's say you, me, two other people were the nodes. Could we cheat? Could we cheat? And say, we're going to fractionalize the e cash, so somebody thinks they have the cash, but it's not backed by bitcoin, and so there's a whole bunch of ways to be able to protect against that.
But well, maybe I want it to be fractionalized.
Yeah, and but yes, and maybe you do, and some people will try to cheat that.
And then then well I don't know if it's necessarily even cheating, right, so it's like think of it as earning yield. I mean typically with the bank, you'd give your money to the bank, the bank would loan it out and they would give you some backup a yield on that for for you know, taking some risk with your money, so to speak.
Right, I think here's what's what's happening. We have that that entire fractional system is failing, right because it requires more fractionalize. It's Ponzi scheme all the way down, right, and it needs more and more. Their yield comes from comes from that and the entire because because if it didn't have more fractional line, if it didn't have more monetary units, it fails. So so you're which, here's a simple way to say this, all of the money that exists.
So if everybody paid back their debt, there would be no money, right, So so you know, and the money is loaned into existence. So when you take a loan for your house, you're adding money, right, and you're paying You're you're paying a fee to somebody that made it up from nothing to be to be able to be indentured. And then you're paying taxes on that as and more as as more and more money is lent into existence. This other system won't look like that, now, will people try?
It doesn't have to be it doesn't doesn't have to be fractionalized, right, like misis would break down, you know, circulating credit versus you know commodity credit. Right, So it's like if I grew ten bushels of wheat, but I only needed to consume seven, I could loan you those three bushel of weet and you give me back three bushel a week next year, right for sure?
For sure? And then in that case and in fetti right, So the money that e cash on top of this, it can be moved around at lightning speed, completely private, so you and I can trade and there's tiny, tiny fees on it and as global privacy. And so now question when would you take a loan, you know, in a in a in how much loan would you take in an environment an entire global system that the more
value is coming each year? Right, So if you take huge loans when more value is coming each year, then the loan gets more expensive in real terms.
Which is exactly why our debt based monetary system likes inflation totally. Yeah, yeah, I was just curious, like I said, I saw that that that that post from hal Finny, and I was just kind of thinking thinking that through
a little bit. If you go back in however far back, I mean, I would imagine even before there was a currency system, medium, before a ledger, sit, before any of that, the first form of money had to have been credit, right, Like, you're my neighbor in the village, go ahead and borrow my whatever and bring me back a little bit extra, right. So I think credit would probably have been the first form of money before anything, all through the gold.
Standard era, probably barter and then barter and then credit.
Barter and then credit. Yeah, probably barter and then credit, and then all through the gold Standard era, I mean for thousands of years. You know, some people just make more money and store money, and they're well on to loan it the people who need.
It, you know.
So I just don't I don't see how that changes it's human nature. To the point that you're making, which is a very good point. It certainly changes the hurdle rate when you're gonna have to pay a higher amount back than what you borrowed. Until everything is priced on that system, I suppose.
So, so that's the interesting thing. If you think through this, and this is where I completely agree with you, it's human nature because we were both the map and the territory and we don't know, we've never known another system. So it would be human nature. It would be all of our history books to talk about that system. And the system has changed, it's already changed. So what does
does that mean? What it means is because of that human nature, there's going to be mispricing and opera and a whole bunch of people wiped out by what we just talked about over and over and over again, because they're going to try to operate the playbook that we've lived in in the last three thousand years on top
of a system that doesn't care. Right. That's exactly so I think we're saying the same thing that human nation and what will change that as they get wiped out over and as they get whipsawed by the system that is every ten minutes, there's a new block and it doesn't care.
Yeah, I was just saying that even in a new system, I think there's always a need for that.
Right.
So I've been a good steward of my wealth. I've built up more than I need. I've grown ten bushels a week, but I only need seven. Unfortunately for you, lightning came down and struck your wheatfield and burned up your wheat. But I know you're a great farmer. So how about I get you three bushels a week because you're going to I know you're going to grow it back, and next year you get me four bushels back. Like,
there's always that need for credit, there's always hardships. It's just life, and somebody does better with it than somebody else. And so I just don't think that part changes.
No, I just mean the what we're talking about is the amount on a system based on credit, then what people think of about So let's use the house as an example. A house is falling to it. We use credit for houses, and everybody thinks it's normal right now to have a million dollar mortgage, right right. It's only normal because of the system of underlying credit that has pushed up prices of houses to a monetary premium to support that. And if it fails, and so the prices
will still rise in houses from that system. But if you measure that house and bitcoin, like my house and bitcoin in last five years has dropped from three hundred bitcoin to say twenty six bitcoin.
Yeah, and so what is that saying.
It's it's saying a house is falling back to its utility value right in the money that's valuable. Could I still take a loan for that? Yes, I could take a loan on to pay for the house today and bitcoin, but I know in four or five years that house is going to be one bitcoin. Yeah, right, So that
means my loan gets more expensive. So or I lose a whole bunch of purchasing power to buy the house today rather than tomorrow because the house is falling to its utility value and that credit destruction or that is going to not be understood by very many people.
Right, And yeah, that that is going to shift for sure. And I think the entire sort of almost retirement industry, if you will, will change, right where like you have all these people that are saving for twenty thirty, forty years and they're hoping they can live off four percent a year or something like that, But you won't need that yield when your money buys you more in the future instead of less. And so that that incessant need for you know, desire to earn yield to retire on
or whatever. I think that part goes away. So, but but the need there's always going to be a need to borrow for some reason or another.
Yeah. And what makes these conversations so fascinating is is is the change in something that is totally changed the rules. Yeah, and us grappling with the rule change and trying to predict kind of when how what that looks like. But if you step back and just say, Okay, which system would I want to be in? Yep? Right, as this is going to be chaotic because on the way through.
That's one thing I like about is this force functioning where really you know, if you if you really study like the difference of a poor middle class or a wealthy person, and really, I should say the mindset of that person, you sort of have the poor mindset mentality or even in a middle class they basically work to live, work to pay their bills, so they earn to spend money on their house, in their car, and their lifestyle.
They'll typically use credit to buy things they can't afford or to increase their lifestyle, whereas like a wealthy person is earning money not to live, they earn money to buy assets. Then the assets pay for them to live, and they don't use credit because they can't afford things. They use credit because it'scheaper to use somebody else's money than their own. And so bitcoin would almost force that function.
Whereas to the point you were making about borrowing and bitcoin to pay for the house, but hard and hard to pay back the loan it but almost like you'd earn and put it into bitcoin and then borrow against the bitcoin to buy the house. Yeah, so it forces you into the correct form, which is buy to earn the assets and have the assets pay for the life.
And think about that asset being repriced. So what we're talking about, so all of the people that are pricing those assets way too high and fia it terms because it's worked for the last forty to fifty years, are they they believe that their house is the house and the real estate asset and all of them, even though the taxes are going up and up on them because other people are paying those rents, they believe it's a safe store of value, and that safe store of and
they keep on doing it, levering more and more to it. When we just described for the person that the person working for wages and moving those wages into bitcoin is repricing them right, right, That's it, That's what's happening. So it's really interesting and that that repricing can happen in Africa, Argentina, Peru, it can happen anywhere for anybody who wants to to
do that. So what's happening today is you and I've talked a lot about this, the risk free rate of return is like forty three percent, right, if you're self custoding and if you're making seven or eight and real estate, you're losing thirty five percent a year to bitcoin. But you think you're winning because other people are losing faster than yeah.
Yeah, and put it to numbers. I mean the media and US home price in twenty sixteen was like two hundred and sixty thousand. Today it's about four hundred and sixty thousand, so it's almost doubled in that time period. But it's gone from you know, a roughly twenty bitcoin down to about four bitcoin yep in the same time period.
So it's describing that process. You've said it before. It's describing that process that is happening when people are asking when is this going to happen?
It's happening.
Yeah, it's happening. It keeps happening, it will continue to happen.
One thing I will just throw out there, just because I'm an old real estate guy. I can't let it go. In America, it's a little bit different thirty year fixed mortgages. But more importantly, it's the tax treatment that we get. So Trump in his first term and now it just got reinstated, gives us like bonus depreciation, and we get like short term rental exclusions and things like that. So somebody with a W two income with earned income could get up to one hundred percent right off of an asset.
So I could put ten percent down on a I could put ten thousand down one hundred thousand dollar home and write off one hundred thousand dollars of my income and have an extra ninety thousand dollars to buy bitcoin with. So and then I could have somebody I could have inflacent inflace in debt destruction. I could have tenants paying down. So that's a little bit more of an advanced strategy.
But I think that's actually really important to call out too, because in all of these things, there's going to be tax strategies that you can take and play a system differently. And I think that's important too, mind you, and which plays into what I think will happen in bitcoin. Governments and states and are going to lower capital gains taxes and try to make this because they're going to try to attract the capital that.
Is in this.
So like you get better tax treatment if you keep it in then etf than if your custody yourself or something like that.
Yeah, well I hope that's not the but they might try to do that and the but but just if you like it what else Salvador did, And you've been a number of times. I've been a number of times. The change is dramatic from opening up a free market and being bitcoin positive, the tourism. The change is so dramatic, and so that's going to be repeated and other countries are going to compete against that.
Yeah, what would you say for the average person who hasn't put the time in that you have and doesn't understand the decentralized and secure theme, For the average person who's just came into bitcoin now with Trump and the Strategic Bitcoin Reserve and all of that talk, what would you say the biggest thing they'll probably be shocked about over the coming year would be how.
Fast the world that they thought they lived in is disintegrating, and how that chaos is going to expand and ripple across It's just going to be if you're not expecting, if you don't realize how much which data is underlying, and how insolvent it is, and and and if you think Elon is going to save you because he's ripping out wasted bureaucracy, That wasted bureaucracy today is also they all have jobs, they all spend, they all buy houses, they all buy food, they all they all spend in
the economy is part of the GDP. When you rip it out, you cause it deflationary collapse faster. So this is so there's so many people right now that cheering for one side or the other without the realization that underneath the whole thing, underneath the entire thing means to me so much printing that is just centralizing more because it's and so so I'm fascinated by how many people are taking a side within this and not understanding the
implications of their side within this. So they and then talk about Europe or talking about Iran or talking about Israel. They're talking about. Of course, the entire system looks like it's based on corruptions. Of course it does, because it's based on manipulation of your time and energy and the things you're doing in that or going to the things you're going to do that is going to give away your power into the centralization, and it has to center go back to AI. The rate of improvement of AI.
It's just it will never be this slow again. It will never say that again and again and again. It will never be this dumb again. It will never be this slow again. Never. It is going to go at a rate that your brain cannot comprehend, and you will. And if you don't use it, other businesses are going to use it to provide more value, and it's going to remove labor at a staggering rate.
So either move to something that cannot be replaced, physical services, or get this, get with the program.
And it's even physical services inside that. So if you lived in a control structure, if all of your stuff was inside that control structure, and you had cameras everywhere and monitor and you were driving an electric car that was going to they could turn off and you were in a bank, in a bank account, and you had gold, but you were in a bank account that could be turned off anytime. If you understood how much of your stuff is tracked right now inside this system, and you
think it isn't. All of these connected systems are all part of that centralized control. You are inside of that. You're in the matrix centralizing with everything you're doing. There isn't There isn't a thing that is safe within that system you have. It's a different it's a system change, and bitcoin is repricing that it's outside because because you can self custody this, you can take this off and you can store the words in your head. You don't
have to trust that system. It's it's immune from everything I just said. So so now just ask yourself, where am I spending my time? And what does that look like? There is no safety. There's what you people say, I got guns, I have a I have a ranch land. Think about think of what I'm saying, Think about think about robotic dogs, drones, drone swarms, all ai IE things. Where are you safe in a centralized system that takes all of its control through you through manipulated money? What
is safe? Good? Luck, right, help build the other system, because that's what it frees you.
There, you go, I think that's a perfect place to end it. Go build the other system. I say, build the world that you want.
So bingo.
I do get a little pet peeved by a lot of these bitcoiners who think they can just go disappear on a hill and with their six point two five bitcoin or whatever in emerge like like punk satani and like the whole world's changed for them. It's like, if you're not going to go build the world, who's going to do it?
Yeah, it's that's That's it. This is what bitcoin, when you really realize it is it connects all of us on a global free market that can't be cheated. It's cooperative system. So so then then what you It's not saying anything about bitcoin, it's saying something about your choices.
Mhm. Powerful. All right, Jeff Booth, we're gonna end it with that. You wrote a great book. You've referenced the multiple times. The Price of Tomorrow will link to that below. Anything new coming out of the pipe that people should be paying attention to.
I'm towayhing around with a new new book, but I haven't completely committed to it yet, so we'll see.
All right, Thanks so much, Jeff.
Yeah, you're great. See anybody