Bitcoin's an expression in this view that you want to invest in an asset without.
Counterparty risk, which means you don't want to be counterparty to a country,
a currency, a city, a company,
a commodity, or a culture, right?
So people think it's a risky thing.
It's all about people wanting to not take risk.
They don't want to guess whether Picassos or real estate in New York or Nvidia
stock will be higher in 10 years.
They want to buy money. They want to buy 1 21 millionth of all the money in the world forever.
Music.
Welcome in to 26 of this week in Bitcoin.
My name is Chris. You know, I'm recording this on September 11th,
2024, notable date for multiple reasons. But for Bitcoiners,
it was this day, seven years ago, that Jamie Dimon said, quote,
I'd fire anyone caught trading Bitcoin.
And with some irony today, in 2024, JP Morgan is the broker for BlackRock's
Bitcoin ETF, which is the most successful ETF launch in history.
And now he's making money on Bitcoin.
But let's start with macro this week because we are kind of in this phantom zone right now.
It's how bad are things? And everybody's trying to play the game of gauging
just how screwed we are so that way they can roughly guess how much of a cut
to the rates the Fed is going to make next week.
Next week may be the most historic week for the market for as long as this show has been running.
But this week is where we start to see things line up. And we got data that
37% of small businesses have seen their earnings drop over the last three months,
which is the highest drop we've seen in 14 years.
It's even weaker than the 35% drop we saw during the beginning of the lockdowns in 2020.
You combine nearly a 40% drop in earnings.
An increase in inflation because the inflation report came out and it's ticked up again.
Consumer prices rose last month while the annual inflation rate hit its lowest
level since February 2021.
The consumer price index rose to tenths of a percent in August, same increase as July.
Now the 12-month inflation rate now sits at 2.5 percent.
Core inflation was up mostly due to a jump in housing prices.
You know, just 2.5%. What's the big deal, right?
What's the big deal? It's just 2.5% silently stealing your money,
compounded. But you heard what she said in there.
Housing, or as they put it, the shelter index, which has risen 5.2% since August
of 2023, which now by their own bogus numbers accounts for more than 70% of their bogus CPI number.
But what the signal is that I find in there is that homes have not come down
like everybody expected.
Now, in some areas of the market, we're definitely seeing some drops.
But I think a lot of millennials and younger were hoping for a lot bigger drops.
And I think people that are older than millennials were hoping for a lot smaller
drops, and it seems they've gotten their way. And I think we have to ask ourselves,
why are housing prices so sticky?
Why does it seem so unfixable? And why has it only been getting worse?
Well, I would propose to you it's because the home is the only viable store
of value for the middle class.
And we're seeing that play out, even as recessions roll across our economy right now.
The fundamental issue is our money is broken.
You see, the people should be able to store their value in the money they use.
But they can't. The U.S. dollar has lost 25% of its purchasing power since the pandemic.
25% just since the pandemic. In other words, if you held on to cash without
getting any kind of interest on it, if you just held on to your cash,
you lost one-fourth of its value in just a few years.
So the people are forced to gamble.
They're forced to invest to protect their savings and their future purchasing power.
So 21% of the middle class, according to the Federal Reserve,
now directly own stocks.
If you include retirement plans where they don't actively participate,
that number actually goes up as high as 60%. It kind of fluctuates down to 56%
depending on the market.
But somewhere between 56% to 61% of Americans are investing in the stock market,
according to Gallup and US Fact.
Of course, if you look at the wealthiest 1%, they own over half the stock market,
if you expand it to the top 10%, the group, that group, the top 10% earners,
they hold 87% of the stocks.
So it's not a great deal for the people, for the middle class.
And I think if you look at recent immigration and if you look at people below
the middle class, they can't invest in the stock market.
And they probably know it's rigged. They can probably sense it somehow that
it's rigged against them. The system is rigged against them.
And if they're not privileged enough to work at an employer that will hire some
Wall Street firm to manage a retirement package for them, they can't participate.
So the only choice they have to protect their buying power is a home.
And that's getting harder and harder, depending on where you're at in the economic ladder.
In some cases, if you're not already in the market, you're never going to get
in. Or if you don't get it through inheritance, you're never going to get in.
And, you know, the standard, you know, run-of-the-mill, average Joe economist,
they just can't figure it out.
Let's hone in on the shelter component of August's CPI data,
the index rising half of a percent, the Bureau of Labor Statistics,
attributing it as the main factor in the items that we did see increase.
Joining us now, we want to bring
in Brian Rose. He's UBS Global Wealth Management's senior U.S. economist.
And Brian, let's just start there. When it comes to the stickiness of housing,
how long it's going to be an issue, how big of a drag this will likely be in
reports to come, what do you think?
Yeah, this is actually quite mysterious how things
like OER are are accelerating now so
the actual data on leases
you know we have this high frequency data showing when people are signing new
leases what their rents are that peaked out you know almost two years ago and
to see the oer accelerating at this point is very strange very difficult to
explain there's a lot of nuances and unusual things.
You know, it's so funny when they look at it through the standard lens,
they just can't explain it.
But when you look at it through the Bitcoin lens, it all just makes sense. It's obvious.
It's hard to buy a house right now. But the home has become the quintessential
store of value for everyday Americans, for those that can get into the market,
or were in the market years ago.
The value of the home is too big to fail.
And not all cultures do this. I read like Germans, for example,
they have a tendency towards renting, partly due to historic reasons,
partly due to political reasons and the way laws and regulations are set up.
But as a result, the middle class in Germany often invest in other assets like
stocks or bonds or savings accounts rather than relying on their home for wealth accumulation.
I read it's also common with the Swiss. The Swiss middle class diversifies their
investments, focusing on other asset classes besides real estate.
So the house doesn't have to be this one giant store of value because the money's
broken and the stock market's rigged.
The problem is, I think the Swiss and the Germans are onto something.
I think housing is a shit coin.
As somebody who's owned a place for like 15 years, you have no control over
what happens around your home.
The area around my home is notably less nice than it was when I bought it.
The fees to maintain the asset are ridiculous and never ending.
And some of them are incredibly expensive.
I'm always getting taxed for the land, regardless of how much of the asset I own outright or not.
The liquidity in this thing sucks, takes forever to get my money out.
I'd probably have to do a whole bunch of crap up front to get that money.
And the transaction costs are astronomical once I do sell it.
Not to mention there's environmental risks here. I'm in a particular area with a lot of wind.
There's security risks as the areas around me have been managed less and less competently.
And the insurance costs are getting astronomical year by year.
On average, they're up over 300% since the 90s. They're about 6% or more a year.
They've gone up since I've lived here.
Now, I'm in the house right now. It has a lot of utility. I'm not saying it
doesn't have utility. I'm not saying houses are good.
I think houses are great, but I don't think they should be a store of generational wealth.
We're using them for the wrong thing.
And a politician is never going to fix this for you. And if you've got a politician
who's been in office for 11 years and is promising to solve things that they
should have solved a long time ago, that's probably not going to do it.
You might think you're never going to be able to afford buying a home,
and you're not alone in that.
A new poll shows that 86% of renters in the United States want to buy a home but can't afford one.
It doesn't have to be this way. I have a bill that would build 3 million new
housing units and lower the cost of housing, all paid for by taxing the ultra-wealthy.
Oh, there you go. I'm fighting to get this done. Yeah, fight, Liz.
That's Elizabeth Warren, if you didn't know. So she's going to tax the wealthy
and she's going to build 3 million quote housing units. I don't know.
Those are probably boxes somewhere.
How does this work? Because it's not just housing that's a problem.
In fact, if you look into the CPI print, food is still extremely hot.
Eggs are up 28.1% year over year. Even by their weak-ass bad number measurements,
their bogus lowball numbers say eggs are up 28.1%.
So what are you going to do, Liz?
Are you going to tax the rich to pay for more chickens and more farmers too?
What about car insurance?
What about transportation inflation in general? What about rent inflation?
How are you going to fix all of these things just by taxing?
You can fix one problem, inventory.
But at the same time, monetary policy is getting looser. So we're going to have
more dollars chasing that inventory.
And then you combine that with consumer credit card debt at historic highs,
which we talked about before.
It just doesn't seem like taxing is going to solve the problem.
At some point, we have to start talking about less spending.
Not more taxes. Like we just keep talking about, well, we'll just tax our way out of it.
That's not going to work. It's not one problem. It is a systemic problem.
It goes all the way down to the fact that Americans don't have a good place
to store their money, which, as you're probably guessing, is exactly where Bitcoin comes in.
So let's get it back to Bitcoin. Let's do a little health check here.
Music.
I think one way to kind of ground this discussion would be, let's look at the
iPhone 16 that was announced this week.
If you bought the iPhone in Bitcoin in 2011, the iPhone 4S would cost you 162 Bitcoin.
In 2012, the iPhone 5 would cost you 52 Bitcoin.
Jumping ahead a bit, the iPhone 13 would cost you 0.018 Bitcoin.
The iPhone 15, 0.031 Bitcoin.
And the iPhone 16 this year, 0.014 Bitcoin. In 2011, it was 162 Bitcoin.
And now in 2024, it's much less than one Bitcoin, 0.014 Bitcoin.
That means the iPhone's gotten substantially cheaper in terms of Bitcoin over the years.
Now let's talk about River because I think they're a great company.
You hear me talk about them all the way. It's one of the ways I recommend you stack sats.
They released a banger of a study this week that I'll have linked in the show notes.
And in this study, they show that Apple's treasury lost $15 billion in the last
decade by playing it safe, I guess, quote unquote safe.
And they stored that in cash and maybe some bonds, right? But they stored it
in a way that neglected long-term effects of inflation.
And I've always wondered, because we've always heard about this massive cash
pile that Apple's sitting on.
And I thought, well, they must be clever enough with that much money.
They must be smart enough to know that it's a melting ice cube.
No, they've lost 15 billion in purchasing power.
And it's unlikely that Apple's going to see the heirs of their ways.
They've got plenty of money. So they're probably not going to diversify into
Bitcoin, although they should, and you could, and your business can.
But River's report shows that businesses are doing just that.
And they think it's going to happen a lot more at scale.
They have a case study of seven different businesses that are using Bitcoin.
They actually showcase eight, but they have case studies for seven.
And they touch on the businesses that are already owning Bitcoin,
which add up to 3.3% of Bitcoin's total supply.
So it's around 683,320 Bitcoin as of August 18th, 2024, that are owned by businesses, River reports.
And they say that a number of publicly traded companies are holding Bitcoin,
and that number has grown pretty substantially by 40% from September of 23 to August of 24.
Also, they estimate that businesses' Bitcoin holdings are going to grow at a
rate of around 204 to 519 Bitcoin per day until at least the year 2026. Wow.
And also notable, they're not buying the ETFs, at least not much,
despite the introduction of the Bitcoin ETFs. River reports that nearly all
businesses are holding real Bitcoin, so they don't get designated as a,
quote, investment company.
They want the actual Bitcoin.
And they also note that while Bitcoin's primary business use case in these case
studies is treasury holding, not too surprising, store of value is pretty important
right now, very important right now.
Now, River also details three areas where Bitcoin can serve as payment solutions
for cross-border payments or they're paying staff and wages.
They also have some examples of commerce payments in Bitcoin that have been
growing in recent years.
It's a really interesting report, even if you just read the first page or so.
It's a PDF that I'll have linked in the show notes. River did great work on this.
I want to bust some FUD and I'm going to ask for your advice on this here in
a bit but this is a story that's been going around in print since July it was
started by Time Magazine,
and before I play this clip I want to make it clear that there must be something
wrong people are clearly suffering and I take no pleasure in that I feel very
bad for these people and I hope that they get to some sort of resolution.
I don't know if I agree with what they say the cause is, but we'll see if you agree.
According to, this is an NBC report, there is a Texas town, Granbury,
Texas, and they say the Bitcoin miner there, run by Marathon Mining, is making them all sick.
My daughter had a seizure on the 4th of July.
In the small town of Granbury, Texas. Our grandson was one of them.
He started having fluid leak out of his ears, had four ear infections in four months.
People reported they were getting sick. I was walking to my barn and it felt
like I got hit in the chest by a baseball.
These claims are massive, right? Seizures, fluids leaking from the ears,
three-time over ear infections, getting hit in the chest by like a baseball.
Where my kind of red flag immediately starts is I just try to picture NBC with
this report with any other industry.
A steel mill, a sawmill, you know, a concrete factory.
I mean, I don't care. a chair factory, a vacuum repair shop,
construction on a nearby building that's loud.
The fact that these actually, one of the things you can hear in the background
is these folks live right next to a freeway.
They live right next to the freeway, for example. You wouldn't hear this report
about the freeway, although road noise is a massive problem.
I live near a train most of the time, and it is obnoxious.
But you'll never see the mainstream media attack any industry except for Bitcoin like this.
And even though they know it's a Bitcoin mine, they'll use terms like crypto
and all that just to kind of use charged words to kind of prime you to think
of this story in a certain particular light.
And then they focus on people that
seem to be particularly abused by the situation, whatever is going on.
Deanna Lakey, a nurse, says she ended up being the patient. And then I started becoming sick.
She's crying now. I just felt like that I was going to die.
Then at a town meeting where she heard other people blame a nearby Bitcoin mine
for their illnesses. Aha, she said, a Bitcoin mine.
It clicked. We live very close to the Bitcoin farm and we are definitely subject
to the sounds that are going on 24 hours a day.
Now, all kinds of heavy industry operate in Texas.
There's been all kinds of actual environmental pollutants that have been leaked.
Into the air, into the water, into the ground. But Bitcoin mining,
and it's clearly the, I guess the implication is it's the sound of the Bitcoin mine.
And we are definitely subject to the sounds that are going on 24 hours a day.
Marathon Digital owns and operates this Bitcoin mine here in Granbury.
A massive network of fans cooling off thousands of computers,
creating cryptocurrency.
And how loud is this noise? Describe it to me. So it's like sleeping with a
vacuum cleaner on your bed.
Cheryl Shadden lives across the street. This is the noise at my barn,
which is just a couple hundred yards away from my house.
And believes the noise is making her sick.
So she's putting up signs that say Bitcoin sucks, no Bitcoin here,
stop the Bitcoin noise pollution.
She's putting up signs all over the road. My ears buzz 24-7.
I've got headaches, I've got dizziness.
Residents say it's even affecting the animals.
I had a dog that last year, she was ripping her fur out.
While there's no direct evidence linking the crypto mine to these ailments, Dr.
Michael Osborne, a researcher and doctor at Massachusetts General Hospital,
says there is research showing there could be a correlation between persistent
noise and health impacts.
It's certainly possible and plausible that long-term exposure to these sort
of stressful insults could lead to adverse health consequences.
So, of course, right, being exposed to a lot of noise is rough.
I mean, I live half a mile away from a freeway or more, and I can still hear
the freeway constantly.
There's never a moment where I can't hear the freeway, and that sucks.
That's one of the reasons I like to go out into the woods.
And then there's a train in there. I mean, I get it. It's definitely possible.
What's not really fairly described in this interview is, like,
the video they play where it's really loud a few moments ago.
That's from a while ago. That's from many months ago. The original complaints,
like the town hall meeting, that's from, like, the beginning of the year.
They talk about it like Marathon hasn't addressed any of the complaints.
They'll get into it a little bit here. They're about to get into some of that, and I'll expand on that.
But when I hear this, I think there's probably a real issue here,
a business set up real quick.
They deployed really fast. They're moving at breakneck speed,
and there's a lot of cooling involved, and those things can get really loud,
and they didn't properly account for the people living around.
They made mistakes. You know, there's probably some of the people that are running
this project aren't from the area. They don't live in the area.
They probably live far away.
They're very remote. They don't quite have that kind of connection.
These are all gaps that businesses can have, especially young businesses that
are moving very fast. What we have to kind of judge them on is how they respond.
A clinical audiologist in Granbury says more patients are seeking his help.
This summer, we've probably seen a significant increase of 100 to 150 percent,
probably more patients complaining about noise exposure.
Six tenths, I measured it. During our recent visit to Granbury,
we checked out the noise for ourselves.
Still audible, but lower than what residents say they're used to.
We're still getting readings up close to 70.
You know, so for those of you that don't know, 70 decibels is loud,
but your freeway, if you're near a freeway, it's going to be 80 decibels.
And he's next to what they call over there a frontage road, which is then next to a freeway.
And the frontage road, if somebody drives over that, it'll be 80,
90 decibels if you're standing right next to the road, which is where he's measuring it.
So 70 decibels sounds like a lot, but if you put a decibel meter up to the speaker
as I'm speaking, you'd see, you know, this is probably 60, 65 decibels,
depending on what volume level you have it at.
So just, you know, in perspective here, yeah, that sounds loud,
but if you're next to a road, the standard sound, I looked it up,
yeah, 70 to 80 decibels would be totally normal, maybe 90 even.
Members of the community are demanding that Marathon turn down the volume.
In a statement to NBC News, Marathon said it holds itself to the highest health and safety standards.
Marathon saying they recently broke ground on a sound wall and are expecting
to transition 50% of the mine to quieter cooling technologies by the end of the year.
The company also says it's investing millions of dollars to reduce the perceived
loudness of the facility.
As a result, all levels measured around the facility are well below state and
county law sound limits.
There is no established link, medical or otherwise, between Marathon's operations
and the ailments that are being alleged. pledged.
Back of the Lakeys, they say their dream home has turned into a nightmare.
We are not complaining. We are not fighting it. We are asking for help to save our lives.
Won't someone save their lives? I mean, clearly they're looking for a settlement.
So yeah, Granbury, Texas, which got misspelled in its filings.
So it's spelled G-R-A-N-B-U-R-Y, not B-E-E-R-Y.
Granbury, Texas, as of the 2020 census, had a population of around 11,000.
It's about 17 square miles across. The town's known for being the final resting
place, I guess, of Jesse James.
And I guess John Wilkes Booth also lived there after President Abraham Lincoln's assassination.
But in 2013, the town was devastated by a tornado. And things have been rough.
Six deaths were confirmed. 100 homes were badly damaged. Many more people hurt.
Nearly, I think, 50 people had serious injuries.
So the town was in kind of a rough patch. and Marathon came in and created a
good business and offered good jobs.
Finally boiled over in July when Time Magazine kicked off a wider reporting
about the noise complaints.
Since July, when Time Magazine had that report, Marathon has been extremely accommodating.
I went through and I did a little research to find out what they've been doing
to address these complaints.
So they took some obvious steps here. They figured out, hey,
there's some fans that we're not using that face the road. We can turn those off.
So most data to senders, they just leave all the fans going for maximum cooling.
They decided we can take these fans and we can idle them.
They've also been building out, as you heard in the report, a large sound wall,
which they've made progress on.
They've hired a local community liaison to speak with...
Whoever that city council folks were. And they've moved 20% of their existing
systems now to immersion cooling.
And then they've turned off the corresponding fans for those systems.
And that's work that they've done. Now what they're doing, because they're doing
this in like a multi-phase, they have a website up where they have big green
check boxes next to the parts of the phases they've completed.
Where anybody that lives in Granbury can go check it out.
And the next like longer term stuff is they're going to you heard the report
they're going to move 50 of their load to immersion cooling and deactivate the
corresponding cooling containers,
they're installing trees and landscaping to help cut down the noise and sort
of building up more wall and they've put up decibel meters all over the property
to try to measure their sound level,
that seems very accommodative you know when i i i don't know if they're causing
earaches and and things seeping from people's ears and causing seizures and
somehow like sound balls that are hitting people in the chest.
I start to suspect something else is going on, but it's good to see Marathon respond to this.
I just, the whole thing has kind of left a weird taste in my mouth.
So I have a question for you.
Boosted and tell me, should I be doing this FUD busting? I look at this and I, is it helpful?
You know, I think maybe for the new listener, somebody new to Bitcoin,
Maybe it's good to have answers about these doubts that gets pushed over and
over again about Bitcoin.
And obviously, some of it slows Bitcoin adoption.
And my goal is to help resolve questions people have about that.
But am I preaching to the audience to seasoned Bitcoiners here?
Are we solving problems?
I don't know, because for me, I find this both frustrating, but yet if there's
a part of me that feels necessary to address it, like it's necessary to address it.
So I guess I'm putting the question out to you what should the future of FUD
busting be in this week in Bitcoin boost in and let me know I'll let you decide.
Music.
Boos. Mikey Saylor had a fantastic moment on CNBC. I've cut down for you.
Some project updates, a little newbie corner, and then a final clip of the week as we round things out.
So if you are stacking those stats, please use my affiliate code to River.
I love River because A, they're a Bitcoin only company. They built their own
infrastructure and they let you withdraw over lightning, which helps with privacy.
And I think while you stack your stats on there, you can feel pretty confident they're safe.
So I have a link to my, it's just an affiliate deal. They didn't ask me to say
this. I just like them. And I put an affiliate link in the show notes.
And then if you're going to spend your Bitcoin, I think the Bitcoin company
is the way to go. I got a link to that too. The bitcoincompany.com.
You can use my code Jupiter.
You get some stats back. I get some stats back, which is nice because then you
can go buy a gift card. Those gift cards give you stats back.
It's a great way to take your balance on lightning and go get yourself something
real quick, real nice. It shows you the power of Sats and Lightning,
too, the way you can convert into those different currencies and systems so fast.
I love it. The Bitcoin Company and River, a couple of great companies in this ecosystem.
I'm proud to link to them as affiliates. You'll find links to that in the show notes.
All right. Now let's move right into the boost, although the song was really
just about to get good. I kind of wanted to keep going.
But we have some boosts to talk about today. And we've got some great boosts.
And our first one comes in from SatSquanch, and he's our baller booster this week.
He's coming in with 136,000 sats.
So excited. I'm bumping my mic. I'm all over the place. Such a great one.
This is a group donation from the Thousand Oaks Meetup. Hey, that's awesome.
We value your time and your efforts. We want to hear more about using liquid and Bitcoin.
All right. Right. Well, that's coming up in the show in just a little bit. Satsquanch.
Also, he says, what is the best tutorial for using Aqua or other wallets with
Bitcoin and liquid to Bitcoin to cold storage? Love the show.
You know, there's not a lot of tutorials using Aqua.
BTC Sessions may have done one. Aqua is really aiming at, as they say,
being a Bitcoin wallet your grandmother could use.
A guide, I'll look and link to one on the show notes if I have one.
I am going to touch on it more, though, so you might not need one,
because I'm going to touch on it a little bit in the show when we get to Newbie Corner.
Rotted Mood comes in with 40,000 sats. I hoard that which you're kind covet.
He says, thanks for answering the question about hardware wallets. Appreciate it.
I was wanting to stay with Albie Hub as well as use a hardware wallet to store
some savings. I'll look into a cold card.
Something without battery is what I would want, too. Yes, without battery.
So think about your Bitcoin lightning stash. Think about it in three levels
of stash. You want three levels of stash.
You want your spending wallet, which has a small amount of your sats in there.
You want your consolidation wallet. That's the wallet that provides you liquidity
where you can either move sats into your cold storage or you can move sats into
lightning. I keep that in liquid.
So first wallet is my hot wallet. That's my spending sats.
My second level stash is my liquid wallet. That's where I keep my liquidity.
That's, you know, there's a little bit more in there. And then my third level
stash is my cold card. That's the life savings.
That's the stuff I'm never spending.
And that's the stuff that I don't
want to keep online. That's the stuff I secure with a hardware wallet.
So I hope that kind of makes sense, Rotted Mood. Thank you for the boost.
Pitar comes in with a fantastic 20,000 sats. Things are looking up for old McDuck.
Socially unacceptable is my middle name. name loving
the old show plan b vibe keep it going chris thank
you yeah i uh i had to uh take the
old plan b song it just was so perfect i every
now that i i find i come across a plan b episode on youtube what a what a wild
ride that was the fun thing i did about those youtube videos is i put the price
in the corner of the video so you can really see you know how stupid cheap it
was i I think like the most expensive it got during the show was $200 a coin. A whole coin.
It's been a long time, Patara. Nice to hear from you. The Tone Wrecker comes
in with a row of ducks, 2,222 sats.
It says, once again, exceptional recap of the past week. Thank you,
Tone Wrecker. It's always nice to hear from you, Mr. The.
Safagas, what? No. S-F-A, Safa, Safalgas comes in with a row of ducks.
I'm sorry if I'm getting that one wrong. Love the show. Long time listener.
Oh, first time booster. Thank you very much.
Thanks for sending it up. Curious what you think of seed QRs and their place
in the overall Bitcoin security management.
So I think you're talking about storing your seed phrase in a QR code.
There's a couple of hardware wallets that will do this.
Not a fan because of the, it requires a lot more OS. it requires functional
hardware and then also it's a lot easier for somebody to nab.
I'm more of a fan of a seed phrase that has been punched into metal.
That's more of my style. And then you never, ever take it out.
I hope that makes sense. Let me know, Safa, if I'm getting your question wrong.
Jonestones also comes in with a row of ducks.
Trillion dollar puke. Yeah. Isn't that just a little puke? Just a little hiccup
in the market. Another crazy market, by the way, this week.
Another billions and billions of dollars in a single day wiped out kind of market.
It. We're really chopping around. It's been a wild one.
I don't talk about price much, but it has been a wild one from a price standpoint too.
Gene Bean comes in with 3,072 sats. This old duck still got it.
Pardon me for fear monger dude talking right now while I go spend a few more
dollars at River, right? I know. Yeah, the guy saying nobody spends Bitcoin.
Plan C is suck it up and never stop working if things don't work out.
Oh, interesting. I was wondering if you had a plan B or a plan C. Thank you, Gene.
Appreciate that. OneDollGeek comes in with 3,333 sets. Put some macaroni and cheese on there, too.
Let me do a little invalid and socially unacceptable boosting to a podcast I
like. Sorry that you have to be the recipient of such antisocial behavior. You know what?
OneDollGeek, I'll keep taking that antisocial behavior. Thank you very much.
Proving those jerks wrong one boost at a time. Ace Ackerman comes in with a row of ducks.
I have a boomer in law, and they're great people. But talking to them about
Bitcoin is difficult because they're hardwired to the legacy system in which they've done very well.
To protect them from scammers, my advice is to tell them to turn off the TV
and go outside, play some ball, get some fresh air and exercise,
and clean your room while you're at it.
Oh, the clean your room while you're at it killed me. That's all great tips, Ackerman.
Yeah, I don't know what to tell you about the boomers either.
I've been thinking about that since last episode.
The question was, how do we help with all the scams that seem to be just getting
leveled to boomers recently and
kind of exploiting a lot of them not being particularly technically savvy?
Clearly, I'm not speaking universally, obviously.
It's just a decent portion of that market is really getting just attacked right now with scams.
And I played some clips last week. If you are out of the loop,
and I'm still kind of curious how we help our friends and family out there that.
Yeah, they're very tied into the existing system. They don't want to hear about
Bitcoin, and yet they're getting just scammed.
This hits home to me because I know of some folks in that age group that are
in my social group that got really, really screwed, and now they're just barely scraping by.
The traders love the vol. Halleck comes in with 10,000 sats.
I really want to carve out some time just to set up a lightning node with a
VPS and tail scale like you have set up.
I think Tor is a safe default, but seems flaky or slow.
Yeah, Tor will work if you're not super dependent on your Lightning node, right?
If you're not receiving boosts at 24 hours of the day or any day or hour of the week.
If you're using Lightning in a very intentional way, you're sending a payment
or at that very implicit moment you're expecting a payment, then Tor is pretty good.
Tor will work for you in almost all cases. Like the JB node actually is on Tor
and gets just about all the boosts, but it's not 100%.
Tor does cause us to lose some of the boost to the JB node. So when I built
my new node, I had to go ClearNet, obviously.
It's just a thing to do, I think.
OPI 1984 comes in with 4,000 sats. This is the way.
While Bitcoin over Meshtastic isn't possible at the moment, there have been
transfers of Bitcoin over ham radio.
You would obviously need a license and radio capable of digital mode, but it is possible.
Not sure how well it would work over the long run, But in a one-off payment
or an emergency situation, it could be a viable option.
Yeah, I wonder, Api. I think that too about just mesh networking in general.
You know, that was something that was a lot popular before the cellular networks really built out.
Some of you longtime nerds probably remember the stories of when Steve Jobs
first was considering the iPhone, he wanted to have it be a Wi-Fi only device
where they would build out mesh networks between each other.
And then, of course, Apple would seed some of the Wi-Fi network as well.
Well, and then ultimately they just decided to go with the cellular route for
obvious reasons, I think.
But wouldn't have that been a fascinating turn of events?
Maybe there's a parallel universe out there where Apple built out the largest
mesh network in the world.
I don't know if I'd want to be on it necessarily, but it might be superior to the cellular networks.
Glacier comes in with a row of ducks and he is supporting our song,
the end of show song, which is always a value for value track.
And those sats, 90% of those sats go to the artist. Thank you,
Glacier. Appreciate that.
Anonymous comes in with a Spaceballs boost, one, two, three,
four, five sats. So the culmination is one, two, three, four, five.
Since you're a Linux guy, I'd love more of a focus on the flossness of the projects you mentioned.
You know, I think universally, but not 100%. I shouldn't say universally,
actually, because I don't think AQA is open source, is it?
But I'd say almost 90% of the projects that I talk about are open source.
I don't always mention the licensing, scene, but I try to if it's relevant.
Digital Farmer comes in with Rho Ducks.
Boost! Thank you. Northern Hoddle comes in with 2,121 sats. B-O-O-S-T!
New to the show, appreciating the signal. Well, thank you, North.
Appreciate you and appreciate you boosting in. Thanks for getting that going.
Orange Pill Lawyer 25 comes in with 5,000 sats. You're so boost!
Are you really a lawyer? I am always looking for a Bitcoin savvy lawyers,
by the way, and accountants, people that are savvy and have worked with people
that have Bitcoin holdings, I would like to talk to you. We should have a relationship.
OrangePillLawyer25 writes, I do think we should warn, especially boomers, of the risk for scams.
The person who gets scammed gets screwed twice, first out of their fiat and
second by losing trust in Bitcoin, which would otherwise be a huge net benefit
in that person's future.
There is nothing wrong with Bitcoin ATMs or any other non-custodial way of stacking, Checking.
But if someone is telling you to deposit money into a Bitcoin ATM, it's probably a scam.
Yeah, that's a good like if there's a way we could say Bitcoin ATMs themselves are not scams.
But if you get a call and somebody tells you you need to take your money and
go put it into a Bitcoin ATM, that's probably a scam.
That's a scam. Not probably. That is a scam.
So somehow, because what I would hate to see is this, when I could see it going
this way, I wonder if you agree, Orange Pill, couldn't you see a backlash on these Bitcoin ATMs?
In fact, they're almost down 1% as of August.
The amount of installations is not increasing at the moment.
It decreased by 1% in August.
The European Union regulators just
came out yesterday saying there is no legitimate use for a Bitcoin ATM.
So I could see regulatory and legal backlash where these ATMs get ripped back
out of the stores and one more path for people to get Bitcoin,
even if it wasn't one of the best, is taken away.
I kind of wonder if that's where this is going.
Like that's what they're building to. Not to be, you know, frying conspiracy
bacon, but seems kind of possible to me. Tomato comes in with 5,000 sats. You're supposed.
Everything's under control. I didn't hear a mention on the show,
but reality started requiring KYC. Oh.
That's too bad.
Or is it, I forgot, I decided how to say that and I've forgotten, but it's R-E-L-A-I.
We talked about them as a non-KYC solution in the past, but they're going to
disable accounts that don't verify by the end of October, Tamato writes.
I'd already had trouble getting my sets out of Raleigh over Lightning,
which never seemed to be able to get an open channel to anywhere.
You had to open the channels yourself?
I moved everything to Strike, which is KYC and Custodial, with the plan of consolidating
chunks in my own non-Custodial wallet.
There you go. So we're going to talk about Liquid a little bit more,
which could be an option for you, Tamato.
I'm sorry to hear that. VaultBite comes in with 2,121 sets.
I hope this is a socially acceptable use of Bitcoin. I say yes,
it is. Thanks, VaultBite.
That rounds us out for all of the boosts above 2,000 sets. I got a bunch of
other boosts that did come in, and we have all of them in the show notes, and I do read all of them.
We had some good streaming support this week, too. In fact, the streamers really
kind of helped bring up the seg just a little bit.
We got 60,263 sats just streamed by 36 different people out there streaming
those sats as they listen.
Something you could only do with the Lightning Network.
You could never do it with the Visa or the MasterCard or any of the fiat networks.
People with 36 of you out there just listening to the show, streaming those
sats alone, helped collectively stack 60,263 sats.
Combined with those of you who
sent a message in, that brought the show's grand total to 321,637 sats.
Thank you, everybody who supports the show through a boost. This is a value for value production.
So if the show is useful, gets you thinking about Bitcoin in the right way or
what's going on in the macro economy and you want to keep it going,
please consider sending a boost. I really do appreciate that support,
and I love reading those messages.
We had 60 unique senders. When you combine the boosters and the streamers, that's pretty awesome.
And if you think about it,
Kind of a unique thing happening here, where we're taking sats,
we're sending them in these little chunks over lightning and supporting independent
media, covering something that the mainstream media could never get right.
They'll never get this topic right because they are measuring the system within the system.
And only podcasting is really the medium that is truly outside the system,
fully distributed, especially with the podcasting 2-0-0 standards.
And now it has distributed funding by its audience. That's just we're doing that.
But we're and we're doing it on a weekly basis. And it's so easy to lose sight
of just how frickin amazing it all is.
It truly is something like desperately needed right now in these times.
I mean, you know, I watched I watched the debate last night.
And what I wanted to hear didn't touch. They didn't touch on anything that I thought was important.
I mean, I shouldn't say that. But the things that I truly care about that I
think are existential, the mainstream media just isn't tuned into.
To it i did hear one person mention lamont i
know what's his name uh he's the gentleman on cnbc
that always reads the inflation numbers what
is his name actually i have a clip of it here let me here i wasn't
planning on playing this but here let me play this clip low yield close
and everybody's talking about the debate i was a bit disappointed having kids
and grandkids who can't afford houses and of course can't afford insurance once
you buy them or some of the other prices it seemed like there was really an
economic tone-deaf panel with respect to drilling down.
If you give people $50,000 to buy their house, I think it sounds like a good idea.
But hmm, I think CPI numbers might reflect that price of homes might go up about what? $50,000?
Squawk box. Well, here we are, Joe. Back to you. There you go.
That's the totality of what I hear about the mainstream media talking about
the issues that I think concern us.
Podcasting and its ability to niche down and have somebody focus like a maniac,
you know, that's unique to this medium.
And I just want to thank all of you who take a moment to support it and make it possible.
Music.
All right, it's been a minute since I've played a Michael Saylor clip.
I've kind of backed off because we hear from him quite a bit.
I think he's a little overrepresented.
But man, if Saylor didn't have just a killer segment on CNBC this week,
I got to play two clips of it. I also put it in the intro a little bit.
The full segment's over 10 minutes
long where he gets into some of the microstrategy strategy as well.
We don't need all of that. We just need the core Bitcoin stuff.
I've cut it down to the best moments, and I want to play them for you.
I just saw a headline that $1.2 billion in outflows took place out of the Bitcoin ETF.
And I'm curious what you think is going on with the impact of the ETF on the price of Bitcoin.
This is Aaron Sorkin. He's probably one of the number one Bitcoin skeptics we
play on the show because he just continuously doesn't seem to get the value proposition.
So when Michael Saylor can sit down and calmly and rationally explain it to
him in a way and a language that Aaron understands, we got ourselves an opportunity.
I think generally it's been a good thing and it's created more demand.
But you've got to keep in mind that Bitcoin is smart, fast, strong money.
So on a Saturday night, if you're worried about a missile strike,
you can't teleport your $10 million apartment to Singapore, lever it up 10 to
1 and short $100 million worth of New York real estate.
But you can short $100 million worth of Bitcoin by borrowing $10 million.
So you have a lot of fast money traders, a lot of volatility,
and that will cause and ripple into volatility in the ETFs. Can you explain
this? That's okay. Can you explain this?
One of the things you just talked about, if there was a missile strike or something,
there was a sense that people talked about this as digital gold.
And maybe you still think that's the case, but it often doesn't act like digital gold.
In the midst of a missile strike. Yeah. It's the most liquid,
fungible, free capital market in the world.
Your New York apartment's not fungible. It's not liquid. I can't panic sell it.
So when there's a short-term panic, Bitcoin is trading really,
really hard. Isn't it supposed to be the opposite?
Over the long term, it's up 44% a year, every year.
And you either get 12% from the S&P with VIX vol, or you take 3x of the vol
to get 44%. So over the long term, if you're an investor, it's going to be great
because it's strong capital.
Over the near term, if you're a trader, you get lots of arbitrage opportunities.
Is it a non-correlated asset people can count on, or is it just a risk-on?
You know, in the near term, whoever's got the most money can decide whether
it correlates or non-correlates.
It's like, again, I can lever it up 20 to 1 on Saturday night,
and I can trade it long or short.
Hey, Michael, just the whole idea of leverage in something that is admittedly
so volatile causes some people some real concern. I mean, I'm far more conservative.
I would be worried about that. Michael, the idea of a free market where anybody
can do whatever they want at any hour causes me some concern.
That's what she's saying. They don't realize it. You know, they're on CNBC,
which is supposed to be the financial network, which, you know,
should understand how capitalism works and human incentives. But they have existed.
You can't blame them because they've existed in a system since birth.
And they can only understand and measure within that system.
I can trade it long or short.
Hey, Michael, just the whole idea of leverage in something that is admittedly
so volatile causes some people some real concern.
I mean, I'm far more conservative. I would be worried about that.
What's the worst case scenario of something that would happen in a leverage
situation like that with the Bitcoin ETF?
I think what happens is people offshore trading on Binance with 20 to 1 leverage
get wiped out on Saturday night when there's a potential missile scare.
And so they're the degenerate crypto traders. On the other hand,
what you want is a free open capital market.
Everybody can trade it any way they want.
And so if you're going to hold it for more than four years, you're going to
get superior performance with that volatility.
That's his key message. Hold it for more than four years.
You're going to get superior performance. All right. So let's get into the price
talk because, you know, they always got to talk about price.
Mike doesn't know where the price is going. He's got some hopes.
He's got some projections and he's got some nice sounding numbers. Take these with a.
I don't know, business finances, how the stock market works,
the overall macro economy, pretty much better than anyone else.
So at least anyone else that articulates it to Bitcoiners.
And so maybe there's validity in his price predictions. But,
you know, I hesitate to say there is really, I think it's all just take it with
a grain of salt, but still interesting, nonetheless.
You buy it and hold it for more than four years. And then you think eventually
it takes how much, let's say it is digital gold, what percentage of gold's market cap does it finally?
You know, Bitcoin's 0.1% of the capital in the world right now.
I think it's going to go to 7% of the capital.
7% of the capital? My long-term forecast is it's going to go to $13 million over 21 years.
$13 million over 21 years. But what is it five years from now,
in your four-year calculus?
You know, it's been growing 44% of years with about a 40 to 50 vol.
I would think it'll move on at 40%, then click down to 35, then 30, then 25.
And at some point, it'll be the S&P return plus 8%, and it'll be the S&P vol
plus 8%, because it's always going to be a more global, open, free capital market.
Music.
Moving on to project updates, just a couple of quick ones for you.
I think you're sleeping on Albie Hub and some of the things that are going on over at Albie.
It's a hard prop to explain, but Albie Hub is going from strength to strength.
And I talked about last week, they added the friends and family capability.
I also mentioned their Go app. It's a simple mobile wallet that in retrospect,
after using it for the last week, I think is really genius. It's it's.
Very basic. They've had three updates since the last episode,
so they're moving pretty quickly, so they're adding stuff.
But right now, it remains very basic. But what you need for somebody who's new
to Lightning that just wants an easy interface to send and receive sats.
And the Albie Hub is actually where the liquidity lives and the wallet actually lives.
And the Albie Go app is a mobile app that you load that connects to that.
And this really gets powerful when you combine it with our new friends and family
feature. You can set up sub wallets now from your Albie hub and basically be
Uncle Jim or Uncle Albie, as it were, for these users.
They don't have to manage liquidity. They don't have to set up an LND node and a hub.
They don't have to know anything about self-hosting. They can just use the sub
account you set up for them and the Albie Go wallet and have essentially a very
complete lightning setup that, oh, by the way,
also works with things like Nostor app and podcasting 2.0 apps, etc.
And something very clever that
the Albi folks don't get much credit for is they've kept the API working.
From their custodial hosted service now to the self-hosted hub solutions,
the API still works, which means all of the stuff the developers have worked
on on the back end all still works even with the self-hosted versions.
Albi Hub is really good, and they're combining it with an ecosystem of applications
that make it even easier for, I would say, your non-Lightning folk,
for your non-native Lightning folk to use, which for like a podcast.
Maybe one of the podcaster could host the Lightning node and then the other
host can participate in value for value and get the splits without having to run their own node.
They could just be a friend or a family of the one host AlbiHub.
And they could use Go to manage their balance, to sell it or to stack it long-term into cold storage.
It's pretty neat. So don't sleep on Albi and AlbiHub. They're doing some neat stuff over there.
RoboSats version 7.0 alpha came out. Shout out to the RoboSats project.
A great, great project. It's a safe way to buy Bitcoin with no KYC.
You pay a bit of a premium, but it's also, I think, probably my favorite way
to get non-KYC Bitcoin in large amounts or sell in large amounts.
They've announced now a desktop app, also a Noster order book, and more.
And the desktop app is for Windows, Mac, and Linux.
Which is neat. I don't really understand the Nostra-enabled order book yet,
but the next time I dig into RoboSats, I'll take a look at that,
and maybe I'll do a little follow-up on the show.
So it's version 0.70 out. Not a big, big major update, but really nice to see
the Windows, Mac, and Linux desktop app.
And the Android app now has built-in Torrified notifications.
Torrified notifications. I think that's Torrific.
Music.
Some newbie corner and a final clip before we go. So I've been running through
a stack of newbie questions and I'm still soliciting more.
And one of them this week is why do you need a more complicated flow for your Bitcoin savings?
You mentioned going from river to liquid, then into Sparrow.
What are the differences in all
of these? So we're going to answer two questions. This is the first one.
The answer to this is it depends. ends, like all things in Bitcoin,
on how much you care about your privacy and how much you want to hedge against
future transaction fees.
We'll talk more about transaction fees in a future newbie corner.
But Bitcoin transaction fees are not based on the percentage of the value you're sending.
Like when you, maybe you wire money or whatever, when you're transferring money
into the cash app or something, maybe they do like a 1% fee or something.
That's not how it works on Bitcoin.
It's kind of the weight of your transaction, the data weight of your transaction,
the size of your transaction.
And based on the amount of data that's going to get taken up in a block,
that's how much your fee is.
And the fees get set on how busy the network is and all of that.
And you can kind of get a picture of this if you go to mempool.space.
You can kind of see a visual of how all of this works.
And in Bitcoin, you end up with a larger size transaction when you're combining
a lot of small UTXOs together.
So if you got, say, you set up a DCA and you're buying a lucky $13 worth of
Bitcoin a day, or maybe an hour, like Strike will let you do it every hour.
It's just for fun. Let's say you bought a dollar of Bitcoin every hour.
So once a day, when the whole day is up, you bought $24 dollars worth of bitcoin
you go into the strike app you set that up awesome cool the problem is.
Each one of those is a transaction. So when you go to spend that,
you have to combine all of those UTXOs in to make whatever total amount you're trying to spend.
And that could be a very expensive transaction because each one of those is going to have a fee.
So what you do is when fees are low or when using something like the Lightning
Network where you're not paying for on-chain fees, you can consolidate into a wallet.
And one of the advantages of consolidating or pegging into a liquid wallet is,
one, you break the tracking.
Because once you go into liquid, it's very hard to track those UTXOs after that.
And when you come out of liquid, you're going from a new address into a new address.
And in liquid, you can combine all of those transactions into one large transaction
when you come out to your cold storage.
One way to avoid this, to help you understand, is you could just say you were
stacking on River. You're buying $100 a week on River.
You could just let all of that stack up on River for months until it's a large
transaction, until it's millions of sats, and then just move that to your on-chain wallet.
You could avoid lightning, you could avoid liquid altogether,
and you could just take one large transaction.
Well, it kind of depends on how River does the transaction, actually.
But you follow me here, I hope, that you could take that transaction,
you could hodl on River for a while.
Liquid adds the ability to break tracking.
And you're removing single-party risk because Liquid is a federation,
and so the entire federation would have to be corrupted before your Liquid funds would be lost.
Whereas River is a good company, but it's one company, so there's a little more risk.
So moving to Liquid, you're going to another place where you can keep your funds
for an extended period of time with a little bit less risk.
And then once you move it to cold storage, you remove all third-party risk.
So that's the workflow. It's not necessary.
It's really about hedging against future transaction sizes and fees and also
getting a little bit of privacy,
because of course these things are all very traceable and
so if liquid can bring you a little bit of privacy I think it's worth doing
there's still a record at the company you bought the stats from and how much
you bought that the IRS or another tax agency could acquire so you're not avoiding
taxes or anything like that you're just preventing casuals from tracing your
funds and seeing how much is in your wallet and whatnot not.
And then the second question is, why do you suggest moving between these in larger chunks?
Simply so the transaction fees are less, you know, 2 million or more.
It's hard to say. We don't really know. There isn't a perfect answer here because
we don't know what the future value of Bitcoin is going to be.
And we don't know how busy the future Bitcoin network is going to be.
Like a lot of the Bitcoin fees right now, network fees are actually quite low.
Because, you know, in part, a lot of the action happens off chain these days.
Either in coinbase's database or you
know it widely in the etfs or over the lightning network so as i record right
now you know a fee is around 56 cents for medium priority yeah if you're trying
to move a dollar 56 cents sucks but if you're trying to move ten thousand dollars
56 cents isn't so bad is it and if you're on the lightning network you don't
really have to worry about it,
until you open or close the channel i hope that helps i really don't know if it does.
Please do let me know. Give me feedback on that. I hope it's helpful.
All right, it's time for our final clip of the week.
Peter Schiff and Jack Mollers had a debate this past week, Bitcoin versus gold.
I don't recommend you watch it. It's pretty much everything you've already heard.
But there was a moment where I thought Jack did exceptionally well.
And he pointed out something that's a weakness in gold that we never talk about
that was inherently solved with Bitcoin. coin?
David, the real problem with gold is that unfortunately it has to centralize.
The problem is that gold can't achieve transaction finality without the help
of a government or a central party.
Meaning that when gold was operating in a local economy and you can exchange
the physical coins with your direct counterpart or your butcher,
your local tailor, your grocer, whoever you were exchanging with, gold was great.
When the world needed to scale an economy and the the velocity of money larger
than your local economy.
Gold failed us. Gold failed us because gold is just a bare physical metal.
It does not carry a monetary network.
What's the gold network? The gold network are human beings.
And when you're trying to transact in an economy of billions of people globally,
you are reliant on central parties, banks, governments.
And it was for that reason that gold failed. And it failed in a way that you
can't operate a truly free market when when the concentrated supply is with
those that you have to trust.
And so that's fundamentally what Bitcoin solved, is that you are able to create
a scarce bear instrument and a network that can achieve finality in transactional
settlement without the reliance on any government or central party.
Boom. I think that's a fantastic point. And with that, we will wrap it up right
there. Thank you so much for listening to This Week in Bitcoin.
Boost in with what you'd like to hear or see from the show, any feedback you
have, and please share it with a friend who You might be Bitcoin curious.
I leave you with a value for value track. Consider boosting the artist as well. It is devil's hand.
Music.