The Author Of The Book: Inventing Bitcoin

He has the author of the new book Inventing Bitcoin, and we had such a great conversation. He comes from a technology background and it was interesting to get his take as to how he learned about bitcoin and what compelled him to write this book. We get into how new people should be looking at the market, how they should be looking at bitcoin, the technology, and then we dig into the technology and talk about a lot of things like the consensus, UH, the security, and so many

other good things. It's a great conversation I really enjoyed, so let's go ahead just jump right into it. So welcome onto the show. Thanks Market Things for having me on. It's a great pleasure. Yeah. I love reading books. I read a ton of books. I love reading books about bitcoin. And so this was it was a nice addition to

the collection. For those that haven't seen it or don't know who you are, why don't you just give us, like a little background on on who you are, what you've been doing, and how you got to this point of writing the book. Sure, So I've basically been involved in technology for the last twenty years. My background has

been in early stage startups. UM. I myself am an immigrants from former Soviet unions, so I came to the States with my parents UM, and so I basically spent my my childhood growing up learning about computers and and got into startups. UM it's built a few sort of smaller startups. I wasn't involved in an early stage engineer. And then in twelve UM was involved in the starting of reverb dot com, which is kind of the last

thing that I was involved with before I get into bitcoin. UM. Reverb was a marketplace where people to buy and sell music gear and became sort of the number one destination for musicians. So from eighteen I was the CTO there, the chief technology officer, building out the tech team and building out the technology UH and the infrastructure, and Reaver grew to be about a half a billion dollar in sales company and just recently was sold to et S, So very exciting. Um, there was a lot of fun.

I had a lot of fun doing that. But throughout my time in the last couple of years, I started really sort of falling down the bitcoin rabbit hole. And uh, I actually decided to leave Reverb. Even though I really loved my job and I loved my team and it was a super exciting company, I decided that I wanted to focus on bitcoin full time because I just couldn't. I couldn't have a job, you know, building a company

and being involved bit quoin at the same time. I feel like it's a very um It's something that really sucks you in, and once you get into it, it just felt like it was the most important thing I could be doing. UM. So I decided to leave and focus on bitcoin. Uh. And So I actually heard about bitcoin back in the day inn I read about it and slash Dot, and um, I didn't know what it was.

I never really bothered its researcher or understand it. I actually did end up buying some around thirty dollars in eleven and then I watched that thirty dollar investment that was the top of that bubble, by the way, thirty dollars at the top of the bubble. UM, I watched it go down to about two dollars and essentially just forgot about it. I think I sold at the bottom UM or lost my keys, I'm not really sure, and

then basically forgot about it. It was a mount gas about places everybody knows m mont gx UM later became until disaster was hacked or who knows what. Um so anyway, basically forgot about the bitcoin for a couple of years, was focusing on startups. Heard it about again again. It was another media hype cycle we had, you know, a thousand dollars was hit and everybody was talking about it.

So I bought them again and again didn't research it at all, which is really embarrassing now for this second time having heard of it and not really understood what it was UM and again saw I go down from a thousand to like, you know, three two hundred level, and basically UM again was like, okay, so fool me twice, you know, shame on me. Forget about it and sort of focused on my startups and UM. It wasn't really

until until I started really learning about it again. And it was my cousin actually, who was working for Microsoft too, UM was was working at my shoft blockchain strategy, came to me and told me about ethereum, and I started looking at ethereum and researching it and sort of I thought it was pretty interesting, um, and then realized that there was this connection between ethereum and bitcoin, and the light bulb went off in my head and I started

sort of researching that side of things and just completely fell down the bitcoin rabbit hole and realized that this was the most important thing, um, possibly the most important invention of my lifetime for sure, um after the Internet force um and the Web, but something that I really wanted to be involved in and helping bring to the world. Yeah. Wow, Yeah, she fool you twice, right, chame on you. Well, but you're butcher, battle hardened and it gives you that perspective

that you need now. So UM, that's good. Yeah. UM, I'm curious. So you said, uh, you know, you said that it was the most important invention that you've seen since the Internet. Why is that? Why do you think it's the most important invention? Well, so it's interesting because my background you know, having come from the former Soviet Union. UM, I actually was sort of living in a country that

experienced the exact problems a bitcoin is purported to solve. Um. So for a lot of people who are maybe you know, in the United States or a pretty sort of like first World regulated type of economy, they don't really see the value of bitcoin right away. Um, for them, it's it's it's harder sell. For me, it was pretty obvious. One. Um, in the former Soviet Union, the government had complete control over the economy. Prices were fixed, um, all that kind

of stuff. But also, um, you were not allowed to own any foreign currency. So if you wanted to own you as dollars, that was legal was considered speculation. A speculation was legal, So you had no way of storing your wealth. And something that wasn't basically under complete control of the government and was constantly being devalued, the Ruble. Soviet Ruble went through devaluations of factors of a hundred

and a thousand multiple times throughout his lifetime. Ah, it was you know, there's shortages of goods everywhere, There's lots and lots of problems, So what does that look like? So that you're you're the ruble is the currency that you had at the time. You're devaluing it, which we hear about devaluing all the time. So basically they're taking the value out right, the value they're they're essentially printing more and more of it in order to quote unquote

fund you know, social programs. But if you look at like you know, if you Wikipedia the history of the ruble, you'll see like at some point, you know, they Chad they issued a ne rouble because the old one was so inflated where people were you had had to carry to thousand, a hundred thousand rubles all of a suddenly

chopped up. Zeros issued a new rouble, trying to create you know, sort of price stability, but it's it's not possible to create price stability because prices are really set by market participants, and when the government's interferes and the pricing mechanism, it doesn't really let the courtesy to his job, and so over time, people whose faith in and becomes a problem. Yeah, that's a it's it's just a it's really fascinating to talk to someone who has that perspective

that's living in it. As you said, right, A lot of people in the United States, which is the majority of the market that I that I talked to, Um, we do get caught up in there, or a lot of people get caught up in this kind of vision where like, oh the dollar strong, the dollar this, but in other countries they see the value as you said. But I'm just curious, like having kind of witnessed that firsthand, like what does that look like to see your currency

being devalued? Like for example, Um, there was a book that was written about kind of like a biography about some of the people that lived through UH in Germany. Why our Germany when it happened? And they said that, Um, they said that they thought when what they didn't really think of their currency at losing value. They just saw like other currencies were stronger and that connection. How was how what was your perspective on it? I mean for me,

you know, to be clear, I was a kid. I was seven years old when I was in Russia, and so most of what I know is through my parents stories and through research. Um. What I do remember, though, is that we had to stand in line for goods, doing basic stuff like bread or whatever. I mean, you had shortages of goods everywhere, and people were just like getting in line. You saw a line somewhere, you just did.

You stood in it. You didn't know what they were giving out, but you stood in and you got whatever they gave you, and then you try to trade it for other stuff. Um So that the value of the currency wasn't even so much an issue because basically there

was nothing to you could buy with it anyway. Um So, what what that really meant is the government was trying to um control the entire economy and reallocate resources and say we want this much bread, and we want this much milk, and this is the price for an apartment, you know, and all that kind of stuff screwed up the market so badly that there were shortages everywhere. UM So, you're seven years old and you're leaving that. So at

that time, seven years old, you're pretty young. You're not really getting it, but you have the visions of that. As you said, I'm sure you've heard the stories from your family and whatnot. Like you said, you've researched it. Um. I mean, it's it's pretty it's it's a pretty big impact. I mean a lot of what we learned up until seven is done through like hypnosis, right, we learned through what we see. Um. So I'm sure that had to

leave an impression. Um. But were you interested in like economics and how money works at all kind of growing up or was it not until you got down the bitcoin rabbit hole that you started to think about it? Yeah, I mean really, it wasn't until very recently because I sort of I grew up. I had a happy childhood here in America. You know, we had a nice life. We came in as immigrants. We we came in with

very little. Um. That's one of the interesting things that I learned about asking my appearance about it is when we left Russia, they basically exchanged only one dred dollars worth of currency for person like gu's how much we were able to take at the government's exchange rate. Because, like I said, the ruble it wasn't worth anything on street.

Nobody actually wanted it. So the government gave us a hundred dollars worth of currency, and then we left, you know, the Russia with four hundred dollars in our project, with the family of four. We came here, and you know, I grew up, you know, with with computers and my dad buying me a computer when when I was eight,

and I started learning all that stuff. So I didn't think about sort of Russia until much later, which was when I get into bitcoin, and I started realizing that all these things that bitcoin was claiming, like one, uh, the government cannot interfere in the issues of this money to nobody can take it from you, right, you can. You can store your wealth and you can take it

with you. It's portable, it's not seasible. Like these things turned those wheels in my head, and I started thinking back to how it was when we were left Russia and I asked my parents about it, and he told me these stories about how much we were able to keep and all this kind of stuff, and I was like, wow, this is this is exactly why bitcoin needs to exist, right, we need to prevent these these disasters, and we need to allow people to put a check on their governments

from doing crazy things like this. Yeah. So, um, I'm curious. Uh, I mean what you're saying, right, what bitcoin is censorship resistant, immutable, right, not seizable, non inflatable. Um, it's revolutionary, right, I mean this potentially has the ability to save hundreds of millions of people that live in these oppressive regimes, but people in the United States still don't get why that's important. Um, so I like, I like to think about the why.

I'm curious. As you've talked to your parents, I'm sure you have right, and I talked to them about bitcoining obviously wrote the book. Um do they seem to get it sooner or easier than a lot of people maybe that are your age, that are in the United States.

I think so, yeah. I mean my dad is also a computer person, so for him, he also sees it as a technology, and that's kind of how I approach it a first, explaining that this is a new type of system that doesn't have anybody in charge, and it's a very interesting innovation in that sense where there's a bunch of computers that are coordinating and there's nobody that's telling them what to do. They're just all enforcing the rules of bitcoin by themselves, and that that was interesting

to him. But I do think that they see the value uh quicker because and so do any really any immigrants, let's come from from a place like Soviet Soviet Union, They see that value quicker because they understand what it's like to live in a regime which has absolute economic control um and basically oppresses its people through the economic system. Right,

that's not something that's happening in America. Even though a lot of American bitcoiners are sort of focused on the dollar losing its value over time and inflation and stuff like that. That's all true, but it's very very slow, right, And in the United States that process is so slow that it's hard for you to see a day to day Whereas if you come from UM, a place that really had a bad economic system, you you have seen

it happen before your eyes. You've seen the shortages, you've seen the currency the value, You've seen this kind of stuff. So it's definitely easier to get from from that perspective. Yeah, I think you know, with with with the u SSR or or we see in venezuel Argentina and and then compared to United States, like you said, it's happening slowly, so it's hard to see it. But as we've seen in Venezuela and Argentina and back to the USSR, I

think it happens slowly and then it happens fast. It's like you're not it's happening slowly, you're not really paying attention, but then once it starts happening, it's like it's almost too late. Um. But I was curious, you know, just because, like I think for me, and you wrote the book,

so I'm sure you've grappled with this. But bitcoin is hard for most people to understand because it's multifaceted, right, So there is the technology piece, there's the money piece, there's the privacy piece, the like there's all these different pieces. There's philosophy and all these things, um and so um. But at the end of the day, it always seems to come down to why, Like why should I care? Like, okay, so it's like a technological revelation, innovation, but why why

do I need something that can do that? But when you've just come from Russia and had your life taken from you all of a sudden, you're like, I know exactly why I need that. So that's why I was just curious about that. Um, definitely, Yeah, it's it's that

was for me. I almost worked back to the why because when I came into the bitcoin, I came in from such a tech angle where I was like, wow, this is such a cool idea just from a technology standpoint, and then I started researching it and then I started like sort of getting red pilled in all the economic aspects of it. And that's something that I never really questioned, you know, like what is money? Right? Like money? Is this the stuff that the government prints? And like I

use it, it's fine, um. And then I get into bitcoin, and all of a sudden, there's all these deeper questions to be asked, like well, why does the government get to print money? Is that a good thing that they get to do that? Um? Has that been abused in some fashion? And like when you get to those wise, all of a sudden, you realize that we do have problems.

And these problems are not obvious to the everyday person who's just like using their money and generally work, especially in America or Canada or any kind of you know, even in Europe, like largely speaking, people don't see a day to day But then you get into the wise of this, and then you see like the Equifax tack, see people losing their identity information, and you see China and you see the sort of the talentari and control they have over over spending that how people are spending

their currency and then watching what people are doing, it's like scary stuff and you start to see that, um, that we're not living in the same financial system that we were living in even fifty years ago, even twenty five years ago. We're digitizing extremely rapidly, and that digitization, like the money everywhere is going digital. Right, there's no

doubt in my mind that that's happening. Um, it's going to happen within our lifetimes for sure, maybe a hundred percent or maybe, but it will be good enough as a right. And once that happens, you're you have to then realize, Okay, do we want money that's completely controllable at the press of a button, where somebody can go and print more of it or take it away from you or shut down your account because you're, you know, an enemy of the state. Do we want that to

live in that society? Or do you want to live in a free society? And that's why I think bitcoin is the most important invention of this of this century, because it literally is the thing that can stop that from happening, and stop this process from happening and give

us a digital money that's actually free from totalitary and control. Yeah, what's awesome with bitcoin is that as you as you mentioned red pilled, So that's a that's a reference to the movie The Matrix, which I just heard they're making a new matrix or I think, but it's a reference to that where um, he was offered, hey, red pill to see what's really going on or blue pill to stay in your dream, right, and so um, red pilled is a term that we use where like your eyes

are opened. And what's amazing with bitcoin is um, as you said, red pilled. You you get your eyes open all of a sudden you're started to ask questions is money like as you said, all those things that you run down and then even the question as to like philosophy, like why is privacy even important? Like a lot of people don't even think why I don't need privacy? What I have nothing to hide? Right, But yeah, you have to understand like philosophically what privacy means to a to

a society. Right. So, Uh, it's it's awesome him, it's awesome to see that. Um. Jumping into the technology side of it, Um, maybe if you want to talk about uh, because I know there's a lot of people that have covered the why so we have you know, bitcoin standard or what what Andrea's and topless is done, which I think, by the way you said, Andreas kind of shifted your mind a little bit, right, Yeah, Andreas was definitely like

my gateway into bitcoin. I think for several months they had like a bene where I watched pretty much every Andreas video I could find on YouTube, and uh, he what I really like about him is he actually does cover the y really well as well as the technical side. And um, I actually watched all the videos before I even looked at the Bitcoin white paper and really understood sort of like the code side of things and what the nuts and bolts are because he does that's such

a good job explaining it. I felt like I already knew advice time I get into the primary sources. So yeah, I always recommend a videos to people who are new. So let's get into the technology side, because your book kind of covers that part, right, I mean, is is that what you're kind of intending is to like kind of explain it better so like people understand how it works and why it's like unique and important. Yeah, I mean to me, when I because I'm a tech person, Um,

when I sort of started in the space. I saw a THEORYUM, and it was a very shiny and well marketed piece of technology, and it looked like it was friendly for developers and and so I easily understood what they were trying to do. Whereas with bitcoin, I think, UM, a lot of the actual innovation isn't for state technological, but it is economic UM, and you have to understand

the economics. Definitely, if understand sort of like why they're trying to do these things, but um, in order to understand the claims that bitcoin makes, such as that it's scarce and there's only twenty one million of them, it can't be seized from you, there's nobody in charge of visuals. You have to understand the nuts and bolts of the technology.

And I found that when getting into this book that most of the resources out there were very They were either highly economic, high level, or they were super deep on the technology. Like Andreas is a book. I mean it gets into code, it gets into really really deep stuff, and that's great if you want to be a developer UM, but I think for the everyday person that would be useful for them to understand how bitcoin works without actually getting so deep and admired into sort of the code

that side of things. So I think in your book one of the points that you really made is like the technological masterpiece or the big piece of the technology of bitcoin is they solved away or or they solved trust. And so I think with computer systems um that we've had previous to bitcoin, we always have to trust a database essentially controlled database to keep that ledger up to date. And so Bitcoin has solved trust. Maybe you can just

kind of talk about that. Yeah, So I think, um, one of the things that we need to understand about bitcoin is that we're we're creating a new banking system effectively. Right, So in a traditional banking system, we have one central entity that's the bank, and that bank uh is in charge.

Just to simplify, that bank is basically in charge of issuing the money as well as transferring that money between you know, point A and point B. Now, the actual banking system is much more complicated than one bank, but nonetheless there's always some central party that's sort of doing

these transfers. So, um, what I talked about is how do we go from a system where if I want to move money from you know, Jhan to Mark that I have to call my bank and say I'm yan and moving Mark uh some money to Mark, and here's my account number and so on. How do we move from that system to a system where there's no central

person or a party to call. And the way that we do that is we first have to give a copy of that ledger, so that what the bank has is essentially just a ledger with everybody's account balances and and how much money is being moved from one point another. We need to move that system to be owned by everybody, essentially democratizing that sort of ledger. And so the first thing we do is we give everybody a copy of it, right, And so that's pretty simple. Everybody can have a copy

of the ledger. We don't need to have a bank anymore. But then you start to get into an issue of well, if I want to move money, then instead of calling the bank, I'm going to basically tell everybody else who's got a ledger that I'm doing that, and everybody has to write that uh information into their ledger. And if we have that kind of system, well, how can we actually trust that people are going to do the right thing?

How are they going to write the right information into their ledgers, and who can we actually trust about the state of the world. And that is the that is the fundamental problem the bitcoin solves because prior to bitcoin, there was no way for us to coordinate a bunch of computers or people or what have you that that where we didn't know who they were. Right, with Bitcoin, we don't need to know who any of the participants are. We don't need to know, um, whether they're honest or

malicious or what they're trying to do. We put our faith in the algorithms. Or it's not even faith, it's mathematical. You know, it's mathematical, right. We we use mathematical algorithms to make sure that um the information that's going into the ledger is correct, and that is all done through this kind of lottery process. So really the problem that's been solved, as you said in the book, is trust.

And so the whole world revolves around trust. You've talked about like a new banking system, but really, if we want to get into it, it's way bigger than that. Um right. It's kind of like a movie with like a drug deal, right, like give me the give the drugs, No, give me the money, right, and they don't trust each

other even when they're face to face. But now that the world is connected, you know, via the Internet, we have this massive global trust problem and we've seen like our institutions, Facebook and whatnot, we can't trust them, um and so trust is breaking down, um and really so so bitcoin is like a trust layer, right, like a like a like a trust system. So maybe it's maybe maybe the money aspect is just the first killer application, and then we'll see lots of other new ways that

trust is being used. Maybe through bitcoin, it could be. I'm not really sure yet. I mean, I think it's it's hard to say because one of the things about bitcoin that's interesting is that the whole security model of bitcoin depends on bitcoin, the asset itself. Right. The way that the bitcoin works is that miners, which are essentially people that want to participate in maintaining this ledger for us, they can participate freely. They don't have to ask any

way for permission. The way they do that is they burn energy, and they burn electricity. When they burn that electricity, they play a lottery system, and that lottery rewards them with with some bitcoin. So that lottery system, um, ensures that that miners behave sort of honestly, because if they don't, they do something that's malicious, then they will have burned that electricity, they will have expended that that effort in mining, and then their entries won't actually be written into the

ledger because everybody else will reject them. So bitcoin as a trust system, all of that, it's doings that's enforcing that people, um spend energy to write to create bitcoins and to write transactions into the bitcoin ledger. So that's kind of the primary thing that's enforcing. Whether there's any additional applications beyond money, it's hard to say. Um, there may be other things that we can do with it,

but I'm I'm skeptical right now. Um, because the asset, the bitcoin asset itself is so key to the actual security model. Well, it's definitely a mechanism to transfer that value. I think it just goes into a bigger conversation of what is money? Money is communication of value, um, and what and so what is value? Will values all types of things, right, So, UM, anyway, you get into some philosophical stuff there, but UM, so it does that, um,

And as you said, these miners are burning energy. They're buying electricity, so they're having to spend the money, so they have this economic uh, the skin in the game, if you will, right, So they're they're having to spend money on equipment to burn energy in order to produce the bitcoin and transfer the bitcoin, and that's basically what secures the network. Everyone's kind of economically incentivized to keep it up. Yeah, I mean, the idea of bitcoin is

essentially like this. So there's a there's a lottery system. We need to be able to create bitcoins. But we can't just give that power to the government or to some singularity, right, So the way that we do it is we're distributing that effort to anybody in the world, anybody at all who wants to do that can. The cost, though, is that they have to burn electricity. And the reason we have this cost is that this is kind of one of the cool innovations of bitcoin, although it's not

technically bitcoins innovation. This is the idea of proof of work um. It came before bitcoin um. But the idea of proof of work is that we can have a mathematical proof that you've us like you've achieved the statistically improbable result. Right. So, so the way that you can think about it is that we're playing a lottery. Okay, everybody who wants to participate in bitcoin mining or security

ex playing a lottery. They're tossing a random die and they're rolling a die and they're generating really really large numbers, and they're taking transactional data, which is basically stuff that people like people want to be moving bitcoin from point to point B, and they're applying a mathematical function to it called the hash function, which basically makes it into

one giant blob of numbers um. And this giant blob has to land on a number line that's that's very very large from zero to the number of atoms in the universe roughly um. And they're trying to hit a very very small space on that number line. And so by doing this lottery and by actually finding that little space on the number line, what they're doing is there's essentially proving to everybody else that they've expended a certain amount of energy, or that the probability of them hitting

that little space is so small. Without having expended in energy, that would have been impossible. So when they do that, they show that skin in the game, right, they show that they've spent that energy, and they still have to produce something that will that is considered a valid Bitcoin transaction at the end of the day. Because even if they spent all that time mining and then try to, for example, give themselves a thousand bitcoins, everybody else will

look at that transaction and say that it's invalid. Right, So every computer on the bitcoin network enforces those rules. So if you wanted to cheat and sort of like take over bitcoin there, it's very difficult. Right. First of all, you would have to have more than half of the energy, half of the mining energy um to yourself, right, so you have to have we call it attack, you have to have just over half of the of the total energy expenditure of bitcoin. And all that would let you

do is just mine bitcoin. You wouldn't actually be able to uh violate the rules of bitcoin, because all the other notes that receive your quote unquote money that you've generated this this bitcoins, they would reject anything that doesn't look like a real Bitcoin transaction. So all that would let you do is effectively a sense or transactions to prevent certain transactions from happening, or mine empty blocks and

prevents the bitcoin chain from moving forward. But you can't really like cheat the system in a sense because the the enforcement of the of the of the rules of bitcoin is done by every note in the system, right and the the This gets into a little bit of a philosophical piece. But money. For money to be good, it has to have a true cost of capital. So like with gold, for example, it costs me money to

get gold out of the ground. I have to spend money in order to produce it, and I'm expending energy, time capital to get that. The problem is, like with the dollar or any other feet currency, is there's no true cost of capital, and so it perverts the entire system. There's no uh, there's no feedback loop, right, and so bitcoin you have to spend money there and there's a cost to produce that, and it keeps the system in check. Yeah,

I think that that. Um, you know, the government money has really screwed up our perception of how money should work. Because if if there was no government, right and we were just you and me on an island or something, and we had to pick something to use his money, um, we probably wouldn't pick grass or tree leaves or something that was extremely abundant, right, because then we would have no real way of of transferring value with each other.

And and and being certain that you're not just gonna go and pick a bunch of grass, know, and all of a sudden you're twice as riches me. Right, it makes the money useless. So in order for for the money to be valuable, it has to have a certain amount of scarcity. It has to and and the scarcity comes from cost to produce. Right. Um, if it was air or grass or tree leaves, there's a very little cost to produce it. It would be very easy for

for for us to keep making more of them. Um. Whereas with something like gold or something like precious metals that were historically used as money, or even things like jewelry beads, uh, glass beads, shells that were found from far away places, all these things had a certain cost of production. Um. When we got into sort of government's

fiat money, all of a sudden that went away. Because now we've replaced that cost of production with just trusting the government that they're not going to produce more than they should. Um. But as we've seen that trust has been abused um time and time again. All over the world. Yeah, I don't think anybody trust the government not to print more. We just we just know what's happening, and and everybody

just kind of step step. Um. So this proof of work is is also this big invention that bitcoin kind of perfected. As you said, it wasn't the first to use it, but um, really so bitcoin was able to

assemble multiple pieces together, uh, to make it new. So would you agree that maybe, uh, people like to use the analogy of MySpace and and uh Facebook, which I know you talked about in your book, and and uh how that's not really applicable to this situation, but uh in that in the way that people try to use it is that Facebook was the first generation. I'm sorry, my space was the first generation. Facebook was the second, um,

which was better. Um, but Bitcoin wasn't my Space. Actually, Bitcoin was a better version of other ones that had come out before it. So if you wanted to use that analogy apples to apples, I mean, Facebook is a better iteration where it took pieces of of other things before it and kind of put it together. I think. So. Yeah, First of all, Bitcoin was not really the first. It was it was assembling of many other pieces of work that had come before, and a lot of ideas that

came before. UM. But more importantly, within my Space and Facebook analogy, there's a flaw in the analogy and that Um, you can have MySpace account and a Facebook account at the same time. And that's how Facebook was able to steal cheer from my Space because people just there was no cost to create a Facebook account, right, you could have both of them at the same time. UM. With bitcoin,

it's more of a money. So you have one dollar bill and you have to decide are you going to buy one dollar bill worth of the coin or one dollar bill of something else. So you're making that decision, and you're really hoping that everybody else around you makes the same decision. Because money is only good if it's extremely liquid and extremely salable. Meaning like if I go to trade, you know, to a random person on the street,

are they going to actually accept my money? If I have a U. S dollar anywhere in America, I know that they will accept the US dollar, right. UM. If I have a Venezuelan Bolivar, nobody here wants it. Even in Venezuela, very few people want it, and most of the time they're going to try to go for the dollars, right. If they can't, there's a black market like that. So in any situation where there's for a sort of a

money that's dying, people prefer the better money now here. Uh, bitcoin is still very early, right, it's still very early, but it's already got a tremendous lead over every other competitor in terms of its liquidity, salability UM, in terms of its UH security model being proven. I mean, it's been ten years that bitcoin has been running, so uh, it's securing hundreds of billions of dollars of value. And

now we're talking about any new competitors coming out. People have to make that conscious decision of selling their bitcoin and buying the competitor with the hope that everybody else will do the same thing. Because of a strong liquidity and network effective money, it's really really hard to shift. You know, it's called the Shelling point. Right. Everybody sort of agrees that bitcoin is that is that most important asset, and everybody is already in it, so it's very tough

to shift everybody over UM. But that's only like one of the things about bitcoin it's important. I mean, there's lots of other things that are going to be very difficult for us to ever reproduce, such as sort of the mysterious founder that disappeared that nobody knows, right, like every other coin has got some founder that the government can go after, co worse and so on. Um, you know, you've got any other coin that comes up has to compete with bitcoins existing network of minors, which is a

tremendous amount of hash power that's out there. Um, you know, there's there's all this kind of stuff that it's very difficult for anybody to compete because they're trying to catch up. But they're catching up. They're trying to catch up with Bitcoin. They're trying to be a better technology, which is already hard because Bitcoin's got better developers. They're trying to attract all that liquidity away from Bitcoin, which is hard because

of the monetary effect. You know, there's it's just compounded. And then there's also the time aspect. Bitcoin has been around for ten years now. You're trying to catch up to something that's already ten years old with something new, and you're trying to do that in a decentralized way, without a founder, without somebody in charge. I mean you're gonna have a hard time, you know. It's that's kind of where we're at. Yeah. Yeah, And you make a really good case for that in the book. So everyone

should go read the book for sure. I'm curious being a technology guy, and and as you said, you kind of got into Ethereum in the beginning and said, oh, I kind of get this right, I understand what you're trying to do. Um, Now you're kind of really focused on bitcoin. How do you, um, how do you look at the rest of the ethereum but also just the crypto space compared to a bitcoin. I mean, obviously you've already said the best money kind of wins. What you

think is bitcoin? Do you think there's other applications or just kind of what's your overall thought about that. You know, when I first got in, and like I said, I did get in through the theorium door. Um. Ethereum has a really good marketing campaign and you know, their website basically said here you can create a bank at a hundred lines of code. You can make your own coin. That was really cool, right, because if you come from a technology background, you know how hard it is to

build distributed systems. Financial systems like that stuff is really really tough. Um Ethereum sort of democratized that, or at least purported to democratize that, and we see a lot of activity and Ethereum right, there's tons of tons of people building stuff. Um, My question is whether any of that stuff actually has true long term staying power because a lot of a lot of the ethereum uh use cases predicated on this like giant ecosystem of things running

on this Ethereum block chain. The problem with block chains is that in order to be decentralized and to actually be like censorship resistance, they have to be um super lean because they can't just like attract more and more gunk. And that's what's happening with the Theoreum is it's like it's growing out of control and that's reducing the number

of those that can actually validate thethereum Um system. And so in order to solve this, they're building Etheroreum two point o, which like even me as a technology person, like I've looked at some of that stuff and it's completely mind blowing how how insanely the complex it seems, and how like probably none of it will work because like there's a fundamental there's a fundamental problem here, Like I'm not as smart as Vitalic or or Ladder are

these people who are working in ethereum. But there's but you know, there's some intuition here where like there's there are computers and they need to share data, right, they need to They need to send data across the world from US to China. There's latency issues, right, There's things that you just can't solve unless you keep that data really really small. And that's not the direction Ethereum sided.

In order to support all this crazy stuff that they're building, they're gonna have to figure out very complex ways of splitting it up. And at the end of the day, it's going to turn into a system that's not really especially decentralized. Now, is there a world where like ten companies share some database and like benefit from that. I don't know. Sure, whatever, that's fine, I don't care, But

it doesn't like it doesn't UM for me. The reason I work on bitcoin is because what we need is a society is not like a fancier way to settle trades between banks. It's it's a new monetary system that's not UM. That censorship resistance and that's uh, you know, not in the control of the government. And I just don't have any faith that Ethereum can execute that part

of it um and let alone any other coin. I mean, everything else is like I said, there are problems in terms of the deaf teams, the founder, centralization and all that kind of stuff, um and and so I think we only get one chance to getting sort of this new monitory system. Right, We've already got it with bitcoin. It's attracting more and more of the right people, of

the right developments, um, the right uh financialization systems. I mean, look at like the you know, the Chicago more cantilic changes in trading theorym I mean maybe they will one day, but everybody's doing bitcoin, Bitcoin become bitcoin, right. Their brand is there, the meme of money, the bitcoin is money is there, and it's it's spreading um and ultimately it's network effects. Yeah, I I I loved what you just said there, and I probably couldn't said it any better myself.

But it's it's it's it's really it's a revolution. I mean, bitcoin is here to change the monetary system. That's what I'm that's what I'm watching for. That's what I'm that's what I want. That's what I'm trying to help usure in UM. Whether a company comes up with a better software to control their supply chain, that doesn't really matter to me. Like you know, like I think it's been a weird conflation and it's caused like you know, if you go on Twitter, there's all these wars of like

bitcoin versus block chambers is etheroryum. It's it's a weird war to be having because it's like you want to work on money, then you work on bitcoin. If you want to work on you know, distributed databases, go work on this other stuff. But nobody knows if any of it's going to be successful because by and large, these things only work in small sort of private one data center. Right.

There's there's issues of scalability there, Like if you want to have something that competes with like a traditional database, you've got to be doing thousands of actions a second at minimum, It's not tens of thousands. And that stuff is just not what block chains are built for. That's

not like their sweet spot. Um and and the only block chain that actually works, you know, UM to its promise, which is to be immutable and to be decentralized is bitcoin, and the ethereum is maybe close to that, but because of all the founder centralization that's there, Like, I would never trust it to be my money, right, I would never trust Etherorium to have Like the monetary policy of

ethereum is not credible to me, even though um. I I listened to one of your recent UH podcasts with Ryan Shawan Adams who was saying that, like the theoryum is gonna have one percent issuance or something, but that's not a credible monetary policy because like the talent could be course, like Joe Lubin could be coerced, these people could be told by the government or by some shadow entities to make changes. Like I'm I'm not a conspiracy theorist, right,

this is just the reality. If we're gonna build a new money, we're gonna come up against state resistance and eftherorium. It's going to fold under state resistance guaranteed. Yeah, And that's the big thing, right, is it is? I don't

I don't. I don't think there's such a thing as immutable ish, right, It's not like kind of like it is or it isn't and so that that's definitely a good point to bring up, um, you know, uh, and and having having a monetary policy or even just comp you know, having the code fixed that everybody knows exactly what the rules are and then people can start to build on that makes sense as opposed to having this

shifting policy where people aren't aware of what's going to happen. Right, And that's another thing with other coins Etherorium and any other coin really is you see a lot of like hard fork governance, meaning like, uh, they pretty much change their system every year with a hard fork, and it's kind of expected, like everybody's on board with this. This is like an ecosystem wide acceptance that like ballic is going to tell us that then you upgrade is coming.

We're all just gonna upgrade. So that in and of itself is the thing that undermines any credibility as a money. Just because it has some monetary premium today doesn't necessarily mean it we'll retain them in the future, especially if like bitcoin catches on more and more and more people start to realize, well, like I have a choice, Am I going to buy the thing that's going up or

hold the thing that's going down. It's gonna be like tough for people to keep punishing themselves, right, Yeah, for sure, Um so maybe we can just uh that's that's really good stuff. And again I just recommend everyone read the book because you getn't get into so much detail on app. But you say that now you know you want to be building on bitcoin. Uh, you want to talk about what you're doing? Now? Is there something like that you're

working on that you want to talk about? Sure? Um so I'm I'm working in a couple of different efforts. I love to keep a lot of balls in the air at the same time. So, first of all, the book is being translated into a number of different languages. Have Spanish coming out very soon, maybe the Sweet hopefully, um. And then I have a Russian translation in the works,

of course, gotta get one from my people. Yeah, and um I've realized more more and more as I get into the space that like, I want to be more of an educator even though my backgrounds and technology. So one of the things I'm gonna be working on next is a bitcoin site called Bitcoin Answers. Uh. It's going to be really really short form content for people are just getting in dispelling some common myths, answering some really

basic questions. Um. And then I've sort of been toying with the idea of building an app that helps people buy bitcoin triggered by certain events. Um. But there's a lot of complexity and doing that without making a custodial So that's something that I'm slowly researching, trying to figure out the best way of going about doing that. But yeah, I mean to me, the current space is very new,

so we need more education, need more onboarding. UM. I'm involved as an adviser to a company called give Bitcoin, which is a really cool effort. They're going to be, um, helping people gift bitcoin to other people, but then also timelocking it, so basically enforcing people to become Hoddler's right away, uh, and then the timelock. During the timelock, they will be offering educational content, which I think is super important because

bitcoin is not currently something trivial to get into. Uh. There's a lot of questions people have when they're getting into it, and UM, we need a better onboarding process. So that's the stuff that I'll be working on because I think that's the most important thing we could be doing right now is just helping more people understand bitcoin, get bitcoin um and learn how to use it. Yeah,

I was. I I've been been a full time investor for for a long time, over twenty years, and I still invest in a bunch of different assets and um. I I have a part ownership of oil field And I was talking with with one of the other GP members yesterday and we're and he's also getting into bit when we're talking about the ability to mind bitcoin off of the oil fields from the natural gases flaring and whatnot. You're familiar with upstream data, Uh yeah, yeah, Okay, Yeah,

they're there. That's uh something that I'm really excited about as well. That's a cool company that they're doing exactly that. Yeah, So we actually have we're working oil wells and we're going to be talking about trying to convert some of it over. But anyway, we're just kind of talking about how bitcoin is really now. I I believe it's kind

of become its own asset class. And just like you would see gold, or just like you'd see oil, you have all these antilla businesses that are built around oil, right, companies that are making equipment to drill oil and companies that are making pipelines to move oil, and companies that are like refining or with gold, same thing, right, companies that are getting it out or making equipment to get it out or to refine it. And so bitcoin and maybe now bitcoin is that asset and now all the

ancillary businesses can be built around bitcoin. Um. So whether that's transferring bitcoin, story and bitcoin, moving bitcoin, educating, right, and so like you can kind of build all that out around it. Yeah, I totally agree. I think we're just very early in that ecosystem where a lot of businesses we're gonna see a lot of churn, right, We're gonna see a lot of things that are just too

early to market. Um. And you know, some of the stuff that's just coming out, like bitcoin loans is interesting, but it might be a little early, might be just the beginning of that. Um. It's just gonna be about market timing and figuring out what the right time to be investing these things is. But I do think that there's a flourishing ecosystem and there's gonna be a lot of interesting opportunities in the space. Um. You know, for me,

it's like there's there's two aspects of bitcoin. One is, if you're an American, you know, person and investor whatever in your your life is fine and you're not worried about government seature of your money. Like bitcoin is just a good way to help the rest of the world. Like you can invest in bitcoin, and that in and of itself helps other people that are in struggling economies because it helps stabilize the valuable coin, helps them get

out of the out of poverty. And we're talking about people like in Venezuela and Iran and all that kind of stuff. So I like that bitcoin has um an aspect to it that's both selfish, where like we can invest in into it and make money, but it's also a global good where when when we're helping bitcoin, we're also helping it spread across the world and become I'm honesty good that people can actually you know, used to escape their sort of horrible um screwed up economies and

deitillarians totalitarian states. With I love it. I love it. We'll wrap it up with that. We're gonna leave it with John says that buying bitcoin is helping to save the world, and I agree, save yourself and save the world. At the same time. I love it. Good stuff. Hey yeahn So, UM, where can people find the book? Where can people learn more? Keep up with you and so forth? Yeah? Absolutely, so you can find a book on Amazon just type in inventing Bitcoin. Um. You can also buy it at

inventing bitcoin dot com. You can pay with bitcoin there if you like, or Lightning Network. But then I have to process the orders manually. So please don't I have an Amazon if you can. If you can't, then I'll be happy to help you out. Also, if you are listening to this podcast and you are in an economy where you you don't have Amazon or you can't you know, get stuff like, just contact me. I'm always happy to

um send out books to places that are hard to reach. UM. Also very interested in talking to any educators or people like that who want to have books for the classrooms. UM. I've done a number of high school talks, so I'm really excited to bring bitcoins to younger people as well. UM. You can also find me on Twitter. U s k w P as my handle. It's pronounced scoop um, so ask WP and uh yeah, hit me up on Twitter. My my dms are open. I'm I'm happy to have

a chat with anybody. Yeah, we'll link to all that in the show notes. H yeahn. Thank you so much. It has been It's been great. Um. I love what you're doing. Keep it up and we'll talk again soon. Thanks a lot, Marco's a pleasure. Hey. If you like this episode of The Market Disruptors Podcast, please help us take this to the top of the podcast charts. Just please do me a favor and rate, review and subscribe.

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