Speaker 1: Hello, and welcome to another episode of the Mark Moss Show,
Speaker 1: where we talk about the decentralized revolution. Of course, talk
Speaker 1: about the way the world is changing through the lens
Speaker 1: of politics, finance, and technology, and technology being bitcoin the
Speaker 1: decentralized protocol, of course, it's voice technology that changes the
Speaker 1: world the most. Now I am joined today by Mark Goodwin.
Speaker 1: He's a director of print at the Bitcoin Magazine. He's
Speaker 1: an author, and man, he's got some late breaking news
Speaker 1: that just got released this morning that I'm excited to
Speaker 1: dig into because I haven't I haven't got a chance
Speaker 1: to go through it yet. Anyway, Mark, thanks for joining me,
Speaker 1: Mark Man, thanks so much. Yeah, longtime listener, first time caller.
Speaker 1: Great to be here. Yeah, tons of exciting stuff to
Speaker 1: talk about, and yeah, thanks so much for having me. Yeah. Now,
Speaker 1: I know, you know, you're the director of the print
Speaker 1: magazine over there at the Bitcoin Magazine, and you've written
Speaker 1: some articles that I wanted to kind of talk about.
Speaker 1: But you told me that there's some breaking news that
Speaker 1: came out this morning about regulations, and so I do
Speaker 1: want to dig into that first. I am. You know,
Speaker 1: I went and made some bold predictions when you know,
Speaker 1: the whole FTX collacts happened, and it wasn't so bold
Speaker 1: that the alt coin crowd, the crypto people didn't like
Speaker 1: it so much. But I basically said that I think
Speaker 1: the regulations are going to come down pretty hard and heavy.
Speaker 1: And I said that I don't think there will be
Speaker 1: another crypto Bowl run. And I talked about it as
Speaker 1: a category, like, of course assets will always just pump
Speaker 1: and dump, but as a category, I don't see that.
Speaker 1: And the reason why I said that is because I
Speaker 1: think I think regulations will be coming down hard. And
Speaker 1: regulations come down hard, then the VC money kind of
Speaker 1: goes away, and that was kind of my reasoning. And
Speaker 1: now we're seeing a play out. So what were some
Speaker 1: of these new regulations. There's been a lot of them,
Speaker 1: but were some of these ones that you just saw? Yeah, No, Mark,
Speaker 1: I think you're completely right about that the crypto bowl thesis,
Speaker 1: especially with this news. So Yeah, the NYAG came out
Speaker 1: today in a lawsuit against coucoin and stated that according
Speaker 1: to them, Ethereum, Luna and ust the Luna stable coin
Speaker 1: are all considered securities. You know, according to this lawsuit,
Speaker 1: Um that rule was released literally probably about forty five
Speaker 1: minutes ago. So I think you're to your point. I mean,
Speaker 1: if they if all of those you know, ways to
Speaker 1: issue a token are considered securities, which you know, I
Speaker 1: think the howe you know, it's pretty black and white.
Speaker 1: I think we can all you know, bitcoiners certainly look
Speaker 1: at this ninety year old law and go, okay, pretty
Speaker 1: black and white. If the New York Attorney General is
Speaker 1: coming out and saying, you know, these three methods of
Speaker 1: distributing a token, you know, the ethico, uh this this
Speaker 1: luna you know, pre mine, and then you know, pegging
Speaker 1: this to a stable coin, all three of these methods
Speaker 1: are you know, considered securities. That has huge ramifications for
Speaker 1: the you know, extended uh crypto space, if you will.
Speaker 1: And I think we're gonna see a very big reckoning
Speaker 1: in that in that sense um with this news. So
Speaker 1: it's a little bit fresh, the markets are still processing it,
Speaker 1: but huge news absolutely. Now the New York New York
Speaker 1: has they kind of have their own license called the
Speaker 1: bit license. It's been around for the longest. Seems like
Speaker 1: New York has been the harshest kind of regulatory agency
Speaker 1: to kind of crack down against cryptocurrency. Although they do
Speaker 1: issue a license maybe Hawaii is still stricter, but let's
Speaker 1: not dig into that. But New York has this kind
Speaker 1: of history of being the harsh system. So a lot
Speaker 1: of a lot of times exchanges weren't able to operate
Speaker 1: to New York customers, but they could still operate to
Speaker 1: the rest. So in the United States, we still have
Speaker 1: you know, states rights and things like that, and so
Speaker 1: New York can kind of do that, but then maybe
Speaker 1: it doesn't apply to the rest of the United States.
Speaker 1: And so again Blockey, New York residents access to these things.
Speaker 1: But what do you think that means? If New York
Speaker 1: Attorney General would declare something like a theorem, a pre
Speaker 1: mind I'm sorry, a security, what effect would that have
Speaker 1: on somebody in California or Texas. I mean, I would
Speaker 1: just say, it's that's a precedent. I mean, that's it's
Speaker 1: an incredibly important legal precedent, very influential offense to come
Speaker 1: out in state something like that. I think it does
Speaker 1: have ramifications for the national regulatory regime regardless of states,
Speaker 1: you know, I think you know, I think again, you know,
Speaker 1: code is speech, and there's you know, it's not necessarily
Speaker 1: we should be rooting for government regulation here, but when
Speaker 1: we're in within this jurisdiction and there's very clear laws,
Speaker 1: I don't think we should really be surprised that this
Speaker 1: stuff is coming. But I do think it will have
Speaker 1: ramifications nationally, and I think the US, you know, banking
Speaker 1: system and the US economy is so important globally that
Speaker 1: it will obviously have huge ramifications on the global economy
Speaker 1: as well. Yeah, yeah, I do want to just kind
Speaker 1: of reiterate what you just said there. And you know,
Speaker 1: while I have said I think that regulations will stop this,
Speaker 1: and I don't think there will be another crypto ball
Speaker 1: run because of that, I am certainly not calling for regulations.
Speaker 1: As a matter of fact, I'm openly saying that I
Speaker 1: think the SEC should just be shut down. I think
Speaker 1: they should shut down a disgrace. I think Gary Gensler
Speaker 1: should be fired in disgrace. Their job is to protect consumers.
Speaker 1: They've obviously failed at that job, and I don't believe
Speaker 1: consumers need to be protected. I think if I can
Speaker 1: buy a gambling a lottery ticket, or I can go
Speaker 1: gamble in Vegas, I supple to buy whatever I want.
Speaker 1: So I think they shut down. However, they're not. They're
Speaker 1: here and so we have to kind of navigate the
Speaker 1: world not as we want it to be, but as
Speaker 1: it is. And so it's here, and so I do
Speaker 1: just want to state that a lot of people got
Speaker 1: mad at me. I'm some status, you know, and I
Speaker 1: want this to happen. It's like, no, I'm not a status.
Speaker 1: I don't want to happen. But but but it's here, right,
Speaker 1: I'm sure you've exactly heard that. You've heard that as well,
Speaker 1: But I think to your point, like it sets a precedent,
Speaker 1: so like law sort of builds on top of itself
Speaker 1: and they want to cite other case laws. So I
Speaker 1: think to your point, it can certainly do that. What
Speaker 1: about I want to dig into the et ethereum one
Speaker 1: a little bit, but what about on the I don't
Speaker 1: know if you're following, and if you're not, that's fine.
Speaker 1: But obviously the big, big, big case, it seems like,
Speaker 1: is the XRP ripple case. And I saw I didn't
Speaker 1: get a dig into it, and if you did, no worries.
Speaker 1: But uh, something about some you know, preliminary judgment and
Speaker 1: they're saying maybe they might say some of the pre
Speaker 1: mind might have been but you know, maybe not I
Speaker 1: don't know have you have you looked at that at all?
Speaker 1: I mean a little bit. I I definitely agree. I
Speaker 1: think it's like, you know, that case will really be
Speaker 1: the landmark case. I think that sort of sets um,
Speaker 1: you know, really you know, the regulatory clarity. Um. So
Speaker 1: I agree, it's definitely a case to watch. I haven't
Speaker 1: actually looked at. It's really hard to tell because the
Speaker 1: ripple marketing you know machine has has has a way
Speaker 1: of turning any you know, legal you know, legal output
Speaker 1: into into something very bullish and very distorted and hard
Speaker 1: to tell what's going on there. Um, So it's a
Speaker 1: little bit hard to follow. Um. But no, I haven't.
Speaker 1: I haven't dug in too much recently. But um, I
Speaker 1: think we're supposed to hear somewhat soon. Um. And I
Speaker 1: think whenever that drops, these could be a very related
Speaker 1: you know shoes about the fall mark. You know, I
Speaker 1: think the New York AG thing is very big and obviously,
Speaker 1: whenever we get clarity on the on the Ripple case, um,
Speaker 1: you know, I think the US regulatory regime will have
Speaker 1: will have made itself you know, very well well known. Yeah,
Speaker 1: I mean you have to think, I mean New York
Speaker 1: is probably the most influential state, at least in regards
Speaker 1: to financial situations, and so to your point, it carries
Speaker 1: a lot of weight. Um. The ramifications of Ethereum being
Speaker 1: labeled a security, I mean, think about that, right. So
Speaker 1: to your point, there's a for the listeners. There's one
Speaker 1: hundred year old Howie test which was developed for put
Speaker 1: together for citrus grove. So I don't know how citrus
Speaker 1: trees kind of compared to this, but it's not so
Speaker 1: bad actually. I mean, if you look at the four ways,
Speaker 1: given money as an investment hoping for a return to
Speaker 1: a common enterprise UM, a common enterprise that has control
Speaker 1: over how good the investment does things like that, UM
Speaker 1: have expectation of profit. I think that's the way, Yeah,
Speaker 1: an expectation of profit. What I know what they're doing.
Speaker 1: I had an SEC attorney on Security's attorney on a
Speaker 1: few months ago and he said, actually, what what Ripple's
Speaker 1: trying to do is they're trying to get these consumers
Speaker 1: to come in and say, we didn't buy it for
Speaker 1: an investment and if you and if you regulate it,
Speaker 1: you're going to cause us irreparable harm. And so anyway
Speaker 1: they're trying to kind of build that case. We didn't
Speaker 1: buy it for an investment, like, yeah, right, what would
Speaker 1: you buy it for it? Because you can't do anything
Speaker 1: with it, you know. But I want to talk about
Speaker 1: We'll talk about a theory, but let's talk about the
Speaker 1: broader implications of these companies trying to actually go along
Speaker 1: with securities regulations. If they're able to do that. I
Speaker 1: think that's kind of interesting conversation. And then, of course
Speaker 1: we're bitcoin people. We want to talk about bitcoin. I
Speaker 1: like to think that the price is the least kind
Speaker 1: of interesting piece, and I like to look at the
Speaker 1: development happening on it. And so I know you just
Speaker 1: recently wrote a paper talking about the development on bitcoin.
Speaker 1: I want to talk about that, and then and then
Speaker 1: we'll jump into some bigger stuff about money and stuff
Speaker 1: like that. If you're just tuning in you're listening to
Speaker 1: the Mark mos Show. We're talking about, of course, the
Speaker 1: decentralized revolution. We're talking about bitcoin and the cryptocurrency market overall.
Speaker 1: I'm joined by a special guest, Mark Goodwin. He is
Speaker 1: the director of print editorial at Bitcoin Magazine. He's an author.
Speaker 1: You can find him at Bitcoin magazine dot com. Just
Speaker 1: go to the author section and check out Mark Goodwin.
Speaker 1: So we're gonna be back talking about securities, regulations, the
Speaker 1: development on the bitcoin blockchain, and money from a bigger perspective.
Speaker 1: We'll be back with that and more in a minute.
Speaker 1: Don't go away, We'll be right back. All right, Welcome back.
Speaker 1: If you just tune in, you are listening to the
Speaker 1: Mark Mass Show. I'm joined by Mark Goodwin. He's the
Speaker 1: director of print editorial Bitcoin magazine. And Mark, we are
Speaker 1: talking about, you know, this news from the New York
Speaker 1: ag coming out with etherem being a security one thing
Speaker 1: that I had talked about and I'm just curious your
Speaker 1: take on this that you know, I think it was
Speaker 1: actually Jack Mollers who called this like regulatory arbitrage, right,
Speaker 1: like you're trying to avoid these regulatory sanctions and they're
Speaker 1: kind of playing in that middle, and they're able to
Speaker 1: kind of make that difference because if they had to
Speaker 1: file a security that's a long process. It's a very
Speaker 1: expensive process. But most importantly the problem that I see,
Speaker 1: of course, these companies have a lot of money because
Speaker 1: they did the pre mind but if they had to
Speaker 1: do full disclosures, Vitallic would have to say how many
Speaker 1: Ethereum he got, and how much Joseph Lubin has and
Speaker 1: what the Ethereum Foundation has and what their involvement is
Speaker 1: and how much they control. I mean, like could they
Speaker 1: even do that? And even if they even if they
Speaker 1: could and they did, what would people think? Yeah, I
Speaker 1: mean I highly doubt we'll ever ever ever see that,
Speaker 1: but uh yeah, I mean that is sort of you know,
Speaker 1: that's how you if you want to deal in the US,
Speaker 1: jurisdiction got to play ball and uh you know the
Speaker 1: Howie test is yeah, ninety years old. Um, and so
Speaker 1: uh you know these folks, I think, you know, the
Speaker 1: US regulatory regime you know, is not doing anything to
Speaker 1: make to make the water warm to come into the
Speaker 1: US right now and try to uh you know make money, right.
Speaker 1: I mean, there's they're threatening raising capital gains tax from
Speaker 1: twenty percent to forty percent, you know, huge billionaire tax
Speaker 1: is coming. All of this this big talk about you know,
Speaker 1: how they're going to try to service this debt um
Speaker 1: and so what that's really going to do is just
Speaker 1: further offshore you know, uh, you know investment capital in
Speaker 1: the United States. Uh. So I think we will see
Speaker 1: jurisdictional arbitrage. I mean, we've definitely already seen it. I
Speaker 1: think the lack of clarity over the last you know,
Speaker 1: handful of years has driven a lot of these banks
Speaker 1: to you know, to Bahamian Bermuda banks, you know, driven
Speaker 1: them off shore, driven them to Asia. I think we'll
Speaker 1: continue to see that. That said, I think when we
Speaker 1: do get some regulatory clarity, which it looks like we
Speaker 1: are getting, whether or not it's what the industry at
Speaker 1: large wants to see. Getting that clarity, I think will
Speaker 1: you know, be attractive to businesses if they have very
Speaker 1: clear you know, filing disclosure, all those practices are very clear.
Speaker 1: I think they will come back. So it would be
Speaker 1: very interesting. Now Gary Gensler, the head of the SEC,
Speaker 1: in the previous head of the SEC, J Clayton, we're
Speaker 1: both very clear to say that bitcoin is a commodity,
Speaker 1: and Gary Gensler has kind of come out again saying
Speaker 1: bitcoin is a commodity. It's the only one I'm gonna
Speaker 1: say pretty much. They are all those security so they've
Speaker 1: kind of said that. So bitcoin is a is a commodity.
Speaker 1: It's it doesn't have a central issue. Everybody has the
Speaker 1: same opportunity to go get it. It's all fungible and
Speaker 1: those are kind of the main thing. So if you
Speaker 1: just stick with bitcoin, you don't have to worry about
Speaker 1: all that regulatory stuff. So, UM, it's a good point. Now.
Speaker 1: I just got back. I was in Jackson Hole, Wyoming
Speaker 1: at the Bitcoin ski Week. Amanda Calvary put together about
Speaker 1: two hundred bitcoinners came together and it was amazing. UM.
Speaker 1: Got to spend a couple of days on the mountain
Speaker 1: as well, and it was really cool to talk about
Speaker 1: a lot of the development that's happening on bitcoin. And
Speaker 1: I know you just recently wrote a paper, UM talking
Speaker 1: about that, talking about these ordinals. Now, at first glance,
Speaker 1: or maybe the initial buzz was that, oh NFTs on bitcoin. UM,
Speaker 1: give us, give us kind of a high level on
Speaker 1: on these ordinals. What you're thinking about that? Yeah, totally. UM.
Speaker 1: Well it's a really interesting project. UM. It's definitely super controversial,
Speaker 1: which I totally understand why. UM. But more or less
Speaker 1: it breaks down into, you know, kind of two parts.
Speaker 1: It's created by another Bay Area bitcoiner out here, Casey
Speaker 1: wrote a more there's kind of two parts to the project. UM.
Speaker 1: The sort of this idea of ordinal theory of sort
Speaker 1: of like uh, you know, looking at satoshi's on an
Speaker 1: individual issuance level, like a serial number, um, arbitrarily uh
Speaker 1: and you know, you know, imbuing value to it based
Speaker 1: on a sentimental reason of some reaction to the number
Speaker 1: or you know when it was found, when that block
Speaker 1: was mined, you know, when this setoshi was issued. So
Speaker 1: that's kind of part of it is this this sort
Speaker 1: of arbitrary index of looking at how setoshi's are issued
Speaker 1: and then distributed within a transaction. So it's just kind
Speaker 1: of an interesting way to look at the at the network.
Speaker 1: And then the second part of it, which I think
Speaker 1: is kind of more of the controversial part, is the inscriptions.
Speaker 1: So it's this new tooling that takes advantage of the
Speaker 1: witness data. With the block sized increase in twenty seventeen
Speaker 1: was segment and then tap root came out a couple
Speaker 1: of years ago and increased some standardness bounds, so basically
Speaker 1: allowed you know, this tooling to exist where you can
Speaker 1: inscribe arbitrary data into a Bitcoin transaction. That data is
Speaker 1: stored in the witness data, not in the actual transaction
Speaker 1: action data. UM and uh, yeah, it allows people to
Speaker 1: create basically immutable data, um, if they want to pay
Speaker 1: for it, if they want to pay the fee. So yes,
Speaker 1: some people are using it to put monkey JPEGs on
Speaker 1: the chain, which is you know, it's either a valid
Speaker 1: transaction or an invalid transaction. That's bitcoin, right, UM, not
Speaker 1: the use case I would necessarily use it for. Right.
Speaker 1: But then you are seeing people storing you know, bannable files.
Speaker 1: We have STL files, three D printing files. We got
Speaker 1: the Yankee Google out in there. We're seeing text, bannable texts.
Speaker 1: The Bible was inscribed to King James version, the whole.
Speaker 1: There's a lot of interesting use cases in that arbitrary
Speaker 1: data beyond the traditional kind of NFT wash trading stuff
Speaker 1: we've seen from kind of the the ethereum ecosystem. So
Speaker 1: they can put the whole Bible on there, oh yeah, wow,
Speaker 1: a lot of I think they split it up into
Speaker 1: I think five parts. But yeah, you know you could
Speaker 1: store up to four megabytes, um, you know, up to
Speaker 1: the full block size. UM. So you can fit a
Speaker 1: lot of text in four megabytes. Yeah, I mean that's incredible.
Speaker 1: I you know, at first it was like the j
Speaker 1: the jpeg thing, right, and which which never made sense
Speaker 1: to me in the first place, because it doesn't make
Speaker 1: sense to take a physical object and then try to
Speaker 1: match it to something digital. You know. Um, of course
Speaker 1: it just doesn't make sense to me. But there is information,
Speaker 1: digital information that is very valuable that does need to
Speaker 1: be protected. Um. It makes me think of that movie
Speaker 1: Fahrenheit I think four fifty one, right where they went
Speaker 1: around and burned all the books, yeah, which which sounds
Speaker 1: actually very similar to where we're at, where the whole
Speaker 1: world had the civil war, and so to prevent the
Speaker 1: war from a civil war from ever happening again, they
Speaker 1: got rid of all the information. There was just one
Speaker 1: arbitrare of truth and everyone just believed the same thing.
Speaker 1: There would be no war, which sounds sort of like
Speaker 1: where we're going, and so we can see it sounds
Speaker 1: like where we are, my friend, I think we've been
Speaker 1: there for a bit, where we're burning books and banning
Speaker 1: platforms and deep platforming everybody left and right. Um, so
Speaker 1: I do think there's an absolute need for immutable truth. Uh.
Speaker 1: And you know, bitcoin is a database, you know, we
Speaker 1: love it as this economic force, and of course it
Speaker 1: is that, and that will always be its main you know,
Speaker 1: it's main principle. It's a main it's main function, but
Speaker 1: it is a database. And uh, you know, if someone
Speaker 1: wants to pay uh, and they think imbuing this data
Speaker 1: and everybody's notes for eternity, um, you know is worth
Speaker 1: is worth the fee then uh, you know, that's their
Speaker 1: right to do it. And you know, I think we'll
Speaker 1: see some interesting use cases. I think it's been there's
Speaker 1: been a lack of creativity at the immediate We sort
Speaker 1: of there was a big just copying of this culture
Speaker 1: that existed before. Um. I'm excited to see new culture
Speaker 1: arise from it. Um. It's interesting. Yeah, yeah, yeah, man,
Speaker 1: I want to dig into some of some of this.
Speaker 1: I have a couple questions here. But if you're just
Speaker 1: tuning in, you're listening to the Mark Moss Show. Of course,
Speaker 1: we're talking about each and every week the decentralized revolution,
Speaker 1: and I am joined by Mark Goodwin. He's the director
Speaker 1: of print editorial at Bitcoin Magazine, and we are talking
Speaker 1: about this new development on the bitcoin blockchain that's not
Speaker 1: just money, it's a database. As he said, we're gonna
Speaker 1: talking about the good, the bad, and where this goes
Speaker 1: and the bigger topic of money. So we'll be back
Speaker 1: with all that and more in a minute. You don't
Speaker 1: want to go in away. This is going to be
Speaker 1: an important conversation. We'll be right back. All right, Welcome back.
Speaker 1: If you're just tuning in, you are listening to the
Speaker 1: Mark Moss Show. We're talking about bitcoin. We're talking about
Speaker 1: the development on bitcoin, and I'm joined by Mark Goodwin,
Speaker 1: the director of print editorial at Bitcoin Magazine. And you know,
Speaker 1: one thing I was thinking of when you were talking
Speaker 1: and when I first saw the ordinals Mark, was that
Speaker 1: my first thought. I kind of had this like knee
Speaker 1: jerk reaction, which is, like, why don't we just leave
Speaker 1: bitcoin alone? You see what happened? You put the tap
Speaker 1: root in and then the law of unintended consequences kicks
Speaker 1: in and now we have this thing going on. And
Speaker 1: that was kind of my knee jerk reaction to it. It, um,
Speaker 1: you know, and then I'm starting to think, well, I
Speaker 1: guess let's just see how the the free market, you know,
Speaker 1: works itself out. What were your thoughts or where are
Speaker 1: you at with it? You know? And yeah, I think
Speaker 1: I think I'm with you, Um, you know, uh, I
Speaker 1: obviously I'm you know, I'm a believer in censorship resistant money. UM.
Speaker 1: I'm also a believer in the consensus and rules of bitcoin.
Speaker 1: That's why I'm a bitcoiner. Uh. None of those things
Speaker 1: have been violated UM by this new tooling UM. But
Speaker 1: I agree with you. I think there has been a
Speaker 1: really big knee dric reaction to it. UM, you know,
Speaker 1: because this ultimately isn't the main you know, purpose of
Speaker 1: bitcoin UM. But I think the the you know, the
Speaker 1: free market, or maybe more more specifically, the fee market
Speaker 1: UM is ultimately going to uh you know sort of
Speaker 1: you know, be the curator of of what comes next. UM.
Speaker 1: And And just when you look at it from an
Speaker 1: economic standpoint, this idea of you know, it's like anyone
Speaker 1: could always have spammed the blockchain forever and bought up
Speaker 1: every block, and you know, of course someone wants to
Speaker 1: waste all their bitcoin doing that. You know, of course,
Speaker 1: go for it. Sure that block space was always available
Speaker 1: to be purchased. But when you're doing inscriptions, UH, you know,
Speaker 1: you want to buy a full block, you want to
Speaker 1: you want to inscribe a substantial amount of data, you know,
Speaker 1: above like three megabytes or something, UM, that gets incredibly expensive.
Speaker 1: And when there's a dynamic fee market. You know, a
Speaker 1: ten x and fees when you're paying fifty cents for
Speaker 1: a transaction, is you know, that's not that's okay. You
Speaker 1: know you can kind of handle that when you're paying
Speaker 1: thousands of dollars to buy a whole block. You know,
Speaker 1: a ten x increase, one hundred x increase and a
Speaker 1: dynamic fee uh you know sat per v byte UM
Speaker 1: that becomes incredibly you know, it just doesn't scale at all. Um.
Speaker 1: There's no economic reason incentive to do that. Um. And
Speaker 1: so this fear I think of, you know, bloating or
Speaker 1: spamming the blockchain, I think just really doesn't economically play out.
Speaker 1: So but you know, we'll see, we'll see how it goes.
Speaker 1: The men pool has been insane lately. You know, we've
Speaker 1: gotten almost like half a gig up there today, so
Speaker 1: we're seeing a lot of transactions, like fifty thousand transactions
Speaker 1: in the men pool. So, you know, we'll see how
Speaker 1: it all plays out. But I think in the long
Speaker 1: term it's very unsustainable. Yeah. Now, one thing I like
Speaker 1: to think about in terms of Bitcoin I talk about
Speaker 1: all the time is is a technological revolution are different
Speaker 1: than technologies the technology like an iPhone, you took a
Speaker 1: phone and computer, you put them together. Cool technological revolutions
Speaker 1: change the course of humanity. So we had five right
Speaker 1: Industrial revolution, steam engines and the railways, electricity and steel, oil, automobiles,
Speaker 1: and then the microprocessor. And what I think about when
Speaker 1: I think about those, I think about each one of
Speaker 1: those gave us new sets of building blocks that allowed
Speaker 1: us to build new things that we had no idea
Speaker 1: because we had no idea because we didn't have the
Speaker 1: building blocks. So like steel, for example, or let's say,
Speaker 1: like electricity, there's a first killer application. So the light
Speaker 1: bulb was the first killer application of electricity. So it
Speaker 1: was designed, it was invented, it was created to give
Speaker 1: us electricity, but of course it became used for way
Speaker 1: more than that. And so like steel was so we
Speaker 1: can get a higher we could build a higher building,
Speaker 1: right or a bridge. We didn't know we'd have space
Speaker 1: shuttle one day. And so when I think about bitcoin,
Speaker 1: like obviously Satoshi Nakamoto in the Bitcoin white Paper said
Speaker 1: that it's a peer to peer electronic cash, and that's
Speaker 1: what it was designed for. But it's a new set
Speaker 1: of building blocks that allows us to build all types
Speaker 1: of new things that maybe aren't what the original creator
Speaker 1: intended them for, right, And so we have this censorship
Speaker 1: resistant database, you know if you call it that, a
Speaker 1: time chains as he called it. And what can we
Speaker 1: do with that? Well, certainly money is the killer application,
Speaker 1: but like what Jack Dorsey's kind of Web five, we're
Speaker 1: like hashing a decentralized identifier I D into it. Well,
Speaker 1: that's that's interesting. We didn't think about that now, like
Speaker 1: an ordinal subscription, which to your point of NFT seems
Speaker 1: kind of silly, but certainly throughout history putting a Bible
Speaker 1: in there could have been very beneficial. Or three D
Speaker 1: printed guns would be very powerful in a country where
Speaker 1: you need it. So do you kind of look at
Speaker 1: it like that? Like maybe it grows out of you know,
Speaker 1: money being the first killer application, but now it's like
Speaker 1: building block we can build all these new things on.
Speaker 1: I mean one hundred percent, yeah, absolutely, I mean it's
Speaker 1: the Internet of money. It is a database, it is
Speaker 1: an economic you know, unbelievable force, and that is it's
Speaker 1: sort of you know again major principle layer one. But yeah,
Speaker 1: I mean there's so many applications you can build when
Speaker 1: you have a you know, a database system that economically
Speaker 1: incentivizes you to retain the immutability of the chain and
Speaker 1: propagate it to everybody and propagate transactions. You know, there's
Speaker 1: an economic incentive of storing those gigabytes on your node,
Speaker 1: and I think you know, there's an that's an interesting
Speaker 1: angle to the ordinal story is that it's sort of
Speaker 1: a psy op to get all of these coiners to
Speaker 1: run full nodes right here they are. They have economic
Speaker 1: incentive to never prune the witness data because that's where
Speaker 1: all their precious JPEGs are. So you know, we've seen
Speaker 1: thousands of nodes spin up in the last six weeks
Speaker 1: because of tooling. Yeah, we're seeing a huge increase in
Speaker 1: node count. And again, all of these people are economically
Speaker 1: incentivized to store that data forever. So it's an interesting wrinkle.
Speaker 1: And you know, bitcoin teaches us so much, we're all
Speaker 1: sort of I like to look at it as a database,
Speaker 1: of course, but also, you know a game. You know,
Speaker 1: it's this big economic game playing out everywhere. Nation states
Speaker 1: are playing, central banks are playing an individuals, sovereign individuals
Speaker 1: alike or playing and it really it's these rules are
Speaker 1: just as much playing us as we're playing them. And
Speaker 1: I think this is just another interesting wrinkle where the
Speaker 1: protocol has evolved via tooling UM. And now we have
Speaker 1: a whole different set of users that are upholding this
Speaker 1: system that we all want to see the world uphold
Speaker 1: for you know, sound economic reasons, and they're doing it
Speaker 1: for a completely different reason, um, but they're achieving the
Speaker 1: same goal of you know, network security. UM. So yeah,
Speaker 1: bitcoin is a is a living thing, uh, and it's
Speaker 1: really not about us, and it's use case will always
Speaker 1: be determined by the market. And right now there's a
Speaker 1: market for that stuff, um, and an economic incentive to
Speaker 1: you know, do do what's best for the network. So
Speaker 1: also I also think about you know being you know,
Speaker 1: the first killer at being money. But then what is money? Right?
Speaker 1: Robert Breedlove as a podcast all he does talk about
Speaker 1: what is money? Right, Like what is money? And everyone
Speaker 1: thinks they understand, Oh, you know, I got my wallet
Speaker 1: right here, I got a dollar bill in there, I
Speaker 1: got money in my bank, and we think we know
Speaker 1: what money is. But really what is money is a
Speaker 1: very deep and profound question to ask. And if you
Speaker 1: were to say, well, money is just communication, money communicates value, right, well,
Speaker 1: then so would the Bible or three D printed gun
Speaker 1: schematics be value as well. So if all money does, right,
Speaker 1: if you boil it down, like if you think about it, well,
Speaker 1: instead of having a dollar bill, I have a sat
Speaker 1: or you know, a fraction of a bitcoin and I
Speaker 1: transfer that to make payment. But if you think about
Speaker 1: it from a bigger angle where money is actually just
Speaker 1: communication and there's all different types. And if you think
Speaker 1: about that, like think about how even communication has changed.
Speaker 1: I would imagine if you went back to the eighties, Well, information,
Speaker 1: you know, I mean, I guess there's books, you know,
Speaker 1: I have the library. I can go to the library
Speaker 1: and I get there's you know, three nightly news channels
Speaker 1: and two morning new paper newspapers. That's information Today. A
Speaker 1: kid on a beach and VG can post a picture
Speaker 1: and I get all that information of what the weather's like,
Speaker 1: what the waves are like. Right, And so even what
Speaker 1: we know is information change. So I think what we
Speaker 1: think of communication and value is going to change. And
Speaker 1: so it's fun to think about. Although humans are no
Speaker 1: good at imagine in the future, because all we can
Speaker 1: think about is better versions of what we have today.
Speaker 1: Without those building blocks, we don't know where those things
Speaker 1: will go. I want to get into a little bit
Speaker 1: of a bigger conversation. We'll get into the dollar itself
Speaker 1: and what we consider money as today. Anyway, if you're
Speaker 1: just tuning in, you're listening to the Mark Moshow. Of course,
Speaker 1: we talk about the decentralized revolution, talking about how the
Speaker 1: world is changing mostly through the lens of politics, finance,
Speaker 1: and technology, and the technology is bitcoin. I'm joined by
Speaker 1: Mark Goodwin, director of print editorial at Bitcoin Magazine, and
Speaker 1: we are going to come back and we'll talk from
Speaker 1: a higher level. We'll talk about the bitcoin and the
Speaker 1: dollar and what the future holds with that. So it's
Speaker 1: gonna be a fun conversation. You don't want to miss it.
Speaker 1: We'll be back with that and more in a minute.
Speaker 1: Don't go away, We'll be right back. All right, Welcome back.
Speaker 1: If you just tune in, you are listening to the
Speaker 1: Mark Moss Show talking about bitcoin with Mark Goodwin. He
Speaker 1: is the director of print editorial Bitcoin magazine. You should
Speaker 1: definitely check it out Bitcoin magazine dot com and uh man,
Speaker 1: We've covered a lot. If you've missed any of it,
Speaker 1: I'm not gonna go back and repeat it, but you
Speaker 1: can catch it on the podcast. Just search the Mark
Speaker 1: Mos show on the podcast or go to the Market
Speaker 1: Disruptors YouTube channel and you can watch it on demand
Speaker 1: over there. Um, you know, Mark, I know, you wrote
Speaker 1: another article albeit a while ago, talking about, um, you know,
Speaker 1: a bitcoin dollar as you called it, and you were
Speaker 1: referencing it kind of in reference to the Petro dollar,
Speaker 1: where the dollar has been backed by you know, by
Speaker 1: Saudi Arabia and the petro or the oil that they have,
Speaker 1: they're basically pricing everything in dollars, and I think you
Speaker 1: were kind of comparing that to like this bitcoin dollar.
Speaker 1: Why don't you frame that up for a little bit. Yeah, no,
Speaker 1: I think you did a great job. Yeah, it's it's
Speaker 1: kind of an allegory to the petro dollars. So this
Speaker 1: idea that you know, the US, in order to fight
Speaker 1: inflationary effects of an increased monetary supply from the Nixon
Speaker 1: Shock at seventy one going off the gold standard, they
Speaker 1: you know, did a whole bunch of military imperialism in
Speaker 1: the Middle East and established an economic monopoly on petrol
Speaker 1: and oil and basically created a a you know, a
Speaker 1: furnace to shove all of this you know, dollar demand.
Speaker 1: Because all of these industrial nations in Asia and Europe,
Speaker 1: you know, needed needed oil, so they were able to
Speaker 1: sort of offshore their debt and inflationary effects. M. And
Speaker 1: so the argument now, this kind of this thesis, and
Speaker 1: I've expanded it actually into a book that's coming out
Speaker 1: called the Bitcoin Dollar, sort of this idea that the
Speaker 1: US government is actually incentivized due to this runaway debt
Speaker 1: service you know, inflation that's happening, UM to find a
Speaker 1: demand elastic commodity and energy commodity uh to to peg
Speaker 1: itself too. And so we're seeing right now sort of
Speaker 1: a recreation of that mechanism of on ramps and off
Speaker 1: ramps to bitcoin being predominantly US dollar denominated, huge USD pairings,
Speaker 1: you know, huge volume on these USD pairings for bitcoin UM.
Speaker 1: You know, strong majority of of of volume is coming
Speaker 1: from you know KYC, you know dollar account inputs. UM.
Speaker 1: So that's sort of the argument that, you know, there's
Speaker 1: an economic incentive for you know, the US to tether
Speaker 1: themselves uh to uh to bitcoin UM. And I think
Speaker 1: what we're seeing now with this regulatory regime and this
Speaker 1: post FTX sort of stable coin war, UM. You know,
Speaker 1: we're seeing the kingmakers being made. Um, we're seeing the
Speaker 1: regulatory regime sort of choosing who gets to be the
Speaker 1: issuers of these, you know, the oncoming billions and billions,
Speaker 1: if not trillions of stable coins that will be issued
Speaker 1: when you know, private banks start buying US treasuries and
Speaker 1: start issuing stable coins. So I really think the dollar
Speaker 1: and bitcoin are going to be the huge players, certainly,
Speaker 1: you know, for the rest of the year and probably
Speaker 1: for the rest of the decade, and possibly even even
Speaker 1: a little bit more than that. Um, So I'm really
Speaker 1: focusing on the dollar, learning a lot about it, and yeah,
Speaker 1: I think bitcoin and the dollar are just very strange bedfellows.
Speaker 1: And uh yeah, there's a lot, a lot to dig
Speaker 1: into there for sure. Yeah, it's interesting. I covered earlier
Speaker 1: the story that you know, everybody kind of in the
Speaker 1: bitcoin community is kind of freaking out because the US
Speaker 1: you know, is potentially looks like they're about to go
Speaker 1: dump a bunch of bitcoin into the market. They trend
Speaker 1: they had a billion dollars worth of bitcoin that they
Speaker 1: transferred over to uh coin base coin base wallets and
Speaker 1: some of the government wallets as well, and so investors
Speaker 1: are thinking that they're probably gonna go dump that, which
Speaker 1: historically they haven't done that. They've sold it off in
Speaker 1: auctions and no smart seller whatever go just dump that
Speaker 1: into the market anyway, unless they potentially wanted to come down.
Speaker 1: So it's probably not the case. But then I was
Speaker 1: looking up some of the but you know, we don't
Speaker 1: know for sure, but some of the government other government's
Speaker 1: holdings of bitcoin, and the US government has quite a
Speaker 1: bit of bitcoin on the books, but some nations like
Speaker 1: China look like they have like two hundred thousand bitcoin
Speaker 1: on their books, and it's sort of like kind of like, uh, well,
Speaker 1: Jason Laurie has been talking about, you know, the strategic
Speaker 1: interests of a nation to acquire bitcoin. I think he's
Speaker 1: talking about it more from a mining standpoint, but that's
Speaker 1: more of a on its books. I saw Bitcoin Magazine
Speaker 1: had Bitcoin Magazine on Twitter had put out something about
Speaker 1: the by dead Men proposing a thirty percent tax on
Speaker 1: electricity used for bitcoin mining. So I don't know which
Speaker 1: way they want to go here. It's like, on one hand,
Speaker 1: it would make sense to have it control it even
Speaker 1: you know, maybe if there's a small chance it takes off,
Speaker 1: maybe we should kind of have it. But I mean
Speaker 1: if they put a thirty percent tax on it, I mean,
Speaker 1: it's just going to go overseas again somewhere, right. I
Speaker 1: mean that's the economic interest, right or it or it
Speaker 1: allows you know them to create uh, you know, loopholes
Speaker 1: for you know, the companies and personnel and DC interest.
Speaker 1: You know. Again, this is the US dollar system is
Speaker 1: all about retaining purchasing economy and making as much money
Speaker 1: for the contillionaires as possible. I mean, that's we've seen
Speaker 1: this time and time again anytime there's debt issues or
Speaker 1: inflation issues up up pops of war, uprises, taxes, uh,
Speaker 1: you know, And here we are, and we're at actually
Speaker 1: sort of an economic breaking point where now are just
Speaker 1: the interest on our debt service in a year is
Speaker 1: now actually over our military spending. So we're actually spending
Speaker 1: more money to pay for our dollar than we are
Speaker 1: to pay for the military. That's you know, holding up
Speaker 1: the dollar theoretically. So we're in sort of uncharted territories.
Speaker 1: We're a road runner that's run off the cliff. So yeah,
Speaker 1: we'll see who gets made king and who gets to
Speaker 1: sort of run the retail CBDC. I guess, yeah, I
Speaker 1: hadn't really thought about it like that. I mean, and
Speaker 1: obviously I should have, but I mean to your point, right,
Speaker 1: it's king making you said that earlier, picking and choosing winners.
Speaker 1: So everybody has to pay a thirty percent tax except
Speaker 1: for you guys over here. You don't have to or
Speaker 1: we don't have to sort of a thing, so that
Speaker 1: that could be interesting, you know. But to the point
Speaker 1: that you made too about running kind of the government
Speaker 1: off the cliff, it's like the FED is trying to well,
Speaker 1: not trying to do. They have raised rates higher and
Speaker 1: faster than in time in history, trying to crush inflation.
Speaker 1: But they haven't been able to crush inflation, but they
Speaker 1: have managed to crush the government, and the government's broke.
Speaker 1: And of the thirty one and a half tillion dollars
Speaker 1: of debt, thirty percent of that has to be refinanced
Speaker 1: in the next year at the new rates. Fifty percent
Speaker 1: of it has to be refinanced in the next three
Speaker 1: years at the new rate, and so that's going to
Speaker 1: push the interest payments up. You know, who knows in
Speaker 1: the in the it's right now an average of one
Speaker 1: point seven percent that would put it. You know, it's
Speaker 1: different different rates at different maturities, but it pushes it
Speaker 1: between a three and a half to a five and
Speaker 1: a half percent number, which could potentially take us from
Speaker 1: about a nine hundred trillion dollars I'm sorry, nine hundred
Speaker 1: billion dollars of interest expense to one point eight trillion
Speaker 1: yep an interest expense. And that's a big problem, yep.
Speaker 1: I mean, you know, we're bitcoiners, you know, compounding annual
Speaker 1: growth rate, you know, a little kgar. You don't want
Speaker 1: that running running wild and your debt, you know, so,
Speaker 1: and that's exactly what's happening. So yeah, to your point,
Speaker 1: I mean, you know we're gonna have to deal with
Speaker 1: that mathematical reality. Um, I don't know when that will happen,
Speaker 1: but obviously we will need to create money to pay
Speaker 1: that debt. There's no way we can make enough off
Speaker 1: tax receipts. Even with the insanity of the capital gains
Speaker 1: threats that they're saying in the last couple of days,
Speaker 1: they won't even come close. So printing will have to
Speaker 1: come at some point. You know, we'll see what happens
Speaker 1: till we get there, but it's going to be a
Speaker 1: hell of a red Yeah. Well, and the other problem
Speaker 1: is that the expense column is going up, right, the
Speaker 1: interest on the DAD is going up. The spending is
Speaker 1: also going up, but the tax receipts are going down.
Speaker 1: So to your point, they want to put in all
Speaker 1: these new tax things because the tax treets are going
Speaker 1: down because the FED is crushing demand by making everybody poor,
Speaker 1: and then everyone's poor, so then there's no taxes and
Speaker 1: then the tax So in California corporate tax shereets are
Speaker 1: down twenty percent. Statewide is down forty percent. In the
Speaker 1: US it's down nine percent. That's a big drop. And
Speaker 1: then I saw this chart last week I was looking
Speaker 1: at and it showed no matter what the tax rate is,
Speaker 1: the government typically gets the taxes to come out to
Speaker 1: about nineteen percent of GDP. So tax rates up, tax
Speaker 1: rates down, the share is about the same. So the
Speaker 1: goal should try to be to get the GDP bigger,
Speaker 1: not just the taxhare bigger. But it's going to be
Speaker 1: interesting to see how that plays out. If you're just
Speaker 1: tune in, you're listening to the Mark Moss Show, of
Speaker 1: course each and every week, talking about the decentralized Revolution.
Speaker 1: I've been talking to Mark Goodwin, he's the director of
Speaker 1: Print editorial at Bitcoin Magazine. Definitely check that out Bitcoin
Speaker 1: magazine dot com. Give him a follow on Twitter at
Speaker 1: Mark Goodwin Underscore I n of course I'm at one,
Speaker 1: Mark Moss. That's what we got for today. Hopefully enjoyed
Speaker 1: it shoot as much. Let me know thanks for listening.