Ladies and gentlemen, thanks for joining us back here again for your favorite fourth tier podcast with second tier haircuts and first tier guests.
Today, we're joined by Sultan. He is a Bitcoin OG and a gangster, been mining Bitcoin for years out of Venezuela.
And he has recently become a little bit of kind of a kind of a cultural phenomenon on Bitcoin Twitter due to some statements that he's made and some things about his.
the way that he was able to matriculate out of Venezuela through Bitcoin mining.
And so we're just super excited to talk to him.
Sultan, thank you for joining us.
And if you would, can you kind of walk us through sort of where you're at in your life now
and how you got there starting in Venezuela and to the point where you're at now
and kind of how you were able to get there?
yeah look at this point it's been um what this is going to be the 13th year since i got into bitcoin
uh 13 years ago i was just like at my house i was helping my pops put together like a
like a pc for his for his company he's he's an architect so he needed like a sick graphics cards
or whatever um he had a he had this small business in the country where he had to sometimes like
import goods from outside of the country. It was also like an issue, you know, ever since he started
his business in Venezuela, like in the 90s and Chavez became a president to basically make yourself
with dollars, right, to pay for goods outside of Venezuela. You like being unable on their
controlled currency exchange, being able to make payments, you know, with your Venezuelan bank
account basically so i built this pc for my dad then he had this like payments issue and i'm like
dad maybe there's this thing called bitcoin that we could use to that we could even mine with the
computers that you have you know in your office uh and we could start like using bitcoin to make
payments to europe etc and keep like importing goods and then also we can buy this bitcoin thing
with Bolivars. So all of the goods that you sell were able to like grab all the free cash flow that
you have in Bolivars, buy Bitcoin and then repay your suppliers to keep importing goods into the
country. So that's how I initially got into Bitcoin. Like I just wanted to help my dad.
How did you? OK, wait. So how did you how did you know about Bitcoin?
Yeah, I was in high school at the time and I had already a friend in high school who had mined
Bitcoin with graphics card. Same thing. We were all basically PC gamers or something. Right.
And so like learning about Bitcoin on Reddit or like on community threads or like where like where do you guys even.
I mean, I remember I saw the white paper in 2009 on Reddit.
I read it and then just completely forgot about it for like 12 years, 11 years.
yeah look 2013 i i think combination of reddit but also just twitter and youtube right like you
you already found like tutorials on youtube and people talking about mining uh and how you like
you could configure the a6 that was all like almost like publicly available at that point
crazy uh and so we were these like teenagers watching these videos on youtube of like
huge mining farms in China. And we're like, OK, how do we get into this? So from graphics card to
the first A6 to importing one of the first S1s and S3s into Venezuela, co-founding one of the first
Bitcoin mining farms in Venezuela, helping other people install Bitcoin mining farms. Man, that
whole era for Venezuelans was really that Bitcoin mining boom in Venezuela, which basically
kick-started the p2p market in latin america it was all defeated by bitcoin mining activity
and local bitcoins volume coming from venezuela basically um but really bitcoin mining back then
you know 2013 14 15 in venezuela mostly the people that got later after the i would say the
early adopter group, we were like 20 people building Bitcoin mining farms, right? All those
hundreds and thousands of people that mined Bitcoin in the country afterwards, they really
just wanted to make themselves with dollars, not with Bitcoin. So they were just selling it
immediately. Yeah. So I would say like in 2013, 2012 in Venezuela, it was maybe a group of maximum
30 people talking about Bitcoin as the future of the internet money, digital gold, the internet
gold. Those were basically the discussion stand. So look, that was an amazing ride. I had at some
point 200 or 300 ASIC units running at the same time. I co-founded everything with like private
capital, funded my family, my dad, etc. So basically, my co-founder was my dad. By 2015,
2016, when the Venezuelan government really started seeing this noticeable activity of Bitcoin mining
in the country, right? People are like using excess energy in some parts of the capital in the country
to what is this Bitcoin mining thing and really like start digging into it, right?
that's when we cashed out and got out of, seized all of our Bitcoin mining operations and sold it
because you were starting to fall under the radar of the Venezuelan government.
2017 is when the seizure, 2016-2017 is when the seizure of Bitcoin mining hardware really started
because in 2017, US sanctions kicked on the country.
and that's when really for the government
after for like a year or a year and a half
studying Bitcoin mining and P2P markets
and local Bitcoins, etc.
and cracking down some CeFi exchanges, right?
People that were opening accounts in banks in Venezuela
and trying to be the Kraken or the Coinbase of Venezuela.
All of those experiments failed
and were cracked down in Venezuela
Because the government had the ability to go directly to the bank and ask them to close and seize the assets in the bank.
The only platform and activity that continued subsisting the purview of the government in 2016, 2017 was P2P markets,
so local Bitcoins, right?
Because it's fully P2P.
There's no way to, like, right?
And then Bitcoin mining.
So by 2017, with the sanctions, that's what forced the Venezuelan regime to really say, hey, we got to find an alternative.
We can't use the SWIFT system any longer.
We can't use the SEPA payment system in Europe.
The state oil company is sanctioned.
The central bank is sanctioned.
The main government officials are sanctioned.
A network of over 100 people with close ties to the government got sanctioned.
What do we use?
Interesting.
Yeah.
So that's really when I said, okay, in Venezuela, there's really, first of all, there's no law for mining Bitcoin anymore.
Like you are getting into a high risk business if you want to mine Bitcoin in Venezuela.
because you will need to get a Bitcoin mining license issued by the Venezuelan government.
A ministry of cryptocurrency, the Sunacrypt, was created, right?
And so it really became difficult.
By 2017, I said, maybe we really also have like a custody problem in Venezuela.
By 2017, that's when really, you know, on Bitcoin Twitter,
People were talking about like, you know, so hardcore self custody, run your own note kind of thing, you know, run lightning over your note when you didn't even have like a lightning wallet.
I ran one of the first Bitcoin lightning notes inside Venezuela.
I got the lightning torch back then when people rotated it all over the world.
So that was super cool.
I mean, all that history of mining in Venezuela, whatever, really Venezuela was like an interesting topic when you talk to Bitcoiners globally.
But I would say, I would argue that until 2017, when hyperinflation kicked in Venezuela, really wasn't on social media like the Bitcoin community wanting to discuss so much about Venezuela.
So that gave me the opportunity to basically open up my voice to the Bitcoin community and start telling my story, start telling what's happening in Venezuela, etc.
I had this small custody startup in Venezuela.
I was trying to help the Venezuelan Central Bank build like a multi-signature scheme to custody Bitcoin in Venezuela.
Because I was trying to argue that if Venezuela had already been the country with the most mining activity and most B2B activity for Bitcoin in South America,
why shouldn't we develop a multi-signature solution to have Bitcoins ourselves and custody them?
that's when no El Salvador
no Nayib Bukele existed
no nation states
were still in a Bitcoin
and you were an idiot
talking about Bitcoin
with central bankers
did anybody listen?
some people listen
but
until now
it's been a hard business
and a sanctioned business
dealing with the Venezuelan government
so dude
as of 2017
and how everything
developed in Venezuela
I said
it is dirty business.
It is hard business.
I'm going to try, you know, to finally be a migrate outside of the country.
Bitcoin and all this industry was really going way more global.
And I said, who can I help co-found another startup globally?
So I joined Lettend via this Venezuelan co-founder, Mauricio Di Bartolomeo.
He already knew me from the Bitcoin Venezuelan scene.
I said, man, I'm getting out of Venezuela.
you know how can i give you a hand so i joined lennon's uh marketing team i was like the 15th
person to join the team now they're like i saw the company grow all the way up to 137 people
we raised more than 570 million dollars at lennon man after i joined it was a rocket ship but
you know eventually ftx thing uh the ftx thing happened right so it wasn't a sexy business being
on the lending side of Bitcoin.
And I had met this Luxor Technology co-founder
in El Salvador, Ethan Vera.
I reached out to him and I said,
man, do you need a quarterback on your sales team
or a marketing team or whatever?
A heavy, you know, like a hectic Bitcoin
or somebody that knows the industry or whatever.
And really that was the right, man,
because I didn't know much about Luxor Technology
before joining, honestly.
I know that was like related to Bitcoin mining software services.
They had like a pool or whatever, but that was an amazing ride.
And that was probably the hardest Bitcoin pill that I've had to swallow
in this 13 years of everything that I've done in Bitcoin.
I helped Luxor launch half-rate derivatives.
So basically, we were the first people to like sell,
like market as a commodity, Bitcoin compute power.
That's fucked, man, you know?
For me, I started in all of this, basically connecting almost like an ASIC next to my microwave with Free Electricity in Venezuela to data centers at the intersection of AIHPC curtailing energy in Texas with ERCUD programs.
What the heck, man?
That's beautiful to see.
It is beautiful.
And I'm really interested, Sultan, in the social context in which you begin to do all this.
like back when you're first starting in 12 or 13 or whatever. So you'd said 2017 is when
hyperinflation hits and that's when it becomes a hot topic for Venezuela. But even before then,
so just from an outside perspective, you can correct me if I'm wrong, but Venezuelan is known
for having kind of a socialist revolutionary movement and socialist ideology. How did that,
you know, you growing up in that environment, I suppose it's taught in the high schools,
How does that kind of interact with the ideology you're getting through Bitcoin of this kind of international free market?
Yeah, man.
I mean, they took every single sector in Venezuela taken by the government.
OK, so all this socialist interaction for 25 years of, you know, my lifetime almost is just, dude, there's you got to always try to reduce the state however you can.
OK, you've got to take as much as you can from the state, honestly.
so right now after everything that happened with the u.s intervention in venezuela now it's a
gradual game of how do we continue reducing the state and privatize shit okay so i when i went to
high school i bought one empanada with like 20 or 50 bolivars if you account for the 14 zeros that
have been removed from the venezolan bolivar you're almost talking about a quadrillion bolivars
uh to buy that same empanada so you went from 20 and 50 to five quadrillion it almost sounds stupid
it is like it is insane right okay it almost sounds like what what are you talking about you idiot
How is anyone still alive? How can anyone how can anyone live there?
Like, I mean, so I lived in Colombia. I lived in Posto.
And at the intersection of every single street at every single street corner, there would be people who were, you know, panhandling or like doing something at the at the intersection.
And I remember asking my host, I was like, you know, the people that are at your intersections, they're way more entertaining than the people that ask for money at intersections in the United States.
And he said, well, these are all like, like, these are Venezuelan people that walked here from Venezuela to escape the country.
And, you know, these are not people that are down on their luck by their own choice.
These are people that lost everything because of what the government did to their money.
So, I mean, what just like in terms of like, can you frame what has the exodus of Venezuelan people been like and what is it like for the people that remain?
Because we were not sure what to believe about the news that comes out of Venezuela post the hijacking of Maduro and taking him taking him for a ride.
So, I mean, who is left and what do they think about the situation with the United States coming in and kidnapping a president?
Who's left? Old people, poor people.
OK, and that accounts for like 70 or 80 or more percent.
OK, and all the all the wealthy, most of the wealthy people that left the country were the ones that left the country.
and the people that actually had like a college degree and stuff.
So it's really not that much.
Because also at some point, even if you are a part of the new generation,
you start figuring out how to work over the internet.
You are looking to make the most amount of money that you can
to just go to another better digital hub in South America or Europe or whatever.
Because you need light.
You need better internet connectivity.
You want better wages.
because if you're talking to a potential employer
and you're from Venezuela,
they're kind of like, you know,
you just earn less money.
So, yeah.
Yeah.
So I'll tell you,
I am excited of the Venezuelan exit.
Nowadays, I'm excited of how all these years,
the Venezuelan diaspora
has built this network of knowledge, okay?
Globally, of Venezuelans globally.
Man, Brazil has,
almost 207 or 210 million people.
Okay?
Brazilians love the U.S.
There's a lot of Brazilians in the U.S.,
but there's like 600,000.
They're not even a million.
There's more than a million Venezuelans.
We're a country of 30 million people,
not 210 million people.
Ooh.
Wow.
A country the size of L.A., basically,
a little bigger than L.A.
Yeah.
Yeah, and 1 30th of that has moved
just to the United States.
Yeah.
I want to answer a part of your question
that's related to this whole social layer.
If you read this Andrew Dickens money and hyperinflation what it called It Fiat Money Inflation in France by white Andrew Dickens right That like the whole history of how hyperinflation happened for a second time in France
after it had happened already, okay?
The first time, whatever.
Dude, it's the same shit, okay?
It's like hyperinflation had happened like two generations ago.
the grandparents of whoever were, you know, the new generation in 1974
were the ones that remembered what ended up being the result of printing money
and issuing a new currency and all of that.
But the new generation didn't know it.
So you got new politicians and new senators talking about,
hey, you know what?
We're going to survive this economic crisis with this new currency
and it's going to be backed by land.
And that's why it's not going to fail this time.
And they ended up melting even like, you know,
gold from churches and shit to back new currency issuances.
So, bro, take it to the 21st century in Venezuela.
It's the same playbook, okay?
It is the same playbook.
Fiat is a hard bitch to kill.
That is one of the most certain things that a Venezuelan can have learned today.
Because still, today, 75% of the transactions in the Venezuelan economy are in bolivars.
The Venezuelan government collects more than almost like $6 or $4 billion a year from taxes in bolivars.
The biggest buy now, pay later startup of Latin America is Venezuela.
And it only operates in Venezuela.
In Bolivar's.
Wow.
Man.
I want to go back to-
You know what, man?
It's one more currency.
And if it becomes a back currency,
the market will look for a better form of currency.
And that's exactly what happened in Venezuela.
People started trying to look for, you know, payments in digital payments in dollars.
Oh, what is this cryptocurrency alternative?
Right?
then stable coins came and the whole stable coin factor like i've for 10 years i was a hardcore
bitcoin maxi i'm still am i still am like i root for bitcoin and but usdt became 90 percent of the
crypto transactions in venezuela when i as a miner from 2013 on the way almost to 2017
saw that most of the volume was all Bitcoin.
All the remittances and payments being sent in and out of Venezuela
were mainly being transmitted through local Bitcoins and Bitcoin.
And Bitcoin lost that to USDT and Binance.
Yep.
And now the U.S. can export their inflation through that digital dollar
by forcing those companies to back it with U.S. debt.
I told you this at the beginning, guys.
Like in 2014, 15, 16, 17, people mining didn't want Bitcoin.
People mining in Venezuela mostly wanted dollars.
Yeah.
They wanted Bitcoin to sell it for dollars.
And they saw Bitcoin mining as a rent in dollars.
Because Bitcoin mining made you more a month than being a doctor.
That makes sense.
So during this time frame when the government comes in and they start seizing Bitcoin miners
and they start taking those away from people.
We've heard on Twitter that there's possibly a stash of like 600,000 Bitcoin,
660,000 or whatever, supposedly, that the Venezuela government has.
Is that where that came from?
Were they just taking over these operations and running these miners?
Or were they forcing people to give up their private keys?
Or is it even real?
That is an excellent question.
I have an embargo draft that will be soon published about my full point of view on the 600,000 Bitcoin.
The conclusion is that is an overestimated figure.
I am not disputing that there isn't a Bitcoin stash inside of Venezuela or a crypto stash.
it is indeed and you can have it for certain a combination of bitcoin and usdt that is for
certain okay um but it is impossible for it to be 600 000 bitcoin man the hardware that the
venezuelan government seized was uh mostly s7s and s9s okay bitmains s7s and s9s that is very
antiquate Bitcoin mining hardware.
Okay? And after this
the seizure of Bitcoin
mining hardware escalated
in the country, imports
of Bitcoin mining hardware to
Venezuela, tanked.
Right. Okay? Tanked.
Almost nobody
mines nowadays with whatever
mining hash rate is left in Venezuela
with an S19 or
S17 or S15.
None of the like
old gen, mid gen
mining hardware are available at a great scale in Venezuela. It's very old generation hardware,
okay? So take into account that we took, we got to one Zeta hash of like hash rate in Bitcoin,
okay? It is impossible for them to have mined hundreds of thousands of Bitcoin also because
the way the seizure and the halting of mining operations happened in Venezuela was forcefully,
was under an extortion.
It was extortion.
So they disconnected the hardware.
Some of the hardware was destroyed.
Some of the hardware was burned
because you're great at seizing.
Out here killing the golden goose, man.
But you're not great at running Bitcoin miners.
Yeah, just slaying calves.
That is horrific, man.
Okay.
All right.
So that is one way the Venezuelan government,
for sure amassed Bitcoin.
The problem with governments
and socialist governments
is also corruption, man.
So a lot of those Bitcoin mined
were just like stolen, okay?
Were sold via OTCs
to send it to accounts in Switzerland
or we don't know right now.
We will know in some years
because now the US will study all those flows
and all that shit will be,
I believe all that shit will be published, man, okay?
The tools exist to track all of that.
They just have to continue getting the right people and like interview them.
So the other two more points related to the 600,000 Bitcoin.
Okay.
The other thing that they're arguing publicly or like on social media is that potentially
the Venezuelan government swapped some gold for Bitcoin.
Okay.
I think it's like an estimate from seven to eight tons of gold that are missing, okay, out of the central bank's reserves.
All right.
So, Pulse, that was shipped overseas in like 2017, 2018, okay?
We're talking about when Bitcoin hit like between, you know, crossing a thousand dollars, tens of thousands of dollars.
Trump was president in the U.S., right?
Just becoming president.
Sanctions kicking in.
the government is starting to figure out a way to work with crypto
and you're telling me they swapped seven tons of gold for Bitcoin?
Who gives you Bitcoin for seven tons of gold?
Tell me right now.
Interesting.
No, man.
You know, like, that's all bullshit, honestly.
So I don't know where this 600,000 figure of Bitcoin actually started to come from.
I've obviously seen the tweets, the charts, Venezuela, 600,000 Bitcoin, whatever.
No, man.
I mean, the level of incompetence and corruption that the Venezuelan government has had to go through
in relation to cryptocurrency or Bitcoin or whatever,
It's so great that it is extremely hard for me to believe that it is 600,000 Bitcoin, the amount that we have.
Again, I am not ruling out that at some point we amassed or that amount of Bitcoin went through Venezuela.
But it's now elsewhere.
OK, and if there's something left of those Bitcoin, it's also potentially spread it in hundreds and thousands of keys, man.
Or exchanges, binas and stuff.
Yeah.
You, I mean, you speak so, so energetically about Venezuela and Grant and I are both from little farms in Kansas.
And we both have this like we talk about this often, like we have the strong draw to where we came from.
And it's always something that, you know, no matter where you go, you always feel this draw to return. Is going back to Venezuela something that you would ever consider?
Absolutely. Absolutely. Okay. Okay. Also, because today I'm a father, I want my daughter to live like at least a couple of years in Venezuela. If there's been a good time to turn back, to go back, you know, it may be pretty soon.
OK, so, man, if I can in any way I can funnel all of the network and all of the knowledge that I built through Bitcoin to rebuild Venezuela, I will do it.
I will do my best.
What is the role that Bitcoin could or would play in rebuilding Venezuela if what the government lacked before was the competence to integrate Bitcoin mining into a petroleum-based economy when you have socialists who want to steal everything?
What does the future look like when you don't have that, when you have people like you with an immense amount of expertise?
How does Bitcoin mining reenter the picture?
What does Bitcoin look like in Venezuela?
Yeah, I think it is. I would love for it to be a combination of a Bitcoin national reserve.
OK, right. And so what is a first step to make that happen?
Who would potentially costaridos Bitcoin in Venezuela?
Maybe the Venezuelan central bank.
OK, because you help stabilize the Bolivar if you back the Bolivar some way with a Bitcoin national reserve.
Right. Not only a combination of dollars and euros and other fiat currencies.
It is trying to replicate the El Salvador model in Venezuela.
I would love to see that. OK, to some extent.
To just not have it, just don't have a central bank and just say, look, we're not going to be in the business of money.
We're just going to have Bitcoin and you guys can use whatever you want.
I would love to close the Venezuelan central bank out of, you know, more than 100 years of Venezuelan central banking history.
we've done a terrible job
even before this administration
they're horrible at their job
at protecting the value
of the Bolivar
horrible job
what is the sense of it
none
but right now there has to be
a Venezuela central bank
because we need an agreement with the IMF
we need an agreement with the United States
it is as of today
finally an unsanctioned
sanctioned central bank by the United States.
$500 million worth of oil were sent to the Venezuelan central bank today under the agreement
that the Venezuelan central bank will use that money to buy agricultural products from
the U.S.
Okay.
So first, I would love for eventually see Venezuela have a Bitcoin national reserve.
Okay.
What is needed?
What is needed is the rule of law, man.
Honestly, like don't fuck with people's Bitcoin.
Don't fuck with the exchanges.
Don't go seize them.
Okay.
Lower the taxes.
Who's going to bring you Bitcoin if you tax it at, you know, 16 or whatever percent.
Actually, cryptocurrency transactions are not taxed in Venezuela.
So there is a very robust crypto regulatory framework in Venezuela.
I would argue that it also needs to be diminished.
Okay.
These licenses for Bitcoin mining activity thing.
It just makes it more bureaucratic.
Okay.
Zero taxes.
Zero taxes for overseas companies.
Everything.
I mean.
Now Bitcoin mining.
It's the same discussion.
Okay.
You need to give reassurance of like first give back all the cease mining hardware.
It can be outdated as shit, but whatever you have, give it back.
That will start giving a signal to the international Bitcoin mining investment community.
Bitcoin miners, especially in the US, even Russia, China, whatever, they love talking about Venezuela.
It's obviously a huge stockpile of gas energy, oil energy, hydroelectric energy.
There is megawatts and gigawatts of energy available in Venezuela at the cheapest of prices globally.
Up until now, it's only been just like a high risk market.
So how do you deal with that?
OK, at large scale, you can.
So it's been impossible with the current state of like the rule of law in Venezuela to finance a Texas data, Bitcoin mining data center equivalent inside of Venezuela.
OK, it's just crazy.
so that needs to come
alright
so I would love
man I would love to see
the military
the military national guard
be completely restructured
because there's thousands
of people
you know just connected to the government
I just do not know right now
if that is going to happen
I would love for that to happen
but I think that's going to be
a long work that it's going to take many years for the United States government.
I don't think it's only just a thing of removing Maduro.
It is the first step on the positive direction of a very long marathon.
And we're maybe in the first kilometers.
So what else needs to be done?
So you've, in kind of essence, one could look at this situation and say, well, the head
has been cut off.
of the snake, but obviously it's a Hydra multiple headed Medusa.
And there's so much more beneath the surface.
It's very unclear whether or not the remaining regime will be able to work with the United
States in a productive way.
And so what like what else needs to be done?
Well, right now, the U.S.
Embassy is reopened.
So the CIA and the FBI and the United States will have, you know, day to day operations in Venezuela.
That is a great step.
OK, but we need the help of the United States to like restructure the military guard.
Because like the opposition, the opposition doesn't talk to the military.
And that's the problem.
I think that's the main problem we Venezuelans have.
The opposition is not talking to the military.
I understand.
The military is fully bought and we need the help of the United States to remove the part of the military that is bought.
But I believe there is really nowadays a part of the military that also sees the reality of socialism.
OK. They just want to see another leader there.
But neither Maria Corina Machado nor Edmundo Gonzalez really talk in person to military guards.
And so those are the ones that were, and Gonzalez, he was democratically elected. He's the candidate that's kind of, if we look at the last election results, is the popular winner. And now Delcy Rodriguez is kind of the de facto leader, the remaining regime element. That's kind of the situation, right?
yeah correct because like you remove the president who gets in as president the entering
vice president and so um i look man i still are i still i find it hard to believe maybe i'm just
very um what is it ignorant in special military yeah special military operations on like so
C6 and Delta Force, whoever knows.
But why didn't they take out the five guys at the same time?
Well, they argue that it's because they had to train for months
under a specific location that they knew how it was designed
to capture Maduro and go in 30 minutes, capture Maduro
once he was finally at that specific location
that they had been training for.
to like, right?
Like intervene or whatever.
So I don know I think Maduro was also sold You think he was put up So who do you think sold him The Rodriguez the vice president
Yeah, I mean, that's a great way to get a promotion.
Like if you could just sell your boss and then take his job,
not only do you get rich, you get his job as well.
Yeah.
I mean, I'd do it if I had a boss.
There's basically five families ruling Venezuela.
Okay.
One is done.
Okay.
You need to remove, I think, like two more to solve the military and the police thing and whatever.
And I think that's going to be part of the agreement with the U.S.
So all their heads are going to have to fall, man.
So do you think it'll be one of those kind of like the golden parachute thing where the U.S. is going to pay off those families to get out of there?
Or do you think that they'll violently remove them or just forcefully remove them?
I think it depends on how they interact these next months and weeks, etc. But so far, honestly, for them, for De Rodriguez, honestly, so far, so good, man. We could see De Rodriguez maybe be two years, four years president of Venezuela.
Because you wouldn't say that those four remaining families have a lot of popular support, right? I mean, if you polled the people, clearly they elected, they tried to elect somebody else.
Um, so, um, do you think, I mean, God, I hate to, I have a brother, I have a brother-in-law
that's in the military and the idea of the military going to occupy another country sounds
awful.
Um, but that to me, when I think about this seems like the tried and not very true playbook
of the United States war machine,
which is to come in and occupy,
build bases and spend trillions of dollars and stuff
to install democracy.
I guess, do you think the Venezuelan people
would welcome that,
would welcome that type of bold interdiction
as far as welcoming another country
into their country?
Or do you think that that would lead to war?
We're all sick of war.
Yeah, I think we're sadly and ignorantly
rooting for the results that, you know,
they got on Maduro and everybody was happy.
Now everybody is like, what the fuck?
What's happening?
Okay, that's the reality.
Because like everybody was expecting for,
you know, the U.S. to come in,
remove all these five families
and put Maria Corina Machado and Mundo Gonzalez on like a red carpet.
They're going to come into the country.
They're just going to walk into the capital city.
You know, they're going to close the new Congress.
We know the socialist Congress that the Venezuelan regime has built over the past years.
And now there's a, you know, Democratic Congress and everybody's happy.
You know, so I don't know.
Maybe, maybe there will be other elections and it'll end up being this thing of maybe like Del C against Maria Corina.
OK, but then the elections will be monitored by the U.S.
The government will not be allowed to just use their voting system that they developed that have been selling to other nation states.
okay and it'll be fully audited by the u.s and maybe then finally maria corina machado wins
but until then i don't know how long it's gonna be i don't know if that's six months or two years
or four years but history takes time to unravel man yeah right so maduro's bodyguards all the
ones around him were cuban right and was that an element of the situation that there was an element
of foreign interference or control behind the scenes.
And maybe now that's been removed
so that things will be able to play out
without at least, again,
foreign interference from Cuba or elsewhere.
Yeah, I would really much think that is correct.
Honestly, Osea.
They removed the Cubans from the equation
on the cost of the Venezuelan regime.
So they're like, now they are monitoring them fully,
not the cubans and like you know i think it's also a fact of you know maduro would have been
since the beginning an illegitimate president man an illegitimate president you know personally
being guarded by the cubans man can you give me an idea of what it was like growing up in that kind
of corruption like i mean did you have to deal with this on a i remember i used to work for a
company that was based in Chicago, Illinois. And one of my coworkers had previously worked for a
construction company. And he said every day they would show up to the construction site
and the foreman on the site would have three brown bags of cash. And one brown bag of cash
went to the police and one brown bag of cash went to the inspectors and one brown bag of cash went
to the politicians.
And that's, you know,
Chicago is like notoriously horrific
when it comes to bribery and corruption.
But can you give me an idea of like,
is this something that you saw on a daily basis
that you grew up with
that you just literally thought
was the way the world worked?
Yeah, I mean, it's sad to see this.
It was immensely sad
see in this gradual process of bribing becoming a normal thing okay like a societal effect
right like i'm not able to make my living with what i make whatever and everybody tries to
just like right other people honestly and everything is about a bribe everything is about
charging more of like whatever and uh obviously the police and the military owning a cut of
everything of all the transport of like from you know whatever we ended up producing or whatever
you always have to pay a cut um and if you don't pay the military directly it's it's like always a
cut okay different cuts first you know i think like these guys made it impossible to run like
a company in Venezuela, okay?
If you open up a company and you want to legally operate,
you need like 19 papers, 19 different papers
that the government has to approve you
and that you have to pay on a yearly basis, okay?
You're like, okay, your tax rate ends up being like 30%.
And then the police take 30% from you.
And maybe you get rocked and you lose the other 30%.
So, dude, it's really a very hard process.
But also, I would say just how insecure it becomes.
It was always unsafe.
It was always an unsafe country.
I grew up in this like, what is it?
Almost like nightmare of being potentially kidnapped or robbed or whatever.
I was kidnapped twice.
My parents were kidnapped once.
So it was normal.
Okay.
It was normal.
That's insane.
It's like getting kidnapped is normal.
Yeah.
Medium class.
Yeah.
Medium class family.
It was pretty probable to have like a sibling or a family, close family member that had been kidnapped.
That became normal.
Okay.
And they just take you and hold you for ransom, right?
They hold you for, you know, whatever.
They take your car.
They won $10,000, $40,000 overnight.
It's like how all the family starts asking for money.
And when you say they, is that just private individuals doing this?
was individuals associated with the government
who was carrying out these ransom
schemes.
Okay, so this is how it works.
It's basically
what the government did is
they bribed 2,500
generals or so
in the military.
That's a rough estimate.
That's not like a hard figure.
And then below that,
what they do is just allow them
to rob.
Rob whatever the fuck you want.
whatever you rob, give me a cut.
Okay?
You could pay your base salary.
You're not able to live with that.
Okay?
And get inside the military and the police
people from the favelas.
Okay?
So like burglars, basically.
Right?
Malandros, as we say in Spanish.
Malandros?
Malandros.
So.
After you got kidnapped the first time
and your dad and your mom had to pay to get you ransomed out and then you got kidnapped again do
you think that they were like man this kid he's just really got to learn to keep his head out of
swivel this little guy he's like i don't know he's costing us a lot of money maybe we just let him
have him for a while you know just leave that guy there sorry that was i was trying to i was trying
to make kidnapping into a funny thing and i was struggling to do so you're good man you're good
I mean, I think that for better or worse, the superpower that Venezuelans have had to learn is trying to get humor out of the bad situations.
Because, you know, ironically, it's a good way to try to deal with trauma.
One would think, yeah.
I want to talk about the Venezuelan superpower because you mentioned something earlier that was really fascinating.
You talked about the Venezuelan diaspora, all these refugees around the world as being a strength.
There's like a knowledge network of people distributed around the world that now I suppose a lot of them are like you with a lot of expertise they've acquired and also a foundation of experience knowing the horrors of socialism and just ready to rebuild maybe.
So what does that look like? Is that diaspora going to converge back on Venezuela or is this a network that's going to be wherever they are supporting things?
What does that look like?
Yeah, great question.
I think it's going to take many years. I see what's happened with El Salvador.
And since everything that the Nayib Bukele effect started happening, I think also the Bitcoiners, us on Bitcoin Twitter,
we saw it take at least some years for some Salvadorians to go back to their country, etc.
And I expect the same thing to happen in Venezuela because it also varies depending on which migration wave you're part of.
Because if you're part of the 2014 and pre-2014 migration wave, okay, you are potentially you're now a dad.
You're a mom, okay?
You've established bases and bank accounts and you've helped part of your family maybe migrate and live with you or close to you in the same country.
And so the ones that have already lost their grandfathers and don't have their parents in the country, they're not going to be the first ones to go back, man.
I think it's going to be maybe the ones that are post-pandemic, okay, that had to migrate during the pandemic.
they're potentially still not that established outside of Venezuela
as the ones that have like over a decade since they've migrated.
Okay.
So, but I believe with the opening of Venezuela,
gradual recovery of the rule of law on sanctioning the state oil company,
dollars slowing back legally into the central bank,
the Venezuelan's private banking sector being able to use the dollar as legal tender.
Because like at some point after the sanctions in the U.S. were introduced in 2017,
like in 2020, 2021, most of the transactions in the Venezuelan economy were being done in cash.
U.S. dollars in cash.
okay so there's a ton of
billions of dollars in cash
in Venezuela
that came all from mostly
you know oil sales
narco traffic
remittances
like physical remittances of people
visiting the country bringing cash
digital remittances
so how is that going to work
are they going to
allow the private banking sector
to like finally
get those deposits in dollars
and recapitalize the Venezuelan banking sector?
That's one thing.
Will it reconnect the Venezuelan banking sector
with the rest of the world?
So finally, it's going through Venezuelan companies
or whatever, the remittance flow
and not going through Binance.
So I expect first to see a remote
remote and digital reconnection of Venezuela with that like vast network of more than 8 million
Venezuelans spread it across the globe, the globe, man. Okay. And, and yes, maybe it's also this,
there's many Venezuelans working in multinationals. There's many Venezuelans working in Silicon
Valley. There's many Venezuelans in Israel. There's many Venezuelans in Spain, man. Okay. So
they are the ideal people to also help the company and the industry where they work at
to figure out the way to invest in Venezuela.
I see that as so huge.
I see people looking at Venezuela now as an opportunity, not just Venezuelans,
other people wondering, like, you know, Venezuela used to be immensely rich.
It used to be the gem and the jewel of South America.
And it can be that again.
And you're seeing people wondering, how can I take part in that?
You know, and they're going to look, oh, I know a Venezuelan down the street.
He used to be a judge.
Now he's cleaning dishes at the local restaurant and people with connections on the ground.
And that huge network is going to be such a valuable way to for capital, I think, to find a home and help rebuild, hopefully.
I sure hope so, man.
Honestly, I think there is.
Venezuela's just disconnected from the world.
None of the oil revenues for the past almost,
yeah, almost 10 years since the sanctions
have been really like hitting the economy.
It's been hitting private accounts of the regime.
Okay.
And then they decide or like whatever.
And then they decide.
Maduro still has an 8 billion euro account
and the Vatican.
what's the Vatican going to do with the money
is it going to give it back to
Venezuela
come on man
seems unlikely
that seems unlikely
I like how you paused there
to let us answer this though
you really think that's going to happen
one of the best
like online documentary
things I've seen
is this guy
it's called the Y files. I forget the guy's name. Um, but there's this one about, um, the secret
war that the United States ran after world war two. And it was basically world war two ends and
the United States is goes into Germany and they're like, Hey Nazis, you want a job? You're not, you
know, doing Nazi stuff anymore, but would you like to work for us? And they're like, yeah. And they're
like, sweet. The Vatican said that they would be our bank so that we could have a cutout and the
mafia would also like to be a part of this. So we're just going to pay you guys for the next 50
years to blow up buildings and conduct domestic terrorism in order to fight socialism. And I was
like, that's fascinating. And also Catholicism has some really interesting thoughts on banking.
They really get their fingers into a lot of stuff. Good for them. Good for them. Yeah.
uh man i i don't really know what else to talk about here i'm just like it's so fascinating to
learn about like i i think that we've nationalized a lot of industries in the united states like in
2008 um you know the the golden parachutes given to all of the people in wall street
that to me is the nationalization is like hey you're going to get bought out and now you do
whatever we want, the automobile industry as well, the dairy industry, literally the entire
agricultural industry, the energy industry, the airline industry, et cetera. We just don't have
it quite as blatantly out front nationalization as some other countries. But you lived through that
kind of when Majuro truly kind of outright nationalized things and just flat out took stuff.
Was there anything good during that time?
Like, was there anything that was like, oh, things got better?
Or you did mention did you say that you were mining Bitcoin with free electricity Yeah it was basically free It was really basically free Yeah it was really basically free man
Look, I would say out of maybe this is a hard take and a very bad take.
Okay.
But maybe out of everything that they it really wasn't nationalized.
But Chavez bought sent in their bank.
Okay.
The private sent in their branch in Venezuela for 800 million dollars.
OK, first a first payment of 400 million dollars.
And then after I don't know how many years, the rest.
That became the Banco de Venezuela.
It became the first bank that the state private bank that the Venezuelan state owned.
OK, under the Chavez regime.
Obviously, it's been done many times, but by other regimes in Venezuela.
OK, for 100 years, 60 years.
Okay, so, you know, it was his way of doing his own bank, right?
Today, that's the bank that issues the most amount of loans and has the most amount of accounts in Venezuela.
It is estimated that almost all Venezuelan families, like at least one family member, has an account at the Banco de Venezuela.
So really, it was like this weird socialist way of socializing banking.
Okay, you're socializing banking.
It's very free to open an account.
If you open your account at the Banco de Venezuela,
that's how you get the subsidies from the government.
Okay.
Okay, all that kind of stuff.
So I would say that out of everything that they put their hand on,
the thing that just like struck me the most
is how they were really able to operate through the bank, man,
a way to give, obviously you force people
because you destroy the currency.
So you force people to try to eventually get into digital form of money, get them out of cash.
OK, and so that was really interesting how a socialist government and socializing the money printer of the central bank and raping the central bank and using it to your own like social experiment and social and economic benefit.
and having a combination of the control of the central bank
plus a publicly owned, like a private bank,
but actually publicly owned by the state, kind of.
So they were really able to foster the adoption of bank accounts in Venezuela,
something that none of the private banks had been able to do.
All right.
But for the rest, they destroyed the electrical grid.
They destroyed the oil production.
They destroyed all the agricultural production.
They stole all the gold.
You know, they owned they own all the coffee, the water, the whatever, the Colton, the Bauxig, the silver.
They own the military.
They own the, you know, just everything.
Actually, that brings up a question I had.
Because you said that there's this like payment of like whatever, $500 billion or something, I think is what you said, or $500 million.
Yeah, $500 million.
$500 million that came that is like earmarked to buy agricultural products from the United States.
Do they need to buy agricultural products from the United States?
I mean, because there's a massive agricultural capacity in Venezuela, but I assume that they have just ravaged it to the point that you just can't really produce.
You're going to need a couple of years to build up that capacity again.
Absolutely. One could argue, one could argue that there is a moral, you know, a moral factor into all this deal. It's basically a trade deal, right?
Yeah, it's just the United States trying to prop up the agricultural prices, which are depressed because they are flooding. I mean, because we subsidize our agriculture industry to a huge degree.
It's a trade deal.
I buy oil from you and you buy these products from me.
That's everything that the Trump administration is trying to do with every single country.
He's a deal maker.
Get a trade deal, right?
The deal maker.
Part of the deal started being that the Trump administration would control the funds of the oil cells, okay, in like a U.S. bank account.
and give that to, I don't know, technology and infrastructure
to rebuild the electrical infrastructure in Venezuela
and agricultural products and medicine.
So one could argue that to your point,
a part of the deal is because, well, the agricultural part,
Venezuela doesn't have the production to feed
all the people that we need to feed.
I don't think that's a huge reason of the deal, man.
Yeah, I mean, 8 million people left, so there's not that many people to feed anymore.
And they're all old people.
They don't eat much.
What I need, what I need is John Deere trucks, right?
Pesticides, U.S. pesticides.
That's what I need, man.
Right?
And I just got to pay my people in Venezuela and start investing in fucking Venezuelan agriculture
and remove the military from the camps so that people can freely fucking cultivate and sell.
Right?
That's what we need, man.
It's still a rule of law thing inside of Venezuela.
But okay, I get it.
And I think that's the first step.
And I also believe that, again, initially,
the idea was for the U.S. to control the funds.
The fact that at least now the funds are going through the Venezuelan Central Bank,
that is very positive.
Because that means that eventually, just like with Argentina,
we will have more dollars
from exports
to be able to sell them
in the Venezuelan banking system
and gradually open up
and open up the dollar
open up the dollar rate
in Venezuela
it's not controlled anymore
the Venezuelan central banks
doesn't decide it any longer
it's a bidding process
it's a supply and demand game
of the banks in the country
bidding for the dollars
that the Venezuelan central banks has
man so i've learned a lot about you talk about yeah you talk about the remaining military elements
in venezuela being a problem i mean how extensive is that so now you're going to have to venezuela
is going to have to enter a stage where you guys are going to have to reckon with um how do we look
at our neighbors who were on the other side and that's a tough thing for a lot of countries to do
And how do you see that playing out that what is called transitional justice in Venezuela? How do you see wide scale justice being done? Is there still rancor and animosity towards the people who are on the other side? Or will people be able to come back and pretty much, you know, accept that everybody did something and just go forward?
Yeah, look, one of the main things that Chavez did to the military National Guard was the duty of the National Guard in Venezuela before Chavez was to protect civilians.
Chavez changed that to protect the president.
Okay, we need that to change.
we need that to change back
and to be protecting the civilian
how do we do that?
I don't know man
but we need
we need a leader
that talks
to the military again
because I believe the military
will need to be re-educated
and the military will also
in itself look for a new leader
we can say the temper
maybe
elections come again and you know they're transparent and finally the government doesn't
have a way of saying hey we won and maria corina wins or el mundo wins or whoever whichever figure
wins if they're not able to talk to the military which in many cases in latin american presidential
history man is what has happened with right-wing governments they're mostly medium class to high
class people that haven't been through poverty like most of the military guards okay and they
don't know how to talk to them and the military guys are not convinced by those guys also the
military in a way the military in a way always needs an enemy man who's their enemy now yeah
yeah because their enemy has just been i mean they didn't really have an enemy but they've been
just preying on the populace right just just extracting from the people or was the enemy like
Was there some social?
The enemy is the Chavismo.
Yeah, like there's a capitalist boogeyman.
The enemy is the Chavismo.
And I believe that a day will come that the military guards,
the military guards will rise against every single Chavism ideology.
There just hasn't been an opposition leader that talks both to the people and the military.
because in the case of a country like venezuela which are almost the equivalent of north korea
in south america they're different
and i don't know that kind of sums it up for me man you've like painted this incredibly vibrant
and just you have such a depth of knowledge and uh and energy to speak about venezuela
and to talk thoroughly about it, your matriculation through the Bitcoin mining world
and into working with Ledin and then onto the derivatives and stuff.
This is like a masterclass in Venezuelan macro and politics
and internal social dynamics and stuff.
I have another question.
This is a really practical question for me.
So I have a friend who lives in Cabimas and he broke his ankle. He broke his ankle recently and he had to go to a hospital that was kind of like a shadow hospital. He said that you don't go to the state hospital because everything there is recycled and it's not safe. So he had to go to some just private hospital of some sort. Now he's kind of swimming in medical bills and I want to send him some Bitcoin.
So what is the stack that somebody would use to like, what is the wallet to use in Venezuela for somebody Spanish speaking in South America?
How do they then if they get Bitcoin, what will they use to convert that into a usable currency there?
Like, what would you recommend for the stack to get something into Venezuela?
Yeah, I look 90 percent plus of the volume in Venezuela is Binance.
It's Binance and via P2P.
So if you were to send, truthfully speaking, if you were to send some Bitcoin to somebody in Minnesota that needs to exchange them to pay for whatever, services, goods, meds, etc.
He's going to need a swap then for USDT on Binance.
That's going to be the cheapest way.
And then sell the USDT B2B for Bolivars.
That's it.
You have to find somebody locally or just somebody he knows who will accept the USDT for the boulevard to get that done.
Or basically open an account on Binance.
Okay.
And receive your Bitcoin on Binance and change the Bitcoin for USDT and the USDT P2P on Binance.
And sometimes for people that haven't dealt with crypto, that's very complicated.
but in the case of when you're talking to a Venezuela
there's a high probability that he will be able to reach out to somebody
who can help them to sell the Bitcoin for USDT
and the USDT P2P for bullet bars
so he needs to find that local person with expertise to help him get it done
he's an older gentleman and he's very curious
but not in any technical capacity
but he's got the will and wants to learn
which I think is the position of a lot of Venezuelans
They want to learn and get ahead.
Man, look, to wrap it up on my end,
I think that is the real side of the Bitcoin story in Venezuela.
It is millions of Venezuelans finding a lifeline
and a parallel system that allowed them to reconnect with their family,
to continue making a life,
to finally save for the long term in many cases,
OK, and dude, it is that is the real the real power of Bitcoin inside of Venezuela.
It's done. It's done. It's the knowledgeable. You have a knowledgeable society in crypto like in Venezuela.
Honestly, yeah, you it is. It sounds like a much higher general aptitude than the United States.
really yeah definitely yeah a hundred percent maybe it doesn't go all the way in some cases
to things like self-custody and hardware wallets and running your own node because you also need
for those things also a little bit more budget man you know honestly like if you don't even have
the money if you're not even able to save on a monthly basis how are you going to buy bitcoin
to eventually have also enough Bitcoin for it to make sense for you
to buy a treasure on Amazon, okay?
Import it into Venezuela for $250 or whatever.
You know what I mean?
But Venezuela is like, they see really Bitcoin and crypto as money.
We know it's even better than our currency.
You know what I mean?
And Venezuelans have become this like payments juggernaut, okay?
And like you are a mental payments freak when you have a small business in Minnesota.
You accept PayPal.
You accept Amazon gift cards.
You accept Bitcoin.
You accept Binance Pay.
You accept ZE.
You accept USDT.
You accept USDC.
You accept Sallow Dollar.
You know?
Okay.
And sometimes you don't have the tool to sell it back to Bolivars because you don't know how to do the P2P
or the connection or whatever, but you pay 10 or 20% to move the money around.
So I believe that Venezuela is still and will finally explode its potential once again
in the Bitcoin and I would say mostly Bitcoin and stable coins experiment that Venezuela is.
And I believe we will finally retake a part of the global share of the seamen
In this game theory global game, okay?
Venezuela once was a big part of the global hash rate.
At some point, I believe we had more than 50% of global hash rate.
Russia right now is something like that, 15 or 18% or something.
We could beat Russia's next Bitcoin mining competitor.
Man, truly so well said.
You know, like the hope that comes from this military action from removing Maduro, the hope that comes for a once great and still proud nation that has a quarter of its inhabitants are now living outside of the country, but truly embody the spirit that you have, this Venezuelan spirit that wants to come home, that wants to make things better.
When I lived in Columbia, one of the things that I came away with was just being in South America in general.
You can just feel this latent potential that there is something great that could happen.
And, you know, the natural resources, the people, the work ethic, the I mean, just favorable weather, favorable geographical conditions.
You know, it makes it actually very hard to conduct military operations in South America because you're so excluded from everybody else.
You're very far away. And so you have the same sort of geographical barrier and safety that the United States has always had, which makes it difficult to to attack the United States domestically.
so um i just want to thank you for taking the time um to give us your time um it's been
wonderful following you um following you on twitter and seeing the things that you post
and hearing about you know how you came up through the system and what you're doing now
um and how you have so much energy right now for venezuela and you're so optimistic about things so
So, yeah, elsultanbitcoin on Twitter is your handle.
And, dude, just a gangster, man.
Absolute gangster.
OG of Bitcoin mining and a guy that's really, like, truly building and making change in Bitcoin.
So, Sultan, man, thanks for your time.
I was going to say thank you, too.
We really appreciate it.
It's so great to hear you talk.
America needs to hear your voice.
The world does.
And I just see a bright, bright future for you and the rest of the Venezuelan people.
It fills me with hope to hear you talk.
Thanks for coming on. I appreciate it.
No, thanks, Lucas, and thank Grant.
Guys, ultimately, if my family and I had waited for a U.S. intervention
instead of going down the Bitcoin rabbit hole, today we'd be poor.
Yeah, well said.
I'm in this shit because Bitcoin saved my family. That's it.
That's so beautiful.
That's excellent.
That's so beautiful.
All right, thanks a lot.
All right, guys.
I'm going to hit stop.
I appreciate it.