Speaker 1: All right, welcome back to another episode of the Markmas
Speaker 1: Show where we talk about the decentralized revolution, talking about
Speaker 1: the way the world is changing as the pendulum swings
Speaker 1: back from a centralized world to a decentralized world. Of course,
Speaker 1: we're talking about bitcoin, which is leading this and we
Speaker 1: look at it through the lens of politics, finance, and technology.
Speaker 1: And I like to bring to you each week, you know,
Speaker 1: some education to help change the way you see this,
Speaker 1: to help you navigate it better, the latest breaking news,
Speaker 1: and I like to bring to you some interesting and
Speaker 1: educated people to help get some different perspectives. You don't
Speaker 1: have to listen to me all the time. And that's
Speaker 1: what we got right now for you today. I got
Speaker 1: a special guest, um I have Adam Oh. You can
Speaker 1: find them on Twitter at Denver Bitcoin. He works with
Speaker 1: a company called Upstream Data Ink, which is a pretty
Speaker 1: cool company because they are um doing something that capitalism does.
Speaker 1: They're taking trash and turning it into treasures. So capitalism does,
Speaker 1: it doesn't waste things. It's always looking for more efficient
Speaker 1: ways to do things and taking unused assets and creating value. Adam, anyway, Adam,
Speaker 1: thanks for joining me today. Hey, thanks for having me markets.
Speaker 1: It's great to be on man. I've listened to a
Speaker 1: lot of your shows, so this is this is fun
Speaker 1: to talk. And I don't think we've actually you and
Speaker 1: i've ever you know, spoken at at any length. So
Speaker 1: so good to get connected. Yeah we haven't, we haven't.
Speaker 1: I know we've traded many many text messages, I'm sorry,
Speaker 1: Twitter messages back and forth together and uh, i've I've
Speaker 1: remember even asking you where you live before, always looking
Speaker 1: forward to a chance where we get together and chat.
Speaker 1: But but anyway, here we are. So UM. You know
Speaker 1: I said it in the beginning. You know, upstream data
Speaker 1: is helping people turn trash into treasure. And what I
Speaker 1: mean by that is that there's a lot of waste
Speaker 1: going on, um. And you figured out a way to
Speaker 1: kind of take this wasted energy, this this flare gas
Speaker 1: and turn it into something of value. UM. And I
Speaker 1: think that's pretty important. Um. A lot of times, you know,
Speaker 1: we're seeing I was talking about on an earlier segment
Speaker 1: about how they say that things are a waste. UM.
Speaker 1: So there a lot of a lot of people talk
Speaker 1: about bit win and say it's a waste of energy.
Speaker 1: And I could say that meditating is a waste of
Speaker 1: your time. However, I choose to use my own assets
Speaker 1: or you know, my own private property, that can't be
Speaker 1: a waste. That's how I want to do it. What
Speaker 1: a waste might be though, is if I made a
Speaker 1: bunch of food and then I had to throw it away,
Speaker 1: I didn't use that food, that might be a waste um.
Speaker 1: And so that's kind of what I see with this
Speaker 1: flare gas. Right. So bitcoin has to use energy that's
Speaker 1: already being wasted. It's not actually wasting it. It's actually
Speaker 1: only using energy that's being wasted. Is that about right
Speaker 1: you think? I'd say, at the end of the day,
Speaker 1: bitcoin miners, those who are participating in right, producing new
Speaker 1: bitcoin um at least for the next hundred fifteen years UM,
Speaker 1: they're most incentivized to use the most economic energy. Right,
Speaker 1: So they're they're constantly going to be seeking out the
Speaker 1: most economic power on the margin. UM. What I mean
Speaker 1: by on the margin is you know, per killed one
Speaker 1: hour to to generate. And what we find when when
Speaker 1: you consider that reality, when you consider the reality that
Speaker 1: we now live in a world where anyone who can
Speaker 1: go and tap into stranded energy, wasted energy, wasted power
Speaker 1: stranded power um. There's a massive opportunity to to benefit economically.
Speaker 1: There's a financial opportunity there because we have this autonomous
Speaker 1: energy consumption market known as the Bitcoin network. Right, it's
Speaker 1: a it's a downstream market. You you you were saying earlier
Speaker 1: in your show, you were talking about you know, one
Speaker 1: of the beautiful aspects of bitcoin is that it's permissionless. Right,
Speaker 1: you can use it without asking permission, and nobody can
Speaker 1: can stop that transaction. Right, it's an immutable transaction. Well,
Speaker 1: it's fun to talk about transferring money and having it
Speaker 1: be immutable. What about selling energy? Because mining is an
Speaker 1: immutable operation. Right, A fifteen year old kid can wake
Speaker 1: up today, he doesn't have to ask anyone's permission, he
Speaker 1: doesn't have to make any phone calls, and he can
Speaker 1: go sell a billion dollars of energy without talking to anybody.
Speaker 1: So long as he has the infrastructure in the access
Speaker 1: to the kill a lot hours to do it, you
Speaker 1: can sell a billion dollars worth of energy. What do
Speaker 1: you mean by that? What I mean is if the
Speaker 1: Big Point network itself, the process of mining bitcoin is
Speaker 1: merely just an autonomous electricity market, right, it's me effectively
Speaker 1: what you're doing is you're selling electricity, and what you're
Speaker 1: getting in return is bitcoin. Now to be more specific,
Speaker 1: you're selling computational hash computational work, right the changing of
Speaker 1: ones and zeros um. But you need electricity in order
Speaker 1: to generate computational work. You cannot you know, you can't
Speaker 1: generate computational work without input. And so um, ultimately, what
Speaker 1: we have is depending upon the efficiency of the chip,
Speaker 1: which at this point we're entering into the period of
Speaker 1: commoditization on the hardware, which you know it won't get
Speaker 1: much much different than it is now. Um, what we
Speaker 1: see is there's a standard electricity calculation where any minor
Speaker 1: today we'll we'll talk kill lot our prices with you
Speaker 1: where they say, yeah, you know my cost is five
Speaker 1: cents per kill a lot hour. If you're mining with
Speaker 1: an ant minor S nineteen pro right now, each machine
Speaker 1: is making seventeen cents per kill a lot hour, right,
Speaker 1: so you've got a nice twelve cent margin there. Um,
Speaker 1: if you were mining last year like a out of
Speaker 1: us work, it got above you know, thirty forty cents
Speaker 1: per kill a lot hour. And so ultimately this is
Speaker 1: a downstream energy consumption market and in oil and gas.
Speaker 1: You know, what we do it upstream data, and what
Speaker 1: what we've done since is we help oil and gas
Speaker 1: producers get their hydrocarbons downstream economically on the margin. And
Speaker 1: Bitcoin is an amazing tool to do that because anywhere
Speaker 1: you have electricity, you have the potential to to sell
Speaker 1: that electricity to market anywhere you're generating it. And in
Speaker 1: the oil field, people generate. You know, oil and gas
Speaker 1: producers have been generating power on site, you know, forever right,
Speaker 1: they generate power on site to to run their own equipment,
Speaker 1: to run their pumps, and so that's not foreign to them.
Speaker 1: Now all they need to do is plug in some computers,
Speaker 1: take some capital risk, understand that capital risk, but what
Speaker 1: end all of a sudden, they are now effectively selling
Speaker 1: gas downstream to market. So you know, it's really just
Speaker 1: that that as much as it's immutable to transact, it's
Speaker 1: an immutable it's a truly free energy market. For the
Speaker 1: first time in the world, we have an energy market
Speaker 1: that is not puppeted states or anything. Now kind of
Speaker 1: getting where you're going with that, because in order to
Speaker 1: sell your energy to the market, it's not necessarily free market.
Speaker 1: So it's all types of bus and hoops that you
Speaker 1: would have to jump into to even get that. So
Speaker 1: a lot of it's stranded, whether it's too far to
Speaker 1: even get it into a pipeline or whatever. And even
Speaker 1: if I could, then there's all types of regulations I
Speaker 1: have to go through to even sell it to the market,
Speaker 1: Whereas I could just drill it on my own land,
Speaker 1: hook up a hook up, a couple of rigs, a
Speaker 1: couple of bitcoin minor rigs, and I could just sell
Speaker 1: that energy to market right there, I guess, is that
Speaker 1: kind of what you're saying. Think about it as exporting.
Speaker 1: You're exporting your energy to the bitcoin network, and you
Speaker 1: don't You don't need a license, I mean as far
Speaker 1: as right now, right the government is required, but even
Speaker 1: if they required it, you wouldn't need it to actually
Speaker 1: do this, right like, you would be successful in your
Speaker 1: attempt of selling your energy. But it's it's a means
Speaker 1: by which to export because the biggest thing is a
Speaker 1: buyer mark. I mean, think about it. You can't sell
Speaker 1: energy today without somebody buying it unless you're mining bitcoin. Right.
Speaker 1: It was pre programmed thirteen years ago to buy your
Speaker 1: electricity today. And that's a that's an amazing thing, right,
Speaker 1: That's something those in the energy industry couldn't have even
Speaker 1: have dreamed of. If somebody would have hypothetically discussed something
Speaker 1: like this, they would have been laughed out of the room.
Speaker 1: And so the reality is kind of stranger than fiction.
Speaker 1: And where I mean, it's a it's an interesting way
Speaker 1: to look at it. You kind of flip it upside down.
Speaker 1: Where I see that as as having a massive impact
Speaker 1: is going to you know, third world countries where they
Speaker 1: need more energy. I just recently did an interview with
Speaker 1: Alex Epstein talking about the fossil Future, and it's talking
Speaker 1: about how the world needs more energy right um and
Speaker 1: specifically in these terrible countries. But a lot of times
Speaker 1: they can't go build the energy there because there's not
Speaker 1: enough people they're willing to pay for it, so they
Speaker 1: have no one to buy it to the point that
Speaker 1: you're making. And so now they can set up and
Speaker 1: they have built in buyers and it can help offset
Speaker 1: the help scale that well, it's it's the chicken and
Speaker 1: the egg problem right where some of these communities, I mean,
Speaker 1: Nigeria is a great, a great example where Nigeria is
Speaker 1: so rich in energy it has. I mean that the
Speaker 1: country effectively runs on diesel where they have diesel generators everywhere.
Speaker 1: They're just businesses run with the diesel generator in the back.
Speaker 1: They have very poor grid infrastructure. But but you're right,
Speaker 1: I mean, if I go in, you know, even if
Speaker 1: I'm like humanitarian and I go spend fifty million dollars
Speaker 1: to build power generation in in a third world country,
Speaker 1: a place without infrastructure, even if I'm successful in building
Speaker 1: it and everything's great, I don't have a I don't
Speaker 1: have a buyer, right, um, And so the investment is moot.
Speaker 1: And what you end up having is you end up
Speaker 1: having these these charitable organizations like the Gates Foundation or
Speaker 1: something will come on and and they'll go and they'll
Speaker 1: they'll do a project like this where you know, maybe
Speaker 1: they'll do solar and they'll start trying to provide electricity
Speaker 1: at a loss. But the problem is now you're you're
Speaker 1: subject to that entity, right, Like that entity if they
Speaker 1: go away, nobody else is going to come replace that entity.
Speaker 1: It's truly charitable. With bitcoin mining, there's a market there,
Speaker 1: so you can set up infrastructure, you can mine as
Speaker 1: you scale and as you build out infrastructure for there
Speaker 1: to become a demand market, right, So it's that it
Speaker 1: solves that really, you know, kind of infinitely long problem.
Speaker 1: It's such a it's such a big topic, and you know,
Speaker 1: you know, you and I we spent a lot time
Speaker 1: thinking about this, but most people have just never really
Speaker 1: thought through this and and what the implications of that means,
Speaker 1: and they grab onto a headline and they don't even
Speaker 1: put any time into it to like think about it.
Speaker 1: But when you start unpacking it, Um, it's not a
Speaker 1: drag on the worlder on society. It's actually probably the
Speaker 1: biggest gift that it's been given. So I want to
Speaker 1: dig into that a little bit more when we come back.
Speaker 1: You're listening to the Mark Moss Show. UM sitting down
Speaker 1: with Adam at Denver Bitcoin on Twitter talking about bitcoin
Speaker 1: and the decentralized revolution. I'll be back with him and
Speaker 1: more in a minute, So don't go away. I'm gonna
Speaker 1: be right back, all right, Welcome back. You are listening
Speaker 1: to the Mark mo Show talking about bitcoin. We're talking
Speaker 1: about the decentralized revolution the world is going through right now.
Speaker 1: I'm joining the studio by Adam Oh. You can find
Speaker 1: them on Twitter at Denver bitcoin, and we're talking specifically
Speaker 1: about well energy, that's why it's a big topic. We're
Speaker 1: talking about bitcoin mining. And before the break, we were
Speaker 1: talking about how UM bitcoin is unique because it's it's
Speaker 1: it's permissionless, it requires no permission to join the network
Speaker 1: or take advantage of it. And so he had brought
Speaker 1: up an interesting point where UM now it enables an
Speaker 1: energy producer, someone who had oil or natural gas, to
Speaker 1: sell that without needing permission, no permits or anything like that.
Speaker 1: But also you have a built in buyer. You don't
Speaker 1: have to go find a buyer. And the reason why
Speaker 1: that's important, if we kind of chase that down, is
Speaker 1: that we were making the case that the world needs
Speaker 1: more energy. Alex Epstein was talking about in his book
Speaker 1: that you have these third world countries who have have
Speaker 1: have have all this unnecessary death because a mother can't
Speaker 1: even go to the hospital and have a sonogram because
Speaker 1: they don't have electricity to power the machine, or a
Speaker 1: baby is born maybe prematurely and there's no incubator to
Speaker 1: put that baby into because there's no electricity, and so
Speaker 1: UM while many people are talking against energy today saying
Speaker 1: that if we don't find a way to curb electricity,
Speaker 1: that the world is going to go into this apocalyptic future,
Speaker 1: and uh, for a lot of people, for actually about
Speaker 1: three billion people in the world today, we're already living
Speaker 1: in that apocalyptic future. And we could solve that. But
Speaker 1: the problem is how do you pay as you as
Speaker 1: you made the case then, Adam, even if you're philanthropic
Speaker 1: like Bill Gates, how do you go in and put
Speaker 1: that energy there if there's no one there to buy it?
Speaker 1: And so bitcoin could allow you to have an instant
Speaker 1: buyer to offset that, and then people could start tapping
Speaker 1: into it, and then eventually as enough people use that energy,
Speaker 1: you could then remove the bitcoin piece that was kind
Speaker 1: of helped subsidizing it, and then they could have this
Speaker 1: energy and then you could have a whole community they're
Speaker 1: using it, and then bitcoin can move on to the
Speaker 1: next place. Is that kind of how you're seeing it, Yeah,
Speaker 1: I mean it's it's kind of the inverse of what
Speaker 1: we're seeing in Texas right now. Right in Texas we
Speaker 1: see an over abundance of supply of energy. Right there's
Speaker 1: a lot of flaring going on. I think it's about
Speaker 1: of the flaring in the United States is out of Texas. Um.
Speaker 1: Keep in mind that's a billion cubic feet a day okay,
Speaker 1: over a billion cubic feet a day UM of methane
Speaker 1: gas and so, and that's just in the oil field.
Speaker 1: And so because those that don't know when you're you're
Speaker 1: talking for those who don't know you're talking about when
Speaker 1: you when you're getting oil out of the ground, natural
Speaker 1: gas as also comes out of the ground, and because
Speaker 1: of where it's located, for whatever reason, they aren't able
Speaker 1: to capture that natural gas and get it to market.
Speaker 1: So instead they just either vent it, let it go
Speaker 1: into the or they burn it and they burn it
Speaker 1: into the air, right, yeah, yeah, they flare it, they
Speaker 1: burn it, um. And it's typically like you said, it's
Speaker 1: I mean, there's there's not very many oil wells in
Speaker 1: the world that don't have associated natural gas at least
Speaker 1: enough that you know, it's it's measurable and it's something
Speaker 1: that would be flared. So pretty much every oil well
Speaker 1: um has some associated natural gas. And so because of that,
Speaker 1: like you said that, the economics are such that you know,
Speaker 1: you're not gonna build up You're not gonna spend millions
Speaker 1: of dollars to build a pipeline that's gonna make you
Speaker 1: a dollar a day and gas sales right just you're
Speaker 1: gonna flare the gas. And so in Texas we see that,
Speaker 1: we see ton of that, and we see an over
Speaker 1: abundance of energy supply, and so bitcoin miners are coming
Speaker 1: in and they're they're trying to help provide what they
Speaker 1: call load curtailment right where grid providers these very big
Speaker 1: power generators. It's it's very costly and the economies of
Speaker 1: scale or are brutal when it comes to um generating power. Right,
Speaker 1: some of these turbine engines, for example, natural gas turbine engines,
Speaker 1: they take like a day and a half to turn off,
Speaker 1: like to stop, you flip the switch and turn the
Speaker 1: engine off. It's still spinning for you know, thirty or
Speaker 1: four hours. And so you know, these are serious pieces
Speaker 1: of equipment, and the problem is you can't be very
Speaker 1: responsive because you know, it's like you're just gonna shut
Speaker 1: down a turbine when all of a sudden, nobody, you know,
Speaker 1: everybody turns off their heat or everybody turns off their
Speaker 1: air conditioning. And so what they're doing in Texas as
Speaker 1: miners are coming in and any time that the grid
Speaker 1: isn't demanding power that's being generated there mining. They're pushing
Speaker 1: that electricity over to bitcoin miners, and then any time
Speaker 1: those on the grid start demanding, they shut off bitcoin
Speaker 1: miners and they they you know, throw the electricity back.
Speaker 1: Kind of the The inverse would be what you just
Speaker 1: said in the third world country where you come and
Speaker 1: initially you'd only generate enough electricity to power exactly as
Speaker 1: many miners as you have as you build out infrastructure,
Speaker 1: and and again this would be a decade long process
Speaker 1: where then maybe slowly, you know, you you go find
Speaker 1: somebody who wants to manufacture, you know, something like aluminum
Speaker 1: or some energy intensive process, maybe even another data center
Speaker 1: of some sorts. You find a customer for that electricity
Speaker 1: which before you didn't have, and then from that customer
Speaker 1: you can say, hey, look, I can I can either
Speaker 1: increase my energy production or I can take half of
Speaker 1: my miners and turn them off and I'll push the
Speaker 1: other power to you. And then now you prove this concept,
Speaker 1: and then you go raise money and you build up
Speaker 1: more infrastructure and the next thing you know, you know,
Speaker 1: fifteen years later, people are lifted out of poverty and
Speaker 1: energy I mean, I I totally agree with that, Alex Epstein.
Speaker 1: Energy is the solution to human suffering, at least the
Speaker 1: majority of it. UH energy consumption directly correlates and corresponds
Speaker 1: to quality of life, length of life, birthrates. And what
Speaker 1: we're seeing today is that they're, like you said, market,
Speaker 1: there's unnecessary death. UM it's and a lot of that
Speaker 1: death is truly tragic, right it's. It's upper acute respiratory
Speaker 1: illnesses that are caused because people are burning dirty wood
Speaker 1: to cook their food in a poorly ventilated environment, and
Speaker 1: they get a sickness and they die. Whereas if they
Speaker 1: had a gast over heck, even if they had a
Speaker 1: bag of coal, like they would be fine, right, we would,
Speaker 1: we would say, dozens of millions of people. UM energy
Speaker 1: is the solution to a lot of human suffering. Bitcoin
Speaker 1: being a autonomous demand market, right, an autonomous energy assumption market.
Speaker 1: And what I mean by autonomous is is it it
Speaker 1: takes care of itself, like there is there's no helpline,
Speaker 1: there's no UM managerial staff. You know, sometimes like it
Speaker 1: happened when China banned bitcoin mining, like all of a sudden,
Speaker 1: the competition on the network can either go up an
Speaker 1: incredible percentage or get chopped in half. And you know,
Speaker 1: if that was any other market, when that happened and
Speaker 1: the hash rate got cut more than in half, um
Speaker 1: any other market, the markets ares or the regulators or
Speaker 1: the politicians would have stepped in and controlled it. Right.
Speaker 1: We've seen it Amazon, like half half of the Amazon
Speaker 1: web services A data centers got shut down or something
Speaker 1: right exactly right, like they freeze the stock market like
Speaker 1: they wouldn't you couldn't trade. But if you're a bitcoin miner,
Speaker 1: when that happened, to all of a sudden boom, you
Speaker 1: were more you were earning double the amount of bitcoin
Speaker 1: that you were a week ago. And it's it's a lander.
Speaker 1: It's an absolute you know, foot race to who can
Speaker 1: get that hash rate back up online until we meet
Speaker 1: that moment of equilibrium where to generate power now is
Speaker 1: is you know bitcoin mining Bitcoin is not economic enough,
Speaker 1: you know, to go generate new power for it until
Speaker 1: the price goes up and then all of a sudden,
Speaker 1: you know, it demands more power. So to that point,
Speaker 1: what I would say is the numbers are really uh
Speaker 1: massive where bitcoin it justifies a multimillion dollar bitcoin price.
Speaker 1: If we want to see even up of of the
Speaker 1: global flare gas be used to mind bitcoin, We're gonna
Speaker 1: need to see a multimillion dollar bitcoin price otherwise the
Speaker 1: economics won't make sense for that next person to come
Speaker 1: in and mind that's how much energy is wasted every day.
Speaker 1: Of course, who knows how much flare gas will hap
Speaker 1: and for how long at the rate. And we're going
Speaker 1: with these policies that we have trying to you know,
Speaker 1: no new investments going into the oil fields. And then
Speaker 1: and and that there's a different conversation. But I was
Speaker 1: thinking about also something you were saying. How about a
Speaker 1: year ago, I'm sure you probably remember Kevin O'Leary, Mr
Speaker 1: Wonderful from the Shark Tank. He came into bitcoin and
Speaker 1: he said Bitcoin is great, but I'm here to fix it,
Speaker 1: like every other rich person that comes in like it's great,
Speaker 1: but I'm here to fix it. And he started this
Speaker 1: whole conversation that through the kind of the whole industry
Speaker 1: into a tailspin. And he said, um, you know, I
Speaker 1: like bitcoin. It's good, but I need to fix it
Speaker 1: because it's all you know, it's bad for the environment,
Speaker 1: and we're going to figure out a way where we
Speaker 1: can mine it. And tag it as it's it's come
Speaker 1: from clean energy. That's what we're gonna do. And then
Speaker 1: then I seem like Elon Musk got involved, and then
Speaker 1: Michael Sailor got involved in his mining cancel and the
Speaker 1: whole thing went to his tail spin. Well, this year
Speaker 1: at the Bitcoin conference, I got to work the news
Speaker 1: desk with Mr. Wonderfully, I sat next to him for
Speaker 1: a while and I gotta have a conversation with him,
Speaker 1: and he went from last year it's great, I need
Speaker 1: to fix it, we need to change mining. And he
Speaker 1: told me this year when I was sitting on the
Speaker 1: desk with him, that he's completely changed his mind. I
Speaker 1: asked him why, and he said really, He said, bitcoin
Speaker 1: is gonna save the environment. What It's gonna save the
Speaker 1: environment because it's as pioneering all these other forms of energy,
Speaker 1: small nuclear au thorium reactors, like other types of energy.
Speaker 1: I want to I'll tell you more about that in
Speaker 1: a minute. You're listening to the Market Mo show. We're
Speaker 1: talking about bitcoin. We're talking about the decentralized revolution. We're
Speaker 1: talking about capitalism turning trash into treasure and how uh
Speaker 1: we can save the energy markets with bitcoin. I'm talking
Speaker 1: with Adamo from Denver Bitcoin. We will be back with
Speaker 1: that in more in a minute, so do not go
Speaker 1: away right back, all right, welcome back. You are listening
Speaker 1: to the Mark Mo Show. We're talking about bitcoin, we're
Speaker 1: talking about the decentralized revolution. I am joined in the
Speaker 1: studio with Adam Oh. You can find them on Twitter
Speaker 1: at Denver Bitcoin, and we're talking about bitcoin. We're talking
Speaker 1: about energy. And before we went to the break, I
Speaker 1: was specifically talking about how I sat on the news
Speaker 1: desk with Mr Wonderful Kevin O. Leary and he went
Speaker 1: from a year ago saying Bitcoin, I need to fix
Speaker 1: it because I can't have any bitcoin it's been if
Speaker 1: it's been mined on this dirty energy, to now saying
Speaker 1: that bitcoin is actually gonna save the environment. I mean,
Speaker 1: a crazy one eighty And I asked him and he said, well,
Speaker 1: because it's going to pine it's it's it's it's helping
Speaker 1: to establish renewables. UM. It's helping to pioneer new forms
Speaker 1: of energy that we might not have before. UM so
Speaker 1: maybe small nuclear reactors, things like that, and it's finding
Speaker 1: much more efficient ways to produce energy. I thought that
Speaker 1: was a pretty amazing about face you're shocked to hear that.
Speaker 1: I'm I'm very shocked to hear that. I was. I
Speaker 1: was ready to jump in, um I. It took everything
Speaker 1: to not interrupt you the that's great news, right, Like,
Speaker 1: that's that's part of the evolution, and that's what I
Speaker 1: want for the world. And I think it's one of
Speaker 1: the reasons that I've you know, Alex Epstein, I'm I'm
Speaker 1: a big fan of his. I think he he's really
Speaker 1: been out there taking it in the teeth and fighting
Speaker 1: the good fight um on on this energy topic, and
Speaker 1: certainly when it comes to fossil fuels, hydrocarbons. But that's
Speaker 1: great to hear because what that means is Bitcoin was
Speaker 1: the rabbit hole that taught I mean, Kevin Leary, what
Speaker 1: he's a you know, everything about his any introduction he
Speaker 1: ever gets is about his experience, his wisdom, his investment.
Speaker 1: I mean, he's seen a thousand, a million pitches um
Speaker 1: for businesses and ideas, and yet obviously he still didn't
Speaker 1: really understand how energy and electricity worked until Bitcoin forced
Speaker 1: him to. And you know, at upstream data, that's that's
Speaker 1: kind of the cascade. But we've seen too, you know,
Speaker 1: I was a customer of Upstream Data. My dad and
Speaker 1: I invested a small amount of money, and I mean
Speaker 1: for the amount of money we invested, it's I mean,
Speaker 1: it's it's a joke, less than six figures UM. And
Speaker 1: we've we've mitigated over twenty million cubic feet of c
Speaker 1: H four emissions, right, methane emissions which are eight five
Speaker 1: times more impactful heavier as a gas than carbon dioxide.
Speaker 1: And it's methane, right, it stinks, it's it's much more
Speaker 1: of a waste, in my opinion. So what happens with
Speaker 1: that methane? Right? So instead of it being invented or
Speaker 1: flared into the system ecosystem um, you're now putting in it.
Speaker 1: The natural gas now goes into a turbine or some
Speaker 1: sort of a generator which then turns it into electricity
Speaker 1: for the power of the miners. But what happens to
Speaker 1: the methane It just doesn't ever methanast or does it
Speaker 1: go to the generator of the turbine and then get released. No, No,
Speaker 1: So that's the methane is the energy dense molecule. The
Speaker 1: SIEGE four is the energy dense molecule that you're you're
Speaker 1: using to to run the turbine. So yeah, instead of
Speaker 1: going to the flare where the reason they flare it
Speaker 1: is because when you can bust c H four, the
Speaker 1: resulting product the CO two and H two. It's carbon
Speaker 1: dioxide and water. It's the same thing that's probably sitting
Speaker 1: on my microphone right now, right, UM. And so that
Speaker 1: what I would call that is is pretty darn clean
Speaker 1: exhaust right, cleaner than gasoline engine. Um. And so you
Speaker 1: run into an internal combustion engine, what you find is,
Speaker 1: you know, if you're burning it through an engine, there's
Speaker 1: a ninety nine efficiency of burn, whereas if you're flaring,
Speaker 1: it depends on the environment. Right North Dakota, it can
Speaker 1: get up to fifty winds. You might only find that
Speaker 1: that that flare is seventy effective. And so a lot
Speaker 1: of that methane is just spewing into the environment, you know,
Speaker 1: getting released into the air. Now, in Canada, there's a
Speaker 1: lot of they still allow venting. So there's a lot
Speaker 1: of oil and gas producers that are truly they're not
Speaker 1: even they're not even burning it, they're just letting it
Speaker 1: spew into the air. And there are allowed fifty cubic
Speaker 1: feet per day UM and so coming in and internally
Speaker 1: combusting that there's no doubt. I mean, any any scientists,
Speaker 1: andy geologists would tell you that this is you know,
Speaker 1: any chemist would tell you this is better for air quality. Um.
Speaker 1: Not to mention the you know, the economic waste of
Speaker 1: natural gas Siege four. It's a very clean fuel and
Speaker 1: it's incredibly energy dance. You know, these small little fifty
Speaker 1: cubic feet of gas can power a kill a lot
Speaker 1: engine continuously, which is a lot of miners, right, And
Speaker 1: so I think I think his coming around is everything,
Speaker 1: um right. I mean, every time we deploy another bitcoin mine,
Speaker 1: another person is getting educated on maybe they're going you know,
Speaker 1: maybe it's an oiling gas producer who's spout on energy
Speaker 1: and well grounded, but he's going to go down a
Speaker 1: financial economic rabbit hole because now he has to go
Speaker 1: challenge whether or not this bitcoin thing is is Mario coin,
Speaker 1: magic internet money or or something real. And so you know,
Speaker 1: the more we can deploy, the better. Something else I've
Speaker 1: been looking at was interesting, is like this contrast or
Speaker 1: really it's it's just competition playing out in real time,
Speaker 1: which is what we should have. And so the United
Speaker 1: States being a republic, we should have fifty independent states
Speaker 1: that then can compete against each other and we can
Speaker 1: try different ideas. And so we're seeing like New York
Speaker 1: just putting the ban on bitcoin mining. Then we're seeing
Speaker 1: like Texas opening up to bitcoin mining, even in Fort
Speaker 1: Worth mining bitcoin in city hall. I love to see
Speaker 1: that competition aspect, you know, I look at it from
Speaker 1: a bitcoin perspective, but also I mean, it's just an
Speaker 1: attack on h it's an attack on energy, but it's
Speaker 1: also an attack just on freedom, right. I mean, as
Speaker 1: Americans like, uh, we should be free. It's landed the
Speaker 1: free right. And so like, what is what is New
Speaker 1: York City doing by banning bitcoin mining? They're really telling
Speaker 1: you what you can and can't do with your own computer,
Speaker 1: and they're telling you what you can and can't do
Speaker 1: with your energy that you buy. Right, if you want
Speaker 1: to dig into it, it's gonna be it's gonna be
Speaker 1: an absolute uh migration, right, I mean, folks like myself.
Speaker 1: Denver's Colorado is one where I'm I'm concerned because they
Speaker 1: were one of the first states to ban uh some
Speaker 1: of these really high end gaming computers. And I saw that, Yeah,
Speaker 1: you couldn't even order these computers. Which they weren't even
Speaker 1: a six. I mean they a sis make these things
Speaker 1: look like like a battery here like nothing. Um And
Speaker 1: so I imagine that I'm not you know, we could
Speaker 1: be we could be close to following suit over here
Speaker 1: or having some you know, similar legislation. So I think
Speaker 1: it's a terrible thing. Um. I think it's a terrible
Speaker 1: thing for individual freedom. And what you'll find is the
Speaker 1: in my opinion, the power markets in those locations New
Speaker 1: York City, it's going to become a nightmare because here's
Speaker 1: the thing. While bitcoin mining, like Kevin O'Leary said, right,
Speaker 1: it incentivizes us to go out and try to try
Speaker 1: to come up with a new way to generate electricity
Speaker 1: because if it's if it's cheap, right, if it's if
Speaker 1: it's something like a hydro electric facility where you know
Speaker 1: the water gravity just pulls the water, right, or solar
Speaker 1: where you know there's there's energy coming there's input energy
Speaker 1: that doesn't take any human capital or human requirement. Um. Absolutely,
Speaker 1: it's going to be investigated because now there's an immediate
Speaker 1: economic benefit. But we forget about all the pre existing infrastructure. Right,
Speaker 1: every single energy producer upstream is going to be a
Speaker 1: more efficient energy producer. They're gonna be better at getting
Speaker 1: their energy downstream um for profit on on the margin.
Speaker 1: This this lifts up all boats, right, This tide lifts
Speaker 1: all boats with its with its use case. Right. Ultimately,
Speaker 1: bitcoin benefits oil and gas just as much as it
Speaker 1: benefits a wind turbine. Now that been said, a wind
Speaker 1: turbine is a lot less efficient, right, you know, the
Speaker 1: winds blowing with no one's demanding, and so there's these
Speaker 1: these peaks and troughs. Bitcoin is great for that, but
Speaker 1: it also makes an oil and gas producer, you know,
Speaker 1: be able to go drill wells where it maybe didn't
Speaker 1: make sense to drill wells because there's not that much
Speaker 1: oil and there's nowhere to sell the gas. But now
Speaker 1: we have somewhere to sell the gas. And the oil
Speaker 1: is kind of the byproducts, right, where the gas is
Speaker 1: the main commodity, even though it seems to be the
Speaker 1: most of history, it was the the association, it was
Speaker 1: the waste product. And now, hey, I don't care if
Speaker 1: there's only a couple of barrels of oil in there.
Speaker 1: I want a day of gas because then I can
Speaker 1: power this many miners, and you know, we have passive income.
Speaker 1: So it's I think countries like Canada's one where orlan
Speaker 1: gas producers. The more and more they get squeezed, the
Speaker 1: more and more they begin to to get you know, kicked,
Speaker 1: kicked by regulators and and put down by at least
Speaker 1: a federal kind of bureaucracy. Um. I think they'll be
Speaker 1: in center is to export their their hydrocarbons to bitcoin countries, right.
Speaker 1: I mean, the US is putting sanctions on Iran, sanctions
Speaker 1: on Venezuela, the very energy rich nations, the United States
Speaker 1: can't stop them from mining bitcoin. And now they know that,
Speaker 1: and so they can take their energy, turn it into
Speaker 1: bitcoin and then go trade with their allies and bitcoin
Speaker 1: and settle global trade in bitcoin. They never entered the
Speaker 1: US dollar. They literally just completely circumvented sanctions and so
Speaker 1: you know, all the way down from the individual to
Speaker 1: the nation state. This is going to disrupt energy probably
Speaker 1: more than finance. Yeah, yeah, And I mean Tiger disrupted finance.
Speaker 1: I mean New York. New York is actively trying to
Speaker 1: get rid of their title as the finance capital of
Speaker 1: the world. Wall Street has of course been the finance
Speaker 1: capital of the world, but through the pandemic, both through
Speaker 1: being so strict on their regulations in lockdowns and through
Speaker 1: the crazy high taxes. People decided they had enough and
Speaker 1: they've been leaving. And so New York has been losing everybody.
Speaker 1: Wall Street specifically has been losing to Florida specifically like Jacksonville, Florida.
Speaker 1: And now we have a new financial system being built
Speaker 1: and they're specifically righting themselves out of that as well.
Speaker 1: And so we'll see Darwinism and competition play play out. UM.
Speaker 1: I have some other questions I want to get into
Speaker 1: about some of the economics, UM, before we do. We're
Speaker 1: listening to the Mark Moa Show. UM sitting down with
Speaker 1: Adam Oh. You can find them on Twitter at Denver Bitcoin.
Speaker 1: We're talking about energy. We're talking about natural gas, talking
Speaker 1: about what we're talking about bitcoin mining, different ways we
Speaker 1: can use it, in ways we can power new technologies.
Speaker 1: I got a lot more to come back in a
Speaker 1: minute when I come back, So uh, don't go away,
Speaker 1: We'll be right back, all right, Welcome back. You're listening
Speaker 1: to the Mark Moa Show talking about the decentralized Revolution.
Speaker 1: Of course we're talking about bitcoin. I'm joining the studio
Speaker 1: with Adamo. You can find them on Twitter at Denver Bitcoin.
Speaker 1: He works for a company called Upstream Data, Inc. Which
Speaker 1: helps people turn trash into treasure, taking vented or flared
Speaker 1: asked that could be potentially bad for the ecosystem and
Speaker 1: turning it into economic energy or bitcoin. Now I'm curious, Adam, because, uh,
Speaker 1: you know what we've we've been talking about where you
Speaker 1: have these uh you know, drilling for oil wells coming
Speaker 1: out of the ground. Natural gas comes out of the
Speaker 1: ground as a byproduct. Um For years and even still now,
Speaker 1: no one's been capturing that natural gas because it wasn't
Speaker 1: worth enough. When I really first started learning about this,
Speaker 1: it was like two dollars, you know, was it two
Speaker 1: dollars a gallon or whatever? Umm? Mcf right? Um, Now
Speaker 1: it's up to what is eight nine per mcf or whatever.
Speaker 1: It's pretty historic, actually, yeah, eight dollars and mcf is crazy. Yeah,
Speaker 1: So it's like crazy, which then of course changes the
Speaker 1: incentives around it, which is like, shoot, we shouldn't be
Speaker 1: flarings anymore. We should probably do something with it now.
Speaker 1: But one of there's other issues involved, so it's strand
Speaker 1: it could be way out in the middle of nowhere.
Speaker 1: Where I don't have pipelines, there's no way, really way
Speaker 1: to get it there. It could cost me millions and
Speaker 1: millions of dollars to get pipelines out there. Whatever. But
Speaker 1: what I'm curious about is two things. So one, Um,
Speaker 1: if we're at eight or nine dollars mcf right now,
Speaker 1: which is to your point, historic, but that's actually cheap globally,
Speaker 1: right we're about what globally or something like that, I'm
Speaker 1: not exactly sure where we're at today. Well, yeah, I
Speaker 1: think Europe because of the whole Russia Ukraine. I mean,
Speaker 1: Russia's pretty much had a monopoly on Germany's gas, and so, um,
Speaker 1: I think it's probably double if not. Yeah, the US
Speaker 1: has been somewhat insulated from global pricing because we haven't
Speaker 1: really been exporting that much. But it looks like there's
Speaker 1: quite a few LG facilities getting put together right now,
Speaker 1: which we could see within the year start becoming a
Speaker 1: major exporter, which then could put us into the global
Speaker 1: price of l G or or or natural gas. So
Speaker 1: I guess what I'm curious about is if I could
Speaker 1: sell it right now for eight or nine dollars mcf,
Speaker 1: maybe I might be able to sell it for within
Speaker 1: the year. Um, if I decide that I don't want
Speaker 1: to sell it and I want to just put a
Speaker 1: start start mining bitcoin with it, do you know how
Speaker 1: much I'm earning per mcf that way? Of course? Yeah, No,
Speaker 1: it depends on what a six year deploying because there's
Speaker 1: because the efficiency of the ASIC will determine how many
Speaker 1: how much computational work per unit of gas or per
Speaker 1: unit of electricity. And so right now, what I can
Speaker 1: tell you is using the latest and greatest models, you're
Speaker 1: about thirteen to fifteen dollars in mcf right now. Um,
Speaker 1: last year we we saw over thirty five dollars in
Speaker 1: mcf UM. We had guys in the oil field back
Speaker 1: in seen that you know, they were initially earning ten
Speaker 1: dollars in m cf This was back using older generation
Speaker 1: a success nines. But then December came around and when
Speaker 1: bitcoin ran up to twenty thousand, right, they made like
Speaker 1: they were making like eight dollars in mcf um. And
Speaker 1: so at the end of the day last year there
Speaker 1: was a big run from the oil field. Right. Oil
Speaker 1: and gas woke up to bitcoin mining in a in
Speaker 1: a massive way. Right, tons of new container bitcoin mining
Speaker 1: kind of companies. All, a lot of oil and gas
Speaker 1: producers are getting funding and things. And what we what
Speaker 1: I think we found was that some certainly some over capitalized,
Speaker 1: um because they were like I said, they were makes
Speaker 1: in mcf and and gas was a lot lower. Right,
Speaker 1: Gas was like to fifty or three dollars in mcf,
Speaker 1: and so when you're ten xing on the margin, um, wow,
Speaker 1: like that's that's huge. And so the upfront capital was
Speaker 1: was definitely reasonable, certainly comparable if not better than a pipeline. UM.
Speaker 1: So the investment came in big. Now, what we're seeing,
Speaker 1: like you said, a tightening where maybe that arbitrage is
Speaker 1: only five dollars in mcf, right, which it's still significant,
Speaker 1: and certainly when you're talking about millions of cubic feet
Speaker 1: of gas, But it's all about I guess that relative investment,
Speaker 1: pragmatism or practicality, right. I think what we're finding today
Speaker 1: is certainly there are a lot more oil and gas
Speaker 1: producers that are willing to invest in a pipeline right now,
Speaker 1: because holy cow, you know, gases on one heck of
Speaker 1: a bull run energy is and it doesn't look like
Speaker 1: it's slowing up anytime soon. Um. But in the meantime,
Speaker 1: some of them are even looking at mining until that
Speaker 1: pipeline gets complete. Right, so they're like, hey, we can
Speaker 1: we can do this on the interim, and then once
Speaker 1: this pipeline is here complete, we'll move this bitcoin mine
Speaker 1: to this well and we'll do the same thing. Um.
Speaker 1: And so I think that's one end of the day.
Speaker 1: I think that's one big reoccurring theme is that is
Speaker 1: the portability of the of the demand, well, the portability
Speaker 1: and the scale, like the how fine you can get
Speaker 1: the scale right, we build it, you know, a hundred
Speaker 1: eight kiloot increments for our data centers, Like you can
Speaker 1: be pretty fine tuned and have little pieces. But beyond that,
Speaker 1: they're not directly competing. Right. The way I've always looked
Speaker 1: at it is, you know, this decade is going to
Speaker 1: be spent. Oil and gas producer are gonna spend this
Speaker 1: decade trying to figure out the best way to incorporate
Speaker 1: mining bitcoin into their upstream operations. Right. There's gonna be
Speaker 1: some places where it makes total sense. There's gonna be
Speaker 1: some places where maybe it makes sense for a little while. Um.
Speaker 1: Sometimes when you know you're you're injecting well and so
Speaker 1: it's it's going to change the way oil and gas
Speaker 1: producers um actually produce oil and gas. It's gonna change
Speaker 1: the way they drill right where Now a lot of
Speaker 1: the times in these remote locations, they'll they'll inject a well,
Speaker 1: they'll they'll blast it full of pressure, and they'll they'll
Speaker 1: try to blow off all the gas because they're really
Speaker 1: making a crude play um and it overall the overall
Speaker 1: production of the well ends up being diminished because of this,
Speaker 1: you know, kind of this high time preference. Let's get
Speaker 1: to the oil. We're looking to r o I. Our
Speaker 1: investment right time is money. And so now they'll look
Speaker 1: at it and say, hey, let's slowly inject this well.
Speaker 1: Let's bleed off the gas. Will bring every single cubic
Speaker 1: foot to market profitably. And then we'll and then we'll
Speaker 1: make it a you know, an attack on the oil
Speaker 1: and the life span of the well will be increased,
Speaker 1: the overall production will be greatly increased. Right, We'll find
Speaker 1: oil and gas producers becoming better stewards of the environment,
Speaker 1: better producers merely just because of the incives that Bitcoin
Speaker 1: lays out for them, just by giving them a portable
Speaker 1: downstream market with no counterparty risk, right, no buyer, And
Speaker 1: so as they begin to understand this, we're we're on
Speaker 1: the frontier, right, we're on the bleeding edge. I think
Speaker 1: we'll look back in ten years and say like, oh, yeah,
Speaker 1: that was crazy the first you know, half ofies, you know,
Speaker 1: when when everybody was still trying to figure out what
Speaker 1: bitcoin was in the economics and the numbers of it.
Speaker 1: Um like, absolutely, well, we'll see that because right now
Speaker 1: it's kind of too hard to tell. Everyone's still trying
Speaker 1: to figure out what is this thing and what capacity,
Speaker 1: at what scale, at what frequency do we do we
Speaker 1: incorporated this into our company. There is nobody really arguing
Speaker 1: anymore that it doesn't have a place. That's the good news. Um,
Speaker 1: I mean it's getting sorry, I've got to I've got
Speaker 1: a grandfather clock here. Um there, there there's a there's
Speaker 1: there's no there's no denying that it has a place. Um,
Speaker 1: it's just a matter about what scale and is this
Speaker 1: gonna be long lasting? I think some guys are still
Speaker 1: waiting for bitcoin to fail. They're waiting for this to
Speaker 1: be like a boom and bust kind of a situation,
Speaker 1: which which which which brings me to a question that
Speaker 1: I had because it seems like for the last two
Speaker 1: years we've kind of had this almost perfect storm for
Speaker 1: bitcoin miners where from March we saw a bitcoin you know,
Speaker 1: in the high four thousand dollar range and then run
Speaker 1: all the wa up to seventy thousand, and as it's
Speaker 1: running from three thousand or four thousand to seventy thousand,
Speaker 1: which is an amazing run, at the same time, you know,
Speaker 1: at half of the mining get taken off the network,
Speaker 1: so you kind of have this like extraordinary event where
Speaker 1: like all of a sudden you had this massive difficulty drop,
Speaker 1: so all the miners were getting more rewards because less
Speaker 1: people were mining, and the price of bitcoin was going
Speaker 1: up crazy at the same time. So it was like
Speaker 1: the last two years kind of this perfect storm. But
Speaker 1: now I'm looking at it and I see all these
Speaker 1: publicly traded companies that have raised hundreds of billions dollars
Speaker 1: to start build giant bitcoin data centers um and so
Speaker 1: we potentially gonna see massive amounts of hash power come
Speaker 1: on the network, which means lower rewards for everybody. What
Speaker 1: do you think happens in the near future with bitcoin
Speaker 1: mining in regards to that, you know, I'm more I'm
Speaker 1: I'm not as bullish on competition growing relative to to
Speaker 1: to where we're at because we were at such a
Speaker 1: massive size now. Um, you know, for anybody that's that
Speaker 1: understands the reference, it's where two d x a hash
Speaker 1: or two hundred twenty million terra hash, which using the
Speaker 1: latest and greatest, most efficient machines, Um, you still need
Speaker 1: twenty five thirty megawatts for one million terra hash or
Speaker 1: for one x a hash. Right, So if you need
Speaker 1: thirty megawatts for one x a hash, and you if
Speaker 1: you want to double the network, right, well, to go
Speaker 1: from two hundred to four hundred, we're seriously talking about
Speaker 1: six gigawatts of power, right That needs to come online
Speaker 1: and continuous probably needs to come online without anything else
Speaker 1: getting shot off. So we're at such a scale now
Speaker 1: that that in my opinion, if bitcoins price does what
Speaker 1: it has done historically, it will there will be a
Speaker 1: lot of froth in the mining rewards market for a
Speaker 1: long time because if we if say, for example, if
Speaker 1: we if we went to a hundred thousand dollars in
Speaker 1: the next ninety days, if we had a crazy you know,
Speaker 1: run up to a hundred thousand, I would bet all
Speaker 1: the bitcoin and I own that there is no way,
Speaker 1: um the hash rate could triple even in five years
Speaker 1: power both of those. You're trying to gauge where is
Speaker 1: the hash rate gonna go? But also where is the
Speaker 1: price gonna go? Um, you listen, You listen to the
Speaker 1: Mark ma Show. I'm in the studio with Adamo from
Speaker 1: at Denver Bitcoin on Twitter. We've been talking about what
Speaker 1: happens with the energy market, specifically, how does bitcoin fix it,
Speaker 1: not waste it, but fix it. Hopefully enjoyed that conversation
Speaker 1: to give at Denver Bitcoin to follow on Twitter. UM
Speaker 1: number one, Mark Moss, That's what I got for you today.
Speaker 1: All right, thanks so much for listening.