Bitcoin vs Blockchain with Patrick Lowry | Bitcoin Infinity Show #153 - The Bitcoin Infinity Show

Episode Transcript
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(00:00):
If you are the U.S.

(00:01):
government,
you don't go after tether
and try to arrest the team
behind tether
and put them behind bars
for what you alleged money
laundering
or anything like that.
You think the
I love them for doing more
for the benefit of the U.S.
dollar
than the government
has for the last 100 years?
Here's where I like tether
is because you meet people
from Colombia,

(00:21):
meet people from Venezuela,
you meet people from Africa.
They don't
necessarily need Bitcoin.
They're not there necessarily
to generate wealth.
They just want something
more stable
than their own currency.
And the US dollar represents
that very well for them.
99% of the big companies
in Bitcoin colluded
to increase the block size.
And it was never
about the blocksize.

(00:42):
It was all about control.
If they had succeeded,
that would have meant that
they were in control
of the development
of the protocol.
But they weren't
because the users were.
Patrick.
Welcome to the
Bitcoin Infinity Show.
Nice to have you here.
I thank you so much
for having me here today.
It's a pleasure to meet.

(01:02):
Yes.
Since this is the first time
we're having you on,
why don't you give,
our listeners
a tldr on who you are
and what you do
and how you found Bitcoin
and all of that? Good stuff.
Oh, I could talk
about that forever.
But just a quick tldr
about who I am and what I do.
So my name is Patrick Lowrey.
I'm the CEO of Samara

(01:22):
Asset Group.
Samara Asset Group
is a publicly traded
holding company
based out of Malta, albeit
publicly listed in Germany.
Our primary focus is on
deploying our balance
sheet into funds.
We basically have,
over 20 funds
that we are participants
in as, limited partners.
And we leverage Bitcoin

(01:43):
as our primary Treasury
reserve asset.
So any assets
that we don't currently
have deployed
to the funds in our platform
is actively
managed in Bitcoin.
Oh, that's
that's a mouthful.
So it is
I could keep going
if you'd like me to.
Yeah.
Please do
please expand a bit on that
and how did this come to be?

(02:04):
Like what?
Where did it start from?
And like what?
What's the
what's the trajectory here?
What is the future
you envision?
Yeah, sure.
So, Samarra massacre
was actually founded,
back in January of 2018,
by German entrepreneur
Christian Ingabire
and Mike Novogratz of Galaxy.
I don't think
I need to explain

(02:24):
to anybody who that is.
Basically, the idea was back
at that time
to create a merchant bank
for all things
crypto in Europe.
And you might remember back
then, Malta
was really pushing this
blockchain island stuff.
They really wanted to have,
this new regulatory framework
to welcome the exchanges,
welcome token issuers, etc.,

(02:45):
which actually for a while
was going reasonably
well for the island.
They ended up having
a whole bunch
of the exchanges
like Binance and OKEx
come over
and it started
to push
a little bit of adoption
until basically
the ECB looked at them
and said, well,
the fuck you are right.
You're you're clearly not,
adhering to European

(03:06):
banking laws
by allowing
what you want to have happen,
happen in Malta.
So unfortunately,
they weren't really ever able
to get Cryptology Asset
Group to be the merchant bank
that they were intending
during that period of time.
But cryptology did invest
in a handful of companies
in the bitcoin
and the crypto space that
did phenomenally well.

(03:26):
One of which was
actually the company
I was CEO of
at the time, Deutsche,
a digital assets,
used to be called iconic.
I'm just an expert
when it comes to rebranding,
I suppose.
But iconic was one
of the very
first issuers of Etps
backed
and traded
by Bitcoin
and other crypto
assets in Europe.
We started that back in 2020
or so after many years

(03:46):
of work.
Other companies
that cryptology had invested
in included,
Block.one,
who I probably don't have
to necessarily
introduce to everybody.
They were
the issuers
of the EOS Bitcoin.
And they went on to
have a large Bitcoin
balance sheet,
which being a shareholder
of block one,
we absolutely loved
because that gave us
indirect exposure
to Bitcoin from day one.

(04:09):
We were also invested
in Northern data,
which is a publicly listed
European miner of Bitcoin.
They're one of the largest
in Europe.
And over the last few years
they've been focusing on
HPC and AI.
So we're actually
pretty excited about
how that investment went.
But in 2021,
when I initially stepped in
to some of our asset group
and took over as CEO,

(04:29):
I looked at
or I had a conversation
with our shareholders
and said, look,
we can continue
to use our balance sheet
to invest in early stage
crypto companies as,
cryptology had been doing
at that point in time.
Or I think
it would be much wiser
for us
to use our balance sheet.
And instead of investing
500 K or small checks here

(04:49):
and there into new projects
or into new companies
in the crypto space, rather,
I felt it would be
a better strategy
for us to deploy
to asset managers themselves
to actually deploy to funds.
That way,
we wouldn't
have to build out
an army of analysts
and significantly increase
the amount of people
that we're working at Samora
and therefore our overhead.
But rather

(05:10):
we could leverage
the network,
leverage the infrastructure
and leverage
the due diligence
that all of the managers
that we would be
deploying to,
and our shareholders
would therefore
be able
to participate indirectly,
of course,
in the performance
of the managers
that we would deploy
our balance sheet to.
So since then,
we built up that position

(05:30):
of over 21 limited
partnership stakes and funds.
But in parallel,
because I am,
at the end of the day,
a Bitcoin or myself,
we do use Bitcoin
as our primary treasury
reserve asset.
And at this moment in time,
I think we're sitting on
something like 540 Bitcoin.
This recording's
in early February.
And that is,
largely from liquidations

(05:51):
of assets
that we've had
on our balance sheet prior,
as well
as at the end of
last year, 2024.
We became,
at least to my knowledge,
the first issuer
of a bond in Europe
from a publicly
traded company,
that was backed
and collateralized
by Bitcoin.
We raised €21 million
in that bonds.
Or what I like to say
is roughly
$21 million,

(06:12):
for obvious
marketing reasons.
We were pretty excited with,
our successful placement
there.
Okay, so so I'm going to have
to, to,
unwrap this a bit
and ask about the,
the ethics
of the whole thing.
So like,
what is your like
how has your position
on bitcoins
changed over the years

(06:33):
and what is your position now
and what did it
start out like like so yeah.
So from my perspective
I first
I mean,
I remember
the very first time
I heard of Bitcoin,
I was working back at
PwC, PricewaterhouseCoopers.
This was maybe 2011, 2012,
something along those lines.
And I had a friend

(06:53):
that worked
in the tech department
at TWC,
and he basically said,
like, look, I mean,
so I was actually on
top of the world
at that moment
because I had gotten
what I thought was
a great Christmas bonus.
I got a whole $500
Christmas bonus.
Check from PwC.
And I was a young kid, too
stupid to know any better,
so I thought I was on
top of the world.

(07:13):
Anyways, my friend
in the tech department
said, hey, you know what?
Take that $500, put it on
this thing called Bitcoin.
Thank me later.
So I did,
I took the $500 on bitcoin.
And when,
you know, at about 2
or 3 months later,
that $500
was magically worth
about $100.
So I yelled at my friend
and said, this Bitcoin
thing is
the stupidest thing on earth.
I can't believe

(07:33):
I put money on it
and that was it.
Now fast forward,
a couple of years.
I get to 2015, 2016,
and I
had left the United States
and was living in Germany
at the time.
I had just completed
my MBA
here, and I actually started
working for the Deutsche,
a business venture
capital team.
Deutsche, a buzz
of being the operator
of the Frankfurt stock

(07:54):
market, the largest stock
market in Europe.
Now,
we had five main
areas of focus
that we were going
to be investing,
and one of which
was blockchain and DLT.
So mind you, this is 2015
and we're looking
at the Ethereum
ICO going, Holy shit,
these ICOs are going
to completely destroy

(08:15):
how capital formation works.
And I actually do still
at my core
believe not
necessarily in ICOs
or certainly not ICOs,
the way
that they ended up going,
because frankly,
they all just
ended up becoming
by and large scams.
But I fell in love
with the concept
of tokenization.
And I would say that
that is where
even though
I held Bitcoin before,

(08:35):
the idea that all assets
would inevitably be tokenized
and secured on a blockchain,
that was so self-evident
to me,
that's where my foray
into crypto started.
So I believe that all debts,
all equities,
all parcels of land,
bars of gold, etc.
would be tokenized
and traded on a blockchain.

(08:56):
So that is where
I really started
to get into crypto.
I founded my company iconic.
We began actually
has an investor in ICOs,
and I would be
more than happy
to tell you about that
because I think
we were actually doing it
the right way before.
Well,
we ended up
going down the ETP route,
but I mean,
I still hold to my core
that all assets inevitably
will be tokenized.

(09:18):
And with the
advent of Bitcoin
layer tos for me, I'm
really excited to see
what will happen
when all global assets around
the world will be traded on
and secured by Bitcoin.
All right.
This is this is the fun part.
But because this is where
we get into a hard disagree
because I don't believe
in tokenization at all.

(09:39):
And the reason I don't is
that I don't believe
in blockchain
technology at all.
Because I believe
that the blockchain is a,
or as I prefer to call it,
the time
chain is a byproduct
of the Bitcoin technology,
which is more, of course,
which is more of
a social agreement
than an actual technology.
So in my mind, it's

(10:01):
a it's a, an agreement
on a fixed set of rules.
And the reason that we agree
on this specific set of rules
is because the rules are more
that they're set up
in such a way
that they're more expensive
to try to break
than to just follow.
And there is no such thing
exists in the crypto sphere
or in the token sphere,

(10:22):
because in the token sphere,
it is
cheaper for an attacker
to try to attack
the system than
it's.
Or it's
at least it's not necessarily
more expensive,
which it is in Bitcoin
because in Bitcoin
the users are
actually in charge.
And my conviction
came from the outcome
of the box size wars,

(10:42):
which was like, holy,
holy shit moment.
Because like 99%
of the big companies
in Bitcoin
colluded
to increase the block size.
And it was never
about the blocksize.
It was all about control,
where if they had succeeded,
that would have meant
that they were in control
of the development
of the protocol.
But they weren't

(11:02):
because the users were.
So they had to abide to
whatever market, the market,
whatever signal
the market sent to them.
And this market was clear,
we don't want this.
We are going to abandon ship.
If you do this,
and we're going to continue
on our own chain.
So they all had to bow down
to the node runners
and the users of the network,
which means this is
exactly where Ethereum fucked

(11:23):
up, right?
I mean, whoa, whoa,
the trade. All right.
Yes, but but
this is where I differ
because I don't think
it was a fuck up.
I think it was a
deliberate scam.
It had a 70%, 100% mine.
And I believe that
the founders
were they were
they knew about this
all along,
that if you look at Ethereum,
it's like a long,

(11:43):
slow rug pull
where they had
to change the narrative
over and over
and over again
over the years.
Like, first
it was like a world computer
and there was ultrasound
money
and all sorts of bullshit.
And it was like a little
for the internet,
I think, where
they were trying
to pitch at one point,
the bitcoins,
the gold, Ethereum's
the oil for the internet.
Yeah, yeah.
And the
Litecoin was the silver
and blah, blah, blah,

(12:04):
all of this. Exactly.
And it's all bullshit. And,
so if you look at
Ethereum
denominated in Bitcoin,
which is the way, by the way,
the only correct way
of denominated anything,
if you're going to
if you're going to have
a measurement
of how your investment
actually performed,
then you can see that,

(12:24):
Ethereum was about twice
as valuable
back in 2017
than in the second bubble
in 2002 and 21.
And now it's just a disaster.
Right.
And and I believe that the
at the core of this
very fundamental problem
is that
the only thing,
quote unquote, digital asset
is, is a, a number

(12:46):
on the internet.
That byte,
for some odd reason,
cannot be copied.
And any copy of that,
any attempt to copy that,
what I prefer
to call a discovery
rather than an invention
just because it's so unique.
Any attempt
to copy that phenomenon is,

(13:06):
inherently doomed to fail.
Or if it succeeds, it it
it would wreck
the entire sphere
like it would
kill Bitcoin to.
If if bitcoin
could be replicated,
it wouldn't work
because the whole
the whole point
is resistance
to replicability.
So like
I'd like to pick your brain
on what you agree

(13:26):
and what you disagree
with with that argument.
So I actually don't disagree
with much of anything
that you said there.
Except for the fact
that you don't necessarily
believe in tokenization.
So when I say tokenization,
I don't
necessarily mean
ICO's on Ethereum
or the bullshit NFTs
that we're seeing
launched on Solana
or Pump that fund or
anything along those lines.

(13:49):
Tokenization, I do believe.
So you're going to start
seeing the Deutsche
abuses, the New York
stock exchanges
and the Nasdaq of the world
having blockchain
based exchanges.
Now these are going
to be blockchains
that are permissioned
and they're going
to be blockchains
that are regulated
and governed.
So it's not going to be
a completely open
source blockchain
in the way
that we typically think of

(14:09):
in the bitcoin
in the crypto space.
But I do believe that
having those elements
of assets
traded on a more transparent
ledger system
does make a lot of sense.
So that's where
I think of tokenization
so completely
different than crypto.
How is it
how is a blockchain
more secure
or more transparent
than just,

(14:31):
a spreadsheet
if it's centralized
so it can be changed by,
oh, spreadsheets or easily
spreadsheets are very easily
manipulated. Right.
But so are blockchain.
So that's my point.
A blockchain that isn't
the Bitcoin time
chain is also trivial
to change and also
erase the history of
because it's not because
it's not governed
by the user.

(14:51):
It's like the whole reason
the time chain works
is because it's being checked
on constantly
by by
the users of the network.
A centralized blockchain
wouldn't be that.
There would be nothing
to prove
that it wasn't tampered with.
Well,
but it doesn't have to be
completely
centralized, right?
So effectively,
if you think about
how capital markets work

(15:12):
today, what is the one
centralized agency
that governs ownership
of any individual assets?
Well, it's the CC'd.
That's quite literally why
we call it the centralized,
depository agency right now
that CC'd recognizes
the moment
in time
that assets
theoretically swap hands.

(15:33):
That is the legal moment
when a equity
or a debt or derivative,
whatever it may
be, is recognized
to have exchanged ownerships
hands like in Europe.
The examples would be euro
clear or Euronext right
are clear stream.
Now in the blockchain
we recognize that
as what happens
whenever one asset
moves from one

(15:53):
wallet to another, right.
One is decentralized,
the other one is centralized.
Right now.
Decentralization.
I do believe, has,
unlike genders, a spectrum.
I do think that there is
full decentralization,
which I think Bitcoin
is the absolute perfect
and most closest

(16:13):
that we've ever
gotten to from that,
especially from a
monetary perspective.
And then you have
full centralization
like the CSD,
and then you have
a whole bunch
of other nonsense
and different
consensus mechanisms
in the middle.
Now, in a heavily
regulated world
like our financial markets.
And believe me when I say I'm
not advocating
for regulation,
I'm just acknowledging
the realities
of the system
that we live in.
I think all regulation

(16:33):
is bullshit,
but given the construct
and given the reality
that we exist in today
and how those capital
markets operate,
those market participants,
the users
themselves are brokers.
They're investment banks.
They're the
exchanges themselves,
their placement agents,
those different types
of users,
and somebody
infinitely more intelligent

(16:54):
than I and will have
to create this
consensus mechanism.
But there is a world
that I see
a permissioned
pseudo decentralized.
I don't say fully
decentralized, obviously,
but pseudo decentralized,
blockchain,
where we can
have tokenization and
issuance of these assets.
That's just at least
what my hope would be.

(17:15):
Well, actually,
let me rephrase that.
My hope would be
is that I would like to see
a fully
decentralized marketplace
where any market participant
can transact
in these different types
of assets
on top
of a
completely decentralized,
permissionless
and censorship resistant
layer one
which effectively
would be Bitcoin
in this case.
I just don't know
if that's going to be

(17:35):
technologically possible.
I don't know
if the core Bitcoiners
are going to allow
for forks of Bitcoin
to get to that road.
I don't think
that's reasonable
to expect that we will.
Layer twos
might be able to offer
that in the future.
But hey, you're sacrificing
decentralization and security
in any way or two,
which is core to Bitcoin's

(17:55):
value proposition. Right.
So it'll be interesting
to see how that transpires.
As new regulation
and new technology develops
over the coming decades.
Yeah.
I Sam, I agree,
I mean,
I do believe that
there's always a trade off.
I wouldn't necessarily say
that you sacrifice
the central station
if you're running your own
lightning nodes.

(18:16):
And so like,
of course, it's
a layer above,
so it has its own trade offs.
But so lightning is unique
in that regard
that it doesn't
really sacrifice
the decentralization
elements.
Does it
sacrifice security
potentially.
But it doesn't
even really look like
it does as well.
I as I say,
you can't have one
without the other.
And this is
where I have
the biggest problem.

(18:36):
You have the trilemma
where you have the
centralization security and
what's the third one?
Scalability.
Scalability. Exactly.
Yeah.
So, so
and if you,
if you're sacrifice
like if the, the only thing
that doesn't sacrifice,
decentralization and security
right now is bitcoin
and you have to
sacrifice scalability.

(18:57):
Anyone that the sacrifices
one of the other two
is actually sacrificing both
because if you
sacrifice decentralization
then you can't have
the security in the long run,
because
the decentralization is
what makes
the users be in charge
and not the miners.
And if you sacrifice
security, well,
but you're not decentralized.
That not that well,
you're not secure.

(19:18):
So so so
so so that is the thing.
And like
I view it
as if you got perfect money
or damn near perfect money.
Money
that is good enough
to last forever.
Then no token for anything
else is ever needed,
because this money
can be exchanged
for everything else.
So it is actually
already like,

(19:39):
a part
of every stock in the world,
every every bond,
every equity.
It's a part
of everything else, you know,
everything divided
by 21 million.
This is this idea
that this thing
can be exchanged
for everything else.
And I well,
that's
where I do believe
that everything
does inevitably
go to zero against bitcoin.
But yeah. Yeah.
Natural price is infinity

(19:59):
right.
I and I think it's very hard
to make an argument
against that
at this point in time.
Yeah.
With that said
because it is money.
That does mean
fundamentally that I mean,
unless you envision a world
where, let's say
there will be no stocks,
there will be no bonds,
there will be
capital markets.
The way we think of
today, I do
I think that's the end game.
I do think that

(20:20):
these things you're
talking about
might make sense
in a transitionary
world, but,
but only if we
we have to keep
the goal in mind.
Because the other thing
that I'm and sorry
for taking up it like,
oh, please,
I love this conversation
because because I love this.
Like trying to connect
with the framing
here because, the the,

(20:43):
where was I here.
Yeah. Ownership.
So right now, as you say,
ownership is like of stocks
and bonds.
It's the centralized time
stamping server, basically.
The other time
stamping is super important
in, in Bitcoin,
the Satoshi figured out
that you can't
have that centralized
because that allows
for double spending.
That's why we need to sync.
That's why we need this.
So in my in my view,

(21:06):
the decent
realization in Bitcoin is a,
unfortunate means
to a much greater end,
which is, copyable number
or absolute scarcity.
Without that,
you cannot have
the 21 million.
It is absolutely dependent
on its users
being vigilant enough
to check on that
at all times.

(21:26):
Like otherwise
that doesn't work.
So that's why
the digital energy
narrative is it's it's
slightly off
because without
the human beings, it would
there would be nothing.
There would just be a giant
nothing burger.
So ownership
is a legal,
relationship
between you and a thing.
That's that's what ownership.

(21:47):
It's
possession is a layer deeper
because possession is
you actually
having access to the thing
and being able to defend it.
So, yeah,
I can steal your car
and then I'm in
possession of it.
But you are the legal owner
and I can just hope
that there's
a police force around
trying to give us
what they say.
Possession is 9/10
of the law. Right.

(22:07):
But yeah, exactly.
But the thing is,
with Bitcoin
you cannot own it
and you cannot
even possess it. Yeah.
The only thing you can do
is hope
that no one else has access
to the same key as you do.
So everything in Bitcoin
is probabilistic,
and the only reason you say
that you own it

(22:28):
is because you find it
very unlikely
that someone else
holds the keys.
And the only
reason that you say that
there will only ever be
21 million
is because you find it
very improbable
that everyone on earth
would agree
to change that number
at some point in time
like this.
But at the end of the day,
these are just numbers
and probabilities.

(22:49):
It's yeah,
this is like an abstraction,
like a very abstract
thought trying to bridge the
the subjective world
with the objective reality.
Like that's what it is.
And we've finally
figured it out in that sense.
I don't know if I can explain
it better than that,
but this is why
I mean,
I absolutely
love the concept, but,

(23:10):
when you say tokenization
and owning this on
a blockchain here,
this and that, to me,
these are all mirages.
And and there are,
at best, prolonging
the system
we're living in now
and not necessarily
helping hyper
bitcoin ization
happen faster,
which I think
should always be the goal.

(23:31):
Hello there,
fellow Bitcoiners.
Take your coins off
the exchange right now.
You need to take
self-custody of your coins.
Now, how do you do that?
First of all,
you need a good hardware
wallet.
And I would recommend
the beatbox.
So go to beatbox
Dot Swiss Slash Infinity
and get your beef box
now with a discount.
Also, you need somewhere
to store your seed phrase.

(23:51):
So why not get one of those
wonderful steel seed
plate storage thingies
from Stamps.com
slash infinity
and you can get the
everything divided
seed plate. It's beautiful.
Also, if you're advanced
and if you want to start
with the
generational wealth thing,
which is a fun hobby I have,
you can go to
the Bitcoin Advisor
group of lovely fellows

(24:12):
from Down
Under that
can help you
store your Bitcoin
for a long time
using Multi-sig solutions.
So check out pip box,
Stamp Seed
and the Bitcoin Advisor
or Chief White.
Back to the show.
So let me ask you this.
What does
what does that to you.
Hyper
bitcoin is
Asian look like
because it probably doesn't

(24:32):
look like Michael
Saylor buying as much bitcoin
as humanly possible. Right?
Absolutely.
It doesn't look like
my samsara asset group using
I mean,
we try to stack
as much bitcoin as we can.
Obviously just on that
and I salute
your shareholders.
But at the end of the day
we use Bitcoin
as our Treasury
reserve asset.
Do you own your own keys.

(24:52):
Yes.
So we do hold our own keys
except for the assets
that we deploy
into our managers.
We do have a couple of funds
that were invested in
that are denominated
in Bitcoin.
Those managers themselves,
of course, hold their keys.
But that's just the way
that we use bitcoin
to compound Bitcoin.
We earn bitcoin in
Bitcoin right.
All right.
But outside of that
we do have our own keys.
We also do custody

(25:14):
with other providers
just because
we're a regulated company.
So we do have to have
a certain element
of our assets
deposited in custodians
just because, hey,
it's not your keys,
not your crypto.
Like I always tell everybody,
no, no, no,
I would say not your keys,
not your coins.
If it's crypto, it's
not yours at all.
But but, that's true too.
But if if you, So, so

(25:35):
if I ask you straight up,
how many of these
what was it, 560 bitcoins.
How many of those? 540. 540.
How how
many of those percentage
or whatever
you want to say, like,
are held
in actual self-custody
and how many are outsourced
to like Coinbase
or something?
So we don't have any big
thing on a Coinbase.
We would we use BitGo.

(25:57):
Largely that is what is,
our asset manager some
our alpha.
They deploy through
different strategies
on Bitcoin predominantly.
We do have one
banking partner
in Europe
that we have 100
Bitcoin deposited at.
And we use that as collateral
for leverage
for just ongoing
operational expenses.
We get bank
we get bank loans
against our bitcoin.

(26:17):
So naturally
the collateral is posted.
And then we have about 150
or so bitcoin
in Self-custody.
So then we have a
mechanism of
about 25
ish percent, 20, 25%.
Okay.
Okay. Interesting.
Yeah.
Like I said, we
we put a good amount
of our bitcoin to work.

(26:39):
I mean, these are Bitcoin
denominated funds.
Therefore they capture
all of the beta of bitcoin
relative to fiat.
But they earn bitcoin
on bitcoin in the strategy.
So we always want to
import bitcoin right.
And then the other
is leverage
we use for operations.
So again
putting Bitcoin to work
as an actual treasury asset
rather than what

(26:59):
Saylor's doing,
which is just trying to buy
as much Bitcoin
as humanly possible
and let it sit at Coinbase.
So let me ask you
a personal question. Sure.
If you
if you had
insider information
to some new innovation
on Ethereum
and you knew that
Ethereum was going to go up
next week,
would you sell Bitcoin
to buy US area
and buy Bitcoin back

(27:19):
after that
like without knowledge?
Absolutely.
So we don't have a theorem
or exposure
to any other
crypto assets
or tokens
on our balance sheet.
There's a couple legacy
token investments
that are on our balance sheet
for many, many years ago.
What? We haven't.
Oh, God.
I think we the company.
Before I stepped in,
they invested in Leo.

(27:40):
It invested in real?
Yeah.
Remember owner said
Leo from, Bitfinex.
God knows
how long ago that was.
Holy shit.
Yeah.
And you,
you said Mike Novogratz.
I thought that was like,
the Cretaceous period to,
you know.
Well, it wasn't
he the guy you tattooed?
Lou nine.
His. Yeah. Yeah.
Yep. Is that. Yeah.

(28:01):
That's that tattoo, I think.
And at least
he says that he wears
it as a reminder for mistakes
he's made before. Right?
He's he's
a great guy, though.
But, yeah,
I think he still actually
has that Luna tattoo.
Yeah,
there were a handful of.
Yeah.
And then, like, for,
like, during DeFi summer,
we invested

(28:21):
in a couple of things
that were just going on here
and there.
We ended up
turning like 100 K
into like 3 million
or something,
but we decided to liquidate
all those positions
because frankly,
we just decided DeFi summer.
Okay, great.
While we were able
to kind of
harvest those gains
and convert them to Bitcoin,
but it's not something for us
we would rather be deploying
to managers,
allow them
to professionally manage

(28:42):
assets
from our balance sheet.
The only crypto
that we touch anymore
is either a Bitcoin
or because it is a stablecoin
and it's the most
widely accepted
stablecoin tether. Naturally.
All right.
Yeah, that's
that's when within
my acceptance,
frames or whatever.
And yeah.

(29:03):
So sorry for being so,
so attacking on this
but but it's a
no please
I love it to to kill.
Look at the sheer
coin narrative.
So I'm just making sure here.
Yeah.
Well,
so here's a narrative
that I don't even think
you've, thought to ask, like,
why should a company,
why should people buy
a publicly traded company
like mine
even have Bitcoin
on its balance sheet?

(29:23):
What real value
should shareholders
get from being invested
in a company
that has Bitcoin?
And my answer to
this is always you should.
If you want
exposure to Bitcoin,
you shouldn't be investing
in publicly traded companies
or even Etps or ETFs
to get that direct exposure
to Bitcoin.
Me personally,
all of my bitcoin
not tomorrow's
but mine personal

(29:44):
is private keys,
cold wallets, private keys.
I have a whole system set up.
Even the wills
and the trusts and everything
where elements
of the private key or,
words will turn over
to certain individuals.
I trust that
they don't even know
that they're going
to be getting those words
in the future,
just because
I don't necessarily
trust my wife
to screw up
accessing that Bitcoin

(30:04):
at some point.
So okay, I have to
I have to sacrifice elements
of my own Bitcoin security.
So God forbid
if I get hit
by a bus later today,
I know my wife
will be entrusted
with that Bitcoin.
I don't have
any of those problem
because I lost.
I lost all my because
in a tragic boating accident.
Oh, I was going to say,

(30:25):
actually, I should be.
I should be telling the IRS
this, I take that back. It's.
I had a horrible
boating accident.
This is what
you would have done
if it had you still had them.
Yes, yes.
It's somewhere on the off
the coast of,
Gozo, if I remember
correctly,
we've never been able
to find the, Bitcoin.
Yeah. No.
So anyways, like,
I really shouldn't
be saying that because, hey,

(30:45):
I run a publicly traded
company heavily
investing in Bitcoin.
And I also created
some of the first etps,
the European version
of a Bitcoin ETF in Europe.
But see, for me
it's all about what
maybe the type
of user experience
investors want.
Because unfortunately,
the reality is, is
there's a lot of
people out there that don't

(31:06):
trust themselves to
go out,
have a Bitcoin
cold storage wallet,
remember their seed phrase
or remember their words,
remember their private key.
And then,
you can go a step further
in operating your own node.
I mean, you're not holding
Bitcoin the right way
if you're not operating
your own node.
That's just the essence,
the truth of it. Right?

(31:27):
So the reality is, is that
if we want Bitcoin adoption,
the way that I think elements
of the community want
Bitcoin adoption,
ETFs and Https
and publicly
traded companies
holding bitcoin
are just an
inevitability of that. Yeah.
But that okay to their own.
If they want exposure
that way
I don't recommend it.
But hey if you

(31:47):
want to trust
a professional asset
manager like Deutsche Digital
or trust a public company
like MicroStrategy
or some Aura Asset Group,
please, by all means.
Our shares are
traded in Germany.
Yeah.
So.
So that,
let me
give you
my perspective on that
and then and see
what you think about it
because like,
I'm interested if,
if like you agree

(32:08):
with the framing.
So.
Oh the ETFs are absolutely
an attack vector
that I already know
where you go.
No no no look
I'm not going down that road.
So so there okay.
So the road I'm going down
is like yes,
I do agree with you.
I think these things
are inevitable,
especially like
in the transition
period for sure.
And I don't know
if we ever get to like

(32:28):
you ask me before what
how I define
hyperbolic ionization.
And I think that's
a super tricky question.
I think most people get it
wrong. First and foremost.
I think hyper bitcoin ization
is a personal thing,
and I
the thing is,
I don't see an end
point to it
because there's always
one more thing
that could come
into the Bitcoin economy.
Even if all fiat is dead,

(32:50):
there's always
people are going to
the economy can still grow.
They can still be like the
I don't see an end
point to it.
Also the
holding your own keys
and doing Bitcoin properly is
by far
like it's absolutely not
risk free.
So if you're a clever person,
you need some type
of diversification.

(33:11):
It's not good
to have all
eggs in one basket.
And by that
I mean
like yes,
put as much as you as
you can stomach into Bitcoin,
but you should probably have
some kind of other lifeline
because what are
you going to do
if like, all of a sudden
there are zeros
all over your computer
screen, like
you are a risk to yourself,
you can bump your head
and lose your keys like that.
It's not entirely risk free.

(33:32):
So yes,
I do agree
that some
some type of diversification
and but the thing is
what what,
so so so these instruments
and these half measures,
if you might call them
that are absolutely
a step on the way.
And they are a good option
for the boomer
who doesn't
trust his own skills
with a computer or whatever.

(33:53):
Like they're very much,
tools for them.
And I like it
because at
the end of the day,
all roads lead to Bitcoin.
Like this
does lead to Bitcoin
getting more powerful.
What I don't like is
the, the,
the road bumps
that can be put in the way.
Like if one of these pension
funds starts
investing in Bitcoin
and the crypto,
for instance,

(34:14):
or or would like
when people issue
NFTs on, on Bitcoin or any,
any other
bullshit use case
than the monetary use case
and the date
like dilute stuff,
dilute Bitcoin's
pure value as pure money
because I believe that,
just as houses or real estate
become a worse form

(34:35):
of housing by being money
so that the billionaire buys
all those beachfront
properties,
all the beachfront
property and, and,
every,
every middle
class person gets,
out, compete
in, on the market
and can't afford a house
next to the sea.
So every house is empty.
So that makes real estate
worse as what it's intended

(34:57):
use case.
The same is true for money.
Oh, you should go to Dubai.
That's in Dubai.
Yeah.
It's like I know
90% of all the houses
and everything is just empty.
But Dubai.
Dubai might have
a beautiful future
if they hope for Bitcoin.
Nice.
Because then the money works.
And if.
But the same is true
for money. That's my point.
Like if if money is
being used
for arbitrary data

(35:18):
storage and Jpeg creation,
then then it's by definition
becomes a worse
form of money.
So like,
the, the
framework to
have in your head
the Satoshi is special
because it's the purest money
we have.
And
and because it's a very,
very personal thing.
The Satoshis don't even exist
except for in people's

(35:39):
had the ability
to move them exists,
and that's
all in people's heads.
Nowhere else.
So.
So like,
this is what
makes the Satoshi
absolutely unique
in comparison
to anything else.
And, so,
so I'd say all roads
lead to Bitcoin,
but you can put up
roadblocks on the way,
which makes
that process slower.
For instance,

(35:59):
if people fall for shit coins
and get get burned,
it's very unlikely
that they get back
to Bitcoin directly
after that.
It'll take them
another ten years
before they.
So so I don't think that
that it's
accelerating anything
except people thinking
that Bitcoin is a scam
when it actually isn't.
So yeah.
And I don't think
that's primarily

(36:19):
but that's like
primarily
where Bitcoin has
distinguished itself relative
to every other
a crypto asset
in the entire space.
Because Bitcoin is
at its core,
the most perfect
form of money
humanity has ever
conceived of.
You can't say that
about Ethereum.
You can't say that
about any of the other
layer ones.
You can't say
that about tether,

(36:39):
and you certainly cannot say
that about any of the ICOs
or NFTs
or anything
that has been tokenized
on any of those
other blockchains. You can.
There is no second best.
Exactly.
There is no second best
when it comes to money.
Hello there.
I'm Kurt Swann home,
and I'm
an International village
idiot and author.
These are my books
on Bitcoin.
Bitcoin sovereignty

(37:00):
through mathematics.
Bitcoin independence
reimagined. Bitcoin.
Everything divided
by 21 million.
I'm Bitcoin
the inverse of clown world.
These are now re-edited,
redesigned and available
from the Bitcoin
Infinity store.
I mean look at that.
Look at how your collection
could look.
Oh. It's upside down.
But there they are anyway.

(37:21):
But more than that,
all of these books
will be released for free.
Chapter by chapter, week
by week on Noster.
Also accompanied by a video
that Luke
and I will make talking
about the ideas in the book.
Where we answer
your questions
because you can sign up
for the Bitcoin
Infinity Academy
and join courses
for each
and every one of the books,

(37:42):
and talk to us
every now and then
and get other perks
like a free
set of steak knives.
So go to the Bitcoin
Infinity store right now.
Get the books.
Sign up for the Academy.
Now the question is, is
what are they?
Because then there's
other assets, right?
You have equities.
That's derivatives.
Every other
financial instrument
that we've ever conceived of.

(38:02):
Now, is there a world
where Bitcoin
as the most perfect
money ever created
and these other assets
coexist?
Yeah, it's
kind of the world
we're living in today.
It's just that
these assets,
except for the bullshit
crypto assets
we currently see
in the world today,
they're traded on
capital markets.
They're highly centralized

(38:22):
on the New York
Stock Exchange and other OTC
desks in private
equity and venture
capital, etc.. Right.
They're in real estate funds.
Now, the question is, is can
and should we bring
those assets
to the blockchain or can
and should we
bring those assets
to Bitcoin?
Now the easiest
and shortest answer
I think is no.

(38:44):
Yes.
Well, for, for, you know.
Right. For me it's. Yes.
Because
creating a global economy
that trades 24 over seven,
that allows
everybody
in as permissionless
a manner as possible
to trade these types
of assets
and realize the value capture
of the appreciation

(39:04):
of those assets over time.
Well, I,
I frankly love that idea.
Can it happen on other coins?
Yeah, we've already
kind of seen
I mean,
there's already
been tokenized funds
on Ethereum, right.
You've seen
tokenized went to shit
because it was a scam.
So so I would say no,
that hasn't really happened.
That's not necessarily true.

(39:25):
There's a couple of funds
I know like KKR
that is tokenized.
I think they had
like what 700.
But but it was
but there are winners
and losers in this.
There are only winners
in Bitcoin. That's the point.
You don't have to like
this is not a zero sum game.
And this is what people
get wrong about it.
And by the way I think the
I hardly I,
I have a hard disagree

(39:45):
on putting anything else
on bitcoin
for a very simple reason.
There are two scarce
assets in Bitcoin.
One is the Satoshi itself
and the other is block space.
And if you fill
up block space
and if you block the utx
all set
by putting arbitrary data
into it
and making more and more,
you take those you you,
what you inevitably

(40:05):
end up with
is a higher starting
cost for firing up that node,
and what that inevitably
will lead to is,
sacrificing decentralization,
which means Bitcoin
is just another shit coin,
and then we're
all fucking doomed.
That is the
inevitable result.
So there's like interested.
Yeah.
So so
there's an interesting,

(40:26):
conversation I had recently.
There's, 1
or 2 groups out there
that I've become aware
of over the last six
or so months,
that their entire thesis
is exactly aligned
to what you just said, that
if we do
start to see tokenization
on Bitcoin, like
not just ordinals
and everything
we've seen thus far,
but like we see maybe layer
twos that build tokenization
or there's an update

(40:46):
to the core code
that these groups
are already anticipating
that that could happen.
And they're building
futures platforms,
to purchase,
the future
rights to block space
because the block space
becomes more scarce
then the Satoshi is itself.
I mean, when Bitcoin hits
$1 million a Bitcoin,
the Satoshi is worth a penny
a day.
Just to clarify

(41:07):
that the block space
cannot be scarcer
than the Satoshi,
only within a limited time
frame.
So per time unit it can,
but not in an forever mode.
It cannot.
It's such.
Yeah,
but only within that block
it can be. Right? Yeah.
Which basically is
what they're selling.
It's a, it's a forward
or their platform
would be selling a forward
on a future block,

(41:29):
that you would have priority
with whatever node
group or miner to settle
whatever transaction
you have.
If Bitcoin becomes too
crowded
from a
transactional standpoint,
which is actually kind of
fascinating to think of,
which is then
where the conversation
has to go,
that I believe
that you have to push any
of what
that theoretical transaction
volume would be

(41:49):
to a theoretical layer two
or a parallel coin or,
an adjacent coin,
which again,
then it's somewhere
else, right? Exactly.
Or somewhere else completely.
Which is
actually interesting.
Did you see, in El Salvador,
at plan B, tether
announced that
they're going to be trying
to bring tether
on top of Bitcoin.

(42:10):
Yeah.
And and like this is
what would your thoughts
be on that.
Because the first time I,
the first time that I saw
that I was like
that sounds incredible.
So and this is
maybe just
where I think of Bitcoin
slightly different
than you do
because I think of Bitcoin
with my accounting brain.
When I put my CPA hat on,
I think of Bitcoin
as a ledger system.
And I want all of global

(42:31):
finance to transact
and be immutable
and be permissionless
and be transparent.
On top of that,
what I think
is a perfect ledger.
So that's
I think that's,
that's a utopia
and that is that
the entire system
is dependent on the Satoshi
being the asset.
Like, yeah,

(42:51):
Bitcoin doesn't reward
its miners in dollars
or tether or,
or fucking monkey
JPEGs or anything else.
It's it rewards
its miners in,
in Satoshi's.
And it's actually not like
the miners do not
search for satoshis.
They don't mine bitcoins.

(43:11):
They mined blocks
and they mined blocks.
Based block
space is the asset
they produce.
And the Bitcoin miners
who run the nodes
and actually
actually run the system,
we pay the miners
to do our security work
for us and create blocks.
So the miners get paid
by the Bitcoin.
It's not only in

(43:32):
the new newly minted Bitcoin,
but also in the fees.
So the two aspects of that,
the fees
and the newly minted coins.
And as soon as
you start messing
with those incentives
and create other things
and pretend
that you can order satoshis,
which you can't like,
there is no ordering
in the actual
Bitcoin protocol

(43:53):
or the ordering,
in in the ordinals bullshit.
It's made by third
party websites.
So when you see
if you go to mempool
dot space
and you see something,
the like, you see this
transaction is data
and you can even
see the block
looking like
a picture of Donald Trump
or something,
you have to remember
that mempool dot
space is not Bitcoin.

(44:15):
It's a third party website
that chooses to
to visualize the blockchain
in this in this way.
But it's not real.
It's it's absolutely
third party has nothing to do
with actual Bitcoin
like that is not internal
to the system.
All of that is external.
And this is
why it's so crucial for the

(44:35):
for the system to be pure
and internal to itself.
And I'm a huge
a proponent of ocean
mining and knots and
Luke Dashers work here
because right now
he's the only one
and he's done it before,
protected Bitcoin
from itself from its,
its ignorant users.
But but for instance,

(44:56):
he came up with SegWit as a,
as a soft fork
instead of a hard fork. And
so he's
once again
pointing out
something that
no one else saw.
And, Short Ocean
won't be
the only alternative.
I know that
other mining
pools are coming up
that are going
to be transparent like this,
and also are going
to filter out the bullshit
because it's absolutely.
And meanwhile,

(45:17):
fucking wizards
get 30 million,
ordinary cut
bucks in funding
from some other firm
that have found out
another way to rug
pull people.
What, what?
These are chip coins.
They're doing
the exact same type of scams
as they were back in 2017.
It's just that
they figured out
a way to fool people
that you can do it
on Bitcoin, but in reality,

(45:39):
owning anything,
owning any
arbitrary data
is not ownership at all.
It's just like owning
a star in the
Andromeda galaxy
where you can say it's yours,
but you can't fucking do
anything with it.
Yeah, it's
everyone else's too.
Like it's on there
on the blockchain.
The only thing that makes
the Satoshi different
is the probabilities
that we talked about before.

(45:59):
It's,
you don't actually own it.
You just find it improbable
that someone else
will figure out the key.
This is not true at all
for any other token,
because the issuer
of that token
and whoever owns the third
party website can do with it
what they wish.
At any point in time.
And you've seen this
with fucking NFTs
that were unique
to just about every project
out there.
Yeah,

(46:19):
and just about every
crypto asset,
as you call them.
I call them
fucking share coins.
And that's the proper name.
It's not crypto assets.
There is no second
best like this is
this is the whole point.
If there was a second best,
Bitcoin would
also be pointless
because Bitcoin
would just be another
shit coin. So yeah, but

(46:40):
I so I don't disagree.
The one question
I would have for
you though would be is
so where do we see
investments in companies
in equities
or other financial. Yeah.
Where do we see
investments
in financial instruments
okay.
In that hyper bitcoin
ization world
that you're describing.
Because I'm describing

(47:00):
this tokenization world.
Yeah.
And I hope that
that comes to Bitcoin.
And like so
if I even expand
that a bit further.
So I would love to see
a world
where the construct
of an organization
or a corporate charter,
which is,
I mean, still largely
based off of the East
India Company,
back from like the,

(47:21):
15, 1600s. Right.
If you
I would like to add
a 10th of a ship.
You. Exactly.
You're only a 10th
when one ship sunk.
Yes, exactly.
Like I would like to see
what the construct
of an organization
is from a
theoretical as well
as from a legal perspective,
changed entirely.
And really be
a community driven thing,

(47:42):
which for a little bit,
it looked like
ICOs might have been
a way to solve that, but hey,
then that all went to shit.
So at this,
okay, like in crypto,
we create something
that could be
a technological innovation
and we end up
screwing it up anyway.
But I guess that's
because to your point,
it's all bullshit.
It's all scammers anyway.
Yeah.
So in that hope.
So.
That's why
it's all boils down

(48:02):
to the double
spending problem.
You can double spend crypto.
So therefore
the double spending problem
is like
at the very nature
of the double
spending problem is of such
as like
that it can only
be solved once
if you really think about it.
If you can solve the double
spending problem twice,
you haven't solved
the double spending problem.

(48:24):
It's a cult.
So how do you have
a copy of a copy?
So it's
so hard to resolve the.
So how do you solve
the double
spending problem
for investments
in financial instruments?
And the answer I have like
in the current system,
a blockchain adds
absolutely fuck gold
because it doesn't provide
any additional security.
I just don't buy that it's

(48:45):
you still rely
on a third party,
and you might as well
rely on the judge
that you're
relying on anyway,
when the crypto
bullshit you attached
your equity to
it goes to shit.
So I don't think that adds
anything of value.
It's just buzzwords and code.
So in my opinion,
having said that,
you asked
what happens with equities

(49:05):
and stocks and bonds
in a hyper
bitcoin ized world.
And I foresee that as like
being more
and more unnecessary.
So you'll have
like the way I see it
is that the
so-called financial sector,
developed in parallel
with the printing
of more money
and now it owns the world.
Everything is in the
financial sector.
And this is not a good thing.

(49:26):
This is a bad thing.
And on on a pure
Bitcoin standard.
And I know this because I'm
in these
types of groups already.
You can run a company
without any friction at all.
You can just have okay,
three guys in a basement,
we, we get a third
each of whatever
this company makes.
And it doesn't have to be

(49:47):
more than a telegram group.
You don't have to
do any accounting.
You don't have
to do anything.
You can be
completely sovereign
and just have the funds
of whatever you sell
directly, directed
directly to you.
So all of these
other layers, like,
legal entities and what,
what I like to call,
to quote my good friend
Dave Bradley,

(50:08):
lubrication companies, like,
what, what,
a company
like Deloitte
or something
is actually doing
or any like, legal
that helps you with
one government
because this is,
this is an interesting
thought process.
So you have this company
with your three
friends, right?
How do you verify that

(50:32):
each and every single
one of you
is entitled to one third
of the revenue or the profit
from that company with you
because you
don't have a
legal entity right?
Oh, well,
because at the end
of the day, you
at the end of the day,
you're going to have
to trust one another or trust
whoever is
managing the books,
or you say
there is no accounting,

(50:52):
but you're going to
have to trust.
There has to be revenue
coming from somewhere,
denominated in some currency.
Obviously, it's
probably Bitcoin
in this scenario.
Well,
if you have
open source software
and you write the website,
you're selling stuff
from yourself
or like just set up
a Bitcoin server
and have that direct
the sets three ways,
then then no, no further

(51:14):
trust is needed
because you can
you can verify it
for yourself.
It's like how are
our expenses covered?
And who is,
paying for the expenses
for the AWS
or whatever hosting service
you're using for your
in the same way
I mean,
I don't believe in
totally
decentralized companies.
I do believe in hierarchies.
I think there's nothing
inherently

(51:34):
wrong with hierarchy.
So so like
like I said before,
I think decentralization
is a unfortunate
means to a greater end,
which is sound money,
because if you
have some money,
you can do
all the other stuff.
And, and what do you say
about legal,
the legal stuff,
like who owns what to whom?
Like, yeah,
I still believe in contracts
and needs.
You should uphold
your contract.

(51:56):
Got it.
What we're doing now
is that
we're outsourcing legal,
whether we want it
or not, to an entity
that takes our stuff,
namely the state.
Like so we've outsourced
everything legal
to an entity
that is inherently criminal.
So so so and if so.
So those

(52:16):
lawyers are
obviously criminals.
I couldn't agree with you.
No, but
this is where
where we get
into libertarian,
ethical and moral philosophy.
Right.
What what is okay
and what is not okay.
And there are already
entities out there
that are trying to,
like, like
they are giving
people options
so they

(52:36):
so you can employ
a libertarian legal,
firm to say that.
Okay,
I have a contract
with this person.
And if there's
ever a dispute,
I want you to solve it.
And not whoever
the government tells
me I should use. You know,
these companies
already exist,
and I think they will be more
and more popular
in the future.
When when people like.

(52:57):
Because Bitcoin
inevitably puts
people on the path
to understanding
Austrian economics
and libertarianism.
And give them this lens
to view the world. Why?
Because what,
if anything, Bitcoin
has taught us
how much we're being scammed
by the legacy system,
how much we're being
scammed by inflation
and by if

(53:17):
if someone can print money,
then why the fuck do we have
laws at all?
Like everyone's
being stolen
from at all times.
And if you denominate
in Bitcoin,
you can see that
all prices can
and ought to
to decrease over time,
and everyone
gets more wealthy
without it
having to be
at the expense of a
of a third guy.
Like we can all get wealthier
and it's it's super easy.

(53:38):
It's just
limit the money supply.
Oh, I agree entirely.
And that's
where I think Bitcoin is
as perfect.
I mean, I,
I mean I couldn't
have conceived
of bitcoin 20 years ago.
I don't think anybody could.
That's why
Satoshi created it.
I can't conceive of anything
that will replace
Bitcoin as the world's
most perfect
form of money ever.

(53:59):
Probably somebody
that has a
higher intelligence,
or I don't know,
as a fourth
dimensional traveler
is going to have to
think of something,
completely outside
of the scope
of my comprehension.
I think all of humanity's
comprehension. Right.
But that's still,
at least for me, doesn't
necessarily solve
the problems that we do
see in capital markets

(54:20):
specifically related
to, transparency,
related to inclusivity,
related to 24 over
seven access
to trading facilities, which,
I mean,
they only run 9
to 5 every day,
which is
horribly unfortunate.
I mean, that's why.
But but
if you have something
to sell
and, you know,
another Bitcoin,
you can call that guy
whenever you want like that.

(54:41):
Bitcoin is always open.
Like but what if I want to
I mean but what if I know
what if I know somebody
that has something to sell.
And I'm a strong believer
in his vision.
I'm a strong believer in
the product that he's created
and his ability to sell it.
And I would like to have
an ownership stake,
or rather.
And so
let's think about like this.
I don't want to have
an ownership

(55:02):
stake in his company
and the future of equity
that like, equity. Right.
But maybe not consider it
equity, but,
what was the,
what did you call it?
You don't own Bitcoin.
You possess bitcoin.
I want
I want a possession of you
don't even possess it.
But anyway, going
hey, you want
a part of his company

(55:22):
like you want to
part of its company,
which is an equity.
And then in that
bitcoin ization world
I still can't outside of you
create some sort of
automated contractual system
where I don't believe I
of the
I don't believe that either.
I don't believe in
smart contracts.
I think they're
dumb contracts
because you're
still always going,
oh, you mean the
you mean the wonderful

(55:43):
if then statements
that we pretend
are smart contracts.
Yeah, exactly.
And unlike
as soon as
as I said
before, with a set
being the internal mechanism
of the system,
as soon as you attach
a blockchain
to something
in the outer world
that does something external,
then it
then it messes
with the internal
incentives of the system.
So it's just doesn't work

(56:03):
because you can
tamper with the outside world
and whatever
it's attached to.
That is why bananas on
the blockchain
makes no sense.
And so on.
So,
I remember when I met
the banana coin guys.
But anyway, we got
to answer the last. Yeah.
So to answer the question
about the equity,
I see now, as I said before,
I see no benefit of adding

(56:23):
like a token or a blockchain
or anything like that
to that,
because at
the end of the day,
a judge is going to decide
whether the contract
was upheld or not.
So I still think equity
is something
that we'll have to be
in a written contract
between two people.
What you can do with Bitcoin
though, is timestamped
that contract.
So that's that, that,
that and you know

(56:44):
that's
makes it a tiny bit better.
Not only a tiny bit
but quite a bit better
because you can actually have
a proper time
stamp that
we agreed on this
at this very moment.
Yeah.
So, so that
I believe it can be used for
but little else.
And it doesn't need to,
because if you
have perfect money,

(57:05):
then you can exchange that
for all of these other stuff
and people
where this is the
this is the real tech,
kicker here.
Because if if I have bitcoin
and you have bitcoin,
you and I are
both incentivized
to help each other
succeed in life
because we know that
if I know that
if you succeed,
you make more money
and therefore you make

(57:26):
my money more valuable.
You see.
So all Bitcoiners
are incentivized
to help one another
and to to
with whatever endeavors
they engage in.
And at the same time, we,
So and we're all incentivized
to help Bitcoin succeed,
because we know that
if we do,
we help other
Bitcoiners succeed
because we're part

(57:46):
of the same system
with the bitcoins,
and the Bitcoiners
are the same entity,
and which is what
which is where
the real mindfuck come
in, comes in, in my.
So if I have
a contract with you
and I know
you're another Bitcoin, or
I have less of an incentive
to screw you over
than I did
on a Fiat standard.
So I think many
of these disputes
and many of these,

(58:08):
things that you're
talking about, the
how can we make it
more secure.
And so they come,
they come with hyper
bitcoin ization automatically
because ironically,
I think there's don't
trust verify
what it leads to
in the long run
is that people actually
can trust each other more
because they know
that it's expensive
to try to cheat
the other guy.
So it's a utopian.

(58:29):
But but this is like my long
term outlook.
So it's a great outlook.
And I would love to say that
we have the ability to fully
and exclusively trust
one another,
that we trust people.
And I do think that
Bitcoiners are more
trusting of other Bitcoiners
than they would be
of anybody else.
So, for instance,
when I,

(58:49):
when I meet a startup
that's trying
to build something
in the Bitcoin
ecosystem versus
I get pitched something
that's being built on Solana,
I can already speak
to the morality
of any of those
individuals, right?
I can already speak
to the intelligence
of those individuals.
I trust the people
that are building
a Bitcoin more than I would
in something else.
Right? Yeah.
I, for instance, am more

(59:10):
trustworthy
working with people that,
accept payments in Bitcoin.
It just makes perfect
sense to me, right?
But for me,
I don't
necessarily think that
that still
solves the issue of ownership
or what
we'll call here
possession rights of

(59:30):
individual assets
or equities,
which as you said,
are based on contracts.
Because
I've been in enough
disputes over
liquidations of,
companies that
maybe the investment
just didn't go
the way
that they were supposed to.
Or you have a very activist
board member
that sits on the same company
that you sit on the board of,

(59:50):
or you have a founding team
that misappropriated
elements of assets
that I've seen other VCs
and other groups invest into.
You still do have to have
that big element of trust.
Yeah.
And while I do think
that your point of in
a hyper bitcoin world,
hyper bitcoin a world
that there is more trust
that individuals
can have with each other,

(01:00:11):
that is true,
but it's not unequivocal.
You still have to have
trust with each other,
and there are still going
to be people out there
in that hyper bitcoin world
that are going to fuck other
people over,
which is where
the courts come in.
Absolutely.
I agree,
but my question there is,
is there
not a world
that we can fathom,

(01:00:31):
where we don't necessarily
need the courts
for those types of disputes
that we don't
necessarily need arbitration
or mitigation
for certain disputes
because we're able
to enact them
in some capacity
on the blockchain,
where, for instance,
I can definitively show a
ownership, right,
a possession, right,

(01:00:52):
whatever you want to call it,
in cash
flow profit
from a company
that I'm invested in.
Now, maybe that's the
so I'm maybe taking this
on the flip side
to a completely different
utopian, manner than you are.
So you're in
you're living in this
utopia of people
will understand
and trust one another,
and we can trust that trust.

(01:01:12):
I'm on the other side
going, okay,
I don't necessarily know
if I can trust that trust,
but hey, here's a
technological utopia
that allows me
to not have to trust anybody
in that financial ecosystem.
Okay, so
the answer to that is,
pretty long, but,
I'll do the tldr.
Like,
like I said before,
you can already

(01:01:33):
choose to use another judge,
the one that the
government appointed,
if you choose to use,
so a libertarian law firm
that that allows you
to settle disputes
with one another
without having anyone else
meddle with them.
So you can already do that.
And you could do that.
You could agree that, okay,

(01:01:54):
we're going to use this token
on this blockchain
to settle blah, blah, blah.
What I just want
to make people aware of
is that that adds
absolutely zero
in terms of
security of, of or,
or transparency.
Since that blockchain
is inherently centralized.
Because it's not Bitcoin.
So it can be tampered with.
So I would not advise
people to do that.

(01:02:14):
However,
I have nothing
morally against people
making bad decisions
by their own volition
and agreeing to stupid stuff
like go ahead and do that.
Like go ahead
and be a hero. Honest.
If you think that's clever,
like I don't care
as long as it doesn't hurt
anyone else.
But my role here as like,
still, I can
I can tolerate stuff

(01:02:36):
but still disagree with it.
So I don't think
there should be regulations
around cryptos or whatever.
I think people should be
free to go to the casino
and lose all their money.
That should be up to each
and every individual.
So I nothing morally
against that.
That's being the case.
What I have something
morally against is

(01:02:56):
is the scammers
themselves like people
trying to scam other people.
And I think anything
on the blockchain
that isn't
the Satoshi is a scam
by, by its very definition,
because it's the only chain
that is decentralized,
and it's the only
thing on that chain that has
that actually
has anything to do
with the incentive structure
of the chain.

(01:03:17):
So so that's why
I'm adamantly
against every other
quote unquote use case.
So I see, like, why not just,
make your own form of equity?
Forget about the blockchain
bullshit.
Just make your own
contract and, and
appoint,
a lawyer, the,

(01:03:37):
a libertarian lawyer.
The thing is,
once you sign that contract,
one party
could still go
to the government and say,
I got screwed over.
And so
that's exactly
what I was going.
That's that's the point.
Like, we're still living
in this world
where the legacy system
still exists,
and it's very
hard to get around that.
And I don't think
a blockchain solves
any of that,
because I'm still going

(01:03:58):
to have to ask
at one point
where I'm super disappointed
because Vitalik
took all my money.
I'm still going
to have to prove
that in court,
and there's still a judge
that's going to have to
to make a verdict.
As long as I live in a
in a world where governments
exist and I have a gun
to my head,
every time I don't pay
my taxes,
I'm still
I'm still beholden to them.

(01:04:18):
And no blockchain
in the world
can fix that problem
except the time chain,
which can allow us
to do
to go on with our day
and do our business
without them having any,
like, it's a tool.
That's all Bitcoin is.
It's a, it's a tool
for the peaceful revolution.
A shield against,
like, its armor
against this weapon of threat

(01:04:38):
that they're using to
to extort us.
Like, that's, that's what
that's how I view it.
And that's why I don't think
any other blockchain
can come
at the end of the day, help.
Neither in the short
term, medium
term or long term
with any of this stuff.
I, I think that it's
a waste of time
to go down that road.
That's,

(01:04:59):
because I think it's a
nothing burger.
I so I don't disagree
when it comes
to all of the other
layer ones
or whatever we conceive
of as blockchains
and crypto assets
that exist today.
I am personally very bullish
on some of the Bitcoin deltas
that we're starting
to see to fruition
or come to fruition.
I'm very bullish on tether,
exploring ways

(01:05:19):
that they'll be able to
leverage elements of Bitcoin
security and decentralization
to enable
tether transactions.
I would much rather
see tether exist on Bitcoin
than on Solana or Tron
or Ethereum
or anything like I think.
I think
the majority of tether
is on Tron right now, right?
And that's probably
God knows what

(01:05:39):
Justin Sun's doing money
laundering wise, right?
I would much rather see
all of this on Bitcoin.
That's why I'd rather see
capital markets
trading on bitcoin
relative
to trading on the NYSE
or on the Nasdaq.
That's where I would
rather see
equity certificates.
That's where
I would rather see
marriage contracts.
I would rather see
arbitration and dispute

(01:06:00):
resolution enacted
in a technological way
on Bitcoin, the same way.
Layer two
I agree, if you can do it
completely on a layer two,
but not on the base
layer, like no.
So that's a
that's not what I'm speaking.
I'm not on the base layer.
I don't think
you're ever going to
I mean, we're going
to have to see
you would have to see
so many forks
of the core code
to enable that on Bitcoin.
It would completely destroy

(01:06:20):
what Bitcoin is today.
Bitcoin has to remain
the money system.
Yeah.
It has to remain the world's
most perfect form of money.
And then on top of that,
if you can have layer
twos that don't sacrifice
too many of the elements
of security
and decentralization,
but offer utility
and flexibility
and scalability. Yeah,

(01:06:42):
that's in my world,
the perfect scenario.
And I think
we're going to see over
the next few years
that come to fruition.
I hope it does.
I think
because when
tether talks about,
tether on Bitcoin,
they're actually
talking about
tether on liquid,
aren't they?
Or on lightning somehow.
So I, I don't know
that there's a couple
of protocols. Yeah.
So I know there's a couple
of protocols out there

(01:07:03):
that tether has
been working with. Yeah.
We'll see what happens.
But I could see it
being liquid.
I could see it being,
and they were talking
about doing it with taproot.
I think, at one point
in time,
I don't know. We'll see.
It's it's
going to be exciting.
I mean,
they're able to do that
liquid.
Liquid is, like,

(01:07:23):
for better or worse.
I think that's a good
trade off,
if any, in the,
in the coin space.
Of course it's not.
It's not liquid. Liquid.
I don't view
that as a shit coin.
I view it
as, Bitcoin
with a
slightly worse security
or lightning
with slightly worse security.
And it's still useful
to a certain extent.
I think the

(01:07:44):
that you have to start
thinking in, in layers
and in, yeah.
But this,
this kind of way of getting,
I don't know where
I stand on tether
in the long run being,
being a good or a bad thing.
Another reason
I'm conflicted
is that I don't know
if it prolongs the fiat scam
or if it accelerates hyper

(01:08:04):
because it's
so it absolutely prolongs
the fiat scam.
But you and I,
we come from the western side
of the world, right?
We're from
Western civilization.
So the way that
I think about it is.
Okay, fine.
Tether for tether,
at least
for the United States.
I think the US government
should be Tether's
absolute best friend.

(01:08:25):
The reason being
is that tether,
because it will create a
digital transparent
and on them know
I transparent.
I don't want
to use that word,
but because it creates
a digital dollar
that transpires borders
and could be used
by anybody at any point
anywhere in the world,
as long as they have a device
and connectivity
to the internet.
Tether is the one true way

(01:08:45):
the US dollar,
I think, can
continue its position
as the global fiat
reserve currency.
Will it be
the global reserve currency?
I hope not,
I hope
that does become Bitcoin,
but as the fiat
reserve currency
that people
from all over the world
transact in,
maybe that does
stick around
a little bit while longer,
because tether exists

(01:09:06):
now and it will make them
in the West a powerful.
Yeah, well,
it makes America
even more powerful.
And I don't think
the government is smart
enough to see that.
But I've been saying
this for years.
If you are
the U.S government,
you don't go after tether
and try to arrest the team
behind tether
and put them behind bars
for what you allege is money
laundering
or anything like that,

(01:09:27):
you thank the
fuck out of them
for doing more
for the benefit
of the US dollar
than the government
has for the last 100 years.
But we'll see what happens.
I don't know,
there's so much
there's so much comfort
out there about tether,
but yeah. So on one hand.
But here's where

(01:09:47):
here's where I like tether.
It's because you meet people
from Colombia,
meet people from Venezuela,
you meet people from Africa,
and they don't
necessarily need Bitcoin.
They're not there necessarily
to generate wealth.
They just want something
more stable
than their own currency.
And the US dollar represents
that very well for them.

(01:10:07):
Like okay,
you and I can
have a discussion
about the merits
of the US dollar.
I think
you and I both hate it.
But for these people,
if they're really
only getting
I mean, so
if the U.S government says
there's 3% inflation
this year, the truth is it's
probably more like
10% inflation.
But hey, 10%
inflation is wonderful
for people
that live
in that area of the world,
which is an awful thing

(01:10:28):
to say,
but it's
the unfortunate truth.
But how about deflation?
Like this is this is why it's
why I'm
so conflicted about it.
Because while
I also think that the US
dollar is the least worst
of the fiat currencies,
it's still a fucking scam
like this.
And these people
that you're talking about in

(01:10:49):
in the poor
people in poor countries,
they are the ones
being scammed
the most by it, like,
and, they're,
and if they all went
to a Bitcoin standard
instead of, of going
via tether
on to go on to
a dollar standard first,
they would all be better off.
Like everything would work
better
if they just adopted
the because

(01:11:10):
Bitcoin standard directly.
That's why
El Salvador is booming
like it's exact.
Much better for them.
So so in that sense like
yeah tether is better than
all the other shit coins,
including all the other
fiat coins,
including the dollar.
Because tether
is digital dollar,
but Bitcoin is
still better than tether,
so like man, oh 100%.
But this is where,

(01:11:31):
this is where
I'm confused because.
So for instance, tether,
they're doing
their headquarters
in El Salvador now. Yes.
Yeah.
So it's going to be in
Bitcoin nation.
Now.
Even Bukele has kind of said
and I don't know
if he was strong armed
by global powers
that be into saying this
or if it's the actual truth.
For instance,
I was in El Salvador,

(01:11:52):
in January.
I was there for a conference.
And what were you at
the Palm Beach conference?
No, I wasn't at the plan
B conference.
So I didn't
see you there, though.
So, like, I was,
I was there, and,
Oh, are you. Dude, you're.
No, I
just came back a week ago
now, so I was there
two weeks earlier.
Max and Stacy
were hosting a pseudo.

(01:12:13):
Oh, the going conference
with the golf tournament.
Yeah, yeah.
So I played in the
golf tournament.
Yeah, yeah,
I said no to that
because I don't play golf.
I was in Colombia
just before that
when the golf tournament was,
I think, wonderful.
Oh, you should have
try to play
in the golf tournament
if you,
got a hole in one on the 17th
or 16th hole,
you would have won
one of my bitcoin.
Oh, I should have been there.

(01:12:34):
I was a hole
in one competition. Exactly.
But in parallel
with the golf competition,
there was actually
a very good conference.
I mean,
I mean, Max,
you can you
give Max a microphone?
He can talk forever.
Yeah.
It's, so Mexican up on stage.
Him and Stacy,
they were doing,
like, unconference sessions.
They had guest speakers, etc.
and actually
was a very good intimate
conference, I think.

(01:12:56):
But even then, like,
we tried
to pay in Bitcoin
at certain places
and it just wasn't possible.
So I don't think
the Bitcoin
experiment is going
maybe as successfully
as Bukele
or even you and
I would have wanted.
That's just
the unfortunate truth.
And I do think that.

(01:13:17):
To get to a digital standard
tether is a good way
to help us get there.
But that does long term hurt.
Bitcoin's potential or it
rather it hurts the long
term potential
of seeing Bitcoin
hybridization. Right.
Because it's a stopgap,
if you know what I mean.
Yeah,
I mean, I yeah, I,

(01:13:38):
people told me this before
I went to El Salvador.
Don't expect hyper
bitcoin ization.
But like
I was positively surprised
because I tried to use it
every here and there.
Like I was surprised
that you couldn't use it in
absolutely all
places in in Santa. Yeah.
But almost all,
but but in San Salvador,
just went around
and asked random places

(01:13:58):
if they accept bitcoin.
And to my surprise,
most of them did so.
So I think that's
a double sided coin.
I think
it depends a lot on
what expectations
you enter the country with.
And I didn't expect it
to be hyper bitcoin. Nice.
But yeah.
But so
I was happily surprised
that everywhere in there
people started
accepting people
accepting bitcoin.
And in malls and everywhere,

(01:14:18):
you know
so so yeah, I was
positively surprised by it.
At the end of the day, if we
end up in a world
where there is a
we see hyper bitcoin ization,
plus we see a
reasonably viable
fiat alternative,
that's not the worst
thing in the world.
Do I want to see everything

(01:14:39):
in Bitcoin. Absolutely.
Is that achievable?
I think so,
but there are powers
that be
that are going
to be fighting against that
for obvious purposes. Right.
So am I willing
to settle for a
digital dollar?
I mean, as long as it's
not a Cbdc
and it's a privately issued
stablecoin like tether.
Yeah, I actually think that's

(01:15:00):
that's absolutely perfect.
I don't want to say that
this is settling, but
I wouldn't be too upset
if we saw the world
transacting in Bitcoin
end tether,
let's put it like that.
Especially if tether
is secured by Bitcoin.
Yeah.

(01:15:20):
I,
I agree on most of that and I
yeah I still want to go
to these conferences that,
tether funds.
So I'm not going to say
anything more.
I love plan B in Lugano.
I didn't make it
to El Salvador,
but I love
the Lugano conference.
I thought they did
a phenomenal job there.
And it's,
actually interested
to see what.

(01:15:40):
How did we see each other
there?
Like, I don't,
I can't remember.
Oh, I have no idea.
I mean, so many people
at these conferences,
it's hard to keep track.
Same here.
Yeah, but
we'll we'll have to
have a chat
that the next one.
Are you coming to Prague,
for instance?
No.
Unfortunately,
I'm not coming to Prague.
I've been in the month
of January
in three conferences
on three or across

(01:16:02):
four continents, actually,
because I had a
little layover in Europe.
So I'm taking the next month
or two off from traveling.
All right.
Need to recuperate
after the holidays,
plus three months of,
a month
of running around the world.
All right,
I'm sure
we're going to bump into one
another
at one of these events.
Sooner or later.
But, Patrick, this been.

(01:16:22):
Well, hey,
if you come to
if you come to Bitcoin.
Miami,
we're the title sponsor
of the Bitcoin Miami
golf tournament.
You can try your best
at winning another bitcoin
I, I probably, Miami.
Oh no I'm sorry not bitcoin
Miami bitcoin Las Vegas
Vegas this year
I'm probably not
going to that
for several reasons.
I think that's
the city coiner fumes are

(01:16:42):
starting to smell a bit
too bad for my taste.
And I have another conference
that, is also.
I'm not going to shit
on, on on,
Bitcoin magazine
too much here
because I do like events.
I, I do pretty well
with them.
I sometimes wish
they would have
made other choices.
When it comes to like,
what, what sponsors
they take in, to me bitcoin.

(01:17:05):
Bitcoin first is a shit
coin company.
Bitcoin only is a bitcoin
only company.
And that's
what they should focus on.
But having said that Patrick
I got to go here.
So and so I'm sorry for that
I don't know
I love this conversation
and I, I,
in advance
I want to apologize

(01:17:25):
for for
putting you against the wall
and calling you a shit coiner
and all of that.
I hope it was enjoyable
for you, too.
And, I had
a great conversation today.
I always love having.
You know what?
Podcasts are not fun
unless they're
slightly confrontational.
If you have two people
that get together and just
agree about everything,
what the fuck are people
going to tune in

(01:17:46):
and listen to? Right.
A little
a little bit
of confrontation,
a little bit of name
calling is always a fun time.
Yeah, I absolutely agree.
And we should both be lucky,
that Luke is not here now
because it wouldn't
have been as confrontational
if it was because
he makes me
a better diplomat.
But but, But anyway.
Thanks. Thanks a lot.

(01:18:07):
Is there anywhere
you want to send
our listeners?
Like,
where can they check out some
our group
and what you're doing
and so on. On the inside.
I mean,
you can just check us out
at Samara Dash Agyekum
if you want to learn
more about us.
The funds were invested in
and our Bitcoin position.
I have my own podcast,
proof of words
we call it,
if you want to come
and listen in to,
I thought

(01:18:27):
it was pretty clever. Right.
So if you want to come listen
to the Proof of Words
podcast,
just look up proof of words
on Google or wherever,
and you can
tune and listen into us.
Fantastic.
So, Patrick,
thank you very much.
And thank you very much
for having me. Life. Yeah.
Looking forward to it.
Have a great day.
You too man.
This has been the Bitcoin

(01:18:48):
Infinity show.
Thanks for listening.

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Bitcoin vs Blockchain with Patrick Lowry | Bitcoin Infinity Show #153

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.css-14f5ked{margin:0;word-break:break-word;display:-webkit-box;-webkit-box-orient:vertical;box-orient:vertical;-webkit-line-clamp:2;overflow:hidden;}Bitcoin vs Blockchain with Patrick Lowry | Bitcoin Infinity Show #153