.... ​In other words we are witnessing the end of what some economists call a debt super cycle which is a multi-generational cycle in which a civilization increases its levels of public and private debt until they become unsustainable 
 
At that point the system of leverage quickly unwinds and debt is restructured but often not until the civilization undergoes an economic depression and shifts to a lower level of complexity. 
 
We are seeing the beginnings of this today, with the collapse of major cryptocurrency exchanges, like FTX and Voyager, and crypto hedge funds, like Alameda and Three Arrows Capital. 
 
Essentially these institutions placed massive market bets using leverage, or debt rather than assets they owned. 
 
They also lent money they didn't have to financial services providers in the crypto space to prop up yield products. In effect high rate crypto savings accounts, which became very popular with retail investors in an environment of low fed rates where most Bank savings accounts effectively yielded zero percent. 
 
Crypto exchanges and hedge funds also had venture arms that invested in hundreds of startups building across the crypto ecosystem. Because these companies were significant market makers, their collapse has triggered systemic shocks causing a cascade of insolvencies and bankruptcies. 
 
Millions of investors have lost significant amounts, if not all of their wealth. 
 
The criminality of what was underway is only now beginning to come to light. But the bad actors in a debt super cycle aren't just the companies making wild unkeepable promises or engaged in outright fraud. They take their cue from the sovereign, and in the case of the United States the Federal Reserve has doubled its balance sheet since the start of the coronavirus from four to eight trillion dollars. 
 
This is what both FTX and Terra Luna tried to do, to print their own private currencies, to prop up their asset books and valuations, but they were not sovereign. They could not force anyone to use their tokens under the threat of sovereign violence. But the state can and prop up the value of its currency for a time. But at some point, confidence in the sovereign also collapses. 
 
After all, debt is a game of confidence. It doesn't matter if you have lots of debt potentially for a long time until suddenly it does and that is the point of no return. Our national debt is currently over 31 trillion dollars and growing. Our debt to GDP ratio currently stands at 125 percent which means that our productive economy cannot generate enough value to repay our debts. 
 
And the world's biggest investors in U.S treasury bonds other sovereigns, other countries, have been systematically selling their holdings and buying less. Confidence is plummeting. It is this very environment that Bitcoin was built for environment that Bitcoin was built for.
 
History has shown again and again that during crises of confidence in governments people rely on stores of value that keep their value over long periods of time like gold, silver or land. 
 
One of the ways that archaeologists know a society was facing conflict and war at a certain period in time is the larger number of coin hordes buried in the ground during that period. 
 
Which brings us to the problems with physical commodities. They're very difficult to store because they are heavy they take up a lot of space and even more difficult to move especially across borders. 
 
If you're a politically persecuted minority for example and you bury your life's wealth in your backyard but then you have to flee the country to save your life, the chances you will ever see that wealth again are slim to none. 
 
But even if you somehow are able to retrieve some of it and take it with you it can easily be found and confiscated. Try crossing a border today with ten thousand dollars worth of gold and you will see what I mean. 
 
Physical Commodities are also hard to verify if someone hands you a gold coin and says it's 97 pure how do you verify that if you're not a jeweler with the right experience and equipment. Bitcoin was developed to solve these problems. Cost of verification is done by The Ledger which only admits transactions with real Bitcoin. If you're transacting on the Bitcoin Ledger you know that Bitcoin is real and not fake. 
 
it's also easy to move Bitcoin anywhere. Peer-to-peer either by sending it electronically by taking a tiny hard drive with you or by memorizing your seed phrase and regenerating it on a new hardware wallet when you are in a safe place. None of this requires any third parties any banks or financial institutions. 
 
The true promise of Bitcoin is therefore self-custody, that you store your Bitcoin yourself on special hardware and you transact with it yourself using that hardware. 
 
I'm well aware that this process is still a pain in the ass for most ordinary people but is it:

• more of a pain in the ass than having your accounts frozen or 
• having your money stolen by a corrupt counterparty? 
• Is it more of a pain in the ass than needing to verify your identity and tell the government exactly what you're going to do with even very small amounts of money whenever you want to send it or spend it? In America most people didn't think they would ever be the victims of this kind of exploitation and surveillance until now.

 
And so now is the perfect time to say Bitcoin is not crypto. 
 
Of course it uses advanced cryptography but it has nothing to do with what crypto has come to mean colloquially. 
 
The Ponzi schemes joke coins and unregistered securities that virtually all cryptos are. 
 
Bitcoin is not a company token or a scheme to create fake value for underwriting bad debt. Bitcoin is absolutely scarce, peer-to-peer, censorship resistant, digital currency designed to keep your wealth safe through any political and economic storm. 
 
Its price fluctuates in the short term but over the long term it's the best performing asset in human history so the only question is are you patient enough to secure your future and this brings me to the question of character. You know in 2017 shortly after we launched learning machine the world went through the ICO or initial coin offering craze this is one of the crypto bull runs. Many of our competitors were launching their own tokens and raising Millions even hundreds of millions of dollars off of the sale of these coins. We had to make a strategic corporate decision about whether or not to do that and we chose not to. There was simply no value that a token would add for our user base or for our product plus we knew that these coins passed the Howie test and therefore they were unregistered securities even if the SEC for some inexplicable reason wasn't going after the vast majority of them 
 
We stuck to building and selling a software product that delivered real value for real users. This was a slower path to growth but it was real. Today I continued to work in the real economy that productive part of human society that generates the value governments use to secure the debt they create but our government has chosen to try to have everything to fulfill everyone's spending priorities while creating unimaginable amounts of money out of thin air and then raising interest rates to fight the inflation that will inevitably occur when you double the supply of money in circulation. 
 
This is not a sustainable situation. In this context Texas has the opportunity to lead by demonstrating fiscal discipline and respect for property rights. 
 
In 2021 the Texas blockchain council worked with our Champions and colleagues in the Texas state legislature to pass HB 1576 which created the state work group on blockchain matters. A group of subject matter experts with a mandate to make policy recommendations about blockchain technology for the state of Texas. I was appointed to that group by Texas speaker Dave Phelan. That report was just published and my colleagues and I testified about it yesterday for the Texas Senate committee on business and commerce. Please find this report.
 
It's linked on my Twitter and Linkedin bios and read it. It showcases why Texas is leading in responsible, well-collateralized, financial services and it outlines the role Bitcoin should play in restoring confidence in both state and National governments. 
 
Finally the Texas Bitcoin Foundation announced this week that we have partnered with Texas State Technical College to launch the world's first professional certification programs in Bitcoin mining offered by any institution of higher education anywhere in the world. This will create a pool of talent for Bitcoin miners the backbone of the Bitcoin protocol right here in Texas. 
 
This project didn't require a 50 million dollar Grant from the FTX future fund. Just a couple of dedicated energy entrepreneurs, Felicia and Gideon Powell, to provide the seed funding so the project can start small demonstrate success, and grow based on the actual value it provides for the Texas economy.

​Two bills were run by the Cascadia Blockchain Council this session -- SB 5544 the creation of a blockchain work group and SB 5534 the trust framework for verifiable credentials -- are up for a public hearing tomorrow, Wednesday, January 12. 

1. SB 5544 creates a working group to examine applications of blockchain technology across key sectors and government bodies with the goal of promoting blockchain development in the state of Washington. It is a foundational policy step that will provide a solid base upon which to build additional blockchain policies. 

2. SB 5534 examines opportunities for use of verifiable credentials in state government agencies, and also calls for the creation of a Trust Framework for Verifiable Credentials.

Both bills, sponsored by (the awesome) Senator Sharon Brown (pictured below).

Several of us, from the WTIA or Cascadia Blockchain Council, did our remote zoom testimonials this morning, including myself (with new 1 month old baby in my arms).

Here's the link to the recorded hearing: https://tvw.org/video/senate-environment-energy-technology-committee-2022011201/?eventID=2022011201 (Time stamp for the blockchain bills is 44:35).

Below is my testimonial for the Blockchain Working Group Bill:

 Introduction: 

• Thank you, Chair and members of the committee. 

• For the record, my name is Arry Yu, and I am the Co-founder and Chair of the Cascadia Blockchain Council. 
• We are a coalition of over 150 companies, universities, and government entities across Oregon, Washington, and British Columbia focused on making the Cascadia region a global hub for blockchain technology. 
• I have over 20 years’ experience in the innovation technology space for companies like Microsoft, Expedia and Google --- and since 2016, have been working specifically in the blockchain/cryptocurrency technology space in areas like Gaming/ + micropayments (8/10ths of a penny) in over 120 countries – who has seen firsthand this community grow across the country and globe. 
• I am here today to testify in support of SB 5544. 

Body:

• Creation of uniform policy around blockchain is an important step to support the sector in Washington state.
• The results of this work group will further cement Washington state and our region as a global leader on blockchain technology. Not Switzerland, or Miami –  it should be our region – this is the center for platform technologies, cloud technologies, Oregon is the birth place for open source. This region has the developer + engineering talent, not to mention the mountains, ocean, evergreen trees, and wholesome hearted community….  
• Increasing opportunities for growth of the blockchain sector in Washington state is a core mission of the Cascadia Blockchain Council, and we hope to see this legislation advance

Conclusion: 

• Thank you for the opportunity to testify. Thank you Senator Brown for your continued support year after year. I am happy to answer any questions. 

Below is my testimonial for the Verifiable Credentials Bill:

Introduction: 

• Thank you, Chair and members of the committee. 
• For the record, my name is Arry Yu, and I am the Chair of the Cascadia Blockchain Council. 
• We are a coalition of over 150 companies, universities, and government entities across Oregon, Washington, and British Columbia focused on making the Cascadia region a global hub for blockchain technology. 
• I have over 20 years’ experience working in the innovation technology space, digital trust research and on verifiable credentials.  
• I am here today to testify in support of SB 5534.

Body: 

• Lumedic is a great example of a startup company working with the Providence Health Network advancing verifiable credentials for health care // Give Arry personal example.
• A Trust Framework is a set of governing standards for the using or providing of digital identity services. The goal of a trust framework is to not to require the use of one centralized digital ID, but to acknowledge that we need a streamlined and privacy preserving way of handing digital ID as it becomes increasingly used across public and private institutions. 
• A Trust Framework can enable more efficiency between the public and private sector by establishing a single set of standards to build identity to, while reducing privacy and fraud concerns that accompany digital ID. 
• VC is a decentralized identifier – that is privacy preserving, portable, secure and interoperable. 
• Major innovation is that no 3rd party stores sensitive info + no private information is on the blockchain.
• Ledger shows proof/ attestation – that a verified issue has sent a credential to a recipient.] 
• It is important to lay the groundwork, via a trust framework, for use of verifiable credentials in Washington state use of this technology in the state in the future. Ultimately, the use cases created need to be built to a standard recognized by both public and private sectors.

Conclusion: 

• Thank you for the opportunity to testify. I am happy to answer any questions. 

Getting a few repeat questions from the many acquaintances and friends I love dearly, so I think I'll have to post the answers as they come up here, to help scale myself. :) 

What's SWAN?
So if you don't know what SWAN is or don't have it, I HIGHLY recommend it. Really great application AND they have awesome learning resources on all things BITCOIN. If you're new to bitcoin or crypto, I also recommend SWAN. Really easy to use, sign up, and seriously great content for folks that want to learn more from a trusted source. Here's what Swan says about itself, "Swan Bitcoin is a platform that helps automate purchasing Bitcoin, essentially acting as a savings account. ... Specifically, it allows users to sign up for recurring Bitcoin purchases while enjoying competitive fees." And yes, Swan has one of the BEST fees for buying Bitcoin. And remember, buying a small amount every week (Dollar Cost Averaging) is one of the best strategies to doing so, versus buying a larger amount all at once while trying to time the market. Swan let's you setup weekly buys like $10/week, or $50/week - whatever makes sense for your budget.

--> Get free $10 in Bitcoin for using my link: https://www.swanbitcoin.com/windshieldtime/ (and I get $10 too!)

What's Coinbase? 
Coinbase is a cryptocurrency exchange platform (with a mobile app, and desktop web browser apps that you can use.) Here's what Coinbase says about itself, "Coinbase is a secure online platform for buying, selling, transferring, and storing digital currency. Our mission is to create an open financial system for the world and to be the leading global brand for helping people convert digital currency into and out of their local currency." You can setup Coinbase (a lot of new folks will usually start with Coinbase too) and use it to go from your fiat money (US dollars) to crypto. You'll have to KYC (go through the security checks, get verified for your identity, hook up your bank account, fund your Coinbase account --- this can take 3-10 days). 

​Just watch out - the consumer app for Coinbase charges really high fees. If you sign up for Coinbase, use the Coinbase PRO application (same login as your regular Coinbase login information) for your transactions for lower fees. (LINK: https://pro.coinbase.com)

-->  Get free $10 in Bitcoin for using my link: https://www.coinbase.com/join/yu_1k (and I get $10 too!) 

How to Move My Bitcoin Out Of SWAN?
1.) Make sure you have TWO FACTOR AUTHENTICATION setup in your Swan account. Otherwise, you will not be able to move Bitcoin out of SWAN. Here's a link for what two-factor authentication is. To setup two-factor authentication on SWAN, please click here.
2.) THEN you need a BITCOIN WALLET. There lots of ways to acquire one.  In this case, if you want to move your Bitcoin from SWAN to Coinbase, then you'll go into your Coinbase application to find your Bitcoin wallet address. Here's what the Coinbase Bitcoin wallet will look like from your desktop computer (Click COPY or use the QR code reader to get your address).

Here's what the Coinbase Bitcoin wallet will look like from a mobile app:

3.) Then go to your SWAN app, and go to your Swan dashboard and scroll down to the withdrawal section. Click the [Withdraw Now].

You'll see a POPUP come up.

4.) Click [CONNECT SINGLE ADDRESS]. Then you'll see a different screen.

5.) Enter the right information.
-- Where it says "NAME" -- write something like, "COINBASE BTC WALLET"
-- Where it says "ADDRESS -  copy/paste the BTC wallet address from your Coinbase account (Step #2 from above).

6.) Confirm the wallet address. You'll have to do the two-factor authentication for Swan that you already setup (remember, from Step #1).

7.) Now that the wallet is CONFIRMED, go back to the Home Screen click [WITHDRAW NOW] again. You're set. You should see a screen that comes up asking for how much you want to withdraw out of SWAN and into your Coinbase Bitcoin wallet.

Alrighty.

Good luck.

Stay safe out there.
--Arry 

CoAuthored by Arry Yu/Molly Jones: Crypto Regulator Sends Strong Signal to Foster Innovation
This week, the Washington State Department of Financial Institutions (DFI) announced the creation and launch of the Center for FinTech Information (CFI) to facilitate communication between the DFI and entrepreneurs, investors, and fintech companies. While Washington aspires to be a global hub for blockchain innovation, the lack of transparency and regulatory clarity has long created challenges for innovative crypto and digital asset startups, funds, and investors in the state. The creation of this center is a welcome, positive step forward for the sector, and if effectively staffed and resourced, can help transform the experiences of crypto companies in Washington.

There is enormous potential for innovative financial services in Washington. States like Wyoming and Florida that have embraced the digital asset industry with updated regulations have seen real results in economic growth, diversification of the economy, creation of well-paying jobs, and expansion of equitable access to fiscal services to residents.

The launch of the CFI is critical to ensure Washington’s innovative financial services sector has the opportunity to share in the benefits of the digital asset industry’s success and growth, which is on an exponential trajectory. Washington is already well-situated to become a global innovative fintech hub – boasting a strong innovation ecosystem with top talent and an active venture capital network. With a regulatory system that promotes innovation while enabling consumer protection, Washington can also become a global digital asset hub. We recommend three key near-term priorities for the CFI to advance this mission:

Information and Transparency: The CFI should prioritize providing proactive guidance for businesses engaging with the DFI, as well as how to establish and maintain compliance. For many new businesses, obtaining legal counsel to establish initial compliance can be prohibitively expensive. By publicly sharing information and expanding communication with the business community, the CFI can significantly reduce these costs and remove barriers to entry for many innovators. This would include publishing contact information for DFI staff available to support new businesses in blockchain applications involving financial services, as well as interpretive letters, administrative decisions, and statements on the DFI website. These small steps would greatly facilitate business compliance efforts.

Align with National Standards: There is a lack of consistency with respect to how businesses that deal in digital assets are treated across the states and by the federal government, which creates a significant challenge for many digital asset companies in Washington. The CFI has the opportunity to standardize Washington’s regulations by adopting nationally-accepted FinCEN rules and definitions surrounding fintech and digital assets, as well as clearly outlining any departures from the national standards. This would allow the CFI to ease compliance for blockchain companies while still maintaining rigorous standards that protect consumers.

Partner with the Emerging Technology Community: As the DFI continues to pursue opportunities to bolster innovative fintech in the state, the Washington Technology Industry Association (WTIA) can bring together innovators and industry partners to collaborate on these efforts. Regular communication channels between the DFI and industry — such as the WTIA-DFI Town Hall this week — is critical to advance the dual goals of both consumer protection and innovation. The DFI should also consider organizing working groups with industry participants, quarterly forums to update the community on recent developments, and other platforms to share guidance and priorities, while also learning from industry on the latest innovations.

The WTIA Cascadia Blockchain Council (CBC) looks forward to working with the DFI and industry partners to build a thriving blockchain sector in Washington state, and we applaud the launch of this new office. The WTIA CBC stands ready to partner with the DFI to identify policies and programs that promote innovation, and we invite all emerging financial technology enterprises to join us in our work to promote a robust tech sector in a thriving community.

To learn more about the Cascadia Blockchain Council, contact Arry Yu at arry@washingtontechnology.org. 

Original OpEd here: www.washingtontechnology.org/crypto-regulator-sends-strong-signal-to-foster-innovation/

Geekwire article here: www.geekwire.com/2021/washington-state-launches-center-cater-potentially-regulate-crypto-fintech-companies/

Bitcoin Wallet FAQ
In recent weeks, Bitcoin has reached all new highs in terms of both popularity and price. And because of this, a number of people are eager to get in on the action—maybe you’re one of them. Maybe not. Before you can buy Bitcoin, understanding Bitcoin wallets is very important. And we aren’t talking the kind of leather wallet that you can buy at the mall. Below (FYI), I'm going to use the word Bitcoin and Bitcoins interchangeably. 
​
What Is A Bitcoin Wallet?
Bitcoin wallets come in different forms. If you want to get technical, no wallet actually contains any Bitcoin. Wallets of any kind productize access and security of the private key.

Remember: 

• The private key Is what gives a person access to the balance of Bitcoin that they have on the Bitcoin blockchain.
• The backup seed phrase gives a person access to a person's bitcoin regardless of the condition of the wallet.
• Guard and secure your private key and seed phrases like your life depends on it. Why? Because that is where you are holding (HODLing) your wealth and savings.

For the non-technical person, there are hardware and software wallets.

• A hardware wallet is a physical device which holds your Bitcoin just a physical wallet holds your cash. These often look like small USB flash drives. You access them by connecting them to your computer, and entering in a PIN number. You also need your private key and/or your Seed Phrase to access your Bitcoin (generally, you'll want to store your Seed Phrase physically far away from your hardware wallet and private key).
• A software wallet (this is not a common term... actually, it's not really a term at all) is a digital wallet which holds your Bitcoin either on an exchange or on a website, but either way it is somewhere in the digital realm and not something you physically store or carry around. Regardless, word of advice to you is don't store your Bitcoins on an exchange. Use exchanges to buy/sell/trade - then get the crypto asset (like Bitcoin) off the exchange and into your own wallet (where you have the private key).
• The golden mantra for Bitcoiners is "Not your keys, not your coins".

Which Is Better?
Well, the word better isn’t necessarily the best word in this case. The real question is, which is safer FOR YOU, specifically. And the answer depends on what you plan to do with your Bitcoin, as both wallets have real risks and benefits. The answer also depends on the kind of person you are and what you can take on in terms of responsibility. The answer depends on what's at stake.

Also, what matters is WHO or what entity has CONTROL or CUSTODY of your Bitcoin. If you use a service like a wallet or an exchange to hold your Bitcoin, that centralized entity has custody of your Bitcoin. NOTE: If you buy Bitcoin through entities like: PayPal, Robinhood ---> THEY have custody of your Bitcoin. You do NOT have the private keys to them (as of the publication of this blog post, neither service provider allows you to take the Bitcoin you purchase out of their wallet gardens). You CANNOT move your Bitcoins out of PayPal or Robinhood. I do NOT recommend PayPal/Robinhood for buying Bitcoin. (see previous article -- best places to buy Bitcoin as a beginner are Swan Bitcoin, CashApp, Coinbase (tho it has higher fees - usually I'll point folks to Coinbase PRO if you want to use Coinbase....). 

If you have Bitcoin in Coinbase, BlockFi, Bittrex, Binance, Celsius, Jaxx or any of these centralized applications and exchanges (aka software), THEY have custody/control over your Bitcoin. Again, you don't have the private keys to your Bitcoin, You CAN move your Bitcoins in/out of these applications as you choose, as long as there are no issues with your 1) identity, 2) relationship with the government, etc.... If anything happens to these companies, your Bitcoin is at risk. If these centralized companies are attacked, your Bitcoin is at risk. If you are in trouble with the government for any reason, your Bitcoin is at risk. So please act accordingly. 

What About Hardware Wallets?
Unlike "software wallets", hardware wallets are nearly unhackable. Unless someone has your Seed Phrase, they cannot get access to your wallet. Not only that, but if you physically lose your hardware wallet, you can buy another one, enter your Seed Phrase (which is like a 12-24 word password) and recover all of your Bitcoins.

Here’s the problem. If you lose that Seed Phrase, which is assigned for you by the device, you will not, ever, ever, get your Bitcoins back. They are gone forever. This is what people mean when they say they’ve lost access to their Bitcoins—they’ve locked themselves out of their hardware wallets forever. And if you haven’t seen the news lately, there are people all over the world ripping their hair out at the passwords they lost to Bitcoins that are now worth millions.

Hardware wallets are generally safer if you plan to hold Bitcoin for a long time (and you can write down/remember a 12-24-word password, aka the Seed Phrase, and not lose it). Where a hardware wallet is kept offline, it is also known as cold storage.

If you are going to go the hardware wallet route, I generally recommend Coinkite, Trezor or Ledger as they are generally easier to set up and use for hardware wallets. (Side note, Ledger has gotten hacked recently - so they leaked ALL of their customer data recently. Hopefully they've increased their security measures and fixed their vulnerabilities since then...). Don't buy them anywhere. If you buy them on Amazon, make sure you're buying from the specific company directly. Do not buy from a second hand or grey market. Trezor and Ledger are also the largest players in the space. Whatever you do, find a way to remember that passcode and keep it safe (and store it physically FAR AWAY from your hardware wallet)! VERY IMPORTANT.

What About "Software" Wallets?
There's no real such thing as "software wallets". The term that matters more is Cold wallet versus a Hot wallet:

• Hot wallets are connected to the internet.
• Cold wallets are NOT connected to the internet.

Generally, if you're not using a hardware wallet, it's all software (or seed phrases). Also, most of the applications in the space have very minimal customer support... so don't rely on being able to get good customer support in this space.

Generally, there's always a risk of an exchange or wallet provider getting hacked (you are responsible for double checking when you decide which exchange or wallet application to use), and this is still a risk you have to take when choosing a  wallet. The risk comes from "centralization" -- most exchanges and wallet providers are centralized private companies. This means they are literally a "honey pot" for the bad guys to attack (like we've seen time and time again in the centralized world: Target, Marriott, Facebook, Equifax, etc...)

What are the benefits of NOT using a hardware wallet? Well if you plan to trade cryptocurrency on a daily basis and often, it will get quite annoying to transfer it on and off the exchange to your hardware wallet constantly. Make sure you choose a reputable wallet provider, because they aren’t all the same. Then again, the annoyance might be a good thing for that extra level of security.

Which Wallets Are The Best?
Again, there is no "best wallet".  Again, the real question is, which is SAFE FOR YOU, specifically. And the answer depends on what YOU plan to do with your Bitcoin, as different wallets have different real risks and benefits. The answer also depends on the kind of person you are and what you can take on in terms of responsibility.

I have heard of people recommending the Coinbase wallet (Coinbase wallet was a spinoff by "Toshi" of the real Coinbase market/exchange.... so it's really confusing. Be careful), or Exodus, as these are supposedly fairly easy to use. I personally think their products are not easy to use. I'm not a user of either of them. There's a Bitcoin Wallet wizard you can try out: https://bitcoin.org/en/choose-your-wallet. 

Some quick recommendations:

• Bluewallet is the respected non-hardware wallet these days. It's open source. It's mentioned and endorsed a lot these days. You'll have to try it for yourself - download it and play with it. It's on iOS.
• What I do recommend for buying Bitcoin (see previous article) is: Swan Bitcoin (the one I recommend the MOST), Coinbase (though higher fees and terrible customer support), Coinbase PRO (better fees than the consumer Coinbase), CashApp, BlockFi....

You can trade your crypto assets on any exchange you are using to trade it. The decision is yours. Know that exchanges are more likely to be targets to hacks - so best practice is to NOT leave your crypto assets on an exchange in terms of storage. 

There are a number of combo wallets out there which employ a little bit of both technologies. These are also an option, but are generally more complicated than just picking one or the other.

So Where Should I Keep My Bitcoin?
Well, if reading this far hasn’t answered your question, this is entirely up to you and what you feel is a greater risk for yourself personally: is it losing your password or is it being the victim of a hack? Are you better at keeping your passwords secure and safe? Are you good and not losing your car keys? Only you know what's best for you. Again, do not store your Bitcoin on an exchange - it is generally NOT a best practice.

Objectively, there is no "best wallet". There is only "the best wallet for you", based on how you want to handle and store (or not store) your wealth, based on your personal needs. At this point in the Bitcoin infrastructure buildout, there is basically a solution to fit every person's individual needs. It's a big spectrum of needs and wants - and a person must go and get it to learn.
​
Generally, I would advise that you spend the time to DO YOUR OWN RESEARCH. Self education is very important in this space. Learn. Learn as much as you can. LEARN. Watch and listen to videos. Read. Don't do anything you are unfamiliar or uncomfortable with - feel free to reach out to others in the community to verify or ask questions. But ONLY YOU can make the ultimate decision as to where you would feel safest storing your Bitcoin. 

Hope that helps!

Hi, All:

Bitcoin's price has been going up a lot recently with new all time high's achieved so I prepared an FAQ: Where to Buy Bitcoin (Getting Started) for new folks coming into Bitcoin. Lots of folks have been reaching out to me (which is great), and I realized that there are quite a few frequently asked questions, so I thought I'd share here, too!​

Please let me know if you have any questions.

FAQ: Where to Buy Bitcoin (Getting Started)

1) Partial Bitcoin
You can buy less than 1 whole Bitcoin at a time. You can buy $1 worth, you can buy $10 worth, you can buy $500 worth - whatever you are comfortable with. You don't have to buy a whole Bitcoin. Start buying, and do dollar cost averaging ---->

2) Dollar Cost Averaging (DCA)
Before you start, I want to give you this piece of advice that is literally the best advice you can get for someone wanting to get into Bitcoin. Dollar Cost Average: Buy a small amount every week. Do not try to time the market, you'll be disappointed. One of the best tools I've discovered (easy to use, great resources, best low fees) is Swan Bitcoin. Use my link and get $10 Free in Bitcoin: https://www.swanbitcoin.com/windshieldtime/

3) Exchanges
You can buy Bitcoin via cryptocurrency exchanges like Bittrex, Coinme (which is done through their partnership with Coinstar/ATM, look for the green machines in grocery stores), Coinbase, CoinbasePro, FTX, etc.... Be careful. The apps are generally a bit tricky to use (**Coinbase is the most accessible and probably the easiest to use out of them). If you do small buys ($10-$1l), the fees are higher than I like, which is why I recommend Swan Bitcoin above (FYI: the fees are usually made in the "spread" of the Bitcoin you are buying). You can get free $10 in Bitcoin for using my link: https://www.coinbase.com/join/yu_1k

4) Consumer Trading Applications
There are consumer trading applications that you would use for buying stocks or for payments like Robinhood, CashApp, PayPal that now also allow you to buy/sell Bitcoin.

To be candid, be careful with this. The only one I will actually recommend is CashApp. CashApp. (Here's my signup link for CashApp if you want to use it - you get a free $5 for signing up too https://cash.app/app/XJCWNGQ). I really like their overall experience for consumers - there's a debit card with shopping boosts you can use while shopping for 3% back in Bitcoin, or 15% back at USPS or the grocery store. Robinhood/PayPal do not actually give you custody or access to the BTC you buy (they only give you the ability to buy/sell this Bitcoin). While this is "nice" in that you get to participate in some way, you don't actually get the full benefit of buying Bitcoin in the first place - so I don't recommend Robinhood/PayPal for buying Bitcoin/crypto.

5) Indirectly Buy Bitcoin 
An indirect way to get BTC is through something like $GBTC (Greyscale Bitcoin) in your stock brokerage/IRA/401k account (like Fidelity, eTrade, etc.). I personally have put a lot of my retirement into GBTC because I believe in this space overall. GBTC is a great buy for an investor who doesn't want to trade cryptocurrency on an exchange (but wants exposure to Bitcoin). At times, it can trade at a pretty high premium due to high demand and limited supply because of what I call the "convenience" GBTC provides for investors. Overall, have done really well with this strategy personally and so I recommend it. 

Side note: There are other cryptocurrencies out there, but NONE of them have as comprehensive and as complete command of the fundamentals of good money, good store of value, security of the network and everything that Bitcoin does. You may assume they are seemingly "cheaper" and assume that they are the same thing as Bitcoin (BTC), they are not (For example XRP, DOGE, etc.... -- they are NOT the same as Bitcoin.) Do your own research, feel free to ask questions. 

Hope that helps.

--Arry 

Hi, everyone:

I've been learning so much lately, and one of them was about making a post go viral on LinkedIn that allows you to game the LinkedIn algorithm to get your post to go "viral". Once I learned about this tip, well, there's "knowing" a tip, and there's actually knowing it because you've tried it.

So I tried it.

And I recorded the results and shared it with everyone, because, why not? As our 4 year old #theLentil says, "Sharing is caring and helping is caring." 

So here it is:
The LinkedIn Effectiveness tips: I learned more about LinkedIn as a social platform and decided to try it out. Here are the rules I learned/tested out: 

-- Longer posts, all text preferred.
-- Don't include photos, don't include links - LinkedIn doesn't want people to go away from Linkedin's website.
-- Only use 2-3 hashtags (and I've learned since they may have removed this preference around hashtags from their algorithm, but I have not tested it to confirm yet.) 
-- There's a golden hour, that's the 1 hour after you post that's the most important. I pinged 10 folks to "like" my post and comment on it during that 1 hour (thanks friends.) Repeat: folks must LIKE AND COMMENT on the post during the first golden hour. LIKE AND COMMENT.
-- Ideally, do this more than once, with more regularity for optimal impact.

Quite interesting, eh? I typically average about 50-200 views/post, so through this test, what I saw was that it really did significantly improve my reach on my message.  Below are the details.

Here's a link to the original Test post I did on LinkedIn to see if this actually did work (and embedded below so you can see the post that I did).  You'll see that I did a long form personal mini-essay with only a couple of hash tags, no links, and no images: 

Here's a link to the LinkedIn post where I recap my learnings/observations if you want to see it: 

Hope that helps someone. Let me know if you want me to participate in any of your posts - just tag me or send me a message with a link to the post, and I'm happy to LIKE AND COMMENT on your post to help you in your golden hour.

Warmly,
​Arry 

P.S. Also, there's a hack on the no links in the message "rule". Do the post without a link. Post it. Then after it's posted, go back and edit the post, and add in the Link. I haven't tried this out, but supposedly this is the workaround. 

On today’s show, I sit down with Jason Yanowitz to talk about his entrepreneurial journey, and his views on Bitcoin and other cryptocurrencies. Jason is the Co-Founder of BlockWorks Group, an events and media company that sits at the intersection of digital assets and traditional finance.

IN THIS EPISODE, YOU’LL LEARN:

• How Jason started his entrepreneurial journey 
• How to scale your startup 
• The challenges you face in building your business, and how to overcome them 
• If you should raise venture capital or bootstrap
• How someone should buy Bitcoin safely 
• How to protect your crypto assets 
• The best cryptocurrency for long-term investment
• And much, much more!

RECORDING LINK: https://www.theinvestorspodcast.com/millennial-investing/mi063-bitcoin-crypto-and-entrepreneurship-with-jason-yanowitz/

<<TRANSCRIPTION BEGINS: >>

0:00  
You're listening to TIP.

Robert  0:02  
On today's show, I sit down with Jason Yanowitz. Let's talk about his entrepreneurial journey and his views on Bitcoin and other cryptocurrencies. Jason is the co founder of block works group and events, a media company that sits at the intersection of digital assets and traditional finance. I've actually worked with Jason on a few different projects in the past, and he's a good friend of us here at TIP. I'm very happy to have him on the show today to talk about how he started his business, as well as to have a discussion about Bitcoin and cryptocurrencies. So let's get right into this week's episode with Jason Janowitz.

0:35  
You're listening to Millennial Investing by the Investors Podcast Network. Where your host, Robert Leonard, interviews successful entrepreneurs, business leaders and investors to help educate and inspire the millennial generation.

Robert  0:57  
Hey, everyone, welcome to this week's episode of millennial investing. With me today I have Jason Janowitz. Welcome to the show, Jason.

Jason  1:04  
Thanks for having me, appreciate it.

Robert  1:06  
You and I have worked together on a few projects in the past. But for those listening to the show today who may not know who you are, give us a brief overview of your background and how you got to where you are today.

Jason  1:17  
I'm the co-founder of Block Works Group. We're an events and media company that helps institutional investors understand the crypto and blockchain space. I grew up in the Bay Area, went to school down in Atlanta at a school called Emory. I moved up to New York, worked in venture for a bit, investing in like late stage tech and life science businesses. So some of your listeners might know some of the investments like Dollar Shave Club, some other Hail Mary shots on Alzheimer's, and some fun things like that. And then I went and joined Sai Cents, which was an Israeli data analytics company that has raised about $300 million. And I built out the outbound sales team there; grew that team from two folks to about 24 people in a year. 

Jason  1:56  
And then, let's see, it was May of 2018 that I launched Block Works Group full time. I'm co-founder with Michael Bolita, who went to Emory with me. We just had our two year anniversary about last week. So we're excited, two year birthday.

Robert  2:10  
You mentioned that the venture firm was focused on technology and Life Sciences. So I have to ask, where does Dollar Shave Club fit into there? Are they a technology company?

Jason  2:19  
Dollar Shave Club was a co investment with Sequoia Capital. You probably see it now. Right? And a lot of the listeners probably see it with like, Peloton, right? And WeWork I think WeWork the prime example. A lot of these tech companies, or a lot of non tech companies, when they file for their IPOs and their S-1s people kind of got access to the company and started to see how they're describing themselves and with WeWork, right, their real estate company, their property management company, and they're calling themselves a tech platform to change people's lives. 

Jason  2:48  
And I think Dollar Shave Club was one of the early adopters of this kind of mentality and, really, marketing. I love their CEO, I was a history major at Emory and he was a fellow history major from Emory. I mean, I think he's a brilliant marketer, not fully a tech company. But uh, I think it was a nice little investment.

Robert  3:06  
Yeah, they're definitely doing a little bit better than I would say WeWork is. So I think it's worked out for them. 

Robert  3:11  
Throughout today's episode, I want to talk a bit about entrepreneurship, how you're building your company, your experience in venture capital, and also Bitcoin. Let's start with entrepreneurship. How did you know you were meant to be an entrepreneur? Why, specifically, did you want to start Block Works Group?

Jason  3:29  
Let's see, so I think those are two different questions, right? I think Block Works Group starts in the end of 2017. I think entrepreneurship starts when I was three years old. And both my grandparents on my mom and dad's side were entrepreneurs. My dad was an entrepreneur, my mom was an entrepreneur - they still are. And so I think oftentimes entrepreneurship is in someone's DNA. And I think what it translates to is just a lack of conformity, right, a lack of conformity to the rules. I think you can trace a lot of entrepreneurs back to non-work-related, non-business-related things. And you can start to see some trends emerging. 

Jason  4:05  
For example, at the VC firm, we would ask founders and entrepreneurs questions like, what was your major? Right? Their answer was I created my own major. That's one data point right? Along a trend of not conforming to the rules to little things like that. All my friends were getting jobs after high school flipping burgers, I was launching a network marketing company, or working with a network marketing company, instead of going to business school, right? Like all my friends did at Emory, I studied history. And so I think from a young age, I knew I wanted to be an entrepreneur. But I really think just entrepreneurship is a risk-reward game, right? Like, financially, I mean, most most entrepreneurs fail, right? And so it doesn't really make sense to be an entrepreneur, unless you love the risk. And I think for myself, I need the risk. But I think it's important to understand that most entrepreneurs fail. But yeah, I think from a young age is kind of the bound for the entrepreneurship.

Robert  4:57  
Yeah, it's interesting you mentioned the major because I was actually One of the things I was going to ask is How did you go from being a history major to being an entrepreneur? I mean, that's not really a common study or a common major for a lot of people that go into business.

Jason  5:10  
I think every entrepreneur have some of the same traits, and I think the biggest one is passion, right? Passion, and curiosity would probably be the second one. There's some other ones like grit and hustle and wanting to make an impact and wanting to have ownership. But I think curiosity and passion are the two biggest traits of successful entrepreneurs, passion for their business, and just a genuine curiosity about life and learning. And I think wanting to major in history, I think is just a genuine passion for it thinking that I'd be doing business for the rest of my life. And so I wanted to study something that I was actually passionate about, you know, paying a boatload of money to go to school. And then I was just genuinely curious about it, right. And I think if you have passion, and you have curiosity, it really doesn't matter what you majored in. Most of my friends are working in investment banking, or consulting or private equity. And it's not like I knew how to build a website out of school, but nobody really does, right. I think a lot of things that you learn in school, whether you're a business major, unless you study like a hard skill, like accounting, it's not too applicable to launching a business to be honest.

Robert  6:11  
So why specifically Block Works Group? Why an event and media company? 

Jason  6:16 
Good question. I think any good company starts with a problem, right? More often than not, it's a problem in a founder's personal life. And it was no different for me. I got into the Bitcoin and crypto space when I was living actually in Budapest, Hungary. So when someone I knew out there introduced me to Bitcoin, that was 2015. I moved to New York in 2016, went deep down the Bitcoin rabbit hole, and really realized over the course of two to three years that there was no real source of information and education to help, whether it's a newbie a 22 year old interested in Bitcoin, or a 60 year old gray haired family office investor who's allocating from their $300 million portfolio, there's no good place for them to go learn about crypto and Bitcoin. And if you're a 70 year old, you're sure as hell not gonna learn from crypto Bobby on Twitter and crypto panda on Reddit, right? And that's all the sources or information that existed. 

Jason  7:07  
So started looking around, didn't see anything in the market. And so actually launched Block Works Group originally, just as a side hustle, I went to a meet up on a Sunday, I came home of living with four friends, actually. I said, I'm launching a consulting firm for the Bitcoin space, does anyone want to get involved two friends said no two friends shot their hands up and said, let's do it. One friend ended up dropping out. And the other friend was Mike, who's the co-founder. And the consulting firm quickly transitioned into an events company, which since has grown into an events and media company. And so took about six months of working with Walker's group as a side hustle, and then eventually launched it full time in May of 2018.

Robert  7:46  
That leads exactly into my next question, because I wanted to talk about why you decided to have a co-founder a lot of people who are starting side hustles or startups or just a small business in general, they're trying to decide do I want to be a co-founder or do I want to go it alone? And why did you decide to get a co founder rather than doing it yourself?

Jason  8:04  
I don't even think the idea crossed my mind to try to do this myself. I think for any first time entrepreneur, you should have a co-founder. Like I feel really, really strongly about that. I think there are a few things that you need to look for. But just hands down, I could not have done this alone. I feel really strongly about that. I don't think it was an active decision - should I have a co founder or should I not? I think it was just how can I link up with somebody who has different traits than I do? Right. And that's what I found in Mike.

Jason  8:33  
So I manage all the sales and marketing at the company. Mike does a lot of like the strategy operations, content creation came from a consulting background, I came from like a sales and VC background. So I think you just want someone who is very complementary skills, right? When you think about finding a co-founder, you want to think about one thing, which is how do you two, combined have an unfair advantage? And so I think there's this narrative, actually, we'd love to talk about this for a second, there's a narrative that founders have to be like college friends or work together, as was the case for us. 

Jason  9:04  
But for any of your listeners think about launching something, I think this is less true than we think actually, right? Like, let's think about dating. People used to be embarrassed to say they met their spouse via an app, right? And instead prefer like, Oh, yeah, we met you know, at college, or we met at a bar. But I think that's going to be a lot less true moving forward. And I think that there will start to be like networks created and apps created to find your co-founder. And they'll help you find people who agree with you on first principles of company building, find people with complementary skills, find people who are aligned on your values and on your mission alignment, right? Like what does success look like? And then find people who are aligned on a company basis who makes the decisions, what trade offs you will and won't accept. 

Jason  9:47  
And so those are kind of company alignment, value, mission alignment, complimentary skills, and someone who agrees with you on the first principles of company building. I think those are the four things everybody really needs to look for in a co founder and I was lucky enough to find them.

Robert  10:00  
Let's take a quick break to hear from today's show sponsor 

Sponsor  10:03  ADVERTISEMENT

Sponsor  11:09 ADVERTISEMENT

Robert  12:15  
All right back to the show. Another big decision that you made early on was to bootstrap the company rather than take on capital from outside investors. And it's interesting because you worked in venture capital. So you almost had a sneak peek as to what you had to do to raise money if you wanted to. But you decided to bootstrap it. So I think that's interesting. For those who aren't familiar with what bootstrapping is, please explain what it means to bootstrap a company. And then why you decided to use this strategy.

Jason  12:45  
So I think first let's talk about bootstrapping what is maybe pros and cons. And then we can talk about why I actually really strongly believe that most companies should not raise venture money right out of the gate. Not to say that they shouldn't ever, but I think right out of the gate they shouldn't. 

Jason  12:58  
So maybe just to touch on the first part. So bootstrapping, basically, it's a term that has its origin in like the early 19th century, actually, with the expression pulling up by one's own bootstraps. And that kind of meant like, I'm going to do it myself, right. And so bootstrapping, a startup just means starting lean, and without the help outside capital. And it means continuing to fuel growth, internally, from cash flow produced by the business. And so there are a couple reasons that we decided to do this. 

Jason  13:29  
The first one was just control. This is our first business that we built. And it was really important to us not to quit our jobs, go full time with the business, and then immediately start working for somebody else, right? If you're a founder, and you raise capital, you're not your own boss, you're working for the venture firm that invested in your company, or really, for the board, actually. Right. And you can get fired at any time. So I think that's something that a lot of first time entrepreneurs don't realize is that as soon as you take outside capital, the second that term sheet is signed, the money hits your bank account, you have a boss, right, and we really didn't want that. 

Jason  14:02  
So the pros, there's ownership, right? Literally, our equity stake is bigger now than if we had taken outside capital. There's control. If we want to promote someone to our executive team, we want to make a big hire, if we want to fire - those are all decisions that we want to have the control over. Instead of having VCs, we're gonna have metal in the business. There's decision making ties into what I just said. There's longevity, VC firms, their incentive structures have big exits after 5, 6, 7, 8, 9, 10 years, we didn't want that incentive structure kind of looming over us. We wanted the option if we wanted to sell in two years to have that option. Or if we wanted to make this a family business that runs for 200 years, we want that option. 

Jason  14:44  
The other thing that bootstrapping forces you to do is it forces you to build a business model that actually works right. You know, we're recording this what, May 5th 2020 we're starting to see some of these VC-backed companies completely blow up, right and the reason is, they never built a profitable business model. 

Jason  15:01  
You have companies that are - Uber, right? WeWork, Airbnb starting to IPO, right? - that aren't profitable. And they never built a business model that actually works long term and is sustainable. And so I think all of those reasons, right, when you look at it, it's kind of a no brainer not to take venture money right out of the gate. 

Robert  15:20  
Yeah, I really like two things you said there. The first thing is about having a boss. I've never raised venture capital. But I've read a lot about that. And that's an idea that really stood out to me, and that I talked about a lot is when you raise that capital you took on boss, and that's almost exactly the opposite of why he became an entrepreneur, a lot of people become entrepreneurs, because they don't want a boss. And so when you go out and raise money, you're kind of defeating that purpose. And I have some friends that have started startups. And as they were trying to decide, do I bootstrap or raise money, this is one of the big things that I explained to them was, well, this is what's gonna happen, you're gonna have a boss, X, Y, and Z. So I think it was a really good point you made. 

Robert  15:53  
And then yeah, we're also seeing a lot of companies, like you said, blow up right now, because they're not profitable. And it seems in the startup space and venture space, a lot of companies think that a business model that isn't profitable, as long as you keep throwing money at it, it'll eventually become profitable, somehow, one way or the other. I mean, you just can't do that with bootstrap. I mean, you have to get to profitability and grow the business organically that way. So I think those are two really good points you made.

Jason  16:17  
Yeah, I think there's a myth, right? No entrepreneur starts out and they're like, I want to, unless you're like one of the digital nomads, who goes to like Southeast Asia, and like, does their web agency or something like that I see all over Instagram. But there's like this big myth that if you want to build a billion dollar business, you have to go raise hundreds of millions of dollars. And it's just not true. 

Jason  16:36  
All your listeners should look at Qualtrics. Right? An awesome business is started by a couple of brothers and their dad, they bootstrapped for a decade, right, they bootstrap for 10 years. Then, over 10 years after refining their business model over and over and over again, then they raised hundreds of millions. They've got an awesome lifestyle, they've got an awesome business, a lot of great companies, Apple, Facebook, they didn't go raise money right out of the gate. They bootstrapped, they created a profitable business, and then they raised money. 

Jason  17:04  
What that allows you to do is if you raise on your terms, right. Imagine if you go to a VC and just picture, you go to a VC and you say, I've got this idea, it's going to be big, and you walk into their doors, and you share the pretty PowerPoint that you put together for a month. Well, you might raise money, but it's on their terms, they've got the liquidation preferences, they take 30% of the company, right? They get a board seat. Now what happens if you run a company for five years, you go into that same VC firm, you go, look, we've grown 100%, year over year. Revenue's 20 million a year now. We're profitable. We'd like to take some money so that we can grow. But we don't really need your money. You're going to get much more favorable terms.

Robert  17:43  
Do you think having worked at the venture firms helped or hurt you wanting to raise capital?

Jason  17:49  
Severely skewed my idea of raising capital. I would say, it just showed me that raising capital doesn't solve any problems, right? I was a really well known VC, Fred Wilson. He said Union Square ventures, they've invested in a "unicorn" like every year for the last decade or something, right? They've invested in hundreds of companies over the last 30 years, or whatever. A lot of your listeners might know him if you don't just type in Fred Wilson. And he wrote something, which was, no matter how much money you take, you still spend money, at the same burn rate is what he's seen, say we raised a million dollars, we're gonna make sure that million dollars last us for the next 12 to 18 months. Say we raised 100 million dollars, we're gonna make sure that money lasts us for the next 12 to 18 months. And on top of that, it doesn't solve any of our problems. 

Jason  18:39  
I think that was the biggest thing I saw at the VC firm is these companies would think that once they've raised the money that they're done, and that's just - the game has just begun. And then the other thing that was important that I noticed is once entrepreneurs raise money, they didn't get as stingy. They felt like they had the money. And one of the things that's so fun about being an entrepreneur is like, you're negotiating all day long, right? And you're taking inputs and you're negotiating all day long. And I think you lose that once you take in money, right? It's just psychology. Like, you just can't keep that mindset. Unless you're someone like a Jeff Bezos building their desks out of doors. That frugality, I think you lose it. 

Robert  19:13  
Yeah, that reminds me of a book I read not too long ago by Daymond John, The power of Broke, where he talks about how you just don't have that grit or that hunger in you, when you just have all these money being thrown at you. I mean, you don't have to be resourceful. You could just throw money at problems rather than trying to be creative and actually come up with a solution for the problem. So yeah, definitely a good point. I think it's really interesting, because I would have thought that working at a VC firm would have made you want to raise capital and kind of give you the inside scoop as to how to do it, how to be successful with it, and - but it sounds like it actually turned you off from it, which is really interesting.

Jason  19:48  
Yeah, I mean, look, we've talked about raising we've spoken to folks before, we're a profitable business. So why go take outside capital. We really don't need it. And then there's the other thing that's really important, which is VC are incentivized to get their portfolio companies to billions of dollars, right? There are many companies out there that shouldn't be a billion dollars. But they're amazing businesses. 

Jason  20:12  
Like, let's take the Investors Podcast Network, for example. The investors Podcast Network, probably never going to do a billion dollars in revenue, right. But it's an amazing, amazing, amazing business that Preston and Stig have built. And they've got amazing partners like yourself on board, who are making a decent chunk of change, and living a really great life. But they had taken VC money, the VCs would be unhappy with how the Investors Podcast Network is being run right now. Because it's not growing quickly enough. The incentives are messed up, right, you see. So I think that's one of the biggest fatal flaws of a lot of companies is VCs kind of step on their neck and say, grow, grow, grow, even though the founder knows that they shouldn't grow any faster.

Robert  20:54  
Yeah, that's a concept that I'm actually really passionate about. Because everybody, when they start a business, they want to become a billion dollar company. And that's mostly because of societal pressures and things like that, not necessarily, because that's what they need to reach their goals. And I think that puts startup founders at a huge disadvantage. Because if you go into this business, saying, I need it to be a billion dollar company, otherwise, I'm not successful. I mean, that's a lot steeper mountain to climb. 

Robert  21:17  
Whereas if you say, if I can get this to a $1 to $5 to $10 million business, then that's a massive success. I think that's so different. I think it really impacts your psychology. And I think if you looked at companies that had from the beginning a goal of $1 to 1$0 million, I bet they're a lot more successful than companies that go in and trying to go right for a billion. And I think that that's a really important thing for founders to get their mind wrapped around, just like you said. And there's nothing wrong with having a $5 million company, you can live a very good life with a $5, $10 $15 million company, even a million dollar company. So it's still a very successful business, even if it doesn't get anywhere near a billion dollars.

Jason  21:53  
Look, we live in a world of instant gratification, but in the entrepreneurial community, right. Like, I open up my emails, and every morning, I've got TechCrunch, saying this other founder, just raised 100 million dollars. And it's natural. It's just psychology to be like, are they doing something better than I am? Right, but I think we live in this world of instant gratification. 

Jason  22:13  
As an entrepreneur, you need to remember to hold out, you need to take the time to build the business into something actually worth funding. And then when the funding comes, you can actually use the investment to scale, right to scale your profitable business, not to figure out what you're trying to do. I think too many folks raise capital to figure out what to do, saying, Oh, if only I had this money, then I could create a business. I think that's reverse of how they should be thinking.

Robert  22:40  
So although you haven't raised capital, and you're doing it bootstrapped, you mentioned you started just in 2018. You guys have grown pretty quickly. So just two years later, you have a team of 10 people, how have you scaled your company already, so successfully, what have really been the different makers when building out your business?

Jason  22:57  
Gotten luckier more than those that have. I wish I had something revolutionary to say, but it boils down to two things. First one is talking to our customers. You read it in the blog posts, and in the articles and you hear it on the podcast, you read it in the books, talk to your customers, talk to your customers, talk to your customers. And then you get into this Founder World and you learn how many people aren't actually doing that, right. And it's fascinating to me, it's really, really fascinating. And so from day one, we've always prioritized if we host an event, we need to be on the phone with the event attendees the next day. If we host an event we need to be on the phone with the event sponsors the next day. We need to be talking to our podcast listeners, our podcast advertisers, our podcast hosts to make sure that we're providing the best network for them, right. And so talking to your end users and your customers is just been crucial. It's allowed us to launch new businesses, honestly, or excuse me new product lines, that we never would have known that our customers wanted, if we didn't talk to them. So that's one thing. 

Jason  23:54  
And then the second thing was just an average guy, right. And so is Mike. We just hired people who are better than us, and put a lot of trust and faith in them, and let them run with it. And that's been one of the hardest things to do, as a founder is give up control of the business. But we've hired folks who are much smarter than us and who have much more experience than us and said, Look, you've done this before, run with it. And that's paid unbelievable dividends. So we've hired experienced people. We've also hired people who are younger than us and hungrier and just having faith in them that they would grow into top talent, even though it might be a few months, maybe even a year or something. But they've grown to top talent. And that's really proven true. So for anyone just starting a business out, two things, just talk to your customers more than you think you need to and hire people who are smarter than you and give up control faster than you think you have to.

Robert  24:44  
Let's take a quick break to hear from today's show sponsor. 

Sponsor  24:47  ADVERTISEMENT

Robert  26:00  
What have been some of the big struggles that you faced while building your business? Both for yourself personally and for the company?

Jason  26:09  
It's a tough question, there's so many. But the company I would say, early on is the decision making. I think when you're an employee somewhere, whether you're at a VC firm, or work in finance, or work in tech, or work in sales, or marketing, whatever it is, there aren't a tremendous amount of decisions. No one can prepare you for the amount of decisions that you have to make as a founder, all day long, right? Hundreds of decisions with incomplete data. And I think you're kind of trained in school and in your life to make decisions based on data, and make a decision once you have the whole picture. Once you talk to both parties. 

Jason  26:43  
That's not how the world works. And as a founder, you just have to make so many damn decisions every single day, whether or not it's the font size, be a tiny bit bigger on the website, or all the way up to should we launch this new product yet? Is it ready, right? All the way up to like should we pivot the business. And so there's just so many decisions, that was a real struggle at first definitely gotten better at that. 

Jason  27:03  
And then the second thing is that I still struggle with is not going after shiny objects. I think not going after shiny objects is the toughest thing for entrepreneurs, and especially first time bootstrapped entrepreneurs. And what I mean by shiny objects is ways that you can get paid and make a lot of money, but that go away from your mission and your values of the company. For us, we're an events and media company that helps institutional investors understand the emerging digital asset space. And there have been so many times where we might do podcasts, and a dentist company would come to us, right. And like we would run an amazing marketing campaign for that dentistry company. But does that align with our mission, our values? And if not, we probably shouldn't do it. So that's what's been tough as a company from a company level. 

Jason  27:51  
And then from a personal level. I've struggled with this my whole life and still do struggle, just saying no - saying no to more people saying no opportunities, and just really trying to understand the opportunity cost of saying yes.

Robert  28:02  
Yeah, as I'm building my podcast business with the investors podcast team, that's one of the big things that I'm struggling with myself is that shiny object. I mean, there's just so many different things that we can do so many different products or services we can offer so many different things you can build. And it's just one of those things that you get to really decide what's going to be best. And it's hard to make that decision. It's hard to say no.

Jason  28:22  
No, I was just gonna say it really is and especially with limited resources. I think it's easier to turn down shiny objects if you've raised capital, actually. But if you're bootstrapped, right, and you see something, you've got revenue 5 million a year, and you see something that could make you an extra 500 k that year? Well, it's easy to want to go after it. But long term, it's not a smart decision.

Robert  28:42  
Now I want to transition and talk a bit about Bitcoin. For someone who may not be familiar with Bitcoin or cryptocurrency explain to us what Bitcoin is and what cryptocurrencies are.

Jason  28:53  
It's a big question. I think there are 100 different ways that you can describe Bitcoin; its importance, and its relevance kind of lies in the eyes of who's looking at it, and who's buying and who's holding it, right. I'm going to maybe take three minutes here and go through the whole shebang. 

Jason  29:07  
I think a simple definition of Bitcoin would be it's first and foremost, a new form of money. It's a new form of thinking about money. It's a new form of storing money, transferring money, and just dealing, organizing and understanding money. And then all kinds of second order financial effects that come out of that, but just to kind of like what is Bitcoin in one line? It's the world's first cryptocurrency. And it works because of the world's first public blockchain network. Right? 

Jason  29:35  
What does Bitcoin do? It lets you send and receive value to and from anyone in the world using nothing more than a computer and an internet connection. 

Jason  29:45  
Why is that revolutionary? Because unlike every other tool for sending money over the internet, it works without the need to trust a middleman, right? And so the lack of any corporation sitting in the middle in between means that Bitcoin is the world's first Public digital payments infrastructure, by public, I just mean, available to all and not owned by a single entity. So when you think about it, you know, we have public infrastructure for information, we have public infrastructure for websites for email, and that's called the internet, right? 

Jason  30:15  
But the only public payments infrastructure that we have for money and for cash is paper money, and it only works in face to face transactions. It's pretty damn outdated right? Before Bitcoin. If you wanted to pay someone remotely over the phone, or the internet, you couldn't use public infrastructure, you had to rely on a private bank, to open their books, enter the debit, enter the credits, the person that you're paying. If you both don't use the same bank, you know, then there'll be multiple banks, multiple ledger entries in between. And with Bitcoin, the ledger is the public blockchain. And anyone can add an entry to that ledger, transferring their Bitcoin to someone else. Anyone, regardless of their nationality, their race, their religion, their gender, their sex, their creditworthiness, and for absolutely no cost, create a Bitcoin address and receive payments digitally. And so for those reasons, I think it's pretty damn cool.

Robert  31:06  
We've had the US dollar for a while and other fiat currencies, and they've treated us well. Why do we need crypto currencies?

Jason  31:14  
It's a good question. I will respond to that question with another question, which is how long have we really had the US dollar? Right? 

Jason  31:20  
The real answer is we haven't had it for that long. The US dollar was backed by gold for a long time, and is really valuable then right? You could exchange your dollars for gold, and it's backed by something. But in 1971, Richard Nixon took us off of the gold standard. And any history nerds out there, you remember the speech, he took us off the gold standard, and said give it it's just temporary guys. It was on that public conference that he did for All Of America, where he said, Look, we're going off the gold standard. It's just temporary. Well, it wasn't temporary. It's been since 1971. And so the US dollar, right, this Fiat system that we've created, it's really an experiment. It hasn't actually been going for that long. So it's been less than 50 years that we've been doing this. 

Jason  32:07  
But actually, let me double up on that, because the second part of your question was, why do we need it? And I think that we is the most important part of that, because the we is very different for different people, right? A lot of your listeners are in the United State. America is the hardest place for folks to understand Bitcoin. Why? Because money works in the US and the government works in the US, right? That's not true for the entire world. Actually, for the majority of the world, that's not true. And so some people might like Bitcoin, because it's not manipulatable. Some people might like Bitcoin, because it's not seizable. It's not censorable. It's not debasable. And so I think when you say like, why do we need it? Well, are you a citizen in Venezuela? Are you a US investor looking to allocate 1% of your portfolio? Who is the we and then you can start to understand why it's valuable.

Robert  33:00  
So if someone is ready to buy a cryptocurrency, whether it's Bitcoin or a different one, and this is a question I actually got after - a lot after our last episode on Bitcoin, so I wanna I want to walk through with you, how does someone from the very beginning to the end go about actually acquiring a crypto asset?

Jason  33:18  
Great question. It's and it's cool, right? Because when I got into the space, there wasn't really any way like, there were some websites right, like Coinbase. But now there are mobile apps and it's even integrated with like Robin Hood, a lot of brokerages like TD Ameritrade and Fidelity are allowing their customers, or soon will be, allowing their customers to buy bitcoin, which is pretty damn cool. 

Jason  33:39  
But for all of your listeners, I would recommend first think about what's the amount that you're going to be buying, Are you someone who should be allocating 100 bucks a week to Bitcoin? A thousand bucks a week? Are you a big investor, you know, allocating $100,000 a million dollars to Bitcoin, right? Because that will determine what platform is best. 

Jason  33:57  
But I think for most of your listeners, there are a few things that should be important, right? Low fees is really important. The ability to dollar-cost-average into bitcoin is really important, right? Dollar cost average is just buying a set amount every single week, kind of having it you know, buying it passively on an automated regime rather than just buying a whole bunch at once. So dollar cost averaging, low fees, and then the ability to send from your wallet to another person's wallet instead of selling and then having to buy again.

Jason  34:28  
To get more concrete with the answer I would look at Voyager. Voyager is a phenomenal app, I would look at with really low fees. I would look at Gemini, which folks might know because it's the Winklevoss twins started that company. I would look at Coinbase, I would look at Cash App. And then so those are the four I would look at if you're more of a smaller investor, buyer: Voyager Gemini, Coinbase and Cashapp. And then I would look at - if you're a bigger investor - I would look at like a River Financial. And if you're much larger, institutional investor, I would talk to the folks that Pantera, Morgan Creek Capital, Galaxy Digital. 

Jason  35:01  
But for your listeners, I would go with Voyager, Gemini, Coinbase or Cash App.

Robert  35:04  
There's a lot of different cryptocurrencies out there. What do you think is the best long term investment?

Jason  35:10  
Bitcoin is the only one I would recommend someone buy. 

Jason  35:12  
So let's zoom out right let's think about why Bitcoin is so revolutionary, right? And one of the biggest reasons is the founder's anonymous. So Ethereum is the second biggest cryptocurrency. It's the one that most of your listeners, if they don't take my advice would probably buy after they bought Bitcoin and they wanted to buy one more, they probably buy Ethereum. 

Jason  35:33  
Well, a few years ago, some folks who've been in the space for a while might remember there was a rumor that Vitalik Butorin, who's the founder of Ethereum got killed. Ethereum's price tanked 20 to 30%. Okay, so that tells you a lot about that public blockchain and, and about Ether and about Ethereum, which is that it's pretty damn centralized, right? If people are so worried that the founder of Ethereum gets is going to get killed, and then the price of Ethereum goes down, then it's pretty centralized. 

Jason  36:04  
Bitcoin and its founder, Satoshi Nakamoto, could be a man could be a woman could be a group of people, we still don't know. He, she them, they're anonymous. And that's one of the most important things about Bitcoin that no one can ever replicate. And then the second thing is there's a hard-capped supply. And that's what makes Bitcoin - more than it's not debasable, it's not seizable, it's not censorable - there's a hard cap supply: 21 million Bitcoins. There will only be 21 million bitcoins.

Jason  36:31  
And so, in a world where we're so damn worried about inflation, and the feds pumping trillions and trillions and trillions into the economy, aka leading to inflation, inflation-hedged assets, like Bitcoin are really, really exciting. And we know because it's built into the algorithm, into the computer, and we trust it because there's no team or founder running this thing, that it can't be changed. Bitcoin's kind of the only one I would recommend. There are thousands of cryptocurrencies are probably going to be 10s of thousands of them pretty soon. But bitcoin’s the only one that's survived the test of time.

Robert  37:04  
When we talk about there being a fixed supply of Bitcoin at 21 million, like you said, how is that still so important, when a Bitcoin is almost infinitely divisible? It can be divided into it's almost like an infinite supply. How is that still a valid reason for Bitcoin?

Jason  37:23  
Yeah, good question. That's important to understand. So it's divisible right? To buy Bitcoin, Bitcoin's trading at like $9,000 or $8,000 today, you don't need $8,000 or $9,000 to buy one Bitcoin, it can be divided and you can buy $2 worth of Bitcoin $1 worth of Bitcoin, right? And it's so it's divisible into little things called Satoshis. But the amount that will be released into the system is hard capped at 21 million. 

Jason  37:49  
So let's compare it to the US dollar, right? The US dollar is divisible, it's divisible into quarters, nickels, dimes, and pennies. Same thing as Bitcoin, it's divisible into smaller units called Satoshis. The difference is, if the Fed you know - we need more money as a country, we just go to the printing press plan the red button start printing out more US dollars. With Bitcoin every 10 minutes, there are more blocks that are basically created every 10 minutes every block, there are more Bitcoin that are added to the circulating supply, but that 21 million fixed supply never changes.

Robert  38:27  
Okay, so that makes more sense. That's the biggest thing I get from people that know that Bitcoin is capped, and people that use it as an argument, they always ask me, Well, why does that matter if it can be divided into a ton more coins, if you will, or fractions? And I've never really had a great answer for it. I'm a beginner when it comes to Bitcoin. So I'm still learning myself. So that's why I wanted to ask that question. 

Robert  38:47  
But Jason, I've really enjoyed our conversation today about your background, your company and Bitcoin and cryptocurrencies. For those listening that want to connect with you further after the show, where can they go? 

Jason  38:59  
I would love for folks to DM me on Twitter. My DMS are open. It's just @jasonjanowitz. Our website is Block Works Group. If you're listening to this podcast, you probably like podcasts. And we have 20 podcasts, right? And so go check out some of our shows on our website, Block Works Group and just type in Block Works Group and podcasts on Google. Subscribe to our newsletter. And yeah, DM me on Twitter. I'm pretty active there and LinkedIn as well. So yeah, hopefully some of your listeners take me up on that. And I would love to have a conversation with some of them.

Robert  39:33  
Awesome. I'll be sure to put links to all those different resources in the show notes. Everybody listening today can go reach out to you and ask some questions if they have any. Jason, thanks so much.

Jason  39:42  
Thank you. Appreciate it. 

Robert  39:44  
Alright guys, that's all I had for this week's episode of millennial investing. And I'll see you again next week.

<< /END TRANSCRIPTION >> 

I just had an ad hoc Bitcoin debate. I'm finding, the more I put myself out there on the topic of Bitcoin, the more I learn about myself and my command of the knowledge I've been accumulating to date. I'm still learning - every single day, reading and listening and watching all of the content that keeps on growing. I stuck my typing fingers out and said something asking everyone on a particular call I was on if they'd been tracking Bitcoin. I heard rumblings, ah, yea, I'm still working on setting up my Coinbase account or, yea, I've gotta dollar average on in. Another person, let's call him Joe, went all in on the other side of the argument, Bitcoin is dead, it's not money, and the only currency that'll ever live is the U.S. Dollar. He said I should be worried about 51% attacks. I was told that I needed to study my history better and go look up the term, "Tulip Bubble", and then get back to him. 

Then I got the following screenshots shared with me:

Seemingly harsh, I thought. Study my history better? Tulip Bubble.... Why do people keep bringing up tulips when they are trying to argue against cryptocurrencies and Bitcoin? Tulips. ...  That always surprises me.

Actually, as my business partner says, "the “tulip bubble” as people refer to it is more of a confirmation of human behavior that, again, is a stupendous affirmation of why bitcoin is needed, is the answer."

I debated back and forth in my mind on whether to engage - or to just let this Tulip Joe go.....  and despite my tendencies, decided to go for it. Here's what I wrote in reply (for context, this is a group chat, so there are other folks viewing this discussion going back and forth). This is literally a "copy/paste" of my response:

• If you've truly read the whitepaper for Bitcoin, you know that Bitcoin was created to specifically address the problems of modern money - the U.S. Financial system and the U.S. Dollar (fiat money).
  

​
Macro-economic points: 

• Federal Reserve has cut interest rates to 0%. This is an issue.
• The world is addicted to Quantitative Easing like it's heroin. Trillions of USD printed out of thin air, even in this year alone. "QE4": This is another big issue.
• Nassim Nicholas Taleb (The Black Swan guy) wrote (in beginning of The Bitcoin Standard): "... we only discovered too late: one can macroBS longer than microBS, which is why we need to be careful of whom we endow with centralized macro decisions." ----> basically, those that have claimed to understand macro-economics and have been running the Fed, had no idea what they were doing.
• 1971 US officially went off the gold standard - became fiat money. There's history for you.
• oh yeah, and shortly after that, 1974 -- Nobel Prize winner, Hayek wrote about ("Pretense of Knowledge") how that was going to be a grave mistake, the U.S. dollar becoming a fiat currency, as the world's reserve currency.  And here we are.
• After WWII, 1944, Bretton-Woods Agreement, the U.S. Dollar became the world's reserve currency. Another bit of history. We had the most guns. But today, 2020 - we're at another "Bretton-Woods" cross roads. Did you see the IMF (international monetary fund) meetings that happened this week - the world is moving to digital currencies. China's already got a massive head start. The middle east is working on digitizing quickly. Once all of these digital currencies exist, what's the common digital currency across the globe? Bitcoin.

Supply side - Bitcoin has a limited supply 

• Again, only 21 million total Bitcoin ever available. Only 18.4 million currently in circulation. Math.
• Actually more than 60% of Bitcoin in circulation has not moved - people are using it as a store of value.

Demand side for Bitcoin (which has limited hard capped supply)

• Bitcoin is up more than 70% year to date, and is the best performing asset class in the decade (2010-2020).
• Corporations are now using Bitcoin as the reserve asset part of their treasury: Galaxy Digital, MicroStrategy, Square, etc. This is just the start. There is very few other assets out there that's not simply way over priced and/or not a great store of wealth when you look at the price in terms of gold prices. Demand will continue to go up.
• Actually, despite how "volatile" Bitcoin has been, it's been consistently trending upwards - it beats a lot of other national currencies out there, including the U.S. Dollar. Another example: Turkey. I wouldn't be surprised if nations opt into Bitcoin as a way to leap frog innovation/time to pull themselves out of the dark holes they are in today. Another example: Venezuela, Argentina, Columbia, etc. Again, more support for the Demand side.

As for 51% attack concerns, yes - and now we are much further along with the Bitcoin network. It would literally cost billions of dollars ($15 billion I read somewhere?) to make this happen, if one could find and secure all the hardware, and that alone is really difficult to do for even setting up a small mining operation. The chances are becoming more and more slim as the Bitcoin network has matured - case in point, we now have more and more public companies putting their cash reserves into Bitcoin. It's 2020 now, a lot has happened since 2015, 2016, 2017, 2018, and 2019. There is no other currency that is as sound, as secure, as borderless, deflationary, hardcapped, transparent, immutable, decentralized, nonsovereign (as Travis Kling says often), than Bitcoin. My bet is on the digital future, on technology, and on math.

More on the 51% attack concerns: Think about it in terms of the built-in game theory. In short, it's not in the best interests of the miners to try and spend a shit ton of money  to double-spend Bitcoin. They would have to spend a shit ton on equipment, electricity, space to even get a short at rewriting the blockchain. It's like trying to rob the bank for $10 million, after spending $10 million. Makes no sense. The numbers favor all of the people who have an incentive to keep the integrity of the Bitcoin global network is MUCH greater than the number of folks that want to attack it. We saw it - with Bitcoin Cash as the hard fork. That was a critical moment in history and the perfect moment for Bitcoin to have died. It didn't. Bitcoin has only gotten stronger since then. 

RE: Bitcoin and tulips. Yea, this is the knock that we hear often from the "peanut gallery, it's a lazy argument intellectually and very misleading" (as I think Pomp would say about the Tulip argument). I heard a lot about tulips in 2017 and especially in 2018. Those were truly hard times for me personally.

[AND THANK GOODNESS FOR HUMANITY that] Bitcoin didn't die in 2018, sorry. Nor in 2019, sorry, or in 2020. Sorry. You're talking about the ATH (all time high, that was just all kinds of crazy speculation thanks to the ICO's) in 2017, it went from $1k to $20k, and then back down to $3k. It's not a good factual representation for anyone that looks at the market holistically. [I've learned recently that] The Bitcoin average across many weeks, 200 weeks is the better metric - [and as we've seen] Bitcoin is a solid investment. Also look at the number of consecutive days that Bitcoin has been (really boring) and just hanging out over $10k in 2020. ----> really that'll show you that Bitcoin has stabilized a lot since the crazy hey day of 2017. [Technology is evolving FAST. 10 years ago, I had turn-by-turn map directions printed out on paper. Today I have Waze on my phone.] As investors, we should care more about the long term. Things go up and down, and in this case, Bitcoin has been trending up, even with its ups and downs. The technology is much more mature. The network is much bigger.

​And the timing is also, very right.

One more (the U.S. Dollar versus Bitcoin debate): 

I don't know how I did, if all of my facts are straight - they should be close (enough). 

Anyways, I'm a believer in Bitcoin, in bitcoin, and in blockchain. This is the future.

​--Arry 

Saw this talk by Jimmy Song (and Jimmy Song speak live) for the first time when in LA for Russell Okung's Bitcoin is_ conference. So many concepts and ideas that I hadn't thought about before were introduced - and so provocative. I found the talk, had it transcribed, and am sharing it with you, because it really is so good. A couple of my favorite points that really got me thinking:

• The Cantillon Effect: "Alright, so I don't know how many of you know what this is but these are glass beads and this was used in sub-Saharan Africa for money for a very long time. And in fact it makes sense to be money if you heard Saifedean Ammous's talk - it's about hard money versus easy money. Glass just isn't very abundant in some in Africa so it made sense to use this as money. European settlers came in and they recognized that oh they're using glass for money. We know how to make glass we have glass blowers and we have a plentiful supply. So what did they do? They went, made a whole ton of glass beads, and bought up everything. They bought up everything. They were able to print money essentially as a way to take the wealth of everybody that was depending on that as money. And this has an economic name and it's called the Cantillon effect. And the Cantillon effect is essentially this - the first printers are the money, the people that get to spend the money first, they get all of the benefits of the printing of the money. "
• Capitalism is about capital accumulation. It is about creating more so you can you can make even more money and continue to benefit society. In fact, production and entrepreneurship are exactly what happens in a in a hard money civilization because most people aren't going towards investment banking or the money production business. They start using their talents towards something else. They start giving people what they want.
  

Watch the video below from Bitcoin Is_ 's Jimmy Song's talk. So good.

--Arry 

Conference: "Bitcoin is ___"
Speaker: Jimmy Song
Title: Bitcoin is the Ultimate Social Justice
TRANSCRIPTION of above video below here.
 
Alright, how's everyone doing? I know it's like late afternoon right now. Maybe you're feeling a little bit sleepy, maybe you need to get a little coffee. I won't be offended if you fall asleep or something. I'm okay with that just you know I won't judge you too much. Alright, so my talk is called Bitcoin the ultimate social justice and I deliberately titled it that way as a way to provoke maybe a little bit of a reaction because we have a conception of social justice that I think is very flawed and we're going to talk about exactly in which… actually can you change that to the actual slide. Yeah thank you. Otherwise I'm going to get lost… as the ultimate social justice and this is something that I'm very passionate about and this is the way in which Bitcoin will impact society is absolutely huge. So, what I'm going to do is go through an argument essentially arguing that Bitcoin is going to be better for the cause of social justice than pretty much anything else and we're going to look at the current situation - what things are like right now, how fiat money changes a lot of the incentives, and exactly what incentives people have under a fiat money system. Then we're going to talk about Bitcoin now that changes you know the incentive system and how people behave under a Bitcoin system and then talk about the future and how things will change there.
 
So let's look at the cause of what's going on and let's sort of try to define at least what social justice is all about. Alright so we have a lot of problems in the world right? We have a lot of people that are poor, some that are rich, and so on. And we also have you know some people that have more opportunities than others we also have other people that have power over you some people that they can abuse and so on. There's a lot of different problems in the world today and the general way in which social justice sort of defines this or sort of attempts to remedy this is by treating essentially the symptom. And the symptom is kind of like the tip of the iceberg, alright? Like there's a lot more that goes into it than just some somebody is suffering. Generally, if you look at any charity or NGO or government program, they're looking to treat the symptom. This means making sure that the people that are going hungry have food or that the people that don't have housing have a place to stay and so on. But that's treating the symptom. The actual problem is underneath and that's what I want to talk about.
 
So this is the general way in which a lot of NGOs and you know charities and so on, this is how they generally approach the idea of helping people. And you know if you can't read it, it's give a man a fish you feed him for a day, teach a man to fish and you feed him for a lifetime, create a good tutorial and you can teach himself how to fish. This is sort of the way in which a lot of people that are in these spaces of charity and social justice, that's how they think about it. But I would submit to you that this is not the problem. It's not a problem of information. It is not a problem of information at all. It's not about somebody not knowing how to fish.

Fact the real problem is oppression - it is oppression. People have power over other people and that is the real problem here. And when you have oppression well you can do certain things. It's not that the person that's being oppressed doesn't know how to fish, it’s that he has to apply for a fishing license or has to you know get in with government crony in order to fish at scale. It's that they got taxed on the fish that they catch because that's the current law that happens to exist and that's the real problem. It's not that they don't know. Lots of people know. That is not the problem at all.
 
So what happens when there are enough people that are oppressed continually and there are more regulations and things like that that happen is that eventually you end up with revolution. This is the most recent thing that happened that's like that is the Arab Spring. I mean Muslim countries where you had Arab Spring, a lot of them were very oppressive. They had so many rules and it gets worse and worse and worse until basically the people explode. It’s gradually then suddenly and all of a sudden something happens. And so you might be wondering, "okay are we always doomed to this kind of cycle where you know you have a revolution and then you have more and more regulation and more and more oppression and then people get sick of it and then they revolt again"? Yes, but things have changed. Bitcoin is something that's new and different and we just heard from Alex who's talking about government surveillance and technology that's used to make people more and more oppressive, but there's also a technology that's taking the power of money printing away from the state. Financial oppression, believe it or not, is the biggest source of oppression that you can have. In many ways, that's what we're going to be talking about going forward. 
 
Alright, so we talked about the current problems and my argument in this section is that the real oppression is easy fiat money - is easy fiat money. Alright, so I don't know how many of you know what this is but these are glass beads and this was used in sub-Saharan Africa for money for a very long time. And in fact it makes sense to be money if you heard Saifedean Ammous's talk - it's about hard money versus easy money. Glass just isn't very abundant in some in Africa so it made sense to use this as money. European settlers came in and they recognized that oh they're using glass for money. We know how to make glass we have glass blowers and we have a plentiful supply. So what did they do? They went, made a whole ton of glass beads, and bought up everything. They bought up everything. They were able to print money essentially as a way to take the wealth of everybody that was depending on that as money. And this has an economic name and it's called the Cantillon effect. And the Cantillon effect is essentially this - the first printers are the money, the people that get to spend the money first, they get all of the benefits of the printing of the money. 
 
And it's something that Richard Cantillon noticed in the 1700s. He used to work as a banker and then you wrote you know some economic treatises, but that's essentially what happens. The thing about the Cantillon effect that's so seductive is that the population doesn't really notice right away. It's very slow. When you're inflating money, when you're adding new money to the population, you don't notice oh this is going to be worthless later. You know it's a very gradual thing and then very sudden. And this has some really pernicious effects including long term uncertainty. And among other things that it does is it increases consumption and rent-seeking. By consumption I mean just like sort of buying things for now alright? Like YOLO or FOMO or whatever. And rent-seeking in the sense that - and the way I define rent-seeking is taxing some transaction without any adding any value and there are plenty of people that do that. 
 
Here's a chart of the health care system in America today and you can notice that the number of physicians has not gone up very much, but the number of administrators has exploded. What is going on? Well there's a lot of money going into the healthcare system and as a result there's a lot more rent seekers - a lot of people that are taxing transactions that aren't really adding anything. Now I could show you a similar chart for education and government and many other organizations, but this is just what happens when you have a lot of money printing. There's no real… there's a lot of people that end up sitting in the middle of transactions making money essentially for doing nothing. 
 
And this has some consequences among others this is the question that gets asked. How do I get a job? And if you know anyone that's unemployed or in college right now, this is the question that they ask - how do I get a job? And if you think about it, this is the wrong question because in a sense it's asking where can I fit right; what rent seeking opportunity can I get? It's not about adding value at all. It's about finding a place in the world where you can survive right? It has a very static view of the world where there's only so much to go around and you need to get your piece - and that is the wrong attitude. 
 
And this has some serious consequences and real social ills that come out of it. Here's a cartoon. I don't know if you can read it but it's sort of from a perspective of a millennial. I don't want much in life, just sick clothes, a bunch of money, convenient restaurant options, free shipping is always nice, and like a sense of purpose I guess. I love this cartoon because it does sort of like capture that mentality, but think about it. If you are a rent seeker in in this economy, what are you going to be thinking about? You're not thinking about changing the world or providing value for the world. You're thinking about all this other stuff and why is that? Well it's because deep down inside you know you are a leech; that you are really stealing from everybody else. And I'm serious about this. There's a lot of people that are going through having to deal with the fact that they are not contributing at all to society. We have epidemic levels of depression. Where do you think that comes from? If deep down inside you know that you are not contributing anything to society well how should you feel? And think about it. There's a lot of other people that when they have that voice inside that's telling them okay you're not really doing anything useful, well they go around and drown that. We have epidemic levels of all kinds of addictions too – alcoholism, drugs, even like TV or getting obsessed with the latest Netflix series, or you know eating or whatever. There's a lot of different addictions that everyone can get into. That causes real social ills. And eventually you get to a situation where you have a lot of run seeking and eventually you collapse. 
 
These are the ruins of Rome right? The Roman civilization famously devalued their money. Diocletian went from 70% silver in a denarii down to like 5% and that caused a lot more rent-seeking that caused a lot more people that weren't doing anything and eventually the whole edifice just sort of crumbled under the weight of all the rent seekers that were out there. So Fiat leads to decay. It's a fundamental part of it. 
 
Alright so why is that? Why does Fiat cause all this? Well there are two ways essentially to make money in any system. The first is to create more of the monetary medium - more of the monetary medium. So with gold or something like that you have to do the hard work of actually mining it. With central bank, they can just print the money and this is actually more expensive than what they do which is update a database that says I have 200 million more dollars. So there's creating more of the monetary medium. 
 
In the second case the other way to make money is to provide goods and services and this is what actually builds civilization. If you're successful with creating a good or service, then you're going to be adding something beneficial to everybody else. It's what they want. 
 
The key thing to realize is that the former does not add anything to society. If you're creating more of the medium of monetary exchange you are not contributing anything. You're not making anything. You're essentially stealing from everyone else through inflation. The latter definitely adds to society because by definition you're doing something better than what's out in the market already. You're doing something faster, more conveniently, more you know securely, or something - you're doing something better than what other people in the market are doing because there's a market for your services. And as a result you're adding to the pie. You're growing the pie. You're making something better. And the key thing to realize is when there's easy money people go towards the former. When there's hard money people go towards the latter. 
 
So when you have easy money for example you want to go into the money production business because the cost of producing that money is very cheap relative to the value that you're going to get out, but when there's hard money only the specialists go in. So if you're… not many of you are probably gold mining right now and that's because you have to be an expert in gold mining in order to be a gold miner and this is actually one of the biggest mistakes that people make when they come into Bitcoin is they think oh I can go print my own money buying miners or something, but in fact it turns out that only the real specialists can make money off of mining. And this is really terrible because think about where people have been going… where the best, smartest, and most talented individuals have been going into for the last 50 years? They've been going into investment banking, right? And they go into it not because they happen to be talented in investment banking, they go into it because that's where the margins are. That's where they can make the most profit. It's much easier to be an investment banker and make 300 million dollars a year than to create a three-billion-dollar company and keep three hundred million dollars for yourself. That's the reality that we are living in is that because of easy money everyone is motivated to go towards that direction and that's a real tragedy. That's how civilization gets built and hopefully this picture comes up. 

Alright, so I was born in Seoul, Korea and I found this nice picture of the contrast between then and now. See, 1900 it was kind of a backwater Asian place and after you know a 120 years later you have this thriving city that you have now. That happens because you have a lot of entrepreneurs, because you have people building things, that are creating things for the benefit of others. In a way, they're creating goods and making the world better and they get to profit - that's the beauty of capitalism. 

So let's talk about the new system right? Because we're are under a fiat money system well how is that going to change? The revolution is Bitcoin and the revolution comes in from the fact that we have property rights. We have control over our own money right now. If you have money in a bank account the government can confiscate it from you. They can accuse you of being a drug dealer or using it for terrorism or something like that. Even if you have money under your mattress, they can just inflate it away. They can print another eight hundred billion dollars to different investment banks or something like that. We don't have property rights over our money, but with Bitcoin we do. We can take the power of money printing away from the state and as a result we have a lot more long-term certainty because we can save for the future. A lot of people think that capitalism is like materialism or something like that. It's this idea you know I got the sickest car or something like that. That is not it at all. Capitalism is about capital accumulation. It is about creating more so you can you can make even more money and continue to benefit society. In fact, production and entrepreneurship are exactly what happens in a in a hard money civilization because most people aren't going towards investment banking or the money production business. They start using their talents towards something else. They start giving people what they want. And this increases production, increases value for everybody. There's a really good illustration in Saifedean's book which I'll repeat here, but at one point in time people used to catch fish with their hands and it would take… maybe you can catch only like one or two fish a day by trying to catch with your hands. At some point somebody decided okay you know what I'll catch an extra fish and sort of half star for a day and I will make a fishing pole and using a fishing pole - that's capital accumulation - they can maybe catch four fish a day and then doing that for about a week, you can save up, take another week to make a boat. Now maybe you hire somebody to drive the boat while you go fish. You get better and better productivity out of people as you have more creativity and entrepreneurship to the point where we are today where we have a, you know, a fishing vessel takes like five years to build cost millions of dollars but you have eight people on that ship and they can catch hundreds of thousands of fish in a week. That's real productivity; that's real entrepreneurship; that's real value that the rest of civilization gets to have.
 
Anyway the pertinent question that people ask in this case is not how do I get a job; it's what do people want. And this is the right question it isn't about finding your place in a rent-seeking society. It is about what value can I bring to other people and this is absolutely critical for entrepreneurship. I'm speaking to you right now as a speaker, as an author and stuff like that, but for the first years of my life I was a coder. I was a programmer. Think anyone ever paid me to go speak in front of people or to write a book? Not a chance. Those are things that I had inside of me that I didn't realize I could use for that sort of stuff but being an entrepreneur, being a producer, I was able to see ok well that's something that I can do. In a Fiat money society, what you end up with are very specific roles right if a company hires you to be an accountant that's all you can really be. They don't hire you to also be a publicist or something like that not unless you're in a start-up. But it's much more fulfilling to be an entrepreneur in part because you get to use all of who you are instead of this narrow slice that's defined by the company. And that's something that hard money allows and Bitcoin is the path to get there because that takes the power of money printing from the state and that makes it very difficult to go into the money production business eliminating a lot of rent-seeking.
 
Anyway, let's examine what that actually means and what that actually looks like. So one of the things that's really scary about Bitcoin is that you know ownership is pretty scary. This is a cartoon you can probably look at it later. It's about somebody that newly bought a house and you know doesn't think that he's ready for a home ownership. Fact of the matter is were not used to the personal responsibility that Bitcoin requires. There's a lot of people that you know… like even Bitcoin core developers, if they have to move their Bitcoins, they get really nervous. Why? Because it's scary having to handle a lot of money right, where it might be permanently lost. Everything is centralized in a sense to take away that fear of having to move or be responsible for a lot of money and that's convenient right because you don't want to lose money to a bank robber or something like that where if you had like a gold bar in your house and it gets taken away from you all your savings disappear. That's kind of scary, but at the same time, we've lost something we've lost something as a civilization as a result of all that centralizing of responsibility and it's this idea of personal responsibility. See when you have personal responsibility, it helps because you start caring about the thing that you're responsible for you. You want to make it grow. And you know those of you that are parents, you kind of understand what that means. A lot of it is helping the thing that you're in charge of. And when you do that it leads to a lot of good things because when you have long term certainty, when you're when you're thinking about ownership and you you're used to the responsibility, now you can set goals and have a purpose, and that in turn leads to a lot of building. And instead of the sort of the rent seeking job that you might have where your soul is telling you, you are not doing anything good, when you are producing something for the rest of civilization that is beneficial, it's much easier to get up in the morning. It's much easier to live and know that you are contributing something. You don't have to drown yourself in alcohol or drugs or sugar or whatever it is that you might be addicted to. It becomes something different. And that is the future that we want to have with Bitcoin. 
 
And really the key here is that we have a path to a peaceful revolution. It used to be that history was you know just a regime that would get more and more authoritarian until there was a revolution. That's like one view, kind of cynical view of history, but now with Bitcoin we have the ability to decentralize the power. See a lot of the social justice advocates, what they think about is okay if only my guy were in charge, things would be different. If only my guy were there, then everything would be okay. That's the wrong problem. It's still centralized power. With Bitcoin, we can start taking some of that power back and give it to ourselves. And as a result, all of the rent seekers that are propped up, we walk off the platform that goes away naturally and that's a very good thing. We don't want waste in our society. I love this picture because it has the Statue of Liberty which stands for freedom in the foreground and you have all these buildings that are built by big banks in the background. 
 
The prosperity that the U.S. experienced in the 19th century versus the 20th century are profoundly different. 19th century we were under a hard money standard and a lot of stuff was built during that era. The 20th century, it was mostly because of the dollar hegemony. It was the result of the dollar being the world standard and being able to use that to gain a lot of wealth from other countries. And thinking about the 19th century, there is a really cool phrase that's part of why I wear the cowboy hat. 
 
The phrase is, “Go west young man. Go west young man.” Now they were saying this not just to people that wanted to you know pan for gold or something like that. They were saying this to nearly everybody because say you are like 22 years old, maybe you're a new baker or a barrister or you know cobbler, whatever. The thing is, if you stayed on the East Coast, you would have to compete against everybody else that was a cobbler or a baker or a barrister and it would be very difficult because they had like 20 - 30 years’ experience on you. How are you going to compete against those people? They already had the clientele and everything. Well if you went out West, what happened? There weren't that many bakers or cobblers or barristers and you could make a lot more of yourself very quickly that way. Bitcoin gives us a new frontier. Bitcoin gives us a new frontier and it makes all of this happen a lot faster. And ultimately, this is why I think that a lot of social justice people have the wrong conception of human value. It isn't that we're not feeding them or housing them or clothing them - that's not the tragedy. Yeah it is a tragedy that's people are starving or don't have homes or don't have clothes or don't have you know freedoms and so on. That isn't the real tragedy. The real tragedy is that these people aren't contributing to civilization. The real tragedy of the starving African child isn't that the child is starving - I mean that's a tragedy too - the real tragedy is that that child has no chance to express their creativity, entrepreneurship, and inventiveness by contributing to civilization and creating something that none of us have thought before by creating businesses, by making something better - that's the real tragedy of centralized power is that it oppresses so many people so that we don't get to benefit from the tremendous human capital that already exists out in the world. By bringing sound money back through Bitcoin, that is the ultimate social justice.