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The Peter McCormack Show
Nassim Taleb’s Bitcoin Black Paper with Lyn Alden - WBD378
01:38:34
Location: Remotely Date: Tuesday 27th July Project: lynalden.com Role: Macroeconomist Nassim Taleb is a well-regarded author and statistician and one-time bitcoin bull who has since turned critic, claiming that it "can be neither a long or short term...
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- [00:03]
Lynn Alden
Now we're seeing bitcoin monetize in real time what gold went through over thousands of years. Bitcoin's going through in like, you know, so far like 12 years. And so it went from zero to a trillion market cap. It's trying to find this total addressable market.
- [00:19]
Peter McCormack
Hello there from Bedford in the United Kingdom. How are you all doing? Bitcoin is flirting with $40,000 again. Interesting times. It does feel like the bull market is warming up again, I think. I think it looks good. You feeling good about it all? I think it's gonna be interesting few months anyway. Big end of the year would be very, very cool. Anyway, welcome to the what Bitcoin did podcast, which is brought to you by Gemini, the only place I am using for buying Bitcoin. I'm your host, Peter McCormack and today I have an interview with Lynn Alden where we are critiquing my good friend Nassim Taleb's Bitcoin black paper. But before that, I do have a message from my show sponsors. First up today we have Exodus Wallet is my mobile and desktop wallet for Bitcoin. Now, long term listeners know I'm always whinging about ux. So when Exodus reached out to me and said, pete, we want to sponsor podcast, I was like, okay, I'll think about it. Let me have a play with it. So I did. I had a play with Exodus Wallet and I love what they've done with this. So that's why I'm happy to recommend it to my friends and my family and of course you lot. Now, Exodus Desktop gives you a way to secure and manage your Bitcoin in one beautiful application. And with their mobile wallet, you can send and receive safely using a QR code or address, knowing that Exodus automatically checks addresses for errors. If you do want to check it out yourself, please head over to exodus.com or search for Exodus in the Google or Apple app stores. Also, let's talk about casa, the safest way for you to store your Bitcoin now. Forgotten passwords, SIM swaps, and phishing attacks. There are just too many ways for your Bitcoin to be lost or stolen. But with a CASA multisig wallet, you never have to worry about your Bitcoin again. Because with their multisig wallets, you you get to take custody of your Bitcoin. But you only move it by signing transactions from multiple wallets. And with those wallets, you distribute them into different locations. And that protects you from a range of mistakes, errors and vulnerabilities now, listen, I've been a customer for about a year now. I've been a CASA multisig wallet user. And if you've got any questions, you can reach out to me, you can hit me up in my Twitter DMs or drop me an email. There is no better time to upgrade your Bitcoin security and get total peace of mind. You can find out more at Keystone Casa, which is K E Y S CA and next up, we have Sportsbet IO, the best place for online gaming because you know what? They accept Bitcoin. Now, with The Olympics on, Sportsbet IO has you covered. They have prepared an amazing calendar for you where you get to complete daily missions and get daily rewards in return. All you have to do is complete the mission of the day and once done, you'll get the reward the next day. So hurry up, because this is only running to August 8th, and you get to enjoy the Olympics even more with Sportsbet IO. So if you want to find out more, please head over to SportsBet IO promotions, which is S P O R T S B E T IO Promotions. Okay, so onto the show today and we have the amazing Lynn Alden back. And for today's show, we've planned something a little bit different. We're not doing a macro review of the month, we're not talking about where Bitcoin is at. We decided to go through Nassim Taleb's recent critical paper on Bitcoin. Now, when Nassim Taleb initially dropped the paper, it was clear that there were some pretty obvious mistakes and I was keen to push back on it. I reached out to him on Twitter and I was like, hey, buddy, let's discuss this. But unfortunately, he wasn't very interested and blocked me. So in my last interview with Elian, I said to her, come on, let's go through this. And she agreed. So we've done it. We've gone through the paper point by point to try and figure out what he's got right and where he's completely missed the mark. So hopefully. Well, actually, I hope he listens to it as well, because if he does listen and he wants to engage on this, would be more than happy to record a show and go through these things he doesn't understand. May you be explaining the Lightning Network to him? Or maybe we'll just get an anti Lightning Network paper, who knows? Anyway, if you want to reach out, if you've got any questions about this, you can jump into my Telegram channel or you can email me on hello or what? Bitcoindid.com okay, onto the interview. Hi, Lynn. How are you?
- [04:12]
Lynn Alden
Good. How are you?
- [04:14]
Peter McCormack
I'm very good, thank you. This is probably the interview we're doing that I've been most excited about. I always learn a lot from you. But to take to work. Nassim Taleb's bitcoin black paper, I think, is quite an interesting thing, and. Interesting. I did skim it previously and just dismissed it. And then I read it again and saw some of the criticisms. And also. Actually, I think he makes some good points in there that also should be discussed. I don't think we should be entirely dismissive. I don't know if you found something similar.
- [04:44]
Lynn Alden
I've always found that in most criticisms, there's a big range of criticisms. Right. Literally. As someone who was more skeptical on Bitcoin back in 2017, there are certainly a number of criticisms that I can appreciate. When you're working out the probabilities of how successful the protocol will be, primarily, it comes down to a lot of the arguments in this particular paper are almost like you took a snapshot from several years ago and teleported them to today. So it's like a mental model of bitcoin that's pretty old, which is why I actually did find a lot of it dismissible. But there are obviously some more reasonable arguments within the paper. Overall.
- [05:26]
Peter McCormack
Yeah, I've read quite a few of the criticisms that were put out there on Twitter, and Nick Carter thankfully collected all of them together. But one specifically said most of these arguments have been dealt with on bitcoin talk years ago. I think if I was to criticize Taleb in doing this, firstly, I'm glad he actually did it now because for a couple of reasons, it just shows that he doesn't really understand bitcoin correctly. I'm also glad he did it because it raised some things I've not thought about and reinforced my position that actually we shouldn't just dismiss things, we should review them. But lastly, the other reason I'm. I'm really glad he did it is because I think it was an opportunity to. Well, I tell you what, my main criticism of him is that it feels like a paper that he's written because he's angry and he wants to find a fault with bitcoin, and it's not particularly balanced. I think there's plenty of places where he could have been balanced and had a fair discussion, pros and cons. But actually, it felt like he wanted to. He felt like. And I think it's because he's got into battles with bitcoiners. He felt like he wanted to attack bitcoin and that's fine. But if you're going to do a black paper against bitcoin and not once mention the lightning network, you kind of destroy your credibility with the criticism.
- [06:53]
Lynn Alden
That's unfortunately how I saw it too. Especially when I got to that part, the paragraph that talks about its scaling mechanism and then the fact that lightning wasn't mentioned once. I've actually seen this a couple of times with say Goldman Sachs had a big 50 page research paper out is far longer than this one. They got into altcoins and things like that. And the whole argument they started out dismissing bitcoin as too slow and then moved into altcoins. But if you actually just do a control F they didn't mention lightning in it and you can kind of look around and see they didn't. So the way I interpret it overall is that lightning is basically about something like three and a half years old on the main net, plus a couple years before then of planning. And so it's really where Bitcoin was in 2012, where some people might have heard of it. Most people have heard the word lightning but they might not know why it's important what it is. They might not realize that it's actually starting to hit critical mass of liquidity and usability. And so it doesn't seem like. I think we're still really early in that aspect. And that's actually one of the most in my view, bullish parts about the paper. Ironically, I was like if some of bitcoin's critics are not yet realizing that that's a source of alpha. That's like information asymmetry if people. Because it'd be one thing to say, here's why xyz, why I think the lightning solution is a poor scaling mechanism. Right. But you don't even mention it. While your paper has a large kind of aspect dedicated to bitcoin as a currency shows just. I mean that's a critical flaw of the paper and kind of the whole bearish thesis like at least half of it just kind of becomes irrelevant once you realize that wasn't even mentioned.
- [08:31]
Peter McCormack
Yeah, it's interesting because there's a few people like him now. Peter Schiff we know there he is up there. Nouriel Roubini, Steve Hanke. Hanke's a really interesting one as well. I think that's how you pronounce his name in that I find his Twitter really interesting because a lot of his tweets are very pro Bitcoin without talking about Bitcoin. He reports on or talks a lot about certain economic situations in other countries or certain issues where bitcoin is certainly something that can help people. Yeah, he seems to be very anti bitcoin, so I find his interesting. But what I also find interesting about these more kind of academic types is that once they take the position, they're not willing to change, not willing to hear constructive arguments. Whereas you compare to someone like Ray Dalio. Somebody said, I think it was Greg Foss said it to me. He has changed position. And I think it's down to the incentive model, like an academic doesn't. They're not paid to change their mind, really. Whereas someone like Ray Dalio is an investor, so he has to take a different position if the games change for him. So I find it really interesting that these people become so. It's almost like anti Bitcoin, which destroys their arguments. It's less balanced anyway. I could talk about that for ages. But I did pick out a quote which was really good from Alan Farrington. I don't know if you've read his Bitcoin Is for Foxes paper.
- [09:49]
Lynn Alden
I don't believe I have.
- [09:50]
Peter McCormack
No, I will send you afterwards because it's fantastic. So he put Bitcoin is new in just about every conceivable way. While the heuristics are highly conservative in the regular sense rather than the political, they ensure certain power structures are conserved. Bitcoin is targeting exactly this power for controlled demolition. So makes kind of a perverse rational sense for them to dismiss it or even in understanding it. And that was. I only read that this morning, but that was really interesting because one of the things that was in my mind, Lyn, and I'd love to get your perspective on this, is that a lot of time people compare bitcoin to other things. They compare it to gold, or they'll compare it to traditional fiat. But also in some ways, it's something that's completely new because it can be one or it can be the other. And it is a technology. So sometimes when we compare it to other assets or forms of money, I sometimes think we do bitcoin a disservice because perhaps bitcoin is something new. It's the evolution of money, is that it is this new thing that operates in a different way. Have I explained myself well?
- [10:53]
Lynn Alden
Yeah, I think so. It draws pieces from other things and so analogies can describe how part of it makes sense. But there's no one analogy that encapsulates the entire thing. I've also noticed lately on Wall street they're going through the whole block size war question again several years after the developers and went through it because Wall street doesn't kind of intrinsically care about decentralization. So when they see these protocols, they kind of look and think, oh, which one has the highest transaction per second? Which one enables the most features? Which one does this? And then they kind of tune out which one is actually decentralized? Which one can you verify the entire money supply with on a laptop? And so it's interesting how people who they have a certain perspective and they don't realize what makes something kind of powerful if that attribute is not valuable to them to begin with.
- [11:43]
Peter McCormack
Yeah, well, listen, we don't really need to cover the introduction or abstract too much because it's really covered throughout the paper. I think there's three primary sections and I will be referring to my notes a lot here. So this might be a little disjointed. So apologies to the listeners. But let's start with the. Let's start with the blockchain. So I will sometimes pull out some of his quotes as we do this and then maybe talk about this. But I'm going to start with this. So where he said the proof of work method has an adjustable degree of difficulty based on the speed of block which blocks which aims in theory to keep the incentive structure sufficiently high for miners to keep operating the system. Such adjustments lead to and these are two key points from this to an exponential increase in computer power requirements and making the time right in onerous energy demands on the system energy which can be used for alternatives such as computational and scientific uses. So firstly, I completely dismiss the moral case. I don't think it's relevant to the paper. If you're discussing whether Bitcoin is good money, whether it succeeded or failed. I don't think the moral argument about energy is relevant. So I've completely discarded that. But one thing I did think was interesting is like he understands proof of work, he clearly understands the difficulty adjustment. But I don't think, I don't think he fully understands why it's there. I think he understands why it works. But as I understand it, the difficulty adjustment is there for long term stability. Right now we're still in speculation phase. We're still very early. The world is pricing Bitcoin in but long term, as a bitcoin price stabilizes, my expectation or my understanding is that so will the difficulty adjustment wouldn't change as much and therefore we won't. This won't lead to exponential increases in demand for energy.
- [13:36]
Lynn Alden
Yeah, this is a common thing that I see when people discuss Bitcoin's energy usage is that I think a lot of them haven't sat down and actually kind of worked the math through the scaling of how it works. Because just because it has gone up exponentially in terms of energy use doesn't mean that it will. And in fact, it's mathematically impossible to really use more energy than the utility is providing. And so, yeah, going back to the moral case for a second, basically bitcoin uses like 0.1% of global energy. At its peak right now, it's even less than that. And it's one of those things where this whole kind of exercise is letting the market determine what it thinks is appropriate electricity usage and energy usage. Whereas you might not have the most accurate way to think about who should use energy. I certainly don't have the most accurate way. Taleb doesn't. And so this is our way of letting the market determine what it thinks is a proper use of electricity. But one thing worth pointing out is that if you look at Bitcoin's basically minor revenue, so how much money goes to essentially security. And not all of that is energy. A big chunk of that ends up being spent in energy, but not all of it. Back in 2011, for example, 46% of the market cap went towards that. Because of course, back then it was a highly inflationary protocol. It had a lower stock to flow ratio. By the time you got to 2015, it was down to 9%. By the time you got to 18, 2018, it was down to 4%. The first half of 2021 is down to 1.9%. And of course, that's because we have the declining block subsidy with transactions on top of that. As the protocol reaches over 20 million coins and reaches the mature phase of its distribution cycle transaction, overall miner revenue and by extension energy usage becomes an increasingly small percent of Bitcoin's market capitalization, most likely getting close to or going below 1% of its market cap. And so as Bitcoin reaches a steady state, it eventually shifts towards transaction fees. And his paper kind of words it oddly, because he talks about basically making the switch to transaction fees. But it's not like developers have to make that switch. It's already part of the code. There's already transaction fees there. And it's just a natural evolution over time that as block subsidies decrease, that transaction fee becomes a more important part of the remaining block subsidy, that's one of the big things that the environmentalists or the anti Bitcoin energy people miss, is that the actual scaling Bitcoin literally gets more efficient every year as the block subsidy approaches zero.
- [16:18]
Peter McCormack
Well, we are going to come back to the miners because I think he made a critical error in his paper there. And I do think it's an open question, something that people are keeping an eye on with regards to block subsidy and how much of that comes from transaction fees because we don't know in the future if it will provide enough security. It's always a tough question to even ask or answer is like how much security is enough security as well? I mean we saw the hash rate fall by 40% recently and blocks were still produced. But it is an open question. The big area, I had a question mark. The one area I just could not understand and I don't know if this is something you can cover, but it's his opening point discussing quantitative finance. I do have a big next to that and it's just because it's a sentence I have no opportunity, I have no chance of understanding, but I'll read it anyway. Consider that before efficient software for Monte Carlo simulations became widely available, some of us were using methods to generate pseudo random variables via some form of chain nonlinear transformation. In the spirit of von Neumann's original idea. I mean, so the mathematical side just went beyond me and I think it would have done a lot of people. Did you go through that at all?
- [17:32]
Lynn Alden
I went through it, but I mean that part of his paper doesn't really have criticisms of bitcoin. He's basically what I interpret as kind of demonstrating that he understands some of the deeper math aspects of it and that that seems to be his aim there because he's not actually really making an argument there. He's kind of walking through the history of bitcoin to get to eventually. Then he later goes on to his arguments about the protocol. And so I read it and I just thought, okay, so I don't have an agreement or disagreement. I kind of moved on to the next set of pieces.
- [18:04]
Peter McCormack
Lyn, is he flexing?
- [18:06]
Lynn Alden
I think he's flexing.
- [18:07]
Peter McCormack
He's flexing. Right? Okay, that's fine. Okay, so let's get into the main arguments. Why bitcoin is worth exactly zero. So immediately just my first initial point on that is not, that's false. Bitcoin right now is worth $37,866. I always say bitcoin is worth the price. People are willing to pay for at that time. So I think it's a disingenuous point. But obviously he goes on to justify and argue this. And I think here he makes some points which are kind of fair and fair for discussion, but ultimately contain errors. So his comparison to gold and precious metals being largely maintenance free, do not degrade over a historical horizon and do not require maintenance to refresh their physical property over time, pointing out that cryptocurrencies required a sustained amount of interest in them. Okay, so there's a couple of points in here. Firstly, when you refers to the protocol require maintenance and security, yes it does. But for me, especially with significant holders of gold, I'm pretty sure storing and holding gold in Fort Knox or transporting large amounts of gold around the world is a different kind of trade off that must be considered in terms of this. Bitcoin security comes from within the protocol, comes from miners. Gold security comes externally, usually from those who are holding it. And my thoughts on this are that the more gold you hold, you have an exponentially higher cost of securing that gold than say for bitcoin. There are people we know in the bitcoin community who probably own $1 billion of Bitcoin and I imagine that's a lot a lower cost to secure than say a billion dollars of gold.
- [19:52]
Lynn Alden
Exactly, yeah. And so with say, multi signature solutions, someone can store a much larger amount of bitcoin than it would be safe to do with gold. If you have a large amount of gold, you generally have to start relying on external custodians to do it for you, and you use that as a counterparty trust. And then they have the security and the scale to do that effectively. One way to separate this is, so it is true that gold itself requires no energy input. That's one of its main qualities that once you say, make a gold bar, that'll last practically indefinitely. But a gold market does require energy input. And so basically securing, verifying, and occasionally transporting that gold does require this ongoing energy input. And so when you think of bitcoin, for example, you could store the blockchain, you could store the code, you could store your private keys, you could do that with a very low energy state. But of course bitcoin would be very useful. Then most of that energy is going into the fact that that's an active market, that's adding new transactions to the blockchain, and the world is kind of coming to a consensus about the validity of that blockchain. Whereas, for example, if everyone say, just buried their gold, stopped protecting it, stopped Verifying it, then sure, it would go into that very low, no energy state, but it'd be useless at that point. And so basically, in order to have gold as either a base layer of money or just as a market that private participants choose to operate in that does have an ongoing energy input cost in the same way that bitcoin does over the very long run.
- [21:34]
Peter McCormack
Well, this is why I think the paper is disingenuous, because this is an opportunity to discuss the trade offs. I, as a holder of gold, don't need any real security. I can keep small amount of gold in my house and not really think about it. I don't have to worry about the security of a protocol. But also at the same time I have to consider, look, Lyn, if I wanted to pay you in gold, the transport costs are expensive, whereas bitcoin is cheaper. And that's where I think he's missed the opportunity to look like he's arguing in good faith because he can say, here are the trade offs. This is gold versus Bitcoin. This is the maintenance cost, this is the security cost, this is the transfer cost. And you can actually compare the two. And there are trade offs there. That's where I felt it was disingenuous.
- [22:21]
Lynn Alden
Yeah, there are analysts within the whole bitcoin community. For example, Vijay Boy Patty has that chart comparing say bitcoin to gold and the different qualities or one is better than the other. I have a long history of investing in precious metals. I still own gold, for example. I have articles also that discuss some of the pros and cons. It's not like bitcoin is better than every attribute. You do have certain areas where one's better than the other and they have kind of different use cases. But I just don't view that that ongoing energy requirement is something that is notable. Right. So if I were to say, what is the chance that 200 years from now gold is say, not worth zero, whereas something happens, some tail risk happened to Bitcoin and made it worth zero? I would say sure, I'd give that be in gold's favor because that bar, that gold coin will still be there and worth some non zero amount, whereas, but they both require that ongoing energy input in order to actually have an active market that's verified, that's secure and that's being used for some purpose.
- [23:26]
Peter McCormack
But that's the advancement of technology as we've grown to a world where people have Netflix instead of going to blockbuster. We have MP3s rather than CDs. There is a Reliance upon technology and energy and systems being up. I think this is kind of the world we've moved to. But like I said, I do think it would be better with showing the trade offs. And you referred to Vijay Boyapali's chart. So anyone listening? It's an article called the Bullish case for Bitcoin which you can Google and find. We'll try and stick in the show notes. But I think Vijay does quite a fair comparison between fiat bitcoin and gold. So definitely check that out. But yeah, then his final point, cryptocurrencies. But let's just stick with bitcoin require some sustained amount of interest in them. I mean, he's right, fundamentally he is right. But so does any similar asset, gold and silver require some sustained amount of interest in them. I still think we are in a speculative phase of Bitcoin. I'm long and I'm highly confident bitcoin will be a success. But there is no guarantee. And I think shitcoins have proved that you require a sustained amount of interest in them because we can see specifically with BSV recently the interest has fallen and it's been subjected to a 51% attack. And that's happened on a number of other cryptocurrencies. So I think his point is fair, but I think what he missed is identifying the risks because the sustained amount of interest comes down to the cost of security. And if there is a significant drop in interest in bitcoin, I think the risk is to security, not to price. I don't worry too much about price, but if the price falls to a certain point, there's a security risk. I think he's right, but I don't think he went into enough detail.
- [25:18]
Lynn Alden
I agree. And that's your way to frame. It's the most accurate one. And that's one of the risks that I take long term seriously about Bitcoin when I think of ways that bitcoin could fail. And so I had a whole article dedicated towards bitcoin's eventual kind of that gradual shift towards relying on transaction fees and kind of working through the math of that. And so it is true that bitcoin does have to achieve a certain level of scale enough to keep those blocks full, a reasonable market capitalization in order to have those transaction fees represent a significant hurdle for someone trying to attack the blockchain. And so it is true that any monetary good, so an industrial good like say copper or oil, is used for a specific purpose. So it doesn't really require your belief in it any Monetary good, whether it's fiat currencies, can be enforced by the government. But still, it has to have a certain level of credibility where people will abandon it in the black market and go elsewhere for their ways of transmitting value. And so one way to think about gold, for example, is that gold has utility. You can use it in some engineering contexts, but the vast majority of gold's price is the monetary premium we place on it due to its unique qualities compared to most other commodities. For example, if that perception of gold as money were to ever dissipate over time, sure, gold would not go to zero. Gold security would not be threatened. The properties would not change. But it could lose a dramatic amount of its value because we've placed so much of that value in the monetary premium, that would then be going away. And so one thing that does make cryptocurrencies and bitcoin different is that if it falls below a certain maintenance threshold and basically becomes a security risk, then basically they could conceivably go to zero. As you point out, if it gets so low that it ceases to function, basically the number of confirmations you need to make a transaction becomes unsuitably long due to improper security, and then it starts being subject to regular 51% attacks. That is essentially spilling the end of that blockchain. And so that is true. That's one of the trade offs between gold and Bitcoin. That bitcoin has a kind of a minimum level of network effects that it has to maintain in order to stay alive.
- [27:44]
Peter McCormack
Yeah, I think. I think you framed that in the right way as well. Is that because we did see with some cryptocurrencies that some exchanges. I remember at one point, one of the exchanges changed their confirmations for a whole number of different cryptocurrencies, and one of them was like over a thousand confirmations. It might again have been something like bsv. But, yeah, I think that's a fair way to frame it. And I think if he could have done that, and that would have made that a fair argument. Okay, so the next area, which is super interesting, and I've got my own points, especially when we get on to miners, but earnings, free assets with no residual value are problematic. So he compares bitcoins to stocks and raises the issues of dividends and future rewards. A question I wanted to ask you because this is where I'm kind of out of my depth, but I don't get a dividend. With Bitcoin, Yes, I can lend it out and earn interest, but I don't get a direct dividend with bitcoin. But what I do get is at this kind of average 200% a year appreciation in value compared to say, the dollar. Now, I can't think of anything I could invest in where I'd maybe get the equivalent 200% dividends. But am I thinking of that in the wrong way? Why is he bringing up dividends? Why is he bringing up the yield you can earn from other assets?
- [29:05]
Lynn Alden
I think that's a fair point to bring up on his part, and it's something that I've looked at as well. And that's essentially what differentiates an investment from a monetary good. And so when we invest in a company or say a property, we're doing it ultimately based on the earnings that that can provide us if we're treating it as an investment. And so obviously a dividend paying stock or a bond that pays interest or rental property with rental income would achieve those right away. And so basically the way we'd model the value of those properties of those assets is to look out the future, put our assumptions in for what kind of income stream it's going to provide us, and then say, use discounted cash flow analysis to pull that into the present and determine what we should pay for that if we want to achieve a certain level of return. Now that's more complicated by say, growth stocks that don't pay a dividend. So they're reinvesting capital in the business. Even then. The philosophical underpinning for why you might want to invest in that growth stock is because you know that in the future it can pay a dividend, that it generates cash flow or will generate cash flow, and that over time that could begin paying back the owners. If you invest in Apple stock, when it was very small, for example, it grew tremendously and eventually started paying a dividend and paying its shareholders. It's paid billions and billions and billions out in dividends, even though we don't think of it as a dividend paying stock. And so that's how you kind of analyze an investable asset. Now, any sort of monetary good or collectible is different because it doesn't produce a cash flow and you're owning it only either for its utility, like a collectible or something like that, or as the monetary premium. The fact that you believe you could then sell that to a person at a later time. So that could be, that could be comic books, that could be magic, the gathering cards, that could be wine, that could be gold, that could be bitcoin, that could be collectible cars, you're buying something that doesn't have any expectation to produce the cash flow to eventually have someone buy that off you in the future. Then of course, you can go into different categories for that. For example, a dollar, like a fiat currency itself, doesn't pay interest. There's no interest coming out of a dollar. It's only when you give it to an institution that leverages it that they are able to pay you interest on that underlying dollar. The same thing is true for Bitcoin. Obviously we're seeing lending markets around that and we can talk about how safe they are. But for example, you can earn interest on a Bitcoin if you're willing to essentially have it levered up in some way just like the dollar. I would say that argument really is a separation between a monetary good versus a cash flow producing asset. And then there are other parts of his argument that you can go into. And so, for example, he argues that a collectible or gold chain is different because a collectible you can still have for its utility, its aesthetic value, so you can get joy from it while you own it. Right. So if I have one of those magic cards, I did laugh at that, yeah. If I have a magic card that's like, I like how it looks, I'm happy that I own it. Then whether or not I can eventually realize my goal is selling at a later price, it still provided value. I can use it in the game. For example, Taleb used the analogy of his gold necklace that even if gold goes to zero, he still got to wear that necklace for decades, and therefore he got utility out of it. One thing I would point out with Bitcoin, for example, is that you can actually separate it into the monetary aspect and actually other utility it's offering. And so Even if, say 10 years from now, Bitcoin goes to zero, there are still people that got value from Bitcoin as a monetary utility. And so, for example, anyone who's familiar with the work of Alex Gladstein, for example, some of his individual articles with use cases is longer than Taleb's entire paper, let alone if you read like ten of Alex's articles. And he just catalogs all the different ways that basically he or other people have used Bitcoin in a human rights situation. So that could be, for example, the fact that Bitcoin's portable allows people that are fleeing certain regimes to convert their money to bitcoin, leave the country, and then convert back into other assets in a way that you can't really do with gold or Cash or things like that, it's also being able to send permissionless payments. So if say he or the Human Rights foundation wants to provide funding to a specific say group in a country that's being oppressed or that's being otherwise blocked, you might not be able to effectively get money to them through the traditional banking methods, but you can send them directly either via the base layer of the Bitcoin or via Lightning, depending on how big your transaction is, you can send them directly money. And so there's already tons of people that have benefited from Bitcoin. So even if this whole project fails at some point, just like Taleb's gold necklace, there are already people that benefited from the fact that this has exist.
- [34:24]
Peter McCormack
So there's kind of a net value to everyone who's getting a usage out of Bitcoin.
- [34:30]
Lynn Alden
Exactly. And I would say it failed next year. I would say that would be ultimately by the end of things it'd be an underwhelming outcome, but it still would have had a non zero outcome. And then the longer it goes, the more that accumulates, basically a net added value. And then we're also seeing, for example with layer three technologies like Impervious AI or Sphinx Chat, we're also seeing that now the Lightning network can be used to run a vpn, you can use it to run decentralized social networks, you can use it to send encrypted information around the world. So basically it can basically provide people with access to information, even in areas that are hostile to that information. If that gets more developed, that's another form of utility added on top of those permissionless payments or those self custody assets that can further benefit people even if one day in the future Bitcoin for whatever reason fails.
- [35:24]
Peter McCormack
Well that's another interesting point because Peter Schiff similarly falls back on gold's industrial use as evidence that gold is a better asset to hold than Bitcoin and gives it intrinsic value. That term intrinsic value. But I think what we have with Bitcoin is this growing technology use of Bitcoin. So one great example is now Strike Strike uses the Bitcoin network to send different currencies around the world. If I want to send you dollars, if I want to send you $100, whatever the rate is, 72 pounds, we use the Bitcoin rails for you to receive $100 and it's instant and it's free or close to free. I think it's free actually. And I also know Peter Todd is working on his open timestamps on Top of the bitcoin network. So one of the things that I was going to discuss with Peter Schiff next time I talk to him is when you talk about industrial uses. Bitcoin has technology uses.
- [36:21]
Lynn Alden
Exactly, yeah. You can separate them into monetary uses or non monetary uses. So the ability to send permissionless payments, that application of technology for that specific goal in a way that say, fiat currencies are gold or not great at doing, that's already specific utility. And it happens to be a monetary utility. But then for the longest time, you could argue that Bitcoin was unique in the sense that it was a purely monetary commodity where, say gold is like a 90% monetary commodity, like 10% utility. And so Bitcoin was 100% monetary utility. But actually what we're seeing with some of these layer three technologies is they're actually now bringing some non monetary utility to Bitcoin as well, which is interesting. And so, yeah, I think over the long span of Bitcoin's project history, again, even if it one day fails, this is now representing a stream of utility that people are getting from the fact that they have a permissionless way to send payments or a way to portably transmit value in a way that other technologies have not provided so far.
- [37:29]
Peter McCormack
All right, so the next thing is where I think he makes one of his critical errors. And I'm going to just give a shout out to Radley Rattler, because it's his thread that I use quite a bit for a lot of my research. And I'll tag that into the show Notes. But if we. So this is talking about Bitcoin being worth zero. If we expect that at any point in the future the value will be 0. When miners are extinct, the technology becomes obsolete, or future generations get into other assets and Bitcoin loses its appeal for them, and then the value must be zero now. So there's two things there, it's whether people get into other assets and also if miners become extinct. But what was quite strange about it, he didn't discuss why miners would become extinct. I think the only logical answer for why miners become extinct, if you get out of a global coordinated ban on bitcoin mining, is the fact that I think he's probably considering the block subsidy and how that is decreasing over time, but he's not considering the increase in the percentage of the subsidy, the subsidy coming from transaction fees. So I think he's missed that point. But I think it would have been a stronger argument if he'd explained why he thinks miners will be extinct. Without actually explaining it, there's no argument there.
- [38:43]
Lynn Alden
Exactly. If he focused that part of his paper about the fact that blockchains have a minimum security threshold under which they start becoming effectively unusable, that would have been a stronger argument to make there. But even then, even acknowledging that that can happen to a blockchain, including potentially Bitcoin, if some of the worst scenarios happen, you can say, okay, but it goes back to that previous point of even if that one day goes to zero, the fact that basically Bitcoin is providing value to people in certain ways doesn't end up getting negated. And so basically the fact that you can use Bitcoin for permissionless payment in a way that there's no other asset that will fill that goal as securely as Bitcoin currently does, means that it currently has a value. And so even if one day does not have a value, it does have a value today. Then two, you can go into expected value theorem to determine what is the value today, considering the range of probable features for any people who's not familiar with the expected value theorem, you take your set of estimated options for what could happen and then you weight them by the probability that they'll happen, and you also assign a value to each one. And so let's say, for example, if we were going to make a bet with a coin flip, there's a 50, 50 chance, assuming a fair coin of either of us winning. And then we can weight how much we get. So if we the winner pays the other $100, that's a fair bet. But you can have another expected value theorem of buying a lottery ticket where there's like one in a million chance you're going to win a million dollars. And then there's like vast majority of chance you're going to lose that your initial investment is just you say you spent $2 on the ticket, it's going to be worth zero. And so you can actually math that out to determine what is that ticket actually kind of worth in a probabilistic sense. And so when you do expected value of Bitcoin, you can assign some non zero possibility that it goes to zero in your lifetime so that it fails to catch on. There's a coordinated attack, there's a critical bug or disastrous hard fork or something like that, and eventually falls below a security threshold and starts going the way of just being an ineffective asset that loses a lot of its monetary premium. So that's one possible feature. Then you can have kind of rather bullish ones where basically you argue that There are reasonable cases to be made that say Bitcoin's market capitalization could be as big or bigger than gold, which in this sense is basically a 10x increase in price from here. And then you can have a range of outcomes in the middle where Bitcoin just kind of continues to exist in a variety of different shapes and forms and market capitalizations. And when you run those numbers, you get some non zero expected value for Bitcoin. And then also, even if you just put math aside, if you just approach it intuitively, if someone say, went to Teleb and said, okay, here's a time locked device with 1000 bitcoin on it and so you can't spend it now, you can't just convert it to Fiat, but in 15 years this will unlock and you can do whatever you want with the Bitcoin and it's free, would you take it? And so if you rationally expected Bitcoin to have mathematically provably worth zero, you say no, because why would I accept it's not worth anything. So I will not accept that. But any rational person, if made that offer, would of course accept that. Because even if you're bearish on Bitcoin, you think probably 15 years from now the flaws will have, in their view, the flaws will have wrecked it. It'll be worth zero or near zero. There's still a possibility that it won't be. And so of course any rational economic actor would accept those thousand time locked Bitcoin and just put it aside and see what happens in 15 years. So we know that in terms of forward probability, either looking at it mathematically or just intuitively, we know that it has some non zero value. And of course the big question is what is that value? And of course the market is trying to determine that every day, but we know that it's non zero.
- [42:47]
Peter McCormack
Well, so even if it was $10 per Bitcoin for those thousand, I'm sure Taleb would take it.
- [42:54]
Lynn Alden
Exactly, yeah, even if it goes down to 10 bucks, it'd still be worth $10,000. And so even at $1,000 exactly what's.
- [43:04]
Peter McCormack
The price he would secretly pay for those thousand Bitcoin?
- [43:08]
Lynn Alden
Yeah, it's a good point. Maybe as someone who's bearish would say, I think the current market price does not adequately affect risks. And so for example, they might want to pay a lower price for that. But that's what the market's trying to determine every day. There's plenty of people that are willing to pay more than the current price. There's people that are willing to pay less than the current price. The price sorts itself out every day as it's weighting the probability of its future outcome. When we see signs of adoption, it tends to have a price bump. And when it sees signs of government pushback or some of those other signs get pulled back, we generally see the price go down a little bit. The market's like this, constant. Of course, then you also have leverage and liquidations and things like that. But in the broad sense, essentially the market is a probability machine kind of sorting through all the future, all the future, you know, possibilities of what happens with bitcoin.
- [44:01]
Peter McCormack
Next up, I talked to Lint More about To Live Bitcoin Black Paper. But before that, I do have a message from my amazing sponsors. Okay, let's talk about Gemini, the only place I am using for buying and selling bitcoin. But as I said before, I'm not selling bitcoin right now. So I'm only using it for buying bitcoin. Why would I be selling bitcoin right now? Now, I have been using the Gemini app for buying the dips, but I've also set up my DCA with twice monthly buys of bitcoin. And you know, I'm yet to see a better or easier interface for buying Bitcoin. With a streamlined trading view, you have access to all the tools you need to understand Bitcoin and start investing. And that is all through one clear, attractive interface. So if you want to find out more, please do head over to gemini.com which is g-e m I n I dot com. And next up, we have Revolut. Now, as many of you know, Lloyds TSB, my bank of 25 years, closed down all of my accounts recently. It's kind of clear they don't like bitcoin. And then Revolut reached out to me. They're like, Pete, we see what's going on here. Do you want to move over? Do you want to get a Revolut account? I was like, sure. And I moved everything over in a couple of hours. They like Bitcoin and they want to make it easier for Bitcoiners to transfer to exchanges. And now Revolut are offering $20 or 20 pounds to all new customers that complete three card transactions. It only takes a few minutes to set up and you can create a card and add it to Apple. Pay immediately and get that cash straight in your pocket. I'd recommend converting it to Bitcoin though, because that's just me. Now, this is a new relationship and I'm working with the Revolut team to help them build a bank which is Bitcoin friendly. There is a lot to navigate, but we're going to get this now. If you want to find out more, please do head over to revolut.com wbd that is R E V O-L-U-T.com wbd let's talk about Blockfi, who have recently just announced that they have launched their BlockFi Rewards Visa Signature card. Now, for my listeners who are in the US who are interested in or owning Bitcoin and want to stack more SATs, the BlockFi Rewards credit card provides the easiest way for you to earn Bitcoin because you get 1.5% bitcoin back on every card purchase. And you know what? There's also no annual fee. It's not just that though. You can also earn 3.5% back in Bitcoin during your first three months of card ownership. And everything you spend over $50,000, you will earn 2% back in Bitcoin. There is no better way to stack sats and I cannot wait to get my card. If you want to find out more, please head over to blockfi.com which is b l o c k f I.com and this week we're finishing with Ledger, the world's most popular hardware wallet. Now, a hardware wallet allows you to take custody of your Bitcoin and I have been a Ledger customer since early 2017. You know what? The Nano S I bought back then I am still using now. Ledger makes it easy for you to safely manage your Bitcoin using their Ledger Live software, which interfaces with your device. And if you're an Android phone user, you can connect that to your Nano S and manage your Bitcoin on the go. If you want to find out more, please do head over to ledger.com which is L E D G-E R.com so he also, as I said, there was two parts. He also mentions that in the future Bitcoin loses its appeal and something else may perhaps come along that's better than Bitcoin. I think any Bitcoin who accepts that's a possibility. Many of us don't believe it. Some do. Some believe Ethereum is better and they have moved their investment over to Ethereum and over time they will be proved either right or wrong by the market. I think they're fundamentally wrong. I know you have your criticisms of Ethereum, but I think every Bitcoin will accept that something better may come along. But we haven't seen it yet. So that is a possibility. And he raises that precious metals lost their quality as a medium of exchange. I don't think it's that they lost their qualities as a medium of exchange. Something better came along which monetary notes, and then monetary notes were replaced by digital money. I think bitcoin has fair criticisms as a medium of exchange. I think its main flaw is really volatility. That's one of its main issues. Because you can't really, if you want to price things in sats in a supermarket, it's a bit like Venezuelan's pricing groceries in a supermarket in the Bolivar. They're always repricing. That is a fair criticism. We all accept that. And maybe we don't hyperbitcoinize. Maybe we will always have a more stable sovereign currency in some countries. I accept that. But I don't think that's a reason to dismiss Bitcoin. It's a bit like any technology. Mobile phones we may use for 10, 20, 30 years and then at some point we just have a chip in our head and we use that instead. Technologies come and go and bitcoin is a technology as well as being a financial protocol. And it might last for 40 years. Years, it might last for 100 years, it might last for 200 years. We just don't know. I don't find that a reason to dismiss it. If something is a better money, it is until something even better comes along.
- [48:44]
Lynn Alden
Exactly. And this is the first kind of upgraded type of money. So it's a protocol that can upgrade so it's not locked into its current form. And so the question becomes how does the network effect of that whole protocol compare to some of the competing network effects? Or it's a brand new technologies we haven't conceived yet. And so as you point out right now it's one of the best forms of money we have. And we're seeing bitcoin monetize in real time. And so what gold went through over thousands of years, bitcoin's going through in so far like 12 years. And so it went from zero to a trillion market cap and then came back down a little bit. And so this is basically it's trying to find this total addressable market. And so of course it's doing that with volatility. And so right now it's in that phase where it's being recognized so far, more so for the store value aspect as a scarce and secure thing that on the side you can use for permissionless payments as well. And so it's gone through these different phases where especially earlier on when it was cheaper, it was prized a little bit more for its medium of exchange. But then as people realize it's actually gone up so tremendously, the overall kind of market started looking at it more of a store of value type of technology. But then interestingly now that with the development of lightning and other technologies like that, we're kind of now seeing more use cases again for the medium of exchange. Because Bitcoin is something that can upgrade over time. And so that's. Different market participants have different mental models for how they look at Bitcoin. And so, for example, someone like Michael Saylor, who's determining what asset to put his corporate treasury in, he's not analyzing different assets based on their medium of exchange capability. He's looking at which one is likely to hold value over a multi year or multi decade period of time. And when he went through all the possibilities, he picked Bitcoin. And he specifically likes to call it a crypto asset or a bank in cyberspace because he doesn't like to view it as a currency. And so of course, different market participants are kind of judging its qualities in ways that whether or not it meets the need that they're trying to use Bitcoin for. And so if you look at on chain Bitcoin transactions, I mean, let's see, he has a section there about the downsides of using Bitcoin as a medium exchange. Some of them are fair and some of them are not. So, for example, he says transactions in Bitcoin are considerably more expensive than wire services or other mode of transfers or ones in other cryptocurrencies, their order of magnitude slower than standard commercial systems used by credit card companies. Anecdotally, while you can instantly buy a cup of coffee with your cell phone, you would need to wait 10 minutes. If you use Bitcoin, they cannot compete with African mobile money. Nor can the system outlined above, as per its very structure, accommodate a large volume of transactions, which is something central for such an ambitious payment system. And so that's a really good argument from like 2013.
- [51:46]
Peter McCormack
What we should say is because we've moved into the next section, which is his second comment, success for Bitcoin as a digital currency. So we will let me just close out on that first point. So people are aware this comment one with why Bitcoin is worth exactly zero. I can say a number of things, but actually your argument is the best. If you could take 1000 bitcoin locked for 15 years and you could have it for zero. Would you take it? Of course you would. So what is the price? I absolutely believe taleb would pay $10 per bitcoin for those thousand. I believe he would therefore, or, and even if he wouldn't, if you surveyed a million people, I think the majority would therefore Bitcoin does have value above zero. I just wanted to conclude that because I think that's a great argument. And just as we're going into this because the next point was success as a digital currency and this is one of the sections you're relating to there. So sorry, just to structure it, I found this bit really poorly argued as well.
- [52:43]
Lynn Alden
Well, this is, I mean this is probably the weakest part in the paper because it fails to mention lightning. And so going back for a second, basically Bitcoin's base layer, it is true, is not well designed for many types of on premise payments and payments where you want any sort of reasonable turnaround because he actually understates it because he mentions 10 minutes and realistically you want a couple block confirmations, it could actually really be more like a half hour or more depending on the size of your transaction. Then of course, when you include transaction fees and things like that, Obviously bitcoin base layer transactions are not great for buying coffee. Now, I would contend that it is actually more cost effective than many types of international wire transfers. Yeah, it is.
- [53:31]
Peter McCormack
It depends on the timing because I think it's around about $2.50, $2.60 right now. But back during a couple of months ago, I think it went up to about $60. And most my experience with wire transfers is they're about $30. I don't know what it's like, like, Lyn, if I wired you some money, but my fee would be about $30 if I wired you a billion dollars. I don't know if the fee's the same. I don't know if there's any form of scaling up of the fees.
- [53:59]
Lynn Alden
It would depend on the bank. Generally that will not scale linearly. But if someone's trying to transfer that amount of money, it would certainly take longer and because there'd be far more checks to make sure that that's all going to be proper. And so basically the amount can scale up to a certain point, but then it becomes more about time and hassle about sending that kind of large amount of money.
- [54:22]
Peter McCormack
One other thing I just want to add in there before you go is that one of the things I noticed in wiring money internationally myself is that the banks use a different exchange rate from what is quoted in the market. And I think they're taking on the exchange as well. So for international wise, yes, you have a $30 fee. But because I invoice internationally, some of my sponsors, I was noticing that I was getting a different amount from the quoted exchan rate. So I think they're on the take there too. I just thought that should be dropped in.
- [54:54]
Lynn Alden
I've noticed that too. I used to work with engineering procurement and so we'd buy stuff from Canada and we'd always have to negotiate the exchange rate and things like that with the counterparty because those can add up when you're making a six or seven figure purchase. And so that is certainly a good point. And then so we look at Bitcoin as a base layer. I mean obviously it makes certain trade offs, but it's also disingenuous to compare it to a credit card because a credit card transaction is a layer on top of an underlying settlement layer. And so Bitcoin in that sense is more comparable to a wire transfer, something like Fedwire, these kind of underlying settlement systems. And so actually if you compare Bitcoin to a wire transfer, it's faster and you can really do it on a Sunday morning at 1am internationally. So it's actually in many ways it's a better underlying settlement technology than what we currently have available. But then when you say, okay, now we want to do individual purchases with it, kind of like how we wouldn't purchase coffee with a wire transfer, it's not suitable for that purpose. That's part of the reason why it hasn't caught on. There's obviously certain Internet use cases where it caught on, like early days with the Silk Road or if say someone like, say Alex Gladstein wants to send a human rights group some funding, Bitcoin is actually the best technology available to him to do that. And so there actually are certain niche cases where a base layer transaction is the most ideal solution. But in many cases, especially for those of us in developed markets, it's generally not. An on chain transaction is not the best kind of medium of exchange for many of our purposes. But that's where the argument kind of gets weaker. Because he doesn't mention lightning either in that section or anywhere in the paper. That's a critical flaw because if a large portion of your paper is focused on Bitcoin's effectiveness as a mean of exchange, but you don't even mention lightning, you don't even acknowledge that you know it exists, he should have at least flexed and mentioned lightning. And then have say reasons XYZ why he doesn't think it's suitable. Right. So you can. It's different.
- [57:11]
Peter McCormack
I was going to say. Sorry to interrupt you. I was going to say what this said to me is like either he doesn't really know anything about the Lightning Network, which is a possibility you might have heard of it and just not really understand what it is. And if he doesn't, this paper, he hasn't even passed it through somebody who understands Bitcoin. Surely he has a friend he can turn around and say, can you check this? Because everybody will instantly say the Lightning Network. And his quote is, while you can instantly buy a cup of coffee with your cell phone, you would need to wait 10 minutes if you use Bitcoin. So yes, you're right, he's got the 10 minutes wrong. But I've got videos of me on Twitter buying coffee with my cell phone using the Lightning Network in El Salvador. And it's instant.
- [57:51]
Lynn Alden
Exactly.
- [57:52]
Peter McCormack
So it's either ignorant or dishonest.
- [57:57]
Lynn Alden
Yeah, I don't know which one it is, but I'm inclined towards that. He doesn't know because it's actually, it's awkward then to read the paper and it's just not even mentioned and because then you knowingly open yourself up to a massive criticism that invalidates the paper. And so basically if he knew, he would have probably had a paragraph explaining even if he, because he kind of. There are other things he dismisses quickly in the paper. And so you could have had a paragraph saying there's Lightning Network, but it's bad. And it would have been a really weak argument, but it would have acknowledged it. The fact that he hasn't mentioned it is one of the most interesting things about the paper. And so when we look at the Lightning Network, it's not a perfect solution yet. It's funny because it's only three and a half years old. Even the design process only goes back like six years. But if you compare how far that's come in that rather short amount of time, I mean, if you look at the majority, the handful of companies that are making lightning implementations like Lightning Labs or Blockstream, the number of employees dedicated to that is in the dozens. And then when you look at, you add some wallet makers, you add the people at Strike, you add things like that. We're talking about the number of people working on lightning in any sort of full time capacity has got to be in the lower hundreds. I don't know the exact number, but this is a tiny number. Whereas if you look at PayPal, Visa and MasterCard alone, they employ over 60,000 people. Then if you include WeChat, Alipay, all these other payment systems, you're up against hundreds and hundreds of thousands of people working in payments. And this tiny little network with dozens or hundreds of people putting it together is now basically being used in a sovereign country as one of their legal tenders. It's a tremendously successful protocol given how young it is and how few people are working on it. That's actually a testament to how interesting the underlying technology is that basically by using the existing Bitcoin base layer as their security assurance, they're able to build this out and scale this in a way that's actually pretty tremendous compared to some of the competitors. It's just remarkable that it came up like that. An example if people that went to the Bitcoin conference in June, one of the big takeaways from that network, I mean from that conference was that Lightning is really kind of hitting critical mass now. And so they had. I heard from sources that something like 50,000 gaming transactions were made using Lightning. But even just using one example like Thunder games, they processed over 13,000 Lightning transactions. And the average fee was like a fraction of 1 penny, 1.4 sats to be specific. In terms of. So when we have these actual use case working out now and that network effects keep getting stronger over time and sure, people can then say lightning has certain limitations. So right now the capacity is not enough that everyone in the world could have a self custodial Lightning wallet, for example. And so you can have kind of a mix of custodial or non custodial depending on your specific use case. If you're trying to just. If you're an unbanked person in a market with $100 on your wallet, you might not care about the level of rock solid security there compared to someone who's a power user of that or an experienced user of it. Lightning still has weaknesses, but it's actually tremendous how far it's come in a rather short period of time.
- [61:30]
Peter McCormack
There's a few interesting points on that as well, because he has to, he talks about the cup of coffee and it's instant on your phone and the cost associated with settling on chain. But one of the things that's interesting is if you learn about the Lightning network. What's really interesting is if I'm in use El Salvador as my example, if I use my Visa card to buy a cup of coffee, and the cup of coffee is $3, yeah, I pay $3. I'm not sure what percentage the vendor loses. I'm assuming it's like maybe 30 cents or whatever for the transaction fee. But because it's an international transaction, I think I end up paying like 50 cents to a dollar every time I use my card. But so even if you forget what I'm using because it makes sense for me then to just use the Lightning Network because it's almost free, it's also great for the vendor because it's almost free. So both sides are actually saving on the cost. So actually, it's cheaper to use the Lightning Network to buy a cup of coffee than the Visa network. Certainly if you're using a custodial service, it's as fast, maybe sometimes even faster. So he completely misses that. And I think the thing is, if he had discovered the Lightning Network, what we would have actually got was why the Lightning Network fails as a section, which is kind of sad. There's other things I think he misses as well. I think he misses two other key points in that. With Bitcoin, it is finally settlement. So even if it takes an hour to confirm, if I was to send you a large amount of bitcoin, say it's 10,000, 100,000, a million, we see it immediately, even if we're waiting for six confirmations. I can't remember if it was. Somebody told me this story about they were trying to get some money out of Argentina. I don't think it was the sailor story. And they were trying to move money from Argentina to the US or the other way. And they said once it went into the system, they didn't know where it was. They didn't know any way of tracking it. And it didn't turn up for a few days. And there were some issues, and they were having to find out. We completely eradicate that problem of moving money between different institutions across borders. It is wallet to wallet, it is address to address, and we instantly see it. I think he's missed so many points on this section. I thought this whole section was just a complete and absolute failure. Apart from one area, which is worth discussing, which is when we get into whole the unit of account. Now, he does make a mistake because he said, apart from the El Salvador residency fee or 3, Bitcoin. Bitcoin isn't used as a unit of account. I mean, it's wrong. Bitcoin is a unit of account within Bitcoin for transaction fees and miners and is also a unit of account on exchanges for cryptocurrencies. And I do know Other people are using Bitcoin as a unit of account. But again, I tried to think this through, Lyn. I think there's a massive problem with Bitcoin being in a unit of account unless it's a stable currency, unless it's the dominant currency globally, because it's always comparative to other currencies. It's always going to be volatile. And I've kind of accepted that it might not ever happen. And is that, does that mean we have to reconsider what Bitcoin is? I mean, so I think it's an area of discussion, and I think it's a valid area of discussion because a lot of people bring it up. But I think it's something we've all come to accept and that's fine. It doesn't stop it being a medium of exchange. It just brings in certain things you have to consider.
- [65:03]
Lynn Alden
That's where we can separate Bitcoin the asset from Bitcoin the monetary network. The cool thing about Bitcoin is that it's both, and they both have different use cases. So that's part of the fact that it's this young asset that's being monetized in real time, which necessitates volatility. And so Bitcoin currently in most contexts makes a poor unit of account. But that's why many people have instead looked at it primarily as their emergence store value, or their crypto asset as they call it, rather than valuing it for its medium exchange capabilities. But part of the reason why it has that store of value property, of course, is because the fact that you can self custody it, because of the fact that you can send these permissionless payments. So some of those underlying settlement capabilities that make it unique are part of what kind of ironically gives it that store of value property. Because you're kind of storing up the ability to do that if you want to. But as we see now, it's not currently really meant to be a unit of account, and it doesn't really rely on that in the same way. For example, there's very little in the world that is priced in gold as unit of account. But that doesn't change the fact that in terms of store value properties, gold is better than fiat currencies. Over a long enough timeline, if you were to bury cash in your backyard or bury gold and you come back two decades later, gold has certainly, almost certainly, unless you, unless you happen to buy gold at the peak of a very rare bubble that would have outperformed the fiat currency. And then even if you Say put currency in a bank, generally over a long enough timeline, gold will even outpace that. So far, just the fact that gold is not used to price, we don't price coffee in terms of say grams of gold. That doesn't change the fact that gold has value for either jewelry or, or its engineering purposes or as a form of money, as a form of holding self custodied long term value. So far that kind of comes down to say, when you have the large blockers versus small blockers arguing about what Bitcoin should be and they kind of cite aspects of Satoshi's paper. Well, it kind of doesn't matter what it was meant to be. What matters is what the market judges to be and what it values it to be. And so it's been pretty clear for a while that a large portion of Bitcoin's monetary premium is about the scarcity, is about the auditability, is about the fact that it's this kind of off grid value storage mechanism that is separate from the fact that it's a unit of account. And so yeah, I would agree with you that whether or not it ever becomes unit of account is somewhat different and it's still valuable regardless of that question.
- [67:51]
Peter McCormack
Well, the medium exchange as a technology is an important point where you were referring to Alex Gladstein earlier and the use cases he talks about. We had the Ansars protests in Nigeria, we had the Lukashenko protests in Belarus. As a medium exchange, it was the only currency that could help support those activists. It was the only permissionless currency that could be sent into these countries that had the necessary liquidity for people to be able to convert that into local currency. So it serves a different purpose as a medium of exchange. I think that's a great point, Lyn. I think he fails in this section, but because I think he failed because primarily he doesn't understand the Lightning Network. A number of his arguments are factually incorrect. And I just love your point. You wouldn't use Fedwire to buy a cup of coffee. I think that's brilliant. I think he failed quite badly in this section and I think he just needs to go back to the drawing board and actually spend some time looking at the Lightning Network. And therefore maybe we get an updated paper about why the Lightning Network doesn't work, but at least it's a valid argument. And that's actually what's quite sad is that I still get people email me or tweet at me and talk about Bitcoin being slow or Bitcoin being expensive and They've failed to actually even know that the Lightning Network exists. So cool. Okay, last section is payment system. So he discusses there is a conflation between accepting Bitcoin for payments and pricing goods in Bitcoin. So we're going into the unit account again to price in Bitcoin. Bitcoin, the price must be fixed with a conversion into fiat floating rather than the reverse. I think his main argument in this section is he's essentially saying we haven't hyper bitcoinized yet. If we had Lyn, we would be paid in Bitcoin. Would we be pricing in Bitcoin? Everything would be priced in Bitcoin. And we've discussed a lot of that. But my main criticism is that he's arguing that we haven't reached a hyperbitcoinization yet. We're 12 years in. I think we're kind of repeating ourselves here, actually.
- [69:58]
Lynn Alden
Yeah, I agree. Basically the fact that bitcoin is really 12 years old, it's remarkable that it hit a trillion dollars in 12 years in terms of market capitalization. So it's already actually gone farther than many people thought it would by this point in its life cycle. So the fact that the whole world doesn't accept its unit count yet doesn't affect the argument of Bitcoin as a viable asset. And an example, he points out that basically, if a company doesn't get their revenue in dollars, if their overhead expenses are not in dollars, if their employees are not paid in dollars, and those employees can't use dollars as a medium exchange, he applies that all to Bitcoin, for example. But as I point out, with dollars, if you go to emerging market, that's not dollarized, right? You generally don't have dollars as a unit of account. Because as his argument applies, all of the revenues, the overhead expenses, the employee salaries, all those things are in the local currency. Now, they still might value dollars. They still might say, wow, a dollar. I'd like to have some dollars tucked away somewhere. Or I might want to. I can accept a dollar if I convert it into what it's currently worth in our exchange system and still accept that as a form of money. That's an example of where a dollar can be recognized as money in a market where it's not a unit of account. And so Bitcoin's kind of along that same route where for most people it's not the unit of account. Because as he points out, that's not what revenues are denominated in. That's not what most people are paid in, but basically right now it's this external good, it's this external gold like asset, for example, that is being valued for its properties aside from unit of account. But then you go back and you add the fact that you can separate Bitcoin the asset from Bitcoin the monetary network, because they're both kind of important parts of the system. And you can say, we don't want to worry about Bitcoin's volatility now, so instead we're just going to use Bitcoin as like fiat to fiat transfer mechanism in a way that is because it's an application of software in a way that the world hasn't seen before. It's better than most legacy systems, assuming you're using the right layer for the right application. That's what we see. For example, that as you point out, in many of those countries, if you want to send someone money to certain regions, Bitcoin is pretty much the only or by far superior way to send that value. It doesn't matter the fact that you convert it back to your local currency. People would store Bitcoin knowing that they can use it for that purpose as one example, let alone any sort of concerns or just viewing it as the hardest form of money, saying, okay, it's got scarcity, it's got credible scarcity, and so I'm going to hold it against these other assets that have less scarcity. So that's one kind of store value use case. But then you're also essentially holding the utility that you could make permissionless payments with that in the future if you decide to.
- [73:01]
Peter McCormack
That's a really, really good point. Actually, I hadn't even considered it like that because when I was in Venezuela, everything is priced in the Bolivar. You got to dinner even in East Caracas, everything is priced in the Bolivar. But when you go to pay, especially in some of the more upmarket restaurants, and I say upmarket, what I mean is you're not out of roadside eatery, but if you're at a, a restaurant, you get your bill in Bolivar. Everything's priced in the Bolivar. But at the end they say can you pay in dollar? I mean, they want you to pay in the dollar and they'll do the calculation at that point and tell you what the price is in the dollars. And actually that's analogous to what's happening in parts of the small part of Venezuela which, sorry, El Salvador, which is adopting Bitcoin. Again, when I was in El Tunco, exactly the same is happening. The coffees are priced in dollars, but they want your bitcoin, so again, they'll run the calculation at that point. So that's actually, that's a really interesting, solid argument for real world examples of where that's, that's actually happening. Comparing fiat to Fiat and then fiat to bitcoin, that's super interesting. The other thing he talked about is the inflation hedge. Okay, this is an interesting one. I've talked about bitcoin being an inflation hedge, but sometimes I've even questioned it myself, said, well, is it really? Because bitcoin tends to correlate quite significantly to the markets and I wonder if bitcoin also benefits from the expansion of the money in the way other assets do. And also it certainly isn't, I think it's nuanced. So bitcoin is definitely an inflation hedge for my friend in Venezuela, he keeps all his money in Bitcoin because even when bitcoin drops in price, generally speaking against the Bolivar, it's still outperforming it. So he is definitely using as an inflation hedge, but he's in a very unique scenario. I don't consider certainly in the short term bitcoin as an inflation hedge against the pound. Actually in the short term it's dangerous to think about it as an inflation hedge over maybe a year because whilst bitcoin can go up to 300%, it can also drop 20, 30%. So over that period it has not been an inflation hedge because it hasn't outperformed it. So I think he has a valid argument there. I do think it's nuanced and I do think over a long enough timescale you can make an argument, but is it an inflation hedge or is it actually you're benefiting from more people speculating on the future of bitcoin. So I do think that's a solid argument. I do think the inflation hedge is overstated a bit with bitcoin.
- [75:34]
Lynn Alden
I think so Hedge generally has a pretty specific aspect and that you want it to pay off at a specific time that you expect it to pay off. And so that's something like if you were to have options that basically pay out if a certain tail risk happens, like say if volatility, the markets go up, you want these investments to give you a value then, right? You don't want it to say pay back six months after that, you don't want a probability that it pays off. You want a near certainty that that's going to pay off in that event that you're hedging for. And so in that sense, bitcoin is not a near term inflation hedge in the sense that if you get say a CPI report that comes in hotter than economists expected, so inflation actually have new information that inflation's higher than people thought. Bitcoin is not guaranteed to go up that day, for example. It could go down that day, could stay flat, could go up, who knows? And so Bitcoin is not that kind of tightly correlated anti inflation hedge now over a long enough timeline. Basically the idea is instead more about a harder form of money in the sense that the number of dollars goes up a lot quicker than the number of Bitcoin go up. And that is even more true when you look at certain emerging markets or certain inflationary developing countries where the time frame required is even shorter. So if I'm comparing Bitcoin to dollars, there are periods of time where Bitcoin could underperform the dollar for say two or three years potentially before eventually outpacing it. Whereas if you go the more inflationary of a currency, you go into the tighter that gets, where Bitcoin's better months later, weeks later, let alone years later, just because those currencies are losing their value so quickly. When you do think of it in a global context, again, I would think of it more as a long term store of value. It's kind of combining that gold aspect of store value. But because it's a younger and more volatile and less certain asset, it has that kind of investment characteristics. That's why I've actually, when I describe this, I try to be specific and call it an emerging store of value in the sense that it hasn't reached the level of say proven store of value that gold historically had. But it's basically people are analyzing its qualities and seeing that it's got the properties of store of value if it continues to be successful as they thought they were. Generally the more extreme use case you go into like say Venezuela, the more immediate of a store of value it becomes. Whereas the more sensible currency regime, the more instead is best viewed as an emergent store of value, as something that's being assessed as an investment for its network effect properties and for its credible monetary supply.
- [78:28]
Peter McCormack
Okay, your nuance is brilliant and it made a much more sensible answer. And also right now I think somebody said the other day with regards to Lebanon, that Bitcoin has been a great store of value over the last couple of years. So I think that's a really fair point. We have actually drifted into the final section, which I should have said, which is kind comment for law versus regulations. Versus rules. I think the first one we can ignore. I can't remember if you said that at the start of the show before we started recording. But he talks about the fallacy of libertarianism. I just completely disregarded this. I was like, I don't. I didn't even understand why he brought this up. I'm not a libertarian. I like a lot of libertarian ideas, but I'm not a libertarian. And as far as I know, Bitcoin can be used by libertarians and communists and socialists and capitalists and right left wing centrists. It doesn't really matter. All bitcoin has to do is produce blocks every 10 minutes. I thought that was a pointless thing to raise. So we covered the fallacy of Safe haven one there. The fallacy of Safe haven two here is with. I can't remember which point it was. I might have these confused now, but it's where he talks about with regards to Bitcoin being completely open and public and transparent and under authoritarian regimes this has no benefit. And also because the ledger is public any refer to the FBI and the recent hack of the Remember, it's the pipeline. I should have written it down. But again there were some key mistakes in here because firstly, in not understanding the lightning network, he's missed out on the point that most transactions on the lightning network are relatively private. There's a difference between sender and receiver. But by missing out the lightning network he's missed out that point. And the next thing I am just going to specifically quote Radley Rattler because all I would do otherwise is rewrite it and take credit and I should just give him the credit. So the blockchain contains addresses and amounts. No real world identity without KYC requirement. At some point the blockchain doesn't provide any information on real world identity and Taleb doesn't give any evidence that it does. And then on the second point with regards to the FBI, there's no such thing as accounts in bitcoin, they're simply addresses. And the FBI didn't hack any of those. Rather, the FBI tracked the sending of bitcoin across addresses and at some point some of it ended up at a known address. The FBI approached the exchange that had the private keys to the address and asked for the bitcoin at that address it was given to them. They didn't hack it. And the pipeline hackers erred in sending bitcoin to address to which they didn't have the private keys. So firstly, I mean, how stupid were those hackers send it to an address.
- [81:09]
Lynn Alden
But secondly, I'm surprised they did that. Yeah, they did send it to their own hardware wallet.
- [81:15]
Peter McCormack
That's crazy. But again, it's just, again, he's just made the mistake of not understanding the lightning network and not understanding Bitcoin itself. And I felt it was either disingenuous or showed a lack of understanding.
- [81:28]
Lynn Alden
One of the most interesting things is that the estimated largest Bitcoin holder in the world, Satoshi, is unknown. And it's because those coins were not KYC'd. And so Bitcoin in a vacuum is private. But of course, because of all these KYC checkpoints, combined with the fact that it's an open ledger that we can do analysis on, basically we've radically reduced how private it is in practice for many people. But then of course, that's where you have this fact that developers are constantly working to make it better. And you have upgrades like Taproot, you have lightning and these different things that push back on that. So you have this kind of war between these entities that are using as much analysis as possible to make it transparent, along with KYC regulations, and these developers pushing back to make it as private as possible. So we know that it's an imperfectly private system when you have certain kind of checkpoints that have linked an identity to an address. But his overall point here is called fallacy of safe haven. Two Protection from tyrannical regimes. The problem that fails in is it's demonstrably being used in a number of tyrannical regimes or even just broken regimes, inflationary regimes. An example mainstream media has reported that, say, Putin's opposition, Navini, the anti corruption lawyer, that's been in the headlines a lot, his organization accepts Bitcoin as payment because they often get their banking system, they get blocked by the banking system and so they've described Bitcoin as their insurance. So whatever else fails, they can still get payment in Bitcoin. And again, I'd suggest anyone read Alex Gladstein's various pieces that he provides individual cases of people using Bitcoin in their everyday life in some of these tyrannical regimes, basically as a way to custody value. And so those regimes are not applying chain analysis to find out what's going on in that kind of setting. The people that are just making use of these technologies are getting the benefits from it. And so we actually do have tangible use cases of people using Bitcoin against these sort of regimes. Another good example is Anita Posh has a whole section of her podcast about Bitcoin in Africa and kind of, they're not always tyrannical regimes, but they're just troubled regimes. There's troubled areas that have currency failures or that often do have tyranny. And Bitcoin is one of the powerful tools that they have. If they can get a cheap cell phone, if they can get some sort of Internet access, which increasingly the number of people that have that access keeps increasing over time. And that is a pretty powerful tool for people that are able to access it.
- [84:17]
Peter McCormack
Yeah, definitely. Alex Klestein's articles. I'll add a few in there. I mean his recent Palestinian piece was 13,000 words. It's like a micro book. I'm still working my way through it. So yes, please do go and check out Alex Glustein's points. I'm not going to bother with the fallacy of the agency problem unless you did want to cover that yourself. It was his final point.
- [84:40]
Lynn Alden
I mean, that's more about the fairness of distribution. And so unlike many other coins that were, say, pre mined, this one was distributed basically as fairly as you can conceptualize in that instance. Right? So anyone could mine it from the beginning. And I mean, Dan Hell did a whole analysis on how it's pretty much if you kind of analyze even the entities that are assumed to belong to Satoshi and how he kind of throttled back his own mining over time. He basically only provided minimum securities to the network. Right. And so over time those coins were distributed pretty well. And so it is natural that people who, say, identify a good investment or a good network or some sort of emergent theme before others, either through luck or skill or some combination, whatever the case may be, in their specific instance, they do end up getting rewarded more than others during that monetization process. But at the end of the day, Bitcoin was designed to be as open as possible and to be as fair as possible. And one thing I pointed out, I had a whole article that went into this and basically it's kind of remarkable that he gave away the secret sauce before he launched it himself. So the white paper came out ahead of time and was made public. And if you read the paper, it reads like an academic paper, right? So it's just kind of this, it's written as though he's in a university presenting this paper. And then when he's kind of discussing it with the cryptographic emailing glass, it's almost like a thesis defense. It's this very adult discussion about some of the trade offs he's made. And this is all at that point fairly public, some of these people could have tried to steal the technology and just kind of implement it before him, even though he already, of course, had most of the work done behind the scenes, but it actually wasn't out yet. And then when he released the open source software, we have a tweet like a day later from Hal Finney, who's running bitcoin. Right. And so from there it was just this open thing that anyone could do. I mean, I had a friend that was mining bitcoin back in either 2010 or 2011, back when you could just do it. If you had a graphics card, you could do it. And so there were a lot of kind of tech savvy people that caught onto this. But that doesn't mean that the actual underlying software is improper or that it has some other faults. I mean, that can open up questions down the line of wealth concentration. That's a problem that the world's struggling with anyway. But that doesn't change the fact that bitcoin as a technology has been proven to be very good for some of these monetary qualities.
- [87:19]
Peter McCormack
Yeah, I mean, the distribution is fair. I know. The article you're referring to with Downhill, I'm trying to remember is I think he literally titled it Bitcoin is fair or Bitcoin's distribution was fair. I'll dig it out and I'll stick that in the show notes as well. I mean, I'm with you. I think the distribution was fair. I do think though, as, again, there are fair questions to raise and debate. What does the concentration of bitcoin wealth mean? What does it mean for Michael Saylor to be in control of 1 in every 200 bitcoin? What does that actually mean long term? What position of power does that put him in or the companies he controls in? And that I don't know and that I don't understand.
- [87:56]
Lynn Alden
But it's a good thing. It's not proof of stake. Right, because proof of stake coins. Right. So if Jeff Bezos, if we had a world where you get a vote for every dollar you have, Jeff Bezos would get 200 billion votes, whereas a science teacher might get 20,000 votes. Right. And so basically that's how we would have constructed things. And so if you have a consensus blockchain, then basically really large holders of those tokens are more rewarded. Whereas in bitcoin it's more about. Obviously you get rewarded in terms of wealth by having that amount, but you don't necessarily have any more influence over the blockchain itself just because you have A large amount of the coins. And so that's actually a pretty important characteristic of bitcoin that separates it from a number of other projects. Then in addition, we saw on chain analysis shows that during these various bullish cycles you do get a lot of those long term holders selling their bitcoin into those strength when someone bought bitcoin and then it goes up 10x, that's often life changing money for people. And then they cash out not knowing that if they hold it for another five years it would have gone up another 20x. And so there's actually there are a lot of crypto millionaires, but there's fewer people than you think that just bought it for like a dollar and just never sold. And in fact many of those that did lost their coins, right? Or it's estimated that there's a certain number of lost coins. And then you just generally have this distributive effect where people are happy because they made 5x or 10x on their money and then they cash out. And so that's kind of. You can look on chain and see those older addresses sell into those bull markets. And so yes, I mean obviously if Bitcoin goes up 10x from here, there will be some very, very wealthy people like say Sailor or the Winklevoss twins. I mean they're already wealthy and they'll be even more wealthy. But that's true for any sort of other being early to some sort of emerging technology or founding your own company and basically having that be wildly successful.
- [90:07]
Peter McCormack
So we have his conclusion, my conclusion of his conclusion, and maybe your own conclusion. But the main point I took from his conclusion is we only judge a technology by how it solves problems, not by what technological attributes it has. Almost to dismiss it solving problems, which again is just completely disingenuous. He should certainly just as a starting point, look at the work of Alex Godstein and what Alex has been doing specifically with regards to activists. But bitcoin has solved a number of problems. So I just felt that was another kind of maybe he believes it, but it was a false conclusion. And so my conclusion was really, it's like I've come out of it different than I expected. I went into the prep for this Lyn thinking, yeah, I'm going to try and tear this apart where I can and then let Lyn do the rest of it. But actually I came out of it thinking, isn't it a shame he doesn't engage intellectually and honestly with bitcoiners? Because I actually think if he wasn't just dismissive for the sake of being dismissive and actually really credibly tried to create some proper arguments against it. That would be for an interesting discussion. I would like nothing more to watch Lynn Oden debate Nassim Taleb on Bitcoin or Seifedine debate him and actually go through these key issues because I think it's good to come and criticize bitcoin. I have a lot of people ask me, emails come in, people say, yeah, you do all these bullish shows, but can we have more critical shows? Actually, I came out of it just disappointed and kind of hopeful that he would engage at some point in a more fair and honest debate about bitcoin. And I will just close before I let you close. And I've mentioned Bradley Retler a few times. He raised four points of discussion. Maybe you and I can tackle this at some point with Bradley. But he said these are fair points of discussion. Can bitcoin succeed without being a unit of account? I think that's a fair question. Can bitcoin succeed as an inflation hedge or tail risk hedge? How are people using bitcoin in tyrannical regimes? And can we make bitcoin better for such people? And if Bitcoin is a great technology, what other features makes it such? So I all think they're good points, but you may have your own kind of conclusion.
- [92:24]
Lynn Alden
I think you summarized it really well. And so I would say as an investor, the reason I invested in Bitcoin is because I analyzed it as having good properties for solving problems. And so I'm not someone who runs a bitcoin based business, right? I'm not just like permanently tied to bitcoin. I constantly assess it and say, nope, yep, it's still solving its problems. And so I continually kind of again, investment, I always refresh my view of what are the probabilities of their long term success. And so bitcoin is doing very well in terms of basically solving real world problems. And so because it's still early on its phase, still it's used by a small percentage of world population. Those have so far still been niche problems. But the interesting thing is actually the problems that they're solving are quite big. It's just they haven't caught on yet enough to be used at a very huge scale. We are starting to see it kind of like a virus kind of spread and start solving these problems in certain areas that can then spread to other areas. So whether or not you can see, for example, strike just applying it to try to reduce remittance fees. Or you see, say Alex Gladstein use it for human rights applications. Or you see people just decide to use it as a self custody emergence store value, that they're willing to accept that volatility in exchange for viewing it as a better long term store of value than say a fiat currency. And of course that has, in more extreme currency environments that's a more immediate payoff than someone in a more stable currency environment. They're making a longer term outlook there. And so I would say basically I do view Bitcoin as solving problems. And that's what the market's currently assessing as it prices Bitcoin is that it's constantly pricing on this probability curve of how any sort of critical failure that it might have versus any sort of critical success it might have versus kind of a big range of middle outcomes. And so I do think it's really good to have criticisms of Bitcoin. And so I do think that we have to discuss all the potential weaknesses there. Right. So for example, I had a whole article again dedicated to Bitcoin's transition towards a fee based model because I do view that as one of the credible risks, that a blockchain has to be above a certain minimum threshold, especially as the block subsidies go down in order to have minimum security and usability, it has to be above a certain threshold. We don't know roughly where that threshold is. So that article explores that concept. There are credible risks to Bitcoin that I think have to be addressed, let alone, I mean, just basically, even if just it means that developers are aware of them and can work on them ahead of time, or that the users know that there are certain risks and so that can determine, say, how much of your net worth you put in Bitcoin or the things that you'll focus on when you're trying to make Bitcoin better and you're trying to defend it against attacks, to know what are the kind of weaknesses to either mitigate or to, you know, improve over time.
- [95:33]
Peter McCormack
Brilliant. Well, you crushed it as ever. That was amazing. We, we've gone a little bit over our normal allotted time. I really enjoyed this. I got a lot from it. And listen, I won't tell you to repeat your Twitter or your email. Everyone knows it. Now, if, if you don't go into the show Notes, I do recommend you sign up to Lynn's email. It's. Remind me, is it like $199 a year or 200?
- [95:58]
Lynn Alden
Yeah, it's $199 a year. But also I Have that free newsletter that comes out every six weeks and a lot of public articles. So I would say just check out the free stuff first.
- [96:07]
Peter McCormack
Stop being a cheapskate buyer. It's $200 a year. It's literally nothing and it's unbelievable. It comes in every month and I'm glued to it. So don't be a cheapskate. Go and buy Lindsay $200 a month. $200 a year newsletter. That's high value for money. I'd probably pay that a month. By the way, if, if you are ever interested in repricing. I probably would. So you should. You may want to think about that. But listen, Lyn, this was amazing. I always appreciate talking to you and I appreciate your help with this and have a great month and I will see you in August.
- [96:37]
Lynn Alden
Yep, thanks for having me. And yeah, we'll see. You know, hopefully this helped people kind of clarify this. As you pointed out, there are already a lot of people that kind of dissected the paper. So hopefully we added something to the discussion and made that maybe more accessible to people.
- [96:51]
Peter McCormack
I hope so. All right, thank you, Lynch. All right. What did you think of that one? Lim was incredible as ever. But the thing that I find most disappointing about Taleb's stance on bitcoin is I just wish he would open up to bitcoiners. I think if you saw some of the work that Jack Malas is doing with Strike, what's happening in El Salvador or what Alex Gladstein is doing with the Human Rights Foundation, I think it would change his minds on some of this stuff. And you know what, the paper would be much more useful if it was a fair critique. If he explained the different trade offs between say bitcoin and gold rather than just making claims which aren't true at all. Missing important parts of the bitcoin network. For example, I mean, the Lightning Network is just very strange that he didn't mention the Lightning Network once. But maybe not. Maybe he is just entrenched in his opinions and I'm willing to change. Anyway, I hope you enjoyed this conversation and if you want to read any of the articles we cited, then please do head over to whatbitcoindid.com and check out the show notes. Also, if you want to get in touch with me, you can jump into my Telegram channel or you can hit me up my email which is hellohatbitcoindid.com lastly, if you're a regular listener of the show and you've never left me a review on Apple Podcasts, what are you doing? Come on. I ask this every week. Maybe you don't even listen this far, but if you do, if you are a listener and you want to support the show, please do head over to Apple Podcast and leave me a review. It really does help with the listings. Okay, it's Wednesday morning. I'm going to catch up on the Olympics. I hope you're doing well, and I will see you all on Friday.