Would Mao Hold Bitcoin? Understanding Money & Freedom in China With Roger Huang

Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
You know, people think the world's going to be like 1984.
I actually think the world's going to be a little bit more
like Brave New World. And I try to just tell people
it's money. Like that is money is the new
God. The thing with money being a new
God, though, is it's here and now and it's something you can
feel. That's something you can touch

(00:20):
because that arena is something that the Chinese Communist Party
always has to continually upliftfor its own people.
It is probably more scared of its people by far than like some
kind of external threat coming in.
Hello, I am Cody Allingham and this is The Transformation of
Value, a place for thinkers and builders like you where we ask

(00:40):
questions about freedom, Bitcoin, and creativity.
Today I'm joined by Roger Huang,author of the book Would Mao
Hold Bitcoin? We talk in depth about China and
Bitcoin and what is going on when it comes to Bitcoin mining
bans, the Chinese Communist Party, and the broader economy.
We also unpack the various layers of optics and politics

(01:02):
involved when talking about anything to do with China and
how freedom and money play into all of this.
I would like to know what you think.
Send me an e-mail at hello at the transformation of value.com
and I will get back to you. Now.
If you enjoyed the show, please consider sharing this episode
with a friend who you think might like it.
You can also support my work directly by streaming SAT's to

(01:25):
the show's Bitcoin wallet or donating through my website.
Otherwise, onto the show. Roger, thank you for joining me
and welcome to the transformation of Value.
Thanks for inviting me and lookslike a really interesting show.
I was kind of catching some of the last few episodes before we
hopped on. Oh, yeah.
No, thank you. Well, today I am hoping we can
explore the connections between Bitcoin and China as you have

(01:47):
written about in your book WouldMao Hold Bitcoin?
But Roger, could you start off by telling me?
Oh, there it is. Yeah.
Could you start off just by telling me a little bit about
your connection to China though,if we maybe we can start there
please? Yeah, sure.
So I was born in China, kind of went back and forth between
China and Canada fairly often and started writing about

(02:11):
Bitcoin pretty early 2014 or so.And naturally also started
writing about China based topicsin 2019 or 2018.
And then decided to combine the two together to write a book
about Bitcoin and China, becauseI figured those were kind of the
two things I was writing about anyways and trying to combine

(02:32):
the different angles where therewere any that I could see.
Yeah. Well, I think there is a lot of
connections which I hope we can pull on.
And as I said to you before, I've spent a little bit of time
in China. I studied a little bit of
Chinese myself, nothing spectacular but and I am based
in Japan, so it's sort of a little bit closer and certainly
originally from New Zealand. There's a lot more.
I think China itself feels a lotmore relevant in our day-to-day

(02:56):
lives than it maybe does for other parts of the world.
But you mentioned you, you grew up, you'll be born in China.
What? What part of China was that?
Fuzo, fuzo. So like, yeah, if for your
listeners, you know, it's the closest large mainland city to
like Taiwan basically. It's usually the way we located.

(03:17):
Yeah, yeah. No, there's a lot of history
there as well. People, a lot of people from
Fuzo and and I think like Fujianin those areas as well.
A lot of them, a lot of people from Shanghai as well, but a lot
of people came to Taiwan I guessin the 1940s, yeah, civil war.
And there there's a long interplay, long history there
between these different regions,right.
Maybe family connections as wellbetween Taiwan and and and like

(03:40):
mainland China, etcetera. I mean, there's a chain of
islands in like 1 is just like two or three miles off the coast
of the mainland. Which Qinman?
Yeah, yeah, exactly. Which is the old, you know,
that's, that's where Mao's invasion failed and all that.
So lots of parts of Chinese history.
I actually, unfortunately my family is not actually really
part of that. That's like more like the Haka
people and like the Fujian people.

(04:01):
I think you're talking about. We were kind of moved in.
I was, I was kind of the equivalent of, you could say
like, you know, army brats in the States.
So kind of have a family that has a little bit of military and
specifically naval background. And so they were kind of
stationed there. That's why the Taiwan thing is
relevant to, I guess, to where Iwas born.

(04:23):
Yeah, and and you're in Vancouver at the moment and then
your connection with North America.
So how did your family, I guess,be in a position where you can
move back and forth? Yeah, just in general, my family
and I, we've go, we go back and forth between China and Canada.
It's like it's got a little bit like a longer personal story to

(04:44):
help to share like more. But in general, yeah, like I've,
I've moved around between China and Canada quite a bit.
Coming back then to Bitcoin, so you started talking, I started
writing about this 2014. Tell me a little bit more about
it. I'm sure you've told the story
before, but how did you learn about Bitcoin originally?
Yeah. So by that time, I was part of
the Montreal kind of like startup scene.

(05:06):
So I learned about it through really just like there's a
Bitcoin embassy and then at the time there's this company called
Block Stream, right, that was being built.
And yeah, like Adam Back and a couple of the like OG kind of
like block stream people that just showed up to Notman House,
which is kind of like the Montreal cause.
One of the Co founders of block stream is actually from

(05:26):
Montreal. This guy called Austin.
Anyways, a long story. So there was actually like a lot
of activity in Montreal about Bitcoin.
And then I wrote the first storyI wrote about it.
It was really about like one of the first coins, unfortunately,
is this crazy thing called Pop coin that eventually ended up
sponsoring Dennis Rodman's trip to North Korea, among other

(05:47):
things. But that was created by a couple
of Montrealers. And so I kind of wrote about it,
got really interested in there. Yeah.
I don't have, like, your classicorigin story.
There's a few people out there who are like, you know, they got
into Bitcoin because of Silk Road or because of drugs or
because of any number of things.Just not one of those people.
It just happened to be like timeand place.
Really interesting threads and Iwill say that, and, you know,

(06:11):
happy to unpack this more and more as we're talking about the
Asia Pacific region, Like the fact that I had that Chinese
upbringing and the fact that I had like people in my community
that did kind of affect my gravitation towards Bitcoin.
A large part of, you know, I spent quite a bit of time
thinking about, like, how to communicate between China and

(06:32):
the West in many ways, not only in like an abstract sense, but
actually like, directly. Like, I know people in the
mainland, I want to get in touchwith them.
How do you do that? And increasingly in the world,
it's become more and more difficult for financial and
communication systems to talk toone another.
So I, I think I had some of those bases.
And yeah, but being in Montreal all the time, that's where I

(06:53):
directly learn about Bitcoin. Yeah, that's incredible.
And I think sort of my, I haven't been to Canada, but my
understanding, you know, as a kind of Commonwealth nation, you
know, this kind of history there, that there is maybe
similarities with the New Zealand experience.
And certainly I, I went back to New Zealand, you know, I lived
overseas, but went back and got caught stuck in New Zealand for
about 3 years during the COVID era.

(07:15):
And you know, all my best friends are pretty much Chinese
people, you know, because it's kind of like, how do you relate
to having lived in Asia for all these years?
Like I had coming back to New Zealand.
And so there was actually a really incredible, you know,
network around me and certainly that led to my own discovery of
Bitcoin and certainly some of the political conversations that
were happening because it's a certain kind of person who

(07:37):
decides to leave China to live in a Western country, right?
And so I certainly understand where you're coming from that
you sort of meet people and there's ways of like, I guess,
desires of wanting to communicate back with China and
navigating personal relationships.
There's a whole lot there, rightto unpack.
But getting on to China, then, what strikes me about your book,

(07:59):
you, you referenced this term techno nationalism.
And I thought maybe we could start with that because this is
really a key fundamental for understanding what is happening
right now with, with the PRC. So where did this term come
from? And like what?
What does it mean for you? Yeah, I think techno nationalist
has been kind of a thing that's that's been in the ether.
I definitely am not the one who like originated the term.

(08:20):
It's it's kind of been around inall your different circles.
You know, I think a lot of people have the the made in
China plan, the 2025 kind of like, yeah, or 2035 or whatever
this all those years in mind. So it's definitely something
that's been pretty common, you know, among people who kind of
study China and the PRC. And just overall, I think even

(08:43):
going all the way back to like the Great Firewall, right?
Just kind of this idea that likeChina was approaching the
Internet in a way that was different than other countries
in the Chinese sense. I think the the the party state
really refers more to it as liketechnical sovereignty or like
cyber sovereignty. Like they see it kind of like
the other way around. They kind of see it as like an

(09:04):
independent version of China's Internet, but brought in broad
strokes. What it really means is that
China has developed its own separate kind of technical model
for how they want to develop their economy, how they want to
develop, you know, in terms of geopolitics and everything
related to that. And I did start with the Great

(09:26):
Firewall, which really came about in the early 90s.
That was when the Chinese Communist Party was still trying
to figure out, OK, well, how do we deal with the fact that the
Internet will bring a lot of commercial potential?
And we want to open ourselves upto that, but we still want to
maintain control of the conversations and everything
that's happening. And I, I think this techno
nationalism theme is like a really big theme, less so

(09:48):
actually. I mean, so I write about in the
book because of course it is a driver for China's central bank
digital currency. And we'll talk about, you know,
kind of the Chinese payments infrastructure, kind of how
those are, it's important for the Chinese government for those
to be at least under the controlof Chinese companies, if not the
Chinese government itself, right?

(10:09):
But I mean, it also has a lot ofimplications across the board
for a lot of things we're seeingright now, like, for example,
Deepseek, the fact that it's like independent efforts to
develop AI. In the book, I write about
China's fascination, the government's fascination with
blockchain, Why? I think that's totally
misguided. But it kind of follows this idea
of like state development, whereit's like the state funnels,

(10:30):
funds, resources, gets entrepreneurs to like, tackle
these technical buzzwords and then claims technical dominance,
but in the name of the state. And since we're talking about
China, really in the name of theparty.
Pulling on that thread, so you say in the book, one of the key
tenets of the techno nationalismis state venture funds and
companies being guided by the state here to invest money into

(10:52):
these choke point technologies in an attempt to leapfrog
rivals. And we're seeing this kind of
with EVs, we're seeing this withdrone technology, with biotech,
a few kind of key pillars. And as you say, it is somewhat
state directed. But arguably in the United
States, we've seen similar things take place where it's

(11:14):
sort of there is nudging. So would you say that the idea
of techno nationalism maybe alsoexists in the US as well or?
Yeah, that's one thing. Well, one thing I always kind of
I've written about this in the past, like I, I don't want it to
be just like a nation state construct where it's just like,
hey, like China is the most obviously techno nationalistic

(11:35):
entity or something like that. That that is a contract that
also often happens in the UnitedStates.
Not only has it become explicitly a little bit more
like that in the sense of like certain platforms and companies,
you know, being banned, let's say, for example, TikTok, not
really banned, but you know, they're that kind of deal that
they're trying to disallow the platform from access to the

(11:59):
United States. So I think the US has
significant advantages in the sense that a lot of the Internet
and a lot of the financial infrastructure was developed in
the United States. So almost like the Internet is
American by default in many ways.
And that is one of the drivers behind why countries like China
want to create kind of like their own independent version,

(12:21):
right? And when it comes to Bitcoin,
not that I subscribe to the belief that like the CIA or the
NSA built Bitcoin or anything like that, but we do have to
acknowledge that the cryptographic primitives were,
you know, signed and by the NSA and, you know, by different
technical standards that are endorsed in the United States.
So yeah, like certainly you can say that there's techno

(12:42):
nationalism in the United Statesand the United States has an
immense advantage both in terms of the financial surveillance
it's able to carry out by default, but also due to it's
just like technical abilities and the technical surveillance
state. Both China and the United States
I think are building burgeons atthis.
I think in the United States it's just more benign because or

(13:05):
seen as more benign because people just kind of like live in
the Internet as is. But they both have their
downsides and they both have their consequences, I guess I
could say. Yeah, that's interesting.
And just again, at that higher level, something about this
techno nationalism for me speaksto an engineering view of the

(13:26):
world, which is a very classic communist idea, this concept
that humans can be made better through technology or or there
can be more to us than say, our spirits or some kind of higher
calling. And I think this is something we
saw in the Soviet Union as well.It's kind of rejection of, say,
classical religions and ideas ofthe transcendent self.
And, you know, everything could be brought down into rationality

(13:49):
and to the technology. And I wonder whether maybe we're
seeing this kind of superchargedwith China with all of these
STEM programs, you know, incredible engineering and and
tech coming out of China, but maybe not so much in the role of
philosophy or law or or history and the kind of more softer side
of things that are also important, you know, So I mean,
what do you think about that? Yeah, You know, it's really

(14:12):
interesting. I've, I've had a lot of
conversations with people who goback and forth between China and
the West, and I think it's always really interesting to
peel that apart and get people'sperspectives.
And one thing I think that stands out, certainly the
Chinese leadership wants to broadcast that it has STEM
leadership of sorts, right? They're really trumpet the fact

(14:34):
that a lot of them have engineering credentials as
opposed to the West, which tendsto have lawyers as politicians,
for example. That is something that does come
out though by the way, just someof the Chinese leadership are.
I was never hesitate to point this out.
They are nepo kids in the sense of like many of the elite

(14:55):
leadership. Now I think this is something
that is under discussed, but much of the elite leadership now
is more George Bush than than anyone else.
If I can just cause Bush was a was a legacy kid and Xi Jinping
and a lot of the current Politburo are, are people who
are able to skip the GAOKAL and during the Cultural Revolution

(15:16):
because of their parents. So just pointed that out that
sometimes the reality and the perception are different.
The perception the Chinese leadership wants to really throw
out there is that they have likesupreme STEM leadership.
They have study groups dedicatedthe study of technologies.
You know, China's triumphing because you, as you pointed out,
like electric vehicles, for example, BYD.

(15:36):
So I think the largest electrical vehicle company in
the world now. And these, these are not like
illusions too in that sense, like they're, this is real.
Like the, the fact China is winning on manufacturing on
several elements. I do think, you know, China's
party state kind of takes this angle of like, oh, we do study
groups on blockchain. We do study groups on it's a

(15:57):
little hit or miss. One of the things about Deepseek
that I thought was really most interesting was like Deepseek
never actually got government support.
It was actually like just privately self financed.
So sometimes that's a little hitor miss.
One of the diaspora I talked to was a really interesting
perspective. He just straight out was like,
you know, in the hierarchy of things, engineers are second,

(16:20):
physicists are first and like social sciences people are like
3rd or 4th. And when you see stuff, you
still have these conversations really interesting with I used
to be on this, like I used to beon Clubhouse.
I don't know if you were on there.
And then you could always pick out like some pretty interesting
people. And there was this woman who was
a professor of speculative sci-fi, and she kind of pointed

(16:42):
out that Chinese sci-fi and American sci-fi were actually
diverging. Like American sci-fi was
becoming this kind of like, whatkind of dystopias can we can be
built today based off of like the identity politics of our
times, for lack of a better word.
But Chinese sci-fi had this likelens of like being very STEM
focused. And if you think about the most

(17:03):
famous book that's come out of China from the sci-fi lens, the
three body problem, it actually directly kind of lends itself to
that view. It's kind of like progress is
stopped because aliens, IE maybeAmericans are like seizing our
ability to be able to develop technology separately.
So yeah, I mean, I, I, I think that there is a view towards

(17:27):
STEM and a favoritism towards it.
I think there's sometimes it's more optics like in, in the
book, I really go into how I think the Chinese government's
making a huge mistake by investing so much in blockchain
patents, because sometimes they confuse the, the means of
innovation with the ends like. And namely, there seems to be

(17:48):
this really large effort to get a lot of like patents out there,
which I, I think personally, although not being a member of
the scientific establishment myself, but I just think that
like that's, that's like misguided, right?
But there is some of that that'svery real.
I, I think it's actually more like a cultural thing.
And I think that's going to playinto the kind of like the

(18:09):
geopolitics of it a little bit there.
There, you know, a lot of Chinese people are very prideful
of STEM and there is more of a call towards people joining like
STEM fields. So we'll see how that plays out.
But it's definitely, definitely something I've observed as well.
Yeah, And something interesting,you mentioned that sci-fi

(18:30):
Divergent, which straight away strikes me because the same
thing happened with the Soviet Union.
And so you had Andrei Tarkovsky making films like Solaris and
Stalker and these, you know, very esoteric, cerebral
explorations of of science fiction.
And then you had Stanley Kubrickand, you know, Star Wars in the

(18:52):
US in this kind of Hollywood model.
And in a sense that kind of reflected the economic systems
of both countries because Tarkovsky was, you know, state
sponsored in a sense. And so it was a very different
model. But drawing on your what you
just mentioned, Roger, about the, the physicists being 1st
and, and that it's really interesting.
I was watching a podcast, I was listening to a podcast called

(19:13):
the Manifold Podcast with Steve SU, who's a theoretical
physicist. I think he's American, but he
spent a lot of time in China andhe was attending some of these
conferences. And, and I mean, he went on this
long exploration of how people maybe need to recalibrate their
perspectives on China and how China is actually really moving
ahead with some of that really deep science around physics.

(19:36):
Talked a lot about how China wasable to independently develop
the process for the hydrogen bomb.
That was not something that theyjust stole through espionage.
They actually developed their own model and there's a very
famous scientist who who helped develop that, that, that model,
which again, is sort of outside of the, the Western tradition.

(19:57):
So he went on this long exploration.
But what what struck me about that was, again, it was the
optics. You know, he was talking about
these conferences they were having in Shanghai and different
places. And, you know, it seemed like it
was very. You know, cutting edge.
But then again, I wonder, you know, how much of that is, is
true, You know, air quotes, you know, there's this, these layers
of optics with China. And maybe this is something we

(20:18):
can just talk about before we get into the Bitcoin stuff
because I think maybe people, yeah, people get into this and
they think, OK, China's this monolithic thing, but there's so
many layers to it, right? Yeah, there's, there's
definitely a lot of layers within.
There's definitely different perspectives and it depends on
where you're kind of slicing theonion, yeah.
Yeah, yeah, no, sorry. I mean, that's, that's a big
guy, that's a big ask. But this I, I guess this idea

(20:43):
that there is a top down leadership that is sitting of
course, and that it is this ideological opponent to the
United States. I mean, straight away that is a
status, a take, right. I mean, as I said, so many
Chinese friends are very involved with the community.
There's a lot of things happening beneath the surface.
And as you mentioned as well, deep seek, you know, this was
maybe this wasn't state funded. And so there are these pockets

(21:04):
where independent stuff is also happening.
But I guess ultimately the end game is that the state chooses
and if something does get in theway or feels like it's a
conflict with the CCP, then it will get shut down.
Would you say like as a that's kind of the the red line or?
Yeah, I mean, it's I, I guess like, yeah, like first what I
always tell people is like, there's the Chinese people, the

(21:25):
Chinese government, of course, that's like easy point to to
bring up. And they're very different.
I think to your earlier point, like one thing I always
encourage people to try to do isto kind of fence hop and like
look at other versions of the Internet, not just the Chinese
Internet, actually, but the Chinese Internet happens to be
like a very fascinating one because there's a lot of people
and there's a lot of different perspectives.

(21:45):
The Iranian Internet and different other places, they all
have their own different, like flavor and different
perspectives. The Chinese Internet in
particular is pretty interestingbecause there are people who do
dissent in different ways. And it's, and it's just
sometimes just like absolutely amadhouse in ways that people
like don't really realize. But I would say that the Chinese

(22:05):
government plays like a strong role.
Sometimes it's closer to the Western model than you would
think. And I, and I think those
examples are instructive becausethey allow us to look back at
our lens and see like, what are the things that we take for
granted? So like, for example, just to
give you a really quick example,a lot of Chinese state
institutions are kind of given, you know, first billing, right?

(22:29):
So the Chinese Communist Party Youth League and like, you know,
the media outlets are kind of given first billing in the
Chinese Internet ecosystem. So they're able to kind of pump
out messages, not be censored and they have a lot of followers
anyways. But it's almost like there's not
like people with a gun forcing you to follow those accounts.

(22:50):
Like a lot of that growth is actually like almost like
organically spurred. So just like how you might think
like, you know, there's like a Politico or like whatever in the
United States, in the West and you want to follow that, then
you know, those same dynamics kind of apply to China as well.
So the state subtly kind of manifests that.
And then some of that actually applies to outside of China.

(23:12):
So for example, Google will giveall Chinese state media kind of
like equal billing on Google News.
So this is the kind of thing that just like as an extension
of state power, and it's something we're thinking about
cause for example, in the West, like where do you get your
information from and how does that information get
authoritatively ranked? While digital power transcends
from analog power. And so if you are a member of a

(23:34):
state of any kind, that can giveconsequences to any of the major
tech platforms. That's why platforms are such a
problem and not protocols, then you know those states will have
a say in that conversation. This is true in China and the
United States, where I think China's a little bit more
extreme and where, you know, those red lines come in and
there are real consequences is that they do target people

(23:57):
individually sometimes. And which is always like very
surprising. Some of it I think is a
reflection of where the politicsare like almost like the Chinese
government. To me, this is going to be kind
of a weird example, but I almostthink they like scaled the way
the US treated Julian Assange. Like you, you, you see the case

(24:18):
with like a Julian Assange that like, you know, there isn't
unfettered freedom of speech. If you're doing things that
upset the powers that be, they will go after you, right?
So in, in in the American case, that's that, that was Juliet.
In China's case, it's more like you have people with like 10
Twitter followers that get arrested, right, for saying
glory to Hong Kong or things like that.

(24:38):
So that's why it's the principleis still disturbing.
It's really the scale that differentiates China and the
West, which I think is is something to reflect on as well
there. Yeah, there's one other thing I
wanted to pull on just on that optics side.
Certainly, as I mentioned this Manifold podcast, and I think

(24:59):
since I started watching that onYouTube, I had been getting all
these other recommendations. And there's this whole universe
of influencers, English speakinginfluencers, traveling through
China, talking about China. And I've always, you know,
celebrating the technology, fasttrains, clean streets, you know,
nice people. And these things are true.
But there's this sense to me that there's just an ideological

(25:22):
vacuum, the thing that is not said, the unspoken side of it,
which is that the critique is not an option.
And as a, as a creative person, you know, that really stands out
to me as a student of history. I think, well, you know, these
things are nice, but what you, you pay a price for having
these, these fast trains and these clean streets.
Like there's, there's questions that can't be asked.

(25:42):
And I just wanted to get your thoughts on that because a lot
of these things seem like they're quite organic, these
influences, like maybe they're getting paid somewhere, but it
feels like they're just not seeing what you and I see
perhaps with the ideology of it all.
They're yeah, that this is like a whole other life of mine
before we even talk about Bitcoin.
But I I did talk to some of those.
I actually know some of them specifically my name.

(26:03):
I can probably like shout out who exactly you're talking
about. You know, the kind of people who
are like, hey, I went to Shanghai and the Starbucks is so
nice and, you know, like, look at how clean the streets are.
You know, some kind of. Opportunity.
The. Economy.
I used to call them the Chinese tourism board, but that's all
good. But yeah, I think to your point,

(26:23):
well, two things on that. One is that it's not quite
organic, right? Some of these people, you know,
I've seen specific examples of this, but you know, so like not
that they're directly funded or sometimes they are, but like
they get recognition from the Chinese state.
So some of them get invited to like galas and stuff like that.

(26:44):
So I mean, I'm not saying that means they're Co opted or
they're bought. But I am saying that that is
that that does exist and that the Chinese government has a lot
of money and has in the past done various things like giving
payments to politicians. Giving payments to this is all
like public record stuff, right?Like politicians who have gotten
payments from the CCP as well as, you know, people who like

(27:09):
news outlets and stuff like that.
And yeah, I don't really know all the individual
circumstances, but certainly if you are doing content in China
on other channels, first of all,that is something the Chinese
government's trying to nurture. It cares a lot about these
channels, even though it itself tries to ban Chinese people from
accessing it, which is kind of an irony.

(27:30):
And then I think that, yeah, it's like a it's so that's the
first part. Like it's, it's not necessary.
It's not like, I'm not going to directly say like you or, or
them, you know, you got paid andyou're you're just a stooge or
something. But I will say that the type of
person, you know, that does thatkind of content normally there

(27:50):
are some incentives associated with that, right?
The other thing I would say is like some of that does seem to
be like natural, like IE like what I've seen, at least for
some of the people that I've interacted with.
And, and I'm speaking specifically about people who
come to China and are kind of like portraying that level of
optics. The Chinese tourism board, they
genuinely do believe in it. This is why I'm trying to try to

(28:12):
stay. They're not like, they're not
necessarily like paid off or something.
It's like, and I, I think where it comes from is that they're
usually disillusioned with like the United States or like, you
know, just the quote UN quote, western LED model and all this
other stuff for any number of different reasons from people
who are like Huacha, which is like Chinese diaspora, like

(28:34):
ethnically Chinese. I've, I've, I've heard and seen
things like they've experienced racism in the United States or
stuff like that, right? So they don't like it.
So they want to go back to China, but from, you know, so I
think some people have certain political views that are like
statist in nature. Sometimes they're already
leaning that way. And they're like, look, China's

(28:54):
got to figure it out. Some of them think that China's
communist, which they think is avery confusing concept to deal
with. And so, you know, there already
is that kind of inclination. And so they're kind of.
Yeah, they're kind of already trying to do that.
And so the two kind of meet together.
Like the Chinese government has like, awards for journalists.
They call it like the Edgar SnowAward.
I don't know if you remember Edgar Snow, he's like a famous

(29:16):
American journalist who wrote about Mao.
He's kind of like the the model ideal of like a good foreign
journalist for people in China. And those people get rewarded
and they already have some natural incentives to join.
Although it's pretty funny because the Chinese government's
very sometimes I find like the agents of the Chinese state are
like very crass. They like very, I don't know if

(29:38):
you remember this Cody, but there was this whole like wolf
warrior thing. So it was almost like the two.
So the Chinese state at one point decided it was a really,
really good idea to like, just be really, really ratchet on
social media. Like you had like state media
people like, like Senator MarshaBlackburn from Tennessee, I
think she wrote something about China that they didn't like.

(29:59):
And then one of these people just like straight up called her
a bitch or something like like adiplomatic figure.
And you're just like, I don't know how productive this is, but
at one point that was like a theory that they embraced, you
know, like this kind of chaos. And so it, it is interesting to
see like whenever the two internets collide.
I do think most of it is optics,though.

(30:20):
Like to your, to your broader point, you know, like yeah,
yeah. Sorry, I was just going to say
as well. I don't know if you can see I'm
I just got this book, Jacques Lul.
He wrote the book on propaganda and this was in the 1960s.
And so he was a French philosopher, kind of sociologist
looking at the, the sociologicalfunction of propaganda and, and
actually kind of how it works. And to be honest, you could

(30:41):
probably take that book and use it as a handbook for the way to
deploy propaganda. But what I I'm really interested
in again, as a creative person and a student of history, is
that it feels to me like there'ssomething new here.
And maybe like we need a name for it just to start identifying
it. But it's not a centralized
effort. As you say, there's these kind
of simplistic Youtubers and Tik Tokers who are like, yeah, here

(31:05):
I am. Xinjiang isn't so bad.
You know, Shanghai is a beautiful city.
It's clean, unlike the US. And there is this degree of
maybe disillusionment with like the US or Canada or or even New
Zealand, to be honest, like that's it's not doing so well.
And so there's kind of like a moment in time where it looks
good to be in China where there's opportunity.

(31:25):
And especially if you don't speak Chinese that well, it's
like because there is a whole lot of darkness once you Start
learning about the all of the knife, all of the stabbings and
like. Yeah, the Japanese.
Yeah, the Japanese do it as well.
But like, I mean, you, you don'tsee that.
It's not, it's not that there's no guns, it's just people use
other weapons and but that neverthat, that never makes it
through to the Western media. So there's a whole lot of stuff

(31:46):
hidden away, but it's like we'rein a moment where there's kind
of a lot of stuff happening. And it's kind of a being taken
advantage of, as you say, to sort of present the optics that
China is actually this kind of great place.
And more and more people are starting to be apologists for
China or for the CCPI should say.
Yeah, which is quite confusing, right?
If you don't know anything or you don't know any better.

(32:09):
Yeah, I, I think the, the, the Chinese like kind of party state
is really good. So what I don't think it's
necessarily different, but I think it's different for our
times. And yeah, maybe if you wanted
like the creator economy in China, I don't know.
I can't think of a name right off bat.
I think I told you it was a little under the weather.
So my creative juices are not 100% flowing here.

(32:31):
So the, the nomenclature is not great.
But I think what's different, atleast from a Western
perspective, is that when the Soviet Union and the United
States were kind of in a conflict with each other, there
was also, there was also a lot of optics there too, you know,
with Sputnik and everything. And there was like all these
glorious propaganda films that were like more obviously gauche
because you're just like, you'reseeing like the effects of it

(32:54):
were not really true necessarily, and the people were
censored and things like that. I think in China, one thing that
that makes it different is that China is kind of on a track
where it can economically compete with the United States.
And I think another part of thatis that China has mastered 1

(33:17):
technical loop because of the low cost of Labor, which is
shopping e-commerce. They have learned, like the
Chinese government and Chinese companies have learned how to
work together to create a kind of like really Placid.
You know, people think the world's going to be like 1984.
I actually think the world's going to be a little bit more
like Brave New World. The whole thing where and, and

(33:39):
you're seeing that happen live now.
It's the Chinese Internet's not terrifying necessarily because I
mean, there are some terrifying implications like there are, I'm
not gonna, you know, there are surveillance cameras.
There's one camera for every twopeople there.
There is some elements in 1984, but I actually find it more
dystopian in the Brave New Worldsense because you can go on the
Chinese Internet and just be totally swamped with like

(34:00):
content that eats your brain andcauses you to consume and buy
things like from like A-Z. It's like a perfect propaganda
system because the people who are in there feel like they're
like part of it and also feel like they're imbibed in terms of
the values. And so bringing this kind of
culture and attitude to the states is different because I

(34:21):
don't think the US government isready for, you know, all the
cool tech products used to come from the states like Facebook
and like whatever. Now they're like trying to
figure out what's going on with TikTok.
Like, how did this Chinese company like kind of outmaneuver
American tech companies and getting adoption and everything
around that? So I definitely think it's a new
phase of superpower competition.Maybe like different tactics,

(34:44):
but still the same strategy and less optics, slightly less than,
you know, what was the Soviet Union in the US.
So I do think there is somethingthere that, yeah, is is driving
people through. Yeah, and interesting, just
pulling on that thread as well. I mean, certainly where I live
in Japan, we get a lot of Chinese tourists, we get a lot
of Asian tourists. And I mean, I spend a bit of
time in China, as I said. And certainly this idea that

(35:08):
people are preoccupied with the reflection in their smartphone.
I I think as a way of describingit, you know, there's a selfie,
you know, the the, the apps, theconstant scrolling.
And what then does though, is that crowds out the opportunity
for ideological thinking. And this is again something you
say that the socialist legacy ofof communist China has destroyed

(35:31):
the idea of a spiritual afterlife.
And so its mandates rule comes from being able to provide
material wealth to the Chinese people.
And so there's this kind of loopthere where the, the, the
consumption and the, the, the, the cheap goods that, you know,
the good middle class life that's been promised to the
Chinese people. It sort of overrides maybe
ideological thinking, which is where in a sense, the Chinese

(35:53):
Communist revolution came from originally as a very poor
country and, you know, strife and turmoil.
So it's like we're entering, as you say, into the brave new
world where you can't even thinkthese ideas because you're too
busy shopping. And that so that that that is
interesting though. But I do want to move on to the
economics and the Bitcoin side, Roger.
So I mean, the title of the bookWould Mao hold Bitcoin?

(36:17):
Is very interesting because you do talk about Mao quite a lot.
And in particular his views on inflation, which was seen as
this scourge, scourge of capitalism.
And the Communist Party in the early days took a really
organized approach to taming therising cost of living.
So maybe we can talk about the history of inflation in China
and sort of how that how that played out.

(36:38):
Yeah. Well, so I cover it through the
book, but inflation has been quite important to China because
China has was the earliest country to develop paper money,
the earliest to develop credit money.
And so it the idea of all these like different cycles in China.
What I always tell people is that Chinese history is so vast

(37:01):
that you will have seen different cycles of things.
And it's things like patterns are more readily apparent
because like, for example, in the United States and other
places, maybe that's only lived through one cycle in China with
inflation. You know, that was a, a large
part of the Yuan dynasty collapse into the Ming dynasty,
which was the Yuan dynasty was kind of the, the legacy of

(37:22):
Genghis Khan and his kind of world conquering at the time.
And that was kind of like the Chinese part of the Mongol
Empire. And they went a little bit out
of control with their paper money.
And that helped to craft the genesis, the Ming Dynasty.
So you can see entire dynasties.Dynasty is kind of changing.

(37:43):
And you know, Mao was somewhat of a beneficiary of that.
I actually sometimes go back andforth.
I don't actually remember exactly how I portrayed in the
book, but it definitely was a big factor at the time.
Like if you think about the timea lot of people, you know, they

(38:04):
when they think about inflation,especially in the Western
context, they think about WeimarGermany.
But China and actually since you're in Japan, Japan have also
been through these periods of inflation that have really
shaped, for example, the military government that ended
up kind of ruling Japan. You know, that was after a
period of like financial, monetary instability.

(38:24):
And when Chiang Kai Shek, who was kind of the ruler of China
before 1949, who was the head ofthe Nationalist Party, who
immigrated out to Taiwan after the war, the civil war between
him and Mao Zedong. He was kind of the de facto
leader of Taiwan for a while as well.

(38:45):
And during his reign, he was theone who led China like the state
during World War 2. So when people remember kind of
like the Japanese invasion, kindof going back and forth and
after the war and the consequences of kind of dealing
with it, the money supply went out of control.
I have this photo, I sometimes give a presentation and it's

(39:07):
this Chinese girl who's holding the equivalent of $10 in the
equivalent of Chinese currency at the time, which is about like
444,000 units or something like that, right?
So if you think about these wheelbarrows of money at Waymark
Germany, and the same thing happened in China.
And so Mao actually, that was one of the first things he did,
was to put together the People'sBank of China, which is China's
current central bank, and to issue a new currency, the UN.

(39:30):
Now, Mao being Mao, he preferredto organize this through
violence. And so there were not really
inflationary changes because there were really strict price
quotas. So you can't really have
inflation if the government setsthe prices for everyone.
Obviously not something that's very, very workable, but then
that actually blends into the history of modern China, you

(39:53):
know, which I'm happy to talk about a little bit more.
But the short of it is that one of the first things the Chinese
government tried to do post Mao was to reform and open up the
economy. And one of the consequences of
that was price reform. And that that actually helped
create and accelerate inflation,which Chinese people had not
known about for a few decades, right?

(40:17):
And it's that backdrop. You know, that may have
contributed to Tiananmen Square protests and definitely
contributed to these two factions of the Communist Party
battling each other. So the point I always try to sum
up to is that inflation has beenin a very important part of
Chinese history. Since Chinese history has had so
many cycles, you can actually really see the consequences of

(40:40):
each inflationary cycle play outthroughout.
And I just, I think, named you three instances where, like, you
know, inflation played a really important role in Chinese
history. Yeah, no, that's fascinating.
And I, I do recall you mentionedthat role of inflation and
gentlemen, and that that was interesting because I hadn't
really read about that, you know, about sort of the on the

(41:00):
surface of the democracy movement and the students.
But the idea that maybe inflation was sort of in that
mix is really interesting. And then the other piece that's
also kind of like a local topic,I guess in this part of the
world is obviously the Japanese invasion of China in the 1930s
and the development of paper money for Manchuria and these

(41:20):
kind of occupied regions. And kind of that extractive
nature of it, this kind of bootstrapping paper money and,
and using that for wealth extractions.
Kind of again, much maybe much clearer than or much more grand
and scale compared to maybe whatwe know about in the West.
Because again, we talk about 1971 as a bit of a rug pool, but

(41:40):
you know, everything's bigger inChina.
And it seems like, yeah, there'sthere's history even in the,
say, last couple of 100 years ofquite profound monetary changes
that have led to social turmoil,to war, all sorts of things,
right? Yeah, and inflation, just to
finish off like on the the 1980sin the Tiananmen Square, not
only was it the backdrop of Tiananmen Square, but it was
also the backdrop between two factions of Chinese governments

(42:05):
and the one that when what out is the one that rules China
today. So, you know, again, like
inflation, very important to know.
That's one of the questions I always get about the book is
like, why does your book start? It's like the 19?
Well, actually it really starts in like all the way back in like
800 AD or like whatever. You know, why start it in 1949,

(42:26):
in like 1989? Like there's a whole chapter and
that actually used to be 3 chapters because that's like my,
my editor in his, in her, in hisinfinite wisdom was like, you
should probably cut this down. But that's kind of like one of
my bugaboos is kind of like the 1980s in China's fascinating
period. So I always encourage people to
read more about that. But there was a lot that
happened because of inflation. Yeah, absolutely.

(42:48):
And another perhaps controversial book, but
certainly on China by Henry Kissinger is really interesting
to also explore that role of politics and money and how China
reopened up through the Nixon administration, that whole era,
certainly before my time. But very fascinating take from I
guess the US side. I'm looking at Kissinger and
Nixon's opening up of China and what that meant for the world

(43:11):
after Taiwan, etcetera. But yeah, that's that's all very
interesting. So that brings us, I guess, to
where we are today. So again, we've got this
interesting relationship betweenBitcoin crypto, you know, quote
UN quote and the Chinese yuan and sort of this interplay where
it seems like sometimes it's OK sometimes, you know, in the West

(43:34):
we hear about bans, we hear about these kinds of secondhand
third hand stories of, of Bitcoin in China.
But how would you sort of broadly paint the picture today
for Bitcoin, how it's treated inChina?
And like how is that maybe changed over over recent years?
Yeah. I mean, today the status quo has
been set since pretty much 2021.It hasn't really changed since

(43:56):
then. And what the status quo is, is
technically there is a mining ban, if not de jure, then de
facto. I mean, basically most of the
provinces have things that make it really clear that they will
not openly endorse Bitcoin mining.
So there is still Bitcoin mininghappening in China.
I've had a few sources confirm with me about this, but it's not

(44:16):
in the open. We're not, not at least like
super in the open. You know, there is an exchanges
ban in China. So technically there is no
public yen to Bitcoin pairing. And there have been.
I, I, I go into this a little bit more.
I have this website calledchinabitcoinbook.com,

(44:38):
which is more like an appendix, the site to the book.
And I go into like people who have been arrested for trading
Bitcoin and Tether. And normally it's because
they're doing local bank transfer, so they're wiring
someone. I actually have an article
coming out describing how Chinese people are currently
buying Bitcoin right now despitethe bans.

(44:58):
But for the purposes of this, it's important to know that
exchanges are banned in China, at least in the mainland.
Now, of course, in Hong Kong it's slightly different.
There is a spot Bitcoin ETF, there is a futures Bitcoin ETF
and there are a lot of over the counter trading desk, which are
kind of like private areas whereyou can trade in Bitcoin and
they're quite cool. There's a mall actually in Hong

(45:20):
Kong where there's like a bunch of different merchants that will
accept lightning in order to give you Hong Kong dollars.
So there's there's some cool stuff, although that is being
squeezed by regulation as well. So that's kind of the current
state. I think since Trump has been
elected, honestly, there's not been much change in the terms of
substance, but there has seemed to be a little bit of a, it

(45:44):
seems to be less of a taboo subject to say that these bans
that we talked about are a mistake.
So recently, the last few years,there's been a couple of op eds
by professors, by former officials just basically saying
like, hey, maybe this cryptocurrency ban or the, the
mining ban, the way we implemented it was like a

(46:06):
mistake. Maybe the state should mine
Bitcoin. But that is kind of like the
current state of play. There's a really active Gray
market. And I will write more about it.
But just so people know there is, there does seem to be
increasing volume of demand for Bitcoin, but especially Tether
among Chinese people. It's just really hard to track

(46:28):
completely on a quantitative basis because, you know, it's
sort of a Gray zone. You you shouldn't really be
publicly declaring that you're trading yen for Bitcoin.
Yeah, I'm just, I'm quickly on the on the Bitcoin mining side.
So I, I was in Hong Kong last year and I was talking to a lot
of different kinds of people, I guess I could say.
And certainly I heard some stories about how that

(46:51):
eventuated and the sense that I don't know if I should say it
and then get you to confirm or not.
But basically, you know, it is a, it was maybe a regional
political issue that kind of wasa bit of an embarrassment and
that turned into a national kindof top down band.
But that was what I heard. I don't know if you have any
sort of thoughts because I don'tknow if it could really be said

(47:11):
that it's about the environment.Is there something else at play
about Bitcoin mining that we we don't?
Yeah, I mean, look, also like reading the tea leaves of
Chinese governance is like abovemy pay grade.
I mean, you know, if you really want to do that, got to read, I
don't know, Bill Bishop or someone or like something, if
you do read a Mandarin, someone else.
But so I've been, I've been, yeah, people have different.

(47:32):
It's all one big elephant and people are feeling different
parts of it. What I've so different elements
just to add to what you were talking about that you may or
may not be aware of. It's like one person I talked to
about this, Simon Lee actually on his podcast.
Simon used to be the the op-ed columnist at Apple Daily.

(47:53):
He was really fixated on the energy markets and like how
basically there was like electricity disequilibriums and
stuff like that because like miners were using so much
stranded energy that they were essentially subsidizing the rest
of the grid. And so that was something that
he fixated on. I've spent a lot of time
fixating on how like the local governments have like tax

(48:13):
revenue shortfalls. So it's in their incentives to
really sign off the book deals. And some of them have, but there
was that case of the one guy. I was just rereading this for
prep for this podcast again. But like every time I reread
these stories, I'm just like, wow, it's amazing.
Like the guy just basically likebuilt is his name.
I always forget his name. So, but he actually built like

(48:35):
basically a Bitcoin mining company on the side as like a
Chinese government provincial official.
So, you know, there's definitelystories like that.
So my, my sense is like, it was kind of like a, a cash grab from
what I've heard from some peoplewho are more in the know that I
am the two things like 1 is kindof like what we mentioned.

(48:58):
It's like after a brief moment of like, Hey, like, you know,
let's pass some new regulations laws.
There's like a phone hotline, like a, a bunch of minors left
there. Doesn't seem to have been like a
lot, a lot of action. Now, having said that, you know
mining conferences are no longerin mainland China, right?
I did get confirmation from a few people that in Shenzhen

(49:19):
there are people openly still selling ASIC miners.
And I did get confirmation that in Xinjiang there, it doesn't
seem like even though Xinjiang was pretty strict on the
regulations, doesn't seem like in practice some of the mining
facilities never shut down. That's what I heard, but I think
the reason I, I somewhat above my pay grade might just be like

(49:44):
the Chinese government controls bit main and controls everything
and controls Bitcoin and I don'tknow about it.
And then XI Jinping's about to flip the switch and buy Bitcoin.
I you know, I, you know, David Bailey is out there saying
versions of this, right? Like, so I, I don't know, but my
point of view is that the Chinese government doesn't
actually spend like a huge amount of time thinking about

(50:05):
Bitcoin. And this was kind of like more
of a, like it came up in a financial stability committee
meeting. And then Liu Hua, who at the
time, you know, was also like USChina trade advisor and all this
stuff, he was just like as part of the agenda.
He's just like, hey, this is nota good thing to, for us to have
around like Bitcoin mining. Like basically he was the first
person in the Politburo to express a view on Bitcoin

(50:26):
mining, positive or negative. And although the Chinese
government had made pretty clearthat they had, you know, plans
to impose a moratorium, I think like 18 months before and all
this other stuff, he was the first one that was really like,
hey, like this is like bad for the whole the Chinese society
and etcetera. He like really put his foot
down. But it and one of the sources

(50:47):
who talked to me, he was kind ofa little bit like that was a
little bit more of an afterthought.
You know, it wasn't, it wasn't like a, hey, let's put together
a meeting and like think about how to tackle Bitcoin.
It was more like, you know, likeRobert's Rules dictated that
Bitcoin showed up at this meeting and I have to address it
right now kind of a thing. Yeah.
So that was what I heard. But yeah, no matter how you

(51:08):
piece it together, it kind of like de facto they're still
mining in Bitcoin, but you can'treally do it openly.
Yeah, well, what strikes me? So as I said, I was at a Bitcoin
conference last year in Hong Kong and.
The Quite Asia strikes. Bitcoin Asia, yes.
And it struck me, I mean, it washad its own issues, which I
talked about in another episode,but it struck me as like the
miners who were there, you know,and I've worked with Chinese

(51:30):
vendors before and, you know, itseemed, I mean, firstly, they
didn't know anything. And secondly, you know, in terms
of staff and that, which is I guess to be expected, but it
struck me like there was no ideology there.
And, and maybe from their perspective, a cynical way of
looking at it would be like, whyare these these silly foreigners
trying to buy these pieces of hardware?
Like it's kind of like, what if they want it, We'll sell it to
them. But there was no sense from my

(51:52):
sort of engagement that they understood that this actually
represented a serious threat to the global world order and Fiat
money in general, You know, likethis stuff that we talk about as
Bitcoiners, right? Like I've, I've met one or two
Chinese friends who are, you know, they get it and, and they
understand. And I mean, you, you obviously
understand, but for me it was like that they're in it to make
a quick buck and there's these, these machines they can make and

(52:14):
they can sell it to people. And that was about it.
And I wonder, just drawing this back to the what we're talking
about before the optics and the TikTok and the YouTube, like, is
it a case that the Chinese government and the officials are
actually so they're kind of dog fooding their own ideology that
everything's just OK in the Middle Kingdom that they don't
maybe can't see that there is a disruptive technology potential

(52:37):
with Bitcoin or maybe they don'tfully appreciate what it means
potentially as an idea. I know that's just kind of my,
my, you know, sort of roughing on it.
But that was kind of what struckme is they don't actually sort
of understand what you and I understand, if that makes sense.
Yeah, this is this is my read inthe scenario.
And this is like just going to be super candid.
So if I catch, if I catch flak from whatever quadrant of of

(53:01):
yeah. So Chinese miners, actually,
honestly, a lot of miners are are more Fiat minded.
That's just like the reality. The reality is like they're
they're like they're in the Bitcoin industry, right.
If that makes sense. Like they're not bitcoiners
necessarily. Some of them have taken steps,
but I'll give you an example. Like there is one of the Chinese
miners, his name is Chandler Guo.

(53:23):
He like went on record and he was just like, hey, I think the
digital yen will win because China's powerful like he's not
like, you know, they're not. So the Chinese miners are even
more like money oriented, right?In my, I make a broad statement,
but like I, you know, like it's the ideology of it is less
impactful than like actually making money from it.

(53:44):
But having said that, you know, some of the people who have been
involved have had consequences be applied to them for making
money. This is like a very Chinese
phenomenon. And like, for example, the whole
like bit main and bit deer splitand everything like that.
You know, you do see kind of like those threads where the
politics do end up mattering. And then the other thing that's

(54:05):
like kind of hard even for someone like I, I sense from you
that you have like an appreciation for and, and trying
to connect with, you know, Chinese people and like trying
to get their thoughts. But like a lot of the Chinese
people are very close to the vest, even among, you know, like
diaspora and everything. Like they're just, I've seen
instances where people refuse totalk about certain topics, you

(54:29):
know, even though they're like thousands of miles away from
China. So I kind of like think that
some of that could be like a little misdirection.
But in general, what I found, OK, so here's like the really,
really blunt take on it. Chinese VCs and Bitcoin are
super based. Like I don't know what it is
like if they're choosing to invest in Bitcoin things

(54:51):
ironically, like I don't actually really think that's
like 100% the case in the West. Like some of the miners are
actually pretty cool. But in China, it seems like the
the people who are like VCs or investors are actually like
really into it. Then there's like cypherpunks in
China, but there's very, very few of them.
I think there's like maybe like there's one guy who went in a
Mandarin podcast, I think I saidin the book like he's like, I

(55:13):
think there's like five of us who think the way I think.
And then there's a whole bunch of like shit coinery, altcoins,
people who are like just sellingdevices for cash, like quick
cash grab, like high time preference.
And you would have seen a lot ofthat in Bitcoin Asia.
Much love to like, I know some of the people who are involved

(55:34):
in the organization of that. But you, it's like you would
have added like a front row seatat that.
Like everyone I've talked to about Bitcoin Asia has like been
exposed to that part, right? Where it's like the orinals are
everywhere. And then it's like there's like
a million layer twos and you're not really too sure what's going
on. And then there's like a bunch of
miners who are just like speaking in Mandarin and like

(55:55):
whatever. So, yeah, I mean, I kind of echo
some of what you're saying therefor sure.
There are some. But the one thing I will say is
there like some of the people who left China, I think not
necessarily have like an ideological basis, but are maybe
more ideologically driven and have seen some of those
consequences. Like, I mean, they're now

(56:16):
they're living in a different whole country in order to to do
what they're good at. So just something about.
Or not. I understand.
And again, I appreciate being candid about it because, I mean,
I, my position here in Asia as well is really interesting
because my general impression isthat the Japanese don't
understand it whatsoever either.And there's a few based
bitcoiners here and, and it's totally fine to talk about it

(56:38):
here as well. That's, that's the big
difference. But there's, I don't know if
it's Confucian or some sort of lineage of, of, of philosophy
and, and law. That means that it's hard to
really dispute the sovereignty of the state and its right to
print money. It's sort of like it's not a
concept that's ever come across people's minds before.
Whereas maybe in the Western liberal tradition where we kind

(56:59):
of have critique of the state and economics, you know, in a
long history of that, That's whyit's quite a generalization.
But so that that's interesting to me.
But then, yeah, when it comes toI, I guess, yeah, the, the, the
Web 3 crypto stuff, we talked about this earlier that, that
this is one of the, the OK things in China right now.

(57:20):
And it's kind of seen as a really valuable thing to be
putting money and time into. But as you and I know, this
doesn't contribute anything to the actual bigger ideas of
Bitcoin and privacy and freedom and all of that stuff.
So maybe talking a little bit about that, what's the situation
at the moment? Is there like VC funding for all
of the stuff? Is it like super popular?
Like how does that all work? Yeah, I mean, the Web 3 stuff is

(57:43):
mostly the mainland. They try to keep the mainland
separated from Hong Kong, at least on this front.
And then Hong Kong has a lot of like, they want to be like a Web
3 hub, right, Or whatever The Hong Kong government has put
itself in its mind that that's the way to like drive more
capital back. And so there's, I don't know

(58:03):
that there's like a official government support, but it seems
like the Hong Kong government has, you know, that it's done a
few things. It's like made got out of its
way to host events in Hong Kong with the support of the
government, including Bitcoin Asia, which had a legislative
member, Johnny Ng, I believe. Let's go speak.
And so, you know, there, there is kind of like that government

(58:25):
driven motion. I, I think in China, this is
like my least favorite part to talk about, but also it's like
really funny. It's just like there's been so
much like even the so, so the mainland, what they fear I think
is like they have a really big fear of the retail investing
class in China because in the past, so in the states, you

(58:48):
know, the retail investors not really that powerful because
like most trading happens with institutions in China, like the
domestic shares are driven by a lot of retail investment
interest. And so that's led to some
crashes in the past, including 2016 in the economy.
So you have instances where likeinvestors don't know what
they're doing, quote UN quote, and then they panic and they.
Yeah. So China's also been through all

(59:10):
the phases of altcoin scams, probably even more than the
quote UN quote WI guess. So yeah, like there's been like
these big scams, like there's been the big one was what's his
name? Multi Coin?
I think it's called multi coin. But there, you know, there's
been like a few, there's there was a there was NEO, which was
kind of like the Chinese Ethereum.

(59:32):
And then there's been all these sometimes I go to the Twitter
and X spaces and I'm just like listening to all these like
Mandarin D Jens talk to one another and just like what
tokens they're trading and stufflike that.
And it's yeah. Anyways, it's like a whole
different universe in, in in China, there's this term called
Jotei, just like chives. I guess that's like in the

(59:54):
English term, it's like retail. And yeah, I just think like
there's a lot of naivete about that and there's government
support for it in Hong Kong, butI think the government's a
little bit like confused and concerned about what's happening
in the mainland. And those are two separate
things. Also, we can talk, this is a
much larger topic, but the Hong Kong and mainland split is I

(01:00:18):
think more due to the mainland government like not caring as
opposed to like it actively caring, if that makes sense.
I can elaborate on that if you want, but that is.
In itself, like maybe a 10 minute conversation, but but
that's, that's kind of like my read on the the investment kind
of like appetite and kind of like what's been happening with

(01:00:38):
like the Web 3 crypto stuff. A lot of trade.
Again, like what I mentioned to you, there's not a lot of
Bitcoin Maxis and what you're saying about Japan, it's kind of
interesting. I do think that in the 1st
generation of the Bitcoin Ogs, there were more people who
talked about like stateless money being really cool.
And there are some cypherpunks in the, in the Chinese
tradition. And I think some of that, it's

(01:00:59):
like, it's always really cool tosee.
It's not like a ton, but there's, there's some that do
see it. Yeah, I've talked to a few and
sometimes, you know, it makes methink that when it's so in front
of your face, like you can't help but avoid getting out from
it. So I've heard people who are
like, yeah, not only am I super into Bitcoin, yeah, I totally

(01:01:20):
cancelled WeChat Pay. I'm off WeChat, like I'm off
Alipay, I'm off all these solutions.
That's actually a harder conversation to have with
Bitcoiners outside of China. Like, for example, you have a
lot of people, no judgement, butlike a lot of people who are
like using Bitcoin, but by usingBitcoin, they're really buying
the Bitcoin ETF and they use credit cards for their
day-to-day, right? So what I found is that there's

(01:01:41):
fewer cypherpunks in China, but once they get to that stage,
they really get it because the consequences are quite stark.
Like, for example, like in orderto get across the Great Firewall
and to access content, it's not like the difference between some
accounts being taken down or not, it's the difference between
whether or not you have access to a certain part of the
Internet or not. That's like a constraint that

(01:02:02):
most people aren't used to. Yeah, at least in the side, it's
interesting. I mean, I reflect on the, the
one or two individuals that I know who are hardcore cypher
punk, Chinese bitcoiners and the, the stakes are much higher,
as you say. And I have a huge amount of
respect for them because they, they sort of embody this.
I mean, they're very much intellectuals, but they're also

(01:02:22):
pragmatic. And so they're very versed in
the history of dissident thought.
They, they understand the, the lenses and the optics and the
various gymnastics you need to do to be able to actually even
see and understand what China has done and what the CCP has
done. It's like, it's actually quite a
mammoth undertaking. And you can say, you know, I,
you know, I live in New Zealand,for example, and I'm, I'm

(01:02:46):
totally, you know, based. But actually when push comes to
shove, and we only have to look at COVID, you know, how many
people bent, bent the knee in, in, in many Western countries
and, and, and did all that stuff.
So it's kind of like, yeah, there's, there's sort of truth
to, to all of it and maybe fiction to it to it as well.
But I wanted to just come back to what you said though about
the the DGN retail class in China, because you write a

(01:03:09):
little bit about housing and, and, and, and many people might
not realise it's just how much housing plays into Chinese
investment and kind of savings mentality.
And that, you know, billion people, billion plus people
Yoloing into housing. The DD, you know, drivers
starting to talk about the next hot stock.
You know, that actually does represent a huge risk to the

(01:03:30):
Chinese Communist Party. And so maybe we can elaborate
just on sort of housing and then, yeah, So what it means to
have this, you know, dynamic degenerate class that can
actually collapse the economy ifthey go in the wrong place, you
know? Yeah.
Well, so housing's really interesting because I think like
housing culturally speaking. So Chinese people are not very

(01:03:52):
equities focused. I think in the West there's a
lot more focus in the equities market.
In China, the equities market ismore underdeveloped and if
there's crashes there, it has less consequences because less
of the mom and pop retail class are exposed to it.
But what does have a lot of consequences is housing.
And specifically a lot of Chinese people use housing as a
store value. This isn't anything new, but

(01:04:14):
what I think, and again, I know we're trying to be nuanced in
terms of like this is a podcast.If I, if I spent like 50 minutes
detailing to you every nuance ofthe Chinese, you know, housing
class. So again, bear with me in the
generalities, but what I've observed is in general, Chinese
people use housing as their default store value and this has

(01:04:36):
implications for the most Chinese adjacent countries.
And so you mentioned, you know, being from New Zealand and
Australia and Canada all have local real estate issues that
kind of like have come up because of this and certain
parts of the United States as well.
So it has global financial implications as well as economic

(01:04:56):
implications. I think on the housing front,
it's doing two things. One is that it's exporting the
Chinese investor class abroad ina way that does have political
consequences. And I think that you're starting
to see that, you know, for example, in the Commonwealth
countries that we're talking about where there's like very

(01:05:16):
inflated real estate markets, you know, they're starting to be
this idea of like, OK, well, howdo you rein that in or like it's
all for money or like things like that, right.
And it also creates a situation for political instability
because a lot of the economic slowdown that's happening now in

(01:05:36):
China, and by the way, we didn'teven cover this, but there is an
economic slowdown that's happening in China right now.
It's not quite inflationary. So this is where it gets
confusing when I explain it's like at least Bitcoiners, but
there's basically like quote deflation.
I mean, it's Chinese government stats are kind of all over the
place. But from what we can think, see,
like producer prices seem to be going down.

(01:05:59):
Sometimes it's because of, like we mentioned earlier, like real
innovation in the sense of like electric cars, like, that seems
to be like, the costs are going down because they're getting
better at manufacturing them. It's like a more simple,
straightforward story. But, you know, in other sectors,
it seems to be because the economy is just doing really
badly. People are getting laid off.
And, you know, things are not going very well.

(01:06:20):
And housing especially is takinga tumble.
It started, I think, because theChinese government was trying to
enforce a line that housing is for living and not speculation.
But as the Chinese government soon learned, a lot of Chinese
people have been using the housing market for you wouldn't
even say speculation, I would say investment.

(01:06:41):
And so there were a lot of firstproperty, second properties.
And what's very unique to China is that the the favorite model
is to put down a deposit for a pre start.
So you like kind of trust the developer, like build the house
and then your deposit is kind oflike a discounted version.
So that way you can start payingmortgage on it only when the
housing unit is completed. This has led to a really

(01:07:04):
interesting thing where a lot ofdevelopers because of
restrictions being placed on thefinancing, Of course, people
have heard about Evergrande, kind of like the structure
bankruptcy there. Those housing units are no
longer being like finished or constructed.
And even if they are being finished or constructed, the
value of those in terms of it being priced in any denomination

(01:07:24):
has decreased. I've heard stats of like, you
know, sometimes I ask people, I'm like, how's your housing
doing? Or how's your, you know, how
your domestic shares doing? And people have said stuff like,
you know, my housing is down like 50 or 60% over the last 10
years. And I'm like, seems kind of like
a Great Depression level answer,but you know, like that that has

(01:07:47):
consequences, not just, you know, like economic
consequences, but also like, I think kinetic consequences
because there have been protestsat these sites because people
kind of gathered together and they asked the developers like,
well, you promised me you have my deposit, so you need to give
either give me back the deposit or give me back a unit.
So this has the potential to create much more explosive
political circumstances. And when we talk about the D

(01:08:09):
Gen. retail class, so it the 2016 there was like a slow down
in the real Chinese in the quoteUN quote, real Chinese economy
because so I graduated in economics.
So I'm just throwing an economicchart in back and forth here.
But yeah, the the real Chinese economy, meaning like, you know,

(01:08:29):
the manufacturing capability andeverything like that, was
affected by the fact that peoplelost a lot of money in the stock
market because the retail investing class got in.
And so the Chinese government, Ithink, learned from that and is
trying to build their version oflike, more sophisticated
protections more for themselves than they are for the retail
class, if that makes sense. Because to your second part of

(01:08:53):
your question, all of this really high youth unemployment,
you know, slowing economy pricesseem to be decreasing, but not
because it's driven by like techand innovation.
It's driven by the fact that people are getting laid off on
mass, right? So all of this is a pretty
combustible formula. I'm again above my pay grade.

(01:09:15):
I don't know if it will blow up or not blow up or whatever will
happen. But all I'm going to say is
like, that exists, like that is there.
And you know, part of the book that you quoted, you know, the
the whole like socialist promiseabout that's the one thing I
think doesn't come across off across and I try to communicate
this. It's like China changed it.

(01:09:36):
It's almost like it's entire spiritual, religious belief, you
know, and there's a lot of Kissinger writes about it and
other people write about it, like is it Neo Confucianism?
Is it like, you know this or is it this strand or is it
legalism? And I try to just tell people
it's money like that is money asthen you got the the thing with

(01:09:58):
money being a new God, though, is it's here and now and it's
something you can feel, it's something you can touch.
And so one of my favorite books about the Soviet Union was The
God that Failed, which is, you know, written by a few, you
know, disillusioned communist, but that was very abstract.
And so it took a long time for the Soviet system to fall apart

(01:10:18):
because of its inherent contradictions.
But with the Chinese system, I think the unit of measure is now
so much more readily apparent and obvious.
Like did you lose 50% in your housing prices in the last like
few years? So I think that's gonna have
dramatic consequences in how China's competing in the same

(01:10:39):
arena. So that's also one part.
That's something that's different from the United
States. But conversely, it's a double
edged sword because that arena is something that the Chinese
Communist Party always has to continually uplift for it's own
people. It is probably more scared of
its people by far than like somekind of external threat coming

(01:10:59):
in and riling it up for now. Yeah, no, absolutely.
And you mentioned you touched ona few things there.
Certainly again with my engagement with Chinese people,
they are hyper capitalists. I mean, some of my business
partners are Chinese and they'rereally incredible people to work
with. They get stuff done.
They don't fuck around. There's sort of this cutthroat

(01:11:19):
Ness to it, which from a New Zealand perspective, which is
pretty laid back country, it's kind of like, wow, these are my
people are getting stuff done. And so that's one point.
And then also this cultural moment with a lot of young
people right now. There's the whole tongue ping
kind of lying flat. Yeah, movement where you got
kids who are just disillusioned with the university system, the

(01:11:40):
career track and they're just kind of doing part time jobs.
They're not really working too hard.
You know, there's kind of Gen. Z equivalent, but maybe a little
bit nihilistic, a little bit more nihilistic.
And then you mentioned the combustibility of it, which I
guess there's the saying, I think I don't know where it
comes from, but it's like the well, yeah, actually I weren't

(01:12:00):
quite that particular one. But there is this idea that
Chinese people, they do get verystrung out about ideas.
And so you know what it took forthe COVID protests in saying New
Zealand, you know, that was likeactually took quite a lot for us
to get there. But as soon as there's any sense
of unfairness, I would say in the Chinese context, I don't
know if you, you know what I mean, But like if someone feels
like they've been done by in an unfair way and there's not a win

(01:12:23):
situation, instantly Chinese people will stand up and, and
fight back against that. They're like.
They're very, they're very rowdyin a way that people the, the,
the in a way that people don't. Yeah, I think that's like 1
misconception that people have. I think about Chinese people,
right? Like there's this perception of
like, oh, everyone's such a goodcitizen and they're all very
like Placid and like whatever. But then you got to just watch

(01:12:45):
one video of like some shop owner like yelling at the local
police being like, get on shop. Like this is, you know, like.
Yeah, yeah, there's this sort ofagain.
So I'm trying not to paint too much sort of broad picture here,
but like I certainly even in personal engagements, it's like,
yeah, people will get rowdy about things.
And when all of that faith is inthis kind of state based or

(01:13:06):
state driven kind of economic growth and this kind of promise,
and when that starts to falter, I think that can be a very
combustible way. And in a way that I would sort
of contrast that, say, with Japan, where, you know, Japan's
been in an economic decline since like before I was born.
You know, like, it's not that it's not that great here in the
sense that it wasn't like the 1970s where things were on the

(01:13:27):
up and up. But there's this kind of
graceful decline. And someone has called it the
aesthetics of poverty. You know, Japan just sort of
goes on, you know, Gumbu, you know, it sort of just keeps
going, right? And and that's sort of maybe in
contrast to the Chinese way where it's sort of like, well,
as soon as things maybe start looking in the short term like
they're going down, it could be quite a flammable situation.

(01:13:47):
And that's why you have more money spent.
I don't know if this is true. Maybe you can confirm there's
more money spent on the public security euro within China then
on the actual Chinese military. I don't.
Is that still true, you know, or?
I don't know, this is like really hard because The thing is
with the Chinese military is I think they underreport their
figures so that. Well, anyway, it's, it's on part
so it'd be like, you know, the police of say, the US spending

(01:14:08):
as much as the entire U.S. military for, you know, for
comparison, or at least in the same order of magnitude, which
is ridiculous to think about, right?
But the, the, the risk of internal turmoil and regional
turmoil is very maybe a major threat, major concern.
And, and how this relates to Bitcoin, I mean as a, as capital
controls or, or other restrictions maybe come into

(01:14:28):
place or, or in many cases are already in place, the ability to
get out of that system through something like Bitcoin could
present itself as a danger to the Chinese Communist Party
potentially. Yeah, I mean that, yeah, I
write, I write about that a little bit.
I mean, to me, what I've always told people is like some people
and I used to kind of have this,you know, belief of like you

(01:14:50):
would think that it it would literally be like this way to
the revolution, right? You know, but that's just like
not how the world works and not the way I think anymore anyways.
Anyways. But the, the truth is that like
Chinese people will choose to adopt Tether and Bitcoin and
defy the Chinese government, butit's not gonna be because like
99% of them are like the Chinesegovernment's wrong.

(01:15:12):
And I'm just gonna do what pisses off the Chinese
government. They're, they're literally just
gonna do it because they just, why are you restricting me from
like using my own money, right? So that's kind of like, yeah, to
that earlier point of the doubleedged sword, like now that money
is the new religion, like any restriction that's being placed
in your money, especially now that things are not so hot
domestically. So China used to get away with

(01:15:33):
it because the trade off was like kind of favorable, like
you, you had to keep your money in the country, but that was
pretty much OK because most people were actually trying to
get their money into China 'cause that was when China was
growing at like really fast clips, right?
So it was just like easier to make money or whatever.
But now that China's struggling,all your options, any investment

(01:15:55):
option, I've seen that mainland Chinese people have had access
to like that stuff has like surged.
Like there's a gold ETF. They went and like tried like
Chinese people went and like bought it.
So it got like suspended or something.
Like during that whole period, because there's so much demand
for it, you know, Chinese peopleplugged into Chinese government
bonds, right? Because they were just like, so

(01:16:16):
there was like nothing that was like actually positive yield.
And so, yeah, maybe Japan is a good comparison.
I think the Japanese model, thiscould be a whole separate
conversation, but I actually didstudy the Japanese economy as
part of my, like, undergrad. So that's been a fascinating way
of slowly stealing from people through degrowth, through
degrowth, and which has been a really interesting model.

(01:16:40):
Yeah. What what strikes me, I mean,
just because even I think on theweekend or a couple, couple of
days ago, there was a slight decrease in the gold price and,
and Chinese investors like or just like retailers like yoloing
into the markets to buy like bullion basically after a like
2% drop. And like for me, I don't ever
see that level of frenzy in Japan.
It's always a much more considered slow moving beast.

(01:17:02):
And you see every now and then maybe like an ad for gold or
something, but there's just the sense.
So I think it's a much slower, Ithink because I've been in this
place for 35 years, right? Like it's, you know, the economy
is it's never going to go back to the way it was in the hey,
say boom years. And so people are just kind of
slowly trotting through. But there's something about the
social contract though that I think is also an interesting

(01:17:24):
comparison because, you know, Japan is actually a safe place,
you know, on the street. And I think though China is safe
as well. Like you do get these flare ups
and these like movements happen that can be incredibly violent
in a way that Japan, Japan hasn't seen since before World
War 2 because it did have it at one point in time.
So I mean, maybe that there's enough there for another episode

(01:17:45):
one day, Roger. But certainly I think as kind of
a former, you know, regional power within Japan and now a
current regional power with China, certainly some kind of
imperial consideration, some economic considerations that are
very interesting to study. Yeah, I mean, the comparison
between the two is, is, is interesting for sure.
I think, yeah, I don't know. I don't know.
Yeah, I think, I don't know if Chinese people like the the

(01:18:10):
violence and the episodes of it.Yeah, it's different.
I'll also demo the, the last thing I'll point out of that
point is demographically they'reat very different places.
Japan is older. China is actually going through
a really critical period to add to the combustion point
potential combustibility. You know, those 30 million spare

(01:18:30):
men are coming to roost, right? Because of the one child rule.
There's like a huge gender imbalance.
And so that that actually is I think a huge internal issue.
And a lot of those, I think men are not getting jobs now as a as
a result of the, the high youth unemployment and everything like
that. So there, there are going to be
some like, you know, maybe we live in interesting times.

(01:18:51):
I guess there are going to be some interesting times.
Yeah, absolutely. And look, in terms of closing
remarks, Roger, you've shared some really interesting stuff
today, but what's next for you? I understand you've got another
book in the pipeline. Yeah, yeah, I mean this, yeah, I
mean, this is kind of well, so first I, I basically spent no
time talking about my book, so I'll just.

(01:19:12):
OK, put that up there. This is my book if you want to
find it. Would Mal hold Bitcoin?
But not that I spent no time. I spent no time shilling the
book. Sorry, that was.
So good. But the new book, the idea is to
actually get slightly outside ofthe context.
So I I spent a lot of time on the China and the Bitcoin front.

(01:19:36):
I do find it a really interesting topic and I may
revisit it again sometime in thefuture.
But it's not like there's been radical changes.
And I think as you'll probably observe, and this is kind of
like a hidden trend about China that I hope more people are
aware of, it's like people doingjournalism in China.
I used to have access to like Hong Kong and places like that.

(01:19:57):
And now these days I'm like, it has to be a judgement call
whether or not I go or not, right?
And I think that's true of, like, pretty much anyone who's
written anything that is slightly critical or, you know,
like, paints China in a different light than the
authorities want. Yeah.
Like, Cody, for example, You, you, you might also have to make
that same judgement call. But what that creates is

(01:20:18):
unfortunately like, you know, like there's just going to be
less material because the peoplewho are going to fill the void
are kind of the people we were talking about earlier, the
Chinese tourism board who are going to be invited officially.
But having said that, my next project directly, I I'm calling
it right now the free future. How not to, how not to let AI

(01:20:38):
take take over or whatever, Likehow, how not to be replaced by
AI and to own the future. Then the idea is like it's more
of a, so when I originally wrotethe book on Bitcoin on what my
whole Bitcoin, some small part of me was thinking about how
this could orange pill Chinese people, but the path was very

(01:20:59):
complex and I did have a like itis translated Mandarin now.
So at least it's still conceivably possible it could
happen. And I've had some Chinese
cypherpunks I've had conversations with because of
the book. So that's been real cool and all
that, but it ended up being muchmore abstract than I think, you
know, like if more of a philosophy book than a like

(01:21:21):
practical, like here's how to like get Bitcoin if you're in
China kind of thing. I think my next one, it was kind
of more direct. I really wanted to give and not
just people in China, like people around the world, like a
reason to really think about like freedom tech, right?
Like why should we embrace privacy?

(01:21:41):
Why is it important to have something like Bitcoin, among
other things? And I just observed that people
seem to be really freaking out. I actually worked for a company
a ways back that did education in the space.
And yeah, people are just very freaked out about the idea of AI
taking their jobs, their brains and everything like that.
So I figured I would write to like, you know, learn about

(01:22:04):
that, see what's true, what's false of all that, and then
hopefully come up with some prescriptions or, you know, just
helpful tips to help people understand the need to embrace
the kind of technologies that we're talking about here.
Cool, that's awesome man. I look forward to seeing, I've
seen that come out and if peoplewant to follow your working,

(01:22:26):
your writing, where, where can they go?
Yeah, probably the most cursed is my like ex my Twitter Roger H
1991. But if you have to then you can.
I'm actually more active on Nostr but it's harder for people
to find me apparently. I'll just say my Nipo 5, which
is low key like the Norse trickster God at

(01:22:48):
nostr-verify.com. So people generally can't find
me. So I would just say like look up
my name on Noster and maybe you'll get lucky.
Yeah, those are probably the twoplaces I'm like most active.
The book is available on Amazon and Bitcoin Magazine store.
And I also have the website chinabitcoinbook.com which has a

(01:23:09):
little bit more material, like some of the stuff we didn't
really get into like Hong Kong and Bitcoin.
I kind of have like these like big 5000 word write ups if
anybody's really interested in going through the whole Shimuda.
My thoughts. Yeah, cool.
All right. Thank you very much, Roger.
All right. Cheers.
Thanks Cody for having me on. Thank you for listening.
I am Cody Allingham and that wasthe transformation of value.

(01:23:33):
If you would like to support this show, please consider
making a donation either throughmy website or by directly
tipping to the show's Bitcoin wallet.
Or just pass this episode on to a friend who you think may enjoy
it. And you can always e-mail me at
hello at the transformationofvalue com.

All Episodes

Episode Transcript

Popular Podcasts

24/7 News: The Latest

Stuff You Should Know

Crime Junkie

.css-15opob5{left:0;position:absolute;top:0.8rem;} All Episodes

.css-14f5ked{margin:0;word-break:break-word;display:-webkit-box;-webkit-box-orient:vertical;box-orient:vertical;-webkit-line-clamp:2;overflow:hidden;}Would Mao Hold Bitcoin? Understanding Money & Freedom in China With Roger Huang

Episode Transcript

Popular Podcasts

.css-r6mb8g{margin:0;word-break:break-word;display:-webkit-box;-webkit-box-orient:vertical;box-orient:vertical;-webkit-line-clamp:1;overflow:hidden;}24/7 News: The Latest

Stuff You Should Know

Crime Junkie

All Episodes

Would Mao Hold Bitcoin? Understanding Money & Freedom in China With Roger Huang

24/7 News: The Latest