1 00:00:00,040 --> 00:00:02,559 Speaker 1: Hey, everyone, Welcome to another episode of The Mark Moss 2 00:00:02,560 --> 00:00:04,920 Speaker 1: Show where we talk about bitcoin and we talk about 3 00:00:05,040 --> 00:00:09,719 Speaker 1: cryptocurrencies and the decentralized revolution that is happening right now, 4 00:00:09,800 --> 00:00:11,760 Speaker 1: right before our eyes. Now, I try to bring you 5 00:00:12,520 --> 00:00:15,040 Speaker 1: everything that you need to understand this. I try to 6 00:00:15,080 --> 00:00:17,600 Speaker 1: bring you the education so you can really understand what's 7 00:00:17,640 --> 00:00:19,400 Speaker 1: going on. I try to bring you the latest breaking news, 8 00:00:19,440 --> 00:00:20,880 Speaker 1: and of course I bring you some of the best 9 00:00:21,200 --> 00:00:23,680 Speaker 1: and brightest guests in the space so you can get 10 00:00:23,680 --> 00:00:27,480 Speaker 1: some different perspectives. Now, you know, trying to understand this 11 00:00:27,560 --> 00:00:29,720 Speaker 1: is difficult, and when you don't understand it right, what 12 00:00:29,800 --> 00:00:33,880 Speaker 1: happens is um usually bad things. You can get lucky, 13 00:00:33,920 --> 00:00:36,159 Speaker 1: but bad things. Right. So for example, if you don't 14 00:00:36,240 --> 00:00:40,240 Speaker 1: understand it enough, maybe you under allocate towards it, Maybe 15 00:00:40,240 --> 00:00:43,960 Speaker 1: you over allocate towards it. Maybe um, you don't understand it, 16 00:00:43,960 --> 00:00:46,240 Speaker 1: and so then you get shaken out of your position early, 17 00:00:46,320 --> 00:00:49,440 Speaker 1: for example. And so you really need to understand it 18 00:00:49,600 --> 00:00:52,120 Speaker 1: and so you can you know, get the right positions 19 00:00:52,159 --> 00:00:54,280 Speaker 1: eyes and learn how to hold it and one of 20 00:00:54,480 --> 00:00:56,240 Speaker 1: you know, there's a lot of things. Actually spent a 21 00:00:56,280 --> 00:01:00,080 Speaker 1: few weeks um going through all the different fund if 22 00:01:00,080 --> 00:01:03,000 Speaker 1: you're uncertainty doubt headlines are the big objections that we 23 00:01:03,080 --> 00:01:05,920 Speaker 1: hear about bitcoin. Um. One of the ones I didn't 24 00:01:05,920 --> 00:01:08,200 Speaker 1: address because it's a bigger topic that I wanted to 25 00:01:08,240 --> 00:01:11,480 Speaker 1: cover at depth is one of the ones that I 26 00:01:11,520 --> 00:01:18,080 Speaker 1: hear all the time of bitcoin is a Ponzi scheme? Now, um, 27 00:01:18,120 --> 00:01:21,160 Speaker 1: what is a Ponzi scheme? Um? Really? What does that 28 00:01:21,160 --> 00:01:22,880 Speaker 1: really mean? What do they mean when they say bitcoins 29 00:01:22,880 --> 00:01:27,200 Speaker 1: like a Ponzi scheme? Um? And why is bitcoin? Is 30 00:01:27,240 --> 00:01:29,680 Speaker 1: bitcoin pons game? Yes or no? So I want to 31 00:01:29,760 --> 00:01:31,680 Speaker 1: I want to explain this in a way that's easy 32 00:01:31,720 --> 00:01:37,040 Speaker 1: to understand, hopefully educational. Well, it's definitely educational, hopefully entertainment um. 33 00:01:37,080 --> 00:01:38,280 Speaker 1: And really, I think this is gonna give you a 34 00:01:38,280 --> 00:01:41,080 Speaker 1: lot bigger perspective. And if you um think that bitcoin 35 00:01:41,120 --> 00:01:42,520 Speaker 1: will be a Ponti scheme, it maybe give you a 36 00:01:42,560 --> 00:01:44,920 Speaker 1: whole different perspective on this. And if you already are 37 00:01:44,959 --> 00:01:46,959 Speaker 1: a bitcoin advocate, that I'm gonna give you the information 38 00:01:47,040 --> 00:01:49,720 Speaker 1: you need to answer this question when you hear it 39 00:01:49,800 --> 00:01:52,520 Speaker 1: from someone else. Now, Um, I hear this all the time. 40 00:01:53,600 --> 00:01:56,080 Speaker 1: I've heard it compared to the tulip mania, you know, 41 00:01:56,080 --> 00:01:59,240 Speaker 1: the Dutch two mania, but really this Ponzi scheme and 42 00:01:59,560 --> 00:02:02,640 Speaker 1: the Fine Fancial Times is uh the ft dot com. 43 00:02:02,640 --> 00:02:06,120 Speaker 1: It's a big financial news news publication. They came out 44 00:02:06,160 --> 00:02:09,960 Speaker 1: with a article and they said why bitcoin is worse 45 00:02:10,200 --> 00:02:14,160 Speaker 1: than a mad Off style Ponzi scheme? So what does 46 00:02:14,200 --> 00:02:16,840 Speaker 1: that even mean? There's a lot to this lot to 47 00:02:16,919 --> 00:02:18,840 Speaker 1: unpack here, and I want to kind of break this down. 48 00:02:18,919 --> 00:02:22,240 Speaker 1: So let's address this first of all. Like I said, 49 00:02:22,600 --> 00:02:25,960 Speaker 1: it's a big it's a big claim. So first the 50 00:02:26,000 --> 00:02:30,000 Speaker 1: thing we have to do is what is a Ponzi scheme? Like, 51 00:02:30,040 --> 00:02:32,079 Speaker 1: what does that even mean? Right? So let's let's let's 52 00:02:32,080 --> 00:02:33,839 Speaker 1: take on that topic. First of all, Like I said, 53 00:02:33,840 --> 00:02:36,799 Speaker 1: this is gonna be entertaining and it's gonna be educational. 54 00:02:37,360 --> 00:02:39,680 Speaker 1: But if we go directly to the U S. Securities 55 00:02:39,720 --> 00:02:43,120 Speaker 1: and Exchange Commission, the SEC, which is supposedly out there 56 00:02:43,160 --> 00:02:45,200 Speaker 1: to protect us. And I say supposedly because I don't 57 00:02:45,200 --> 00:02:47,680 Speaker 1: know if they are, um, but I'm gonna takenna give 58 00:02:47,680 --> 00:02:50,640 Speaker 1: you a quote directly from the SEC which says, quote, 59 00:02:50,919 --> 00:02:54,480 Speaker 1: a Ponzi scheme is an investment fraud that pays existing 60 00:02:54,560 --> 00:02:59,360 Speaker 1: investors with funds collected from new investors. Ponzi scheme organizers 61 00:02:59,400 --> 00:03:02,280 Speaker 1: often promised investor money and generate high returns with little 62 00:03:02,400 --> 00:03:05,200 Speaker 1: or no risk, But in many many Ponzi schemes, the 63 00:03:05,240 --> 00:03:08,520 Speaker 1: fraudsters do not invest the money. Instead, they use it 64 00:03:08,560 --> 00:03:11,800 Speaker 1: to pay those who invested earlier, and may keep some 65 00:03:12,040 --> 00:03:16,840 Speaker 1: for themselves with little or no legitimate earnings. Ponzi schemes 66 00:03:16,840 --> 00:03:19,560 Speaker 1: require a constant flow of new money to survive. When 67 00:03:19,560 --> 00:03:22,200 Speaker 1: it becomes hard to recruit new investors or when large 68 00:03:22,320 --> 00:03:26,320 Speaker 1: numbers of existing investors cash out, these schemes tend to 69 00:03:26,400 --> 00:03:31,400 Speaker 1: collapse end quote. So that's directly from the SEC. So basically, 70 00:03:31,400 --> 00:03:34,440 Speaker 1: what they're saying is that they are saying, Hey, you know, 71 00:03:34,480 --> 00:03:38,240 Speaker 1: giving your money, I'm gonna invested. I'm making whatever and uh, 72 00:03:38,320 --> 00:03:41,400 Speaker 1: and I'm gonna keep I'm gonna pay these investors. As 73 00:03:41,440 --> 00:03:43,800 Speaker 1: long as I'm able to keep sucking in new people, 74 00:03:44,320 --> 00:03:47,080 Speaker 1: I can keep paying the old ones out. I keep 75 00:03:47,160 --> 00:03:50,360 Speaker 1: eight percent. That's a pretty good deal. Um. But of 76 00:03:50,360 --> 00:03:52,800 Speaker 1: course I'm not really investing. I'm not really making anything, 77 00:03:52,800 --> 00:03:55,960 Speaker 1: but everybody thinks I am. Now. Ponzi schemes were named 78 00:03:55,960 --> 00:04:00,240 Speaker 1: after Charles Ponzi, who duped investors in the nineteen ease 79 00:04:00,480 --> 00:04:04,440 Speaker 1: with a posted stamp speculation scheme. All right, So we 80 00:04:04,480 --> 00:04:07,800 Speaker 1: want to break this down, all right. So first, ponzi 81 00:04:07,840 --> 00:04:11,320 Speaker 1: scheme organizers promised to invest your money and generate high 82 00:04:11,360 --> 00:04:14,480 Speaker 1: returns with no risk. Um. So that's that's a big 83 00:04:14,520 --> 00:04:17,360 Speaker 1: piece of it, all right. So they go further on 84 00:04:17,480 --> 00:04:19,839 Speaker 1: in the sec piece. Um, a couple other things that 85 00:04:19,880 --> 00:04:22,320 Speaker 1: they list as red flags. So if you're this is 86 00:04:22,320 --> 00:04:26,040 Speaker 1: the sec warning you so quote. Many ponzi schemes share 87 00:04:26,080 --> 00:04:31,080 Speaker 1: common characteristics. Look for these warning signs. One high returns 88 00:04:31,160 --> 00:04:34,279 Speaker 1: with little or no risk. Every investment carries some degree 89 00:04:34,279 --> 00:04:38,120 Speaker 1: of risk, and investment yields yielding higher returns typically involve 90 00:04:38,320 --> 00:04:41,919 Speaker 1: more risk. Be highly suspicious of any guaranteed investment opportunity. 91 00:04:41,960 --> 00:04:47,800 Speaker 1: So okay, that's one. Another sign overly consistent returns. So 92 00:04:48,000 --> 00:04:50,000 Speaker 1: they say investments tend to go up and down over time, 93 00:04:50,000 --> 00:04:53,200 Speaker 1: So be skeptical about an investment that regularly generates positive 94 00:04:53,200 --> 00:04:57,520 Speaker 1: returns regardless of overall market conditions. Um, they say that 95 00:04:57,600 --> 00:05:02,160 Speaker 1: it's uh. They also another red flag is secretive complex strategies. 96 00:05:02,480 --> 00:05:05,240 Speaker 1: They say, to avoid investments if you don't understand them 97 00:05:05,400 --> 00:05:09,640 Speaker 1: and can't get complete information about them. Um. They say 98 00:05:09,680 --> 00:05:13,359 Speaker 1: that they there's issues with paperwork, an account statement errors, 99 00:05:13,360 --> 00:05:15,880 Speaker 1: maybe a sign that funds are not being invested as promised. 100 00:05:16,440 --> 00:05:20,279 Speaker 1: And then finally they say difficulty receiving payments. Be suspicious 101 00:05:20,279 --> 00:05:23,159 Speaker 1: if you don't receive a payment or have difficulty cashing out. 102 00:05:23,560 --> 00:05:26,720 Speaker 1: Ponzi scheme promoters sometimes try to prevent participants from cashing 103 00:05:26,720 --> 00:05:30,920 Speaker 1: out by offering even higher returns for stay input. So 104 00:05:31,279 --> 00:05:34,600 Speaker 1: that is uh good, some good red flags. Hopefully guys 105 00:05:34,640 --> 00:05:37,440 Speaker 1: took advantage, took note of that. If you see any 106 00:05:37,480 --> 00:05:40,640 Speaker 1: of those red flags, be careful. But now let's take 107 00:05:40,720 --> 00:05:44,280 Speaker 1: that and let's compare those warning signs, those attributes, and 108 00:05:44,360 --> 00:05:47,880 Speaker 1: let's see if Bitcoin has any of those. Okay, so 109 00:05:48,320 --> 00:05:51,680 Speaker 1: before we before I compare bitcoin point to point by 110 00:05:51,760 --> 00:05:55,479 Speaker 1: the to that list, Um, let's first just take a 111 00:05:55,480 --> 00:05:57,400 Speaker 1: look at how bitcoin was launched. A lot of people 112 00:05:57,400 --> 00:06:00,000 Speaker 1: may not know this. So in in August of two 113 00:06:00,080 --> 00:06:03,640 Speaker 1: thousand and eight, somebody identifying themselves as Sotoshi Nakamoto created 114 00:06:03,640 --> 00:06:07,400 Speaker 1: bitcoin dot org. Two months later, October two eight, so 115 00:06:07,520 --> 00:06:12,640 Speaker 1: Toshi released what's called the Bitcoin White Paper, and that 116 00:06:12,640 --> 00:06:14,640 Speaker 1: that's basically the document explaining how the tech, how the 117 00:06:14,640 --> 00:06:16,680 Speaker 1: tech would work, and what the solution was, how the 118 00:06:16,800 --> 00:06:19,680 Speaker 1: how he solved what's known as the double spending problem. 119 00:06:20,120 --> 00:06:22,160 Speaker 1: The problem with digital goods is that if you send 120 00:06:22,160 --> 00:06:24,560 Speaker 1: me a song or a photo or a video, I 121 00:06:24,600 --> 00:06:26,640 Speaker 1: can make a copy of it on my computer. And 122 00:06:26,680 --> 00:06:28,159 Speaker 1: if I send you the video, how do you know 123 00:06:28,200 --> 00:06:30,599 Speaker 1: if I don't still have a copy on my computer. UM. 124 00:06:30,680 --> 00:06:33,640 Speaker 1: So he solved the double spending problem. That's the big 125 00:06:33,680 --> 00:06:37,600 Speaker 1: revolutionary thing that bitcoin solved. UM that there's only one 126 00:06:37,600 --> 00:06:42,400 Speaker 1: bitcoin and it can't be copied or double spent. UM. 127 00:06:42,440 --> 00:06:44,480 Speaker 1: In addition to that, a couple months later, January of 128 00:06:44,520 --> 00:06:47,600 Speaker 1: two thousand nine, s Tosi published the initial software, the 129 00:06:47,600 --> 00:06:51,440 Speaker 1: Bitcoin Code Software UM. In the Genesiens Genesis block, the 130 00:06:51,440 --> 00:06:54,480 Speaker 1: first block of the blockchain UM, there was no spendable 131 00:06:54,480 --> 00:06:58,360 Speaker 1: bitcoin there UM, and he provided a timestamped article headlining 132 00:06:58,839 --> 00:07:01,760 Speaker 1: which I love. It was an article headline about bank 133 00:07:01,839 --> 00:07:05,599 Speaker 1: baillouts from the Times of London, and I love that 134 00:07:05,640 --> 00:07:07,520 Speaker 1: he put that in there. He said, the Chancellor is 135 00:07:07,560 --> 00:07:10,440 Speaker 1: on the brink of another bailout. And the reason why 136 00:07:10,480 --> 00:07:12,120 Speaker 1: they put that is because that was at the time 137 00:07:12,160 --> 00:07:14,960 Speaker 1: of the two thousand eight bank baillouts. It was the 138 00:07:14,960 --> 00:07:18,000 Speaker 1: time with the great financial crash, and so he basically 139 00:07:18,080 --> 00:07:21,120 Speaker 1: stamped it saying that this is made as a response 140 00:07:21,160 --> 00:07:23,760 Speaker 1: to that, because you are bailing out these banks, We're 141 00:07:23,760 --> 00:07:26,400 Speaker 1: going to create our own monetary system, is what he said. Um. 142 00:07:26,400 --> 00:07:29,280 Speaker 1: From there, it took a few days to finish mind 143 00:07:29,280 --> 00:07:32,960 Speaker 1: in the block Um. There was really nothing going on 144 00:07:33,000 --> 00:07:36,280 Speaker 1: in there. UM. And then and then there are some 145 00:07:36,320 --> 00:07:39,240 Speaker 1: other people that got involved. How Finny started publicly tweeting 146 00:07:39,240 --> 00:07:42,280 Speaker 1: about bitcoin. He was running software. UM, so Toshi was 147 00:07:42,360 --> 00:07:44,120 Speaker 1: running at him and soci and how Finny, we're sending 148 00:07:44,120 --> 00:07:47,920 Speaker 1: bitcoins back and forth to each other. UM. Basically, the 149 00:07:47,920 --> 00:07:49,960 Speaker 1: point that I'm making here is that this was done 150 00:07:50,240 --> 00:07:54,360 Speaker 1: out in the open on the public um message boards. 151 00:07:54,800 --> 00:07:58,560 Speaker 1: There was other people involved, how Finny, We had Nick Sabo, 152 00:07:59,080 --> 00:08:02,480 Speaker 1: Adam back. They were all getting involved in this. They 153 00:08:02,480 --> 00:08:04,360 Speaker 1: were all aware of it. They were all mining bitcoin. 154 00:08:04,600 --> 00:08:07,480 Speaker 1: So this was not done in the in the dark. 155 00:08:07,640 --> 00:08:10,800 Speaker 1: This was not done. Um, you know, not, this was 156 00:08:10,880 --> 00:08:13,680 Speaker 1: not done and the forest lead a lot of well 157 00:08:13,800 --> 00:08:17,000 Speaker 1: pretty much, I think all the other cryptocurrencies besides Bitcoin 158 00:08:17,280 --> 00:08:19,520 Speaker 1: were done with what's called a pre mind. And so 159 00:08:19,600 --> 00:08:22,520 Speaker 1: when the founders created their token, they created a bunch 160 00:08:22,560 --> 00:08:25,680 Speaker 1: for themselves. So they printed, you know, a hundred million 161 00:08:25,720 --> 00:08:27,560 Speaker 1: tokens for themselves, and then they gave away a little bit. 162 00:08:27,640 --> 00:08:31,960 Speaker 1: Typically they would keep anywhere from typically about thirty to 163 00:08:32,040 --> 00:08:34,560 Speaker 1: sometimes as much as seventy of the tokens they created. 164 00:08:34,840 --> 00:08:36,840 Speaker 1: The founders would keep that for themselves. But with Bitcoin, 165 00:08:36,880 --> 00:08:39,360 Speaker 1: that that wasn't that wasn't done. As a matter of fact, 166 00:08:39,559 --> 00:08:43,480 Speaker 1: he publicly put it out to everybody long before ever 167 00:08:43,760 --> 00:08:45,640 Speaker 1: ever mining any on its own. As a matter of fact, 168 00:08:45,640 --> 00:08:47,959 Speaker 1: the coins that's to Totian not Commoto mind, have never 169 00:08:48,200 --> 00:08:52,280 Speaker 1: been moved, and so there was no pre mind in that. Now. Um, 170 00:08:52,320 --> 00:08:54,280 Speaker 1: now that you understand that, let's dig into a little 171 00:08:54,280 --> 00:08:57,320 Speaker 1: bit about these red flags and kind of dispute some 172 00:08:57,360 --> 00:08:59,719 Speaker 1: of these one by one by one. Now, by the way, 173 00:08:59,720 --> 00:09:01,160 Speaker 1: if you're just tune in, you're listening to the Mark 174 00:09:01,240 --> 00:09:05,760 Speaker 1: Mass Show. We're talking about bitcoin, cryptocurrencies and the decentralized 175 00:09:05,880 --> 00:09:10,880 Speaker 1: revolution that's happening. Uh, specifically, I'm talking about bitcoin being 176 00:09:10,960 --> 00:09:13,320 Speaker 1: a ponzi scheme. Is it is it a ponzi or 177 00:09:13,440 --> 00:09:16,439 Speaker 1: is it not? Well, we're breaking down what a ponzi is, 178 00:09:16,760 --> 00:09:18,920 Speaker 1: and I gave you the warning flags and we're gonna 179 00:09:18,920 --> 00:09:22,000 Speaker 1: look at some of those in comparison to bitcoin. Um, again, 180 00:09:22,000 --> 00:09:24,959 Speaker 1: you're listening to the Markma Show, talking about bitcoin and cryptocurrencies, 181 00:09:25,200 --> 00:09:29,240 Speaker 1: giving you the education that you need to thrive and 182 00:09:29,320 --> 00:09:32,240 Speaker 1: succeed through this crypto revolution. I'll be back with more 183 00:09:32,320 --> 00:09:34,320 Speaker 1: on this in a second. Don't go away, all right, 184 00:09:34,360 --> 00:09:36,400 Speaker 1: Welcome back here, listening to the mark Ma Show. We're 185 00:09:36,400 --> 00:09:40,000 Speaker 1: talking about bitcoin and cryptocurrencies and the decentralized revolution that's 186 00:09:40,040 --> 00:09:42,920 Speaker 1: happening right now. And specifically, before the break, I was 187 00:09:42,960 --> 00:09:46,360 Speaker 1: talking about bitcoin being a ponzi scheme? Is it a 188 00:09:46,360 --> 00:09:48,199 Speaker 1: ponzi scheme? Is it not a ponzi scheme? What does 189 00:09:48,200 --> 00:09:51,079 Speaker 1: a ponzi scheme even mean? Well, I read you the 190 00:09:51,120 --> 00:09:54,319 Speaker 1: definition from the SEC of what a ponzi scheme is, 191 00:09:54,600 --> 00:09:57,320 Speaker 1: and I read you a list of red flags they 192 00:09:57,320 --> 00:10:00,080 Speaker 1: said ponzi schemes have and what you should be watching 193 00:10:00,080 --> 00:10:02,040 Speaker 1: out for. So what I want to do now is 194 00:10:02,120 --> 00:10:05,000 Speaker 1: let's compare Bitcoin to the red flags of a ponzi 195 00:10:05,000 --> 00:10:07,960 Speaker 1: scheme and let's see if that works out. So the 196 00:10:08,040 --> 00:10:11,720 Speaker 1: first thing, as they said that investment returns were they 197 00:10:11,840 --> 00:10:16,439 Speaker 1: they promised um high returns with little or no risk. 198 00:10:16,679 --> 00:10:21,280 Speaker 1: So with bitcoin, there's no investment returns promised. So Toshi 199 00:10:21,320 --> 00:10:24,160 Speaker 1: never promised any investment returns. Let let alone, any high 200 00:10:24,240 --> 00:10:28,880 Speaker 1: investment returns, never promoted any consistent investment returns UM. As 201 00:10:28,880 --> 00:10:30,680 Speaker 1: a matter of fact, bitcoin was known for the first 202 00:10:30,679 --> 00:10:34,800 Speaker 1: decade of his existence of being extremely highly volatile speculation UM. 203 00:10:34,880 --> 00:10:37,760 Speaker 1: The online writings from Sotoshi still exists because it was 204 00:10:37,840 --> 00:10:39,680 Speaker 1: launched through message boards, and so we can still see 205 00:10:39,679 --> 00:10:42,640 Speaker 1: what he said, and he barely ever talked about any 206 00:10:42,640 --> 00:10:44,840 Speaker 1: financial gain at all. As a matter of fact, he 207 00:10:44,880 --> 00:10:48,920 Speaker 1: mostly only wrote about technical aspects. He talked about freedom, 208 00:10:48,960 --> 00:10:52,000 Speaker 1: he talked about the problems of the modern banking system 209 00:10:52,160 --> 00:10:54,560 Speaker 1: and things like that, but he never talked about, you know, 210 00:10:54,720 --> 00:10:57,280 Speaker 1: making a bunch of money from that. And so I 211 00:10:57,320 --> 00:11:00,280 Speaker 1: think that's a big key to differentiate a couple things 212 00:11:00,280 --> 00:11:02,079 Speaker 1: that he said. One of the quotes that I love 213 00:11:02,160 --> 00:11:05,000 Speaker 1: that he said. Now, of course I'm educated on bitcoin 214 00:11:05,000 --> 00:11:08,480 Speaker 1: and cryptocurrencies, but what what um he said? A couple 215 00:11:08,480 --> 00:11:11,760 Speaker 1: of things. He said, Uh, it might make sense just 216 00:11:11,840 --> 00:11:15,560 Speaker 1: to get some in case it catches on. That's what 217 00:11:15,559 --> 00:11:17,640 Speaker 1: he said. So he didn't say, hey, you should buy it. 218 00:11:17,679 --> 00:11:19,080 Speaker 1: You can make a bunch of money, Hey you should 219 00:11:19,120 --> 00:11:21,040 Speaker 1: buy it. Your guaranteed to make a bunch of money. Hey, 220 00:11:21,160 --> 00:11:23,040 Speaker 1: you're guaranteed to get higher returns. He didn't say that. 221 00:11:23,160 --> 00:11:25,440 Speaker 1: He said it might make sense to get some just 222 00:11:25,520 --> 00:11:28,120 Speaker 1: in case it catches on. And that's what I tell people. 223 00:11:28,120 --> 00:11:31,160 Speaker 1: If you're skeptical about bitcoin. Um at this point, I 224 00:11:31,160 --> 00:11:32,600 Speaker 1: don't know how you could be. But if you are, 225 00:11:32,880 --> 00:11:35,600 Speaker 1: that's okay. You're new to it, I understand, but hey, 226 00:11:35,760 --> 00:11:38,320 Speaker 1: it might make sense to get some just in case 227 00:11:38,720 --> 00:11:42,440 Speaker 1: it catches on. That's what he said. Um, let's see 228 00:11:42,440 --> 00:11:46,240 Speaker 1: a couple other things here. Um. Okay, So the second one, Um, 229 00:11:46,520 --> 00:11:49,040 Speaker 1: the second red flag that they that they warned us 230 00:11:49,080 --> 00:11:53,000 Speaker 1: of was that they they that a ponzi scheme uses 231 00:11:53,080 --> 00:11:58,640 Speaker 1: secretive and complex strategies. Okay, well, bitcoin is open source. 232 00:11:59,160 --> 00:12:02,400 Speaker 1: Open sources the opposite of secrecy. Now, I talk a 233 00:12:02,400 --> 00:12:05,200 Speaker 1: lot about the Federal Reserve. The Federal Reserve is the 234 00:12:05,240 --> 00:12:08,840 Speaker 1: opposite of open source. The Federal Reserve is secret. As 235 00:12:08,840 --> 00:12:10,760 Speaker 1: a matter of fact, in a previous segment, I was 236 00:12:10,760 --> 00:12:13,720 Speaker 1: talking about the Federal Reserve and how a Freedom of 237 00:12:13,760 --> 00:12:17,200 Speaker 1: Information Act request was filed against them and they are 238 00:12:17,320 --> 00:12:21,440 Speaker 1: denying the request, which I don't even know how that's legal. Uh, 239 00:12:21,520 --> 00:12:25,280 Speaker 1: it's the opposite of open source. So ponzi schemes rely 240 00:12:25,360 --> 00:12:28,439 Speaker 1: on secrecy. If the investors understood that an investment they 241 00:12:28,480 --> 00:12:31,160 Speaker 1: owned was actually a Ponzi scheme, then of course they 242 00:12:31,160 --> 00:12:33,719 Speaker 1: would try to pull their money out immediately. Right, it's 243 00:12:33,800 --> 00:12:38,679 Speaker 1: the secrecy um. The secrecy prevents the market from appropriately 244 00:12:38,760 --> 00:12:42,760 Speaker 1: pricing the investment until the secret gets found out. So 245 00:12:43,960 --> 00:12:46,160 Speaker 1: one of the most famous examples of the Ponzi scheme 246 00:12:46,240 --> 00:12:49,199 Speaker 1: was Burnie made Off and investors in Bernie made Off 247 00:12:49,240 --> 00:12:52,600 Speaker 1: scheme thought they owned a variety of assets, but in reality, 248 00:12:53,000 --> 00:12:56,120 Speaker 1: the earlier investors outflows were just being paid back from 249 00:12:56,200 --> 00:12:59,559 Speaker 1: new investor inflows, so it wasn't actually money being made 250 00:12:59,640 --> 00:13:02,560 Speaker 1: from the investments. The investments list on their statements were 251 00:13:02,559 --> 00:13:05,400 Speaker 1: all fake and for any of those clients it would 252 00:13:05,440 --> 00:13:08,800 Speaker 1: be nearly impossible to verify that they're fake, Like, how 253 00:13:08,800 --> 00:13:10,640 Speaker 1: could they do that? Right, They didn't have access to it. 254 00:13:10,640 --> 00:13:15,200 Speaker 1: There was secrecy. Bitcoin is the opposite though, right. Bitcoin 255 00:13:15,320 --> 00:13:18,640 Speaker 1: works the opposite on an opposite set of principles. It's 256 00:13:18,640 --> 00:13:22,839 Speaker 1: a distributed piece of open source software that requires a 257 00:13:22,880 --> 00:13:26,040 Speaker 1: majority consensus to change. Every line of code is known. 258 00:13:26,480 --> 00:13:29,760 Speaker 1: There's no central authority that can change it. And you know, 259 00:13:29,840 --> 00:13:31,400 Speaker 1: one of the things that we say with bitcoin is 260 00:13:31,440 --> 00:13:34,680 Speaker 1: don't trust but rather verify. And so what that means 261 00:13:34,720 --> 00:13:37,840 Speaker 1: is that because the code is open source, because I 262 00:13:37,880 --> 00:13:41,439 Speaker 1: can run the bitcoin software on my own, anybody, anybody 263 00:13:41,440 --> 00:13:43,520 Speaker 1: can just freely download it and run on a on 264 00:13:43,559 --> 00:13:46,080 Speaker 1: an old laptop if you want, you can use that 265 00:13:46,280 --> 00:13:48,960 Speaker 1: to audit the entire blockchain. You can use it to 266 00:13:49,040 --> 00:13:52,880 Speaker 1: odor the UM, to audit the entire monetary supply. It 267 00:13:52,960 --> 00:13:55,599 Speaker 1: doesn't rely on a website. There's no data center, and 268 00:13:55,640 --> 00:13:58,520 Speaker 1: there's no corporate structure. There's none of that. And because 269 00:13:58,559 --> 00:14:01,360 Speaker 1: of this, there's no issue with the paperwork, right, there's 270 00:14:01,360 --> 00:14:04,440 Speaker 1: no difficulty receiving payments. As as the SEC told us, 271 00:14:04,440 --> 00:14:08,000 Speaker 1: there was red flags about now you know, there's of 272 00:14:08,040 --> 00:14:12,040 Speaker 1: course there's bad actors that would you know, associate with 273 00:14:12,080 --> 00:14:15,160 Speaker 1: this with the with the ecosystem. Let's say, UM, you 274 00:14:15,200 --> 00:14:18,280 Speaker 1: know people rely on others to hold their private keys, 275 00:14:18,280 --> 00:14:21,200 Speaker 1: for example, and those people holding private keys, the custodians 276 00:14:21,200 --> 00:14:23,800 Speaker 1: could be bad, they could do things like that. UM. 277 00:14:23,840 --> 00:14:27,120 Speaker 1: But the but the bitcoin software isn't isn't bad. The 278 00:14:27,120 --> 00:14:32,040 Speaker 1: bitcoin software doesn't trick people. It's open source. UM. Another 279 00:14:32,120 --> 00:14:36,880 Speaker 1: thing is that UM back to that, as I was 280 00:14:36,920 --> 00:14:39,680 Speaker 1: kind of saying before about the mining UM, there was 281 00:14:39,680 --> 00:14:42,760 Speaker 1: no there was no pre mind there and so um 282 00:14:42,840 --> 00:14:46,400 Speaker 1: so Toshi didn't really never got any of his any 283 00:14:46,400 --> 00:14:49,120 Speaker 1: of his coins of the mind. But usually you know, 284 00:14:49,160 --> 00:14:51,720 Speaker 1: so bitcoin was launched and open in a fair way 285 00:14:51,920 --> 00:14:55,080 Speaker 1: when it was launched, But as I said, most cryptocurrencies 286 00:14:55,120 --> 00:14:57,760 Speaker 1: don't follow those principles. So like with Ethereum. For example, 287 00:14:57,800 --> 00:15:00,920 Speaker 1: ethereums the number two cryptocurrency by market app and the 288 00:15:01,120 --> 00:15:06,280 Speaker 1: Ethereum developers provided seventy two million tokens to themselves and 289 00:15:06,440 --> 00:15:10,200 Speaker 1: their investors prior to any being available to be owned 290 00:15:10,200 --> 00:15:13,440 Speaker 1: by the broader public. So that's about half of the 291 00:15:13,480 --> 00:15:17,720 Speaker 1: current token supply of Ethereum, So before anybody could get 292 00:15:17,760 --> 00:15:21,280 Speaker 1: it half, about about half seventy two million tokens were 293 00:15:21,320 --> 00:15:24,760 Speaker 1: given to themselves and their investors. Ripple x RP, on 294 00:15:24,840 --> 00:15:26,800 Speaker 1: the other hand, is even worse. Now, if you're an 295 00:15:26,880 --> 00:15:29,120 Speaker 1: x RP fan, um plug, your ear is not gonna 296 00:15:29,120 --> 00:15:32,880 Speaker 1: like to hear this. But Ripple Labs pre mind one 297 00:15:33,080 --> 00:15:37,120 Speaker 1: hundred billion XRP tokens with the majority being owned by 298 00:15:37,200 --> 00:15:40,200 Speaker 1: Ripple Labs, and then what they did is they gradually 299 00:15:40,240 --> 00:15:43,120 Speaker 1: begin selling the rest to the public, but they still 300 00:15:43,160 --> 00:15:46,720 Speaker 1: hold the majority. Now, of course, they're currently being accused 301 00:15:47,000 --> 00:15:50,400 Speaker 1: by the sec of selling unregistered securities. And we've yet 302 00:15:50,440 --> 00:15:54,160 Speaker 1: to see how that plays out. But with bitcoin, the 303 00:15:54,240 --> 00:15:58,800 Speaker 1: founder gave himself no advantage to mining bitcoin. He started 304 00:15:58,800 --> 00:16:01,160 Speaker 1: talking about it, he started even the software oute long 305 00:16:01,240 --> 00:16:05,400 Speaker 1: before mining was ever done. Um, So lots of people 306 00:16:05,440 --> 00:16:07,080 Speaker 1: had the same opportunity to mine at the same time. 307 00:16:07,120 --> 00:16:09,440 Speaker 1: And he's never even cashed his coins in anyway, and 308 00:16:09,480 --> 00:16:12,640 Speaker 1: so that makes it the cleanest approach. The other thing 309 00:16:12,760 --> 00:16:16,440 Speaker 1: is that there's no leader, right. So bitcoin is really 310 00:16:16,480 --> 00:16:21,120 Speaker 1: interesting because there's no centralized leadership. So totian not comot 311 00:16:21,160 --> 00:16:23,280 Speaker 1: to a person or a group of people, but you know, 312 00:16:23,840 --> 00:16:27,360 Speaker 1: a group of people potentially, Um, they disappeared, So there's 313 00:16:27,360 --> 00:16:31,200 Speaker 1: no leader there. Um. And so I think when you 314 00:16:31,240 --> 00:16:33,640 Speaker 1: break that down point by point, you see that it 315 00:16:33,680 --> 00:16:38,600 Speaker 1: doesn't really trigger any of these red flags. Um. There's 316 00:16:38,920 --> 00:16:42,400 Speaker 1: you know, again they're not unregistered investments or unlice. It's sellers. 317 00:16:42,960 --> 00:16:47,520 Speaker 1: If if there was maybe any um red flag to 318 00:16:47,520 --> 00:16:49,760 Speaker 1: be raised potentially and not not about a ponzi but 319 00:16:49,840 --> 00:16:55,560 Speaker 1: about but but about a security, um, is that you know, 320 00:16:55,640 --> 00:16:58,480 Speaker 1: I mean you're selling assets, um, But it doesn't mean 321 00:16:58,520 --> 00:17:00,760 Speaker 1: that just because it's an asset that could be maybe 322 00:17:00,760 --> 00:17:03,160 Speaker 1: potentially a security doesn't mean it's a ponzi. Right, So 323 00:17:03,240 --> 00:17:06,359 Speaker 1: it doesn't mean that. Now let's look at something else. 324 00:17:06,480 --> 00:17:10,960 Speaker 1: Let's look at um a broader definition of a ponzi. Right. So, 325 00:17:11,200 --> 00:17:13,399 Speaker 1: I think I've proven that bitcoin is not a ponzi 326 00:17:13,480 --> 00:17:17,040 Speaker 1: based off of the SEC's definition and the SEC's red flags. 327 00:17:17,400 --> 00:17:19,800 Speaker 1: But I want to look at a broader definition of 328 00:17:19,800 --> 00:17:22,320 Speaker 1: a pons because I believe that maybe there are some 329 00:17:22,359 --> 00:17:25,880 Speaker 1: similarities to the gold market or some other assets like that, 330 00:17:26,240 --> 00:17:28,360 Speaker 1: And I think if you understand how the gold monetary 331 00:17:28,400 --> 00:17:32,160 Speaker 1: network works or the Fiat banking system works, you might 332 00:17:32,280 --> 00:17:37,159 Speaker 1: actually see this whole situation from an entirely different angle. Now, 333 00:17:37,160 --> 00:17:38,920 Speaker 1: by the way, you're listening to the Markmas Show, we're 334 00:17:38,960 --> 00:17:42,040 Speaker 1: talking about bitcoin, we're talking about cryptocurrencies, we're talking about 335 00:17:42,040 --> 00:17:44,880 Speaker 1: the decentralized revolution that we're going through. We're talking about 336 00:17:44,920 --> 00:17:48,600 Speaker 1: bitcoin and cryptocurrencies. Well, bitcoin not being a ponzi scheme, 337 00:17:48,720 --> 00:17:52,639 Speaker 1: as it's been a huge many times before. When I 338 00:17:52,680 --> 00:17:54,120 Speaker 1: come back, I want to talk about, like I said, 339 00:17:54,119 --> 00:17:56,119 Speaker 1: the broader definition of a ponzi and talk about the 340 00:17:56,119 --> 00:17:58,960 Speaker 1: gold market, talking about the Fiat money system and the 341 00:17:59,000 --> 00:18:02,000 Speaker 1: stock market, and like I said, once you understand these 342 00:18:02,080 --> 00:18:04,440 Speaker 1: from this different angle. I think you'll see this from 343 00:18:04,440 --> 00:18:08,080 Speaker 1: a completely new light. You don't want to miss this. 344 00:18:08,160 --> 00:18:10,840 Speaker 1: You need to understand this. Listening to the Markmas Show, 345 00:18:10,960 --> 00:18:13,440 Speaker 1: I'll be right back. Don't go away, all right, Welcome back. 346 00:18:13,480 --> 00:18:15,560 Speaker 1: You're listening to the Markma Show and we're talking about 347 00:18:15,560 --> 00:18:20,760 Speaker 1: bitcoin and decentralized revolution, cryptocurrencies and all that stuff that's 348 00:18:20,760 --> 00:18:23,359 Speaker 1: going on right now. And specifically, before the break, I 349 00:18:23,400 --> 00:18:26,639 Speaker 1: was talking about bitcoin and uh, bitcoin being a ponzi scheme? 350 00:18:27,000 --> 00:18:30,840 Speaker 1: Is Bitcoin a ponzi? What is a ponzi? A lot 351 00:18:30,880 --> 00:18:32,640 Speaker 1: of times people throw these words around and they don't 352 00:18:32,640 --> 00:18:34,760 Speaker 1: ever really stop to think about what they are, what 353 00:18:34,840 --> 00:18:37,080 Speaker 1: they mean, And so I want to break that down. 354 00:18:37,119 --> 00:18:41,080 Speaker 1: We've been dissecting what the SEC said of ponzi was. Um, 355 00:18:41,160 --> 00:18:44,200 Speaker 1: we talked about the Bernie made Out scandal. I talked 356 00:18:44,240 --> 00:18:46,760 Speaker 1: about the red flags that the SEC gives you to 357 00:18:47,200 --> 00:18:49,160 Speaker 1: watch out and be careful if you may be involved 358 00:18:49,200 --> 00:18:51,160 Speaker 1: in a ponzi, and then we went point by point 359 00:18:51,160 --> 00:18:53,560 Speaker 1: and showed how bitcoin actually doesn't have any of those 360 00:18:53,600 --> 00:18:56,200 Speaker 1: red flags. UM. Now, what I want to talk about 361 00:18:56,240 --> 00:18:58,320 Speaker 1: is is something bigger. I wanna talk about the broader 362 00:18:58,400 --> 00:19:02,040 Speaker 1: definition of a ponzi because the narrow ponzi scheme, you know, 363 00:19:02,160 --> 00:19:04,560 Speaker 1: as I just made the case, it clearly doesn't apply 364 00:19:04,600 --> 00:19:07,359 Speaker 1: to bitcoin, um. And so what some people try to 365 00:19:07,359 --> 00:19:09,399 Speaker 1: do is they use like a broader definition of a 366 00:19:09,440 --> 00:19:12,159 Speaker 1: ponzi scheme to assert that bitcoin is one of them. 367 00:19:12,280 --> 00:19:14,000 Speaker 1: You have to be very careful, like I said, with 368 00:19:14,040 --> 00:19:16,840 Speaker 1: these words and definitions, especially in today's age, because we've 369 00:19:16,840 --> 00:19:18,919 Speaker 1: twisted all these words. So for example, let me give 370 00:19:18,920 --> 00:19:23,040 Speaker 1: you an example, UM, capitalism. Capitalism has almost become this 371 00:19:23,160 --> 00:19:27,240 Speaker 1: dirty word, and I've found myself starting to not use 372 00:19:27,280 --> 00:19:30,480 Speaker 1: the word capitalism and instead used UM free markets because 373 00:19:30,520 --> 00:19:33,120 Speaker 1: free markets to sound different, and people think, no, capitalism 374 00:19:33,200 --> 00:19:37,959 Speaker 1: is capitalism led to slavery, and capitalism led to colonialism, 375 00:19:38,000 --> 00:19:44,680 Speaker 1: and capitalism UM allows these greedy corporations to pollute the environments. Right, Okay, 376 00:19:44,760 --> 00:19:49,720 Speaker 1: well we should inspect the word capitalism then, because UM, 377 00:19:49,840 --> 00:19:53,520 Speaker 1: I don't believe that is capitalism. So capitalism is sure 378 00:19:54,160 --> 00:19:58,320 Speaker 1: private property rights and UM me being able to manage 379 00:19:58,320 --> 00:20:00,000 Speaker 1: and control my property rights and direct him as I 380 00:20:00,040 --> 00:20:03,640 Speaker 1: see fit. Now, UM, what people think is that capitalists 381 00:20:03,640 --> 00:20:06,800 Speaker 1: are only in the pursuit of profits, and that's it. 382 00:20:07,400 --> 00:20:11,720 Speaker 1: And so that's what leads to slavery and colonialism and etcetera. 383 00:20:11,800 --> 00:20:15,160 Speaker 1: But that's not true. That's not totally true. So capitalism 384 00:20:15,320 --> 00:20:21,919 Speaker 1: is the protection the priority of private property rights, private 385 00:20:21,920 --> 00:20:29,000 Speaker 1: property rights. It's also voluntary exchange. And so my thoughts, 386 00:20:29,320 --> 00:20:34,439 Speaker 1: my labor, my energy, it's my private property. That's my 387 00:20:34,480 --> 00:20:38,920 Speaker 1: private property. My arm is my private property. Nobody can 388 00:20:39,000 --> 00:20:41,400 Speaker 1: move my arm except for me. That's my private property. 389 00:20:41,560 --> 00:20:44,639 Speaker 1: My energy is my private property. My my my my 390 00:20:44,720 --> 00:20:49,520 Speaker 1: thinking capacity, my ideas, my creativity, that's my private property. 391 00:20:50,080 --> 00:20:53,720 Speaker 1: And so if anybody were to, you know, hold me 392 00:20:53,800 --> 00:20:57,160 Speaker 1: as a slave, for example, I don't think that would 393 00:20:57,160 --> 00:20:59,600 Speaker 1: be protecting private property. As a matter of fact, I 394 00:20:59,600 --> 00:21:04,119 Speaker 1: think that would exactly contradict that. Another attribute of capitalism 395 00:21:04,240 --> 00:21:08,800 Speaker 1: is voluntary exchange. If I'm a slave, that's not voluntary exchange. 396 00:21:09,640 --> 00:21:14,119 Speaker 1: So you see, by omitting the key words that define 397 00:21:14,200 --> 00:21:17,320 Speaker 1: what capitalism is, sure then you can say capitalism is 398 00:21:17,320 --> 00:21:20,520 Speaker 1: colonialism if you're saying all capitalism ism is trying to 399 00:21:20,600 --> 00:21:21,840 Speaker 1: be as greedy as you can and try and grow 400 00:21:21,880 --> 00:21:24,600 Speaker 1: your capital. But that's not what it is. It's protecting 401 00:21:24,640 --> 00:21:28,200 Speaker 1: private property rights and free and voluntary exchange, all right, 402 00:21:28,359 --> 00:21:30,000 Speaker 1: So it's important to break that down. And by the way, 403 00:21:30,480 --> 00:21:32,560 Speaker 1: I'm wanna throw a plug out. I wrote a book 404 00:21:32,800 --> 00:21:35,639 Speaker 1: UM a couple of weeks ago, UM, trying to actually 405 00:21:35,680 --> 00:21:38,320 Speaker 1: define this much better. UM. And you can go to 406 00:21:38,600 --> 00:21:42,240 Speaker 1: Uncommunist dot com Uncommunist dot com and you can check 407 00:21:42,240 --> 00:21:46,000 Speaker 1: out this book. It's just a little booklet UM. And 408 00:21:46,000 --> 00:21:49,639 Speaker 1: I basically took the Communist Manifesto and we rewrote it 409 00:21:49,680 --> 00:21:51,879 Speaker 1: and it's it's just about a forty five minute read. UM. 410 00:21:51,880 --> 00:21:55,159 Speaker 1: And I read defined um this capitalism theme because in 411 00:21:55,240 --> 00:21:58,760 Speaker 1: the Communist Manifesto he broke down how capitalists were bad 412 00:21:58,800 --> 00:22:00,680 Speaker 1: and didn't contribute anything. And I think you just got 413 00:22:00,680 --> 00:22:03,080 Speaker 1: it all wrong. And so in the Uncommunist I basically 414 00:22:03,080 --> 00:22:04,800 Speaker 1: rewrote the book to kind of reframe it. That's why 415 00:22:04,800 --> 00:22:06,520 Speaker 1: it's the top of my head. But it's important to 416 00:22:06,600 --> 00:22:09,639 Speaker 1: understand these UM, these words and what they mean. And 417 00:22:09,680 --> 00:22:12,639 Speaker 1: so back to Ponzi, we also need to understand what 418 00:22:12,640 --> 00:22:16,760 Speaker 1: it means because we broke down the definition, but they're 419 00:22:16,760 --> 00:22:18,639 Speaker 1: trying to use a broader definition of what that Ponzi 420 00:22:18,720 --> 00:22:22,800 Speaker 1: scheme is. So UM, a bitcoin is basically a commodity. 421 00:22:22,880 --> 00:22:26,720 Speaker 1: That's how the Commodities Exchange has labeled it. UM. The 422 00:22:26,800 --> 00:22:29,199 Speaker 1: I R s has labeled it as property, which is 423 00:22:29,200 --> 00:22:31,920 Speaker 1: like a commodity. So in the sense it's a scarce 424 00:22:32,040 --> 00:22:37,080 Speaker 1: digital object. But um, it provides no cash flow, all right, 425 00:22:37,160 --> 00:22:39,359 Speaker 1: But it has utility because it allows me to store 426 00:22:39,400 --> 00:22:42,720 Speaker 1: wealth and transmit value. But there's no cash flow. R's 427 00:22:42,760 --> 00:22:47,000 Speaker 1: just the digital object. Now, like any commodity, um, so 428 00:22:47,080 --> 00:22:50,720 Speaker 1: commodity like energy, like wheat, like grain or whatever, it 429 00:22:50,840 --> 00:22:54,520 Speaker 1: produces no cash flows or dividends, right, So it's only 430 00:22:54,640 --> 00:22:57,199 Speaker 1: worth what someone else is willing to pay for it 431 00:22:57,320 --> 00:22:59,160 Speaker 1: or trade you for it. And that's a key piece. 432 00:22:59,560 --> 00:23:02,840 Speaker 1: So that's what people say with with with with bitcoin, Yeah, 433 00:23:02,960 --> 00:23:04,720 Speaker 1: it's only good if you can find someone else to 434 00:23:04,760 --> 00:23:09,040 Speaker 1: buy it from you. Yeah, like every other commodity in 435 00:23:09,040 --> 00:23:11,400 Speaker 1: the world, because it pays no casual or dividends. It's 436 00:23:11,440 --> 00:23:13,000 Speaker 1: only worth what someone else will wanted to pay for it, 437 00:23:13,520 --> 00:23:18,080 Speaker 1: all right. Now, it's specifically it's a monetary commodity commodity, 438 00:23:18,119 --> 00:23:21,600 Speaker 1: but it has utility, like I said, storing and transmitting value. 439 00:23:21,920 --> 00:23:25,440 Speaker 1: So it kind of made Gold is probably its closest comparison. 440 00:23:25,760 --> 00:23:28,040 Speaker 1: So if we look at bitcoin versus the gold market. Now, 441 00:23:28,080 --> 00:23:30,760 Speaker 1: some people say that bitcoin is a Ponzi scheme because 442 00:23:30,880 --> 00:23:33,600 Speaker 1: like I said, it relies on an ever larger pool 443 00:23:33,640 --> 00:23:35,879 Speaker 1: of investors coming into the space to buy from the 444 00:23:35,920 --> 00:23:39,160 Speaker 1: earlier investors. Right, So if more people don't come by, 445 00:23:39,560 --> 00:23:41,439 Speaker 1: you need you know, they say, Mark, You're always like, 446 00:23:41,600 --> 00:23:46,760 Speaker 1: you're always shilling bitcoin. You just want more people to buy. Um. Yeah, okay, 447 00:23:46,920 --> 00:23:49,640 Speaker 1: so bitcoin, you know need They say that it needs 448 00:23:49,680 --> 00:23:52,480 Speaker 1: an ever larger pool of investors to come in. But 449 00:23:53,280 --> 00:23:57,639 Speaker 1: that's basically the same thing as other network. So the 450 00:23:57,680 --> 00:24:00,680 Speaker 1: reliance on new investors is correct, that's no k framing. 451 00:24:01,000 --> 00:24:04,520 Speaker 1: Bitcoin keeps growing its network effects reaching more people, and 452 00:24:04,560 --> 00:24:07,120 Speaker 1: it reaches more people with bigger pools of money, which 453 00:24:07,160 --> 00:24:11,360 Speaker 1: then keeps increasing its usefulness and its value. Right, So 454 00:24:11,640 --> 00:24:14,080 Speaker 1: um Metcalf's law. If I'm the only person in the 455 00:24:14,119 --> 00:24:16,040 Speaker 1: world with the phone, it's not worth very much. If 456 00:24:16,080 --> 00:24:18,400 Speaker 1: more people have phones, it's worth more. When everybody has 457 00:24:18,400 --> 00:24:21,240 Speaker 1: a phone, they're worth more. And so as it reaches 458 00:24:21,280 --> 00:24:24,359 Speaker 1: more people, it becomes more useful and more valuable. Yes, 459 00:24:24,560 --> 00:24:28,120 Speaker 1: they are true with saying that, right, but that doesn't 460 00:24:28,160 --> 00:24:30,520 Speaker 1: make it a Ponzi scheme, because if I use similar 461 00:24:30,560 --> 00:24:34,440 Speaker 1: logic with gold, then goals of five thousand euro ponzi scheme, right, 462 00:24:34,480 --> 00:24:38,480 Speaker 1: Because the vast majority of gold's usage is not for industry. 463 00:24:38,800 --> 00:24:42,320 Speaker 1: It's for storing and displacing displaying wealth. It produces no 464 00:24:42,440 --> 00:24:44,880 Speaker 1: cash flow. It's only worth what someone else will pay 465 00:24:44,920 --> 00:24:47,840 Speaker 1: for it um. If people's jewelry taste change and if 466 00:24:47,880 --> 00:24:50,240 Speaker 1: people no longer view gold as an optimal store value, 467 00:24:50,359 --> 00:24:52,240 Speaker 1: then it's a network effect would go down and it 468 00:24:52,280 --> 00:24:57,560 Speaker 1: would lose value. Right, So very similar, it requires more 469 00:24:57,640 --> 00:24:59,960 Speaker 1: and more people to continue to use it and can 470 00:25:00,000 --> 00:25:03,040 Speaker 1: continue to store their wealth in it um. There's about 471 00:25:03,080 --> 00:25:05,800 Speaker 1: sixty years of gold's annual production supply estimated to be 472 00:25:05,800 --> 00:25:08,800 Speaker 1: available in various forms around the world, and that's like 473 00:25:09,160 --> 00:25:13,160 Speaker 1: five hundred years worth of industrial only supply, and that's 474 00:25:13,400 --> 00:25:17,879 Speaker 1: factoring out jewelry and store value demand. And so that 475 00:25:17,960 --> 00:25:21,080 Speaker 1: means that gold's supplied demand balance to support a high 476 00:25:21,080 --> 00:25:25,879 Speaker 1: price requires the ongoing perception of gold as an attractive 477 00:25:25,920 --> 00:25:29,679 Speaker 1: way to store and display your wealth because it's not 478 00:25:29,720 --> 00:25:34,160 Speaker 1: being used for monitor for industrial usage. So gold monetary 479 00:25:34,160 --> 00:25:38,240 Speaker 1: network has remained robust for a long period time because 480 00:25:38,280 --> 00:25:42,359 Speaker 1: the collection of unique properties it has is what made 481 00:25:42,359 --> 00:25:46,680 Speaker 1: it continually regarded as being optimal for long term wealth preservation. 482 00:25:47,040 --> 00:25:50,560 Speaker 1: All right, that's why people use it. Similarly, bitcoin relies 483 00:25:50,600 --> 00:25:54,000 Speaker 1: on network effects, meaning it's a large number of people 484 00:25:54,040 --> 00:25:56,080 Speaker 1: need to view it as a good holding to retain 485 00:25:56,119 --> 00:25:59,240 Speaker 1: its value. But a network effect is not a Ponzi 486 00:25:59,320 --> 00:26:04,200 Speaker 1: scheme in you know, in itself. Prospective investors can analyze 487 00:26:04,240 --> 00:26:06,840 Speaker 1: the metrics of bitcoins network effects and then determine for 488 00:26:06,920 --> 00:26:09,840 Speaker 1: themselves the risk and reward of buying into it. So 489 00:26:09,960 --> 00:26:12,760 Speaker 1: bitcoin is no more a Ponzi scheme than gold is 490 00:26:12,760 --> 00:26:15,560 Speaker 1: a Ponzi scheme, or any other commodity to be a 491 00:26:15,560 --> 00:26:18,600 Speaker 1: Ponzi scheme. Now, what about if we look at the 492 00:26:18,640 --> 00:26:22,800 Speaker 1: FIAT banking system. Now this is interesting, so let's look 493 00:26:22,840 --> 00:26:25,480 Speaker 1: at it in the same type of a lens. So 494 00:26:25,800 --> 00:26:29,879 Speaker 1: by the broadest definition of a Ponzi scheme, the entire 495 00:26:30,080 --> 00:26:34,760 Speaker 1: global banking system is a Ponzi scheme. Now we've talked 496 00:26:34,760 --> 00:26:36,639 Speaker 1: about um. The Federal Reserve has now come out and 497 00:26:36,640 --> 00:26:38,720 Speaker 1: said they're gonna cut rates. They're gonna cut them, They're 498 00:26:38,720 --> 00:26:42,200 Speaker 1: gonna start tapering, sorry, cut taping. They're gonna they're gonna 499 00:26:42,200 --> 00:26:45,560 Speaker 1: start tapering, and they're going to start raising rates. And 500 00:26:45,600 --> 00:26:47,639 Speaker 1: I've said over and over and over again, you can't 501 00:26:47,840 --> 00:26:51,679 Speaker 1: taper a ponzi You can't taper a ponzi because it 502 00:26:51,760 --> 00:26:54,600 Speaker 1: requires new money coming in to pay the old people. 503 00:26:55,480 --> 00:26:59,800 Speaker 1: And so, um, I'm gonna back it up. I've said 504 00:26:59,800 --> 00:27:01,560 Speaker 1: that any times. You probably heard me say that many times. 505 00:27:01,640 --> 00:27:03,280 Speaker 1: Let's back that up here. Like I said, the broadest 506 00:27:03,280 --> 00:27:07,040 Speaker 1: definition of a ponzi scheme, the entire global banking system 507 00:27:07,240 --> 00:27:10,960 Speaker 1: is a ponzi scheme. So, firstly, fiat currency is an 508 00:27:11,080 --> 00:27:16,320 Speaker 1: artificial commodity. Right, A dollar in and of itself is 509 00:27:16,359 --> 00:27:19,720 Speaker 1: just an object made out of paper. Now the dollar 510 00:27:19,880 --> 00:27:24,360 Speaker 1: is supposed to represent something. The it's an artificial commodity. 511 00:27:24,400 --> 00:27:27,840 Speaker 1: So gold was money for five thou years. Gold is 512 00:27:27,880 --> 00:27:29,800 Speaker 1: hard to move around, it's not portable. It's hard to 513 00:27:29,800 --> 00:27:31,399 Speaker 1: pay someone in gold. So I put the gold in 514 00:27:31,440 --> 00:27:34,000 Speaker 1: a bank and the bank gives me a paper gold certificate. 515 00:27:34,480 --> 00:27:38,000 Speaker 1: Gold is layer one settlement. The paper goal certificate is 516 00:27:38,080 --> 00:27:40,840 Speaker 1: layer two. The gold. I can tran the paper certificate. 517 00:27:40,880 --> 00:27:44,600 Speaker 1: I can transact very quickly, but it's not final settlement. 518 00:27:44,880 --> 00:27:48,719 Speaker 1: And so what that means is that there's additional risk there. Um, 519 00:27:48,840 --> 00:27:52,719 Speaker 1: But really that that paper only represents it's a claim 520 00:27:52,880 --> 00:27:58,000 Speaker 1: against the gold, all right. Now, Secondly, when we organized 521 00:27:58,040 --> 00:28:00,679 Speaker 1: all these pieces of paper or let's call it a 522 00:28:00,680 --> 00:28:03,960 Speaker 1: digital representation of the paper because now most dollar transactions 523 00:28:04,000 --> 00:28:05,840 Speaker 1: that they are digital. So if we take the piece 524 00:28:05,840 --> 00:28:09,320 Speaker 1: of paper the digital representations in a fractural reserve banking system, 525 00:28:09,800 --> 00:28:13,200 Speaker 1: then we add another complicated layer. So what does that mean? 526 00:28:13,600 --> 00:28:17,280 Speaker 1: So that means that the banks create money or they 527 00:28:17,320 --> 00:28:21,000 Speaker 1: create currency from thin air. Alright, the Fiat money. So 528 00:28:21,040 --> 00:28:22,800 Speaker 1: first of all, Fiat A lot of people don't understand 529 00:28:22,800 --> 00:28:25,399 Speaker 1: what Fiat is. People think that Fiat money is like 530 00:28:25,560 --> 00:28:28,040 Speaker 1: fake money. That's not really what it means. I'm gonna 531 00:28:28,040 --> 00:28:29,720 Speaker 1: give you the definition of Fiat money. I'm gonna explain 532 00:28:29,720 --> 00:28:31,679 Speaker 1: to you how they create this Fiat money through the 533 00:28:31,680 --> 00:28:34,400 Speaker 1: banking system out of thin air. When I get back, 534 00:28:34,400 --> 00:28:36,320 Speaker 1: you're listening to the Mark Moa show talking about bitcoin, 535 00:28:36,440 --> 00:28:40,840 Speaker 1: cryptocurrencies and the decentralized Revolution, talking about the Fiat money 536 00:28:40,840 --> 00:28:44,479 Speaker 1: system and how that is a Ponzi system and not bitcoin. 537 00:28:44,640 --> 00:28:47,000 Speaker 1: I'll be right back with more. Don't go away, all right, 538 00:28:47,040 --> 00:28:49,080 Speaker 1: welcome back. You are listening to the markma Show and 539 00:28:49,080 --> 00:28:53,520 Speaker 1: we're talking about bitcoin and cryptocurrencies and the decentralized revolution, 540 00:28:53,640 --> 00:28:57,040 Speaker 1: and uh, I was knocking down some of the big 541 00:28:57,040 --> 00:29:00,880 Speaker 1: objections that you hear talking about how uh, well, we 542 00:29:00,880 --> 00:29:03,480 Speaker 1: were taking a look at is bitcoin really a ponzi scheme? 543 00:29:03,560 --> 00:29:06,000 Speaker 1: Yes or no. We've looked at what the definition of 544 00:29:06,040 --> 00:29:08,280 Speaker 1: a ponzi scheme is. First of all, what the SEC 545 00:29:08,720 --> 00:29:11,000 Speaker 1: warns us, the warning signs of what a ponzi scheme is. 546 00:29:11,040 --> 00:29:14,720 Speaker 1: We looked at, um, the broader definition of it. We 547 00:29:14,720 --> 00:29:16,800 Speaker 1: looked at one of the best, the most famous ponzi 548 00:29:16,840 --> 00:29:20,320 Speaker 1: scheme histories of Bernie made Off and now we're looking 549 00:29:20,360 --> 00:29:22,800 Speaker 1: at a broader definition. We compared to the Ponzi scheme 550 00:29:22,880 --> 00:29:26,560 Speaker 1: of bitcoin to gold and how if if bitcoins upon 551 00:29:26,600 --> 00:29:29,320 Speaker 1: the scheme, then gold upon the scheme as well. And 552 00:29:29,360 --> 00:29:32,240 Speaker 1: when we just finished off, we were talking about big 553 00:29:32,600 --> 00:29:36,400 Speaker 1: the Fiat banking system and how um, by the broad 554 00:29:36,440 --> 00:29:39,840 Speaker 1: definition of ponzi scheme, the entire global banking system is 555 00:29:40,360 --> 00:29:42,600 Speaker 1: a Ponzi scheme. Now I was talking about fiat currency 556 00:29:42,960 --> 00:29:44,959 Speaker 1: and a lot of people think that fiat currency is 557 00:29:45,000 --> 00:29:47,960 Speaker 1: like means it's not backed by anything for example. Um, 558 00:29:48,000 --> 00:29:50,320 Speaker 1: but what fiat currency means is I believe it's a 559 00:29:50,400 --> 00:29:53,400 Speaker 1: Latin word and it means like by decree. So what 560 00:29:53,440 --> 00:29:57,000 Speaker 1: does that mean? So? Um, that means that fiat money 561 00:29:57,120 --> 00:30:00,400 Speaker 1: has value because we say it does. We've create it 562 00:30:00,680 --> 00:30:04,440 Speaker 1: as a government. We've said you must use this by law, right, 563 00:30:04,920 --> 00:30:06,040 Speaker 1: and so that's what it is. But like I said, 564 00:30:06,080 --> 00:30:09,120 Speaker 1: it's just an object made out of paper. And so 565 00:30:09,160 --> 00:30:12,640 Speaker 1: what happens is, um that that paper, that money, that 566 00:30:12,640 --> 00:30:16,720 Speaker 1: that currency is created when the banks loan it into existence. 567 00:30:16,720 --> 00:30:20,480 Speaker 1: And so the federal reserve creates um reserves. They put 568 00:30:20,520 --> 00:30:22,800 Speaker 1: those reserves into the banks, and then the bank's loan 569 00:30:23,000 --> 00:30:26,680 Speaker 1: money into existence. And it's a fractional reserve banking system. 570 00:30:26,720 --> 00:30:29,120 Speaker 1: So what that means is that, UM, you deposit your 571 00:30:29,160 --> 00:30:31,840 Speaker 1: money into the bank, and then the bank keeps that 572 00:30:31,920 --> 00:30:35,920 Speaker 1: money on deposit on reserve and they loan money out 573 00:30:36,040 --> 00:30:40,479 Speaker 1: in multiples of that. And so for example, if UM, 574 00:30:40,520 --> 00:30:42,720 Speaker 1: you bought something from me for ten dollars, I take 575 00:30:42,800 --> 00:30:44,960 Speaker 1: that ten dollars, I put it into the bank. The 576 00:30:45,000 --> 00:30:48,240 Speaker 1: bank holds onto one of those dollars, and the nine 577 00:30:48,880 --> 00:30:51,720 Speaker 1: loans them back out, And those nine dollars going to 578 00:30:51,840 --> 00:30:54,160 Speaker 1: nine different banks, and the bank takes ten percent of it, 579 00:30:54,200 --> 00:30:56,280 Speaker 1: holds it, and the rest loans it back out, and 580 00:30:56,320 --> 00:31:00,320 Speaker 1: that process repeats over and over and over and over 581 00:31:00,400 --> 00:31:03,800 Speaker 1: and over again. That money is created into existence. So 582 00:31:03,800 --> 00:31:05,239 Speaker 1: when you take out a loan for a house, a car, 583 00:31:05,320 --> 00:31:08,760 Speaker 1: a boat, and RV that money is created into existence. 584 00:31:08,960 --> 00:31:11,240 Speaker 1: And so what that means is if only a few 585 00:31:11,320 --> 00:31:13,640 Speaker 1: percentage of the people were to all go to the banks. 586 00:31:13,720 --> 00:31:15,440 Speaker 1: Let's say that, you know, all these people that don't 587 00:31:15,440 --> 00:31:18,680 Speaker 1: have trust in the banks anymore, decide we're all gonna 588 00:31:18,680 --> 00:31:20,080 Speaker 1: go to the bank and pull our money out right now. 589 00:31:20,520 --> 00:31:22,280 Speaker 1: That would create what's called a run on the bank. 590 00:31:22,320 --> 00:31:24,239 Speaker 1: It happen, It's happened to many times throughout history and 591 00:31:24,280 --> 00:31:27,520 Speaker 1: even in recent history, and the banks would collapse because 592 00:31:27,760 --> 00:31:31,360 Speaker 1: they don't have the money. They would create it out 593 00:31:31,360 --> 00:31:33,680 Speaker 1: of the air. Now, realistically, the banks would say no, 594 00:31:34,280 --> 00:31:35,960 Speaker 1: they would say no, you can't withdraw. As a matter 595 00:31:35,960 --> 00:31:37,760 Speaker 1: of fact, go to your bank and try to withdraw 596 00:31:37,840 --> 00:31:41,240 Speaker 1: twenty dollars and see what happens. I pretty much guarantee 597 00:31:41,240 --> 00:31:42,960 Speaker 1: you if you drove to the bank today and try 598 00:31:42,960 --> 00:31:45,160 Speaker 1: to withdraw dollars, you could not get it out. They 599 00:31:45,160 --> 00:31:47,560 Speaker 1: would tell you that. They would tell you no because 600 00:31:47,800 --> 00:31:50,680 Speaker 1: they don't have the cash. That's why if you want 601 00:31:50,680 --> 00:31:53,280 Speaker 1: to get twenty dollars today, you pretty much have to 602 00:31:54,040 --> 00:31:55,880 Speaker 1: organize that ahead of time. You have to order that 603 00:31:55,920 --> 00:31:58,200 Speaker 1: ahead of time. They just don't have the cash. Now, 604 00:31:58,240 --> 00:32:00,120 Speaker 1: Like I said, this has happened many times throughout history. 605 00:32:00,160 --> 00:32:02,240 Speaker 1: In recent history, it happened to some banks in the 606 00:32:02,280 --> 00:32:06,480 Speaker 1: early twenties during the pandemic shutdown. Um, it occurs regularly 607 00:32:06,560 --> 00:32:10,240 Speaker 1: around the world. And it's actually, like I said, one 608 00:32:10,280 --> 00:32:12,760 Speaker 1: of the SEC's red flags of a ponzi scheme is 609 00:32:12,880 --> 00:32:20,680 Speaker 1: quote difficulty receiving payments. M that's interesting. So, um, that's 610 00:32:20,680 --> 00:32:24,080 Speaker 1: a red flag. They warned me about that, So that's 611 00:32:24,240 --> 00:32:27,360 Speaker 1: one strike against it. Now. It's kind of like, um, 612 00:32:27,480 --> 00:32:28,880 Speaker 1: probably as a kid, you guys have played the game 613 00:32:28,960 --> 00:32:31,480 Speaker 1: musical chairs. Right, there's like a set of chairs. Someone's 614 00:32:31,480 --> 00:32:34,640 Speaker 1: playing music. Um, there's one less chair than there are 615 00:32:34,680 --> 00:32:37,680 Speaker 1: people than kids, and they walking around around around right 616 00:32:37,680 --> 00:32:40,960 Speaker 1: when the music stops, one per one kid unfortunately doesn't 617 00:32:41,000 --> 00:32:42,880 Speaker 1: doesn't get a chair. Right in the next round, you 618 00:32:43,040 --> 00:32:45,600 Speaker 1: move another chair. Um, and on and on and on. 619 00:32:45,640 --> 00:32:48,800 Speaker 1: Eventually you have just two kids in one seat, and 620 00:32:48,840 --> 00:32:51,360 Speaker 1: then eventually there's a winner. Um. And that's basically what 621 00:32:51,400 --> 00:32:53,360 Speaker 1: the banking system is. It's a it's a permanent round 622 00:32:53,360 --> 00:32:56,120 Speaker 1: of musical chairs. There's more there's more kids than chairs, 623 00:32:56,160 --> 00:32:59,280 Speaker 1: there's more people than money, and they all can't get one. Right. 624 00:32:59,360 --> 00:33:02,480 Speaker 1: If the music ops, then that would become very clear. 625 00:33:03,000 --> 00:33:06,040 Speaker 1: Now what happens to stop the music, Well, that's when 626 00:33:06,080 --> 00:33:11,480 Speaker 1: trust is lost, right. UM. For the United States, banks 627 00:33:11,520 --> 00:33:17,959 Speaker 1: collectively have about plus or minus about of customer deposits 628 00:33:18,000 --> 00:33:22,360 Speaker 1: held as cash reserves, so about two outs. So that's 629 00:33:22,360 --> 00:33:25,360 Speaker 1: like back to the musical chairs, there's ten kids walking 630 00:33:25,400 --> 00:33:28,160 Speaker 1: around the chairs and there's only two chairs. To put 631 00:33:28,200 --> 00:33:31,760 Speaker 1: that into perspective, that's basically what we're working with. UM. 632 00:33:31,800 --> 00:33:34,120 Speaker 1: So that's not very good UM at all. Now this 633 00:33:34,320 --> 00:33:36,560 Speaker 1: this actually used to be much lower. It was about 634 00:33:36,600 --> 00:33:40,160 Speaker 1: five percent back to the global financial crisis. So that 635 00:33:40,200 --> 00:33:45,400 Speaker 1: means out of UM anyway way way more kids, weigh 636 00:33:45,480 --> 00:33:49,000 Speaker 1: less chairs. That's what that means, UM. And so that's 637 00:33:49,000 --> 00:33:51,640 Speaker 1: basically it works. It's a it's a red flag UM. 638 00:33:51,640 --> 00:33:55,280 Speaker 1: At the Ponzi scheme, there's not enough money for the 639 00:33:55,320 --> 00:33:58,480 Speaker 1: people to be able to pull their capital all at once, 640 00:33:58,480 --> 00:34:03,640 Speaker 1: and so people would run into that difficult receiving payments. UM. Now, 641 00:34:04,000 --> 00:34:07,320 Speaker 1: the monetary system also, like I said, functions as like 642 00:34:07,360 --> 00:34:10,880 Speaker 1: this round of musical chairs on on top of artificial 643 00:34:10,960 --> 00:34:15,160 Speaker 1: governed government issued commodities UM, which is those those paper 644 00:34:15,239 --> 00:34:17,640 Speaker 1: moneys right, So there's more claims on the money, there's 645 00:34:17,640 --> 00:34:20,759 Speaker 1: more kids and there's available than there are chairs. Now 646 00:34:20,800 --> 00:34:23,080 Speaker 1: we kind of accept this as normal. Well, actually we 647 00:34:23,080 --> 00:34:29,000 Speaker 1: don't accept it as normal. Most people just have no idea. Um. 648 00:34:29,120 --> 00:34:32,040 Speaker 1: I I've said many times before, Henry Ford famously said, 649 00:34:32,080 --> 00:34:33,920 Speaker 1: over hundred years ago the American people knew how the 650 00:34:33,960 --> 00:34:36,920 Speaker 1: banking system work, there would be a revolution before the morning. 651 00:34:37,520 --> 00:34:39,560 Speaker 1: That's why you don't know. So most people don't know 652 00:34:39,600 --> 00:34:41,719 Speaker 1: you're actually playing a game of musical chairs. But for 653 00:34:41,760 --> 00:34:44,719 Speaker 1: those that do, like myself, we also assume it may 654 00:34:44,800 --> 00:34:48,920 Speaker 1: never end. Right, the fractional reserve banking system, it's functioned, 655 00:34:49,120 --> 00:34:52,040 Speaker 1: you know, for a few hundred years. Um, you know, 656 00:34:52,080 --> 00:34:54,360 Speaker 1: I mean, sure there's been a few you know, problems 657 00:34:54,400 --> 00:34:56,040 Speaker 1: here and there, but you know, for the most part, 658 00:34:56,040 --> 00:34:59,320 Speaker 1: it's not that bad. Um. Although you know, the purchasing 659 00:34:59,360 --> 00:35:03,560 Speaker 1: power of my via currency has lost about of its value. 660 00:35:04,920 --> 00:35:07,279 Speaker 1: I guess that's not really good. Most people don't know 661 00:35:07,360 --> 00:35:10,640 Speaker 1: that as well. They think things are getting more expensive. 662 00:35:10,680 --> 00:35:13,040 Speaker 1: They don't realize that that means that their dollar has 663 00:35:13,120 --> 00:35:17,000 Speaker 1: just lost the value. But what that really means is 664 00:35:17,040 --> 00:35:19,799 Speaker 1: that investors either need to earn a rate of interest 665 00:35:19,880 --> 00:35:23,480 Speaker 1: that exceeds the real inflation rate, which of course isn't happening, 666 00:35:23,800 --> 00:35:26,560 Speaker 1: or they have to buy investments instead, which inflates the 667 00:35:26,640 --> 00:35:29,040 Speaker 1: value of stocks and real estate compared to their cash 668 00:35:29,080 --> 00:35:32,720 Speaker 1: flows and pushes up push up the price of those assets. UM. 669 00:35:33,040 --> 00:35:35,759 Speaker 1: So if the inflation rate, if the government printed thirty 670 00:35:35,800 --> 00:35:38,359 Speaker 1: percent more currency, then you need to make about thirty 671 00:35:38,840 --> 00:35:41,799 Speaker 1: more money, which, as I said, most people are getting 672 00:35:41,840 --> 00:35:44,000 Speaker 1: that pay raise, and so everyone is being forced into 673 00:35:44,160 --> 00:35:50,840 Speaker 1: being an investor. Um. Also there's very high frictional costs. 674 00:35:50,880 --> 00:35:54,200 Speaker 1: So um. Again, another variation of the broader Ponzi scheme 675 00:35:54,239 --> 00:35:58,680 Speaker 1: claim asserts that because bitcoin has frictional costs a Ponzi scheme, um, 676 00:35:58,719 --> 00:36:01,160 Speaker 1: the system requires can don't work to keep it keep 677 00:36:01,160 --> 00:36:03,080 Speaker 1: it functioning, so you have to you know, mine it, 678 00:36:03,120 --> 00:36:05,040 Speaker 1: you have to pay a transaction fee to move it. 679 00:36:05,600 --> 00:36:07,400 Speaker 1: But again bitcoin is no different in this regard to 680 00:36:07,400 --> 00:36:10,360 Speaker 1: any other system of commerce that costs money to move gold, 681 00:36:10,400 --> 00:36:14,719 Speaker 1: for example, Any any healthy transaction has a cost associated 682 00:36:14,719 --> 00:36:18,080 Speaker 1: with it. Right, So bitcoin miners have this customized hardware, 683 00:36:18,080 --> 00:36:21,720 Speaker 1: they pay electricity, they have support personnel, all those things. 684 00:36:22,080 --> 00:36:24,719 Speaker 1: If I was talking about gold, gold miners have the 685 00:36:24,800 --> 00:36:26,600 Speaker 1: same thing. They put a bunch of money into equipment, 686 00:36:26,600 --> 00:36:29,600 Speaker 1: they have personnel, they have exploration, they have to extract 687 00:36:29,600 --> 00:36:31,680 Speaker 1: the gold, they have to process it, all of those things. 688 00:36:31,719 --> 00:36:34,400 Speaker 1: So there's cost. And also the global fiat monetary system 689 00:36:34,440 --> 00:36:37,680 Speaker 1: as frictional costs as well. Um. And so you know, 690 00:36:37,880 --> 00:36:41,840 Speaker 1: banks and fintech firms extracted over a hundred billion dollars 691 00:36:41,880 --> 00:36:45,120 Speaker 1: a year in fees, and that's just what happens. That's 692 00:36:45,160 --> 00:36:49,680 Speaker 1: the way things work. UM. So the gold system, the 693 00:36:49,719 --> 00:36:53,680 Speaker 1: bitcoin system, and the monetary system both require that. And 694 00:36:53,680 --> 00:36:57,240 Speaker 1: then I guess um summary, Um, I was a bitcoin 695 00:36:57,360 --> 00:37:00,239 Speaker 1: is a network effect and not a pon z right, 696 00:37:00,239 --> 00:37:02,600 Speaker 1: So the broadest definition of a ponzi's game refers to 697 00:37:02,640 --> 00:37:04,839 Speaker 1: a system that must continually keep operating to her main 698 00:37:04,880 --> 00:37:08,640 Speaker 1: functional or has frictional costs. Um. Bitcoin doesn't meet this, 699 00:37:09,080 --> 00:37:11,520 Speaker 1: um because you know any more than the than the 700 00:37:11,520 --> 00:37:15,160 Speaker 1: gold market doesn't anyway, but the global fiat banking system does. 701 00:37:15,239 --> 00:37:17,400 Speaker 1: As a matter of fact, we saw President Biden come 702 00:37:17,400 --> 00:37:20,600 Speaker 1: out talking about the last stimulus and they said, um, 703 00:37:20,640 --> 00:37:23,000 Speaker 1: the government has always paid its bills, but we need 704 00:37:23,000 --> 00:37:25,560 Speaker 1: to take new debt in order to pay the old debt. 705 00:37:26,440 --> 00:37:28,400 Speaker 1: He said that I don't have a clip for you. 706 00:37:28,440 --> 00:37:29,960 Speaker 1: I wish I should have pulled that ahead of time, 707 00:37:30,320 --> 00:37:33,160 Speaker 1: but he basically told us up front, we are a ponzi. 708 00:37:33,239 --> 00:37:36,360 Speaker 1: We need new debt to pay our old debt um 709 00:37:36,400 --> 00:37:39,200 Speaker 1: not like bitcoin. Bitcoin doesn't do that, and hopefully that 710 00:37:39,239 --> 00:37:42,000 Speaker 1: makes sense. You're listening to the Mark Mos Show talking 711 00:37:42,040 --> 00:37:43,880 Speaker 1: about bitcoin. Thanks for listening.