2minutebitcoin

2 minute summaries of popular and important Bitcoin pieces.

Learn something yourself, review an old-but-gold article or send to a friend who doesn’t have time. All in 2 minutes.

Public Key

npub1p63d4vekvuql9zltpp4dezzfk2xxfgjsfqyglf4ju4syalekn4csn9ej3v

NIP-05 Address

[email protected]

NIP-57 Address

[email protected]

Profile Code

nprofile1qqsqagk6kvmxwq0j304ss6ku3pym9rry5fgyszy056ew2czwlumf6ugsw0wu6

Publishing to

nos.lol

relay.damus.io

Author Public Key

npub1p63d4vekvuql9zltpp4dezzfk2xxfgjsfqyglf4ju4syalekn4csn9ej3v

Show more details

Last Notes

2023-09-24 15:46:12

The system will collapse. Most people refuse to believe this possibility. Especially the older generations that have heard these warnings time and time again over many decades or the better part of a century.
Can't blame them too much - but one has to remember that a broken clock is right twice in a day. It’s coming, although nobody can predict when.
Society changes when money dies. Take for example the Roman Empire which went fiat by way of diluting the denarius of its silver content
> From a purity of greater than 90% silver in the 1st century AD, the denarius fell to under 60% purity by AD 200, and plummeted to 5% purity by AD 300 (Wikipedia)
People became more degenerate whether by social engineering or just declining societal morals and ethics.
People in occupations that were deemed beneath them also became celebrities in a way. Gladiators, actors, entertainers, chefs and so on went from being looked down on to becoming celebrities. Ring a bell today?
Time will ultimately show us. Better be stacking sats in the meantime.

2023-09-05 16:06:43

The question of which money humans will choose, therefore, boils down to which good, or goods, any individual believes will best store the sum total of their lifetime of daily labor (i.e., their life force).
Because the most important trades we make are the ones we make with our future selves, humanity’s Darwinian propulsion towards holding the soundest money possible is based on our intuitive understanding that the longer our choice of money can hold its value, the greater the potential compounding benefits of our life-to-date-production.
Our timeless search for ever-sounder money is an individual, intuition-based optimization – as unstoppable as evolution – because we instinctively know that our survival is at stake.
Will our life force be durably storable in a particularly wellchosen money, and therefore potentially accumulate, enhancing our potential longevity? Or will it dissipate, no matter how hard we work, because we chose the wrong storage vessel, threatening our very lives and those of our progeny?
- an excerpt from the 2-minute version of Stone Ridge 2020 Shareholder Letter https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter

2023-09-05 13:06:04

Bitcoin Education is profoundly important.
As most who have dived in the rabbit hole know, there are an immense amount of concepts, sciences and history to learn.
But without said knowledge, conviction about Bitcoin cannot be reliably built. The only way we reach a world-wide Bitcoin standard is when a majority of the world learns and appreciates its benefits.
We try to help as much as we can by summarizing and hopefully making it more accessible to a greater number of people.

2023-09-05 10:03:50

Bitcoin teaches you:
- Game Theory ✅
- First Principles ✅
- Economics ✅
- Simplicity ✅
- Self Reliance and Independence ✅
- Network Effects ✅
- Human Psyche ✅
- Monetary Systems ✅
- Capital Markets ✅
Opt out of fiat education and teach your kids Bitcoin! Hopefully our project helps.

2023-09-05 04:52:34

Humans function through their network.
Our unique ability to abstract, tell stories, and orient ourselves around the stories allow us to function like a single organism.
That is what the world economy is.
We communicate with words and prices to shift allocation of resources to the highest and best use - at least in a purely free market.
In that context, the railroads and resulting interconnection - the ability to move things around were key to economic development.
-- an excerpt from the Saylor Series Episode 2 - the Rise of Man through the Dark and Steel Ages, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/saylor-series-episode-2-the-rise-of-man-through-the-dark-and-steel-ages-robert-breedlove

2023-07-10 00:17:53

BITCOIN HAS NO PRICE CAP
We say it all the time, but it's literally true.
Learn why 👇
Most simply said - money becomes more useful and more valuable the more people use it.
i.e. its value AND utility BOTH rise as people start using it.
Money is a different type of asset. 🦊
It doesn't have an "underlying value" like a cash flow of a business.
Conventional investing call this an "unproductive" asset but that's a derogatory term for no reason.
The underlying value of money is how widely accepted it is. That's a fundamental network effect.
The main thing that drives people to adopt it in the first place is its underlying properties - which we know #Bitcoin excels at.
1. more adoption
2. more useful
3. more valuable (price up)
The rational response of everyone else is to try to get more themselves, resulting in a positive upward spiral -> 2) and 3) make people want to do 1) more, which makes 2) and 3) go up!
This incentive is the polar opposite of conventional investing.
If a stock gets too expensive, its value decreases because an investor buys a smaller share of the company's revenue for more dollars.
Contrastly, $100 of Bitcoin today is MUCH MORE VALUABLE than $100 of Bitcoin years ago because it is spendable at more places.
This makes it both more useful (utility) and safer (downside risk), which unblock further adoption.
What we described here is a unique positive feedback between price and value.
This feedback loop makes the growth of Bitcoin self-sustaining.
There is no top until EVERYBODY adopts it. http://nostr.build/i/1fb449c9f42f949e90e84f80cc89268708c4bd50d5a27693eec9cbc7a46b5ad6.jpg

2023-07-10 00:14:42

We’ve been gone for a while
How is everyone doing? 🤙

2023-05-24 11:13:07

The nature of an intermediary is one that can extract perpetual profits from anyone doing business in its network.
And that’s what money is - a network of trust. This is why the governments have been so keen to monopolize it - it gives them essentially unlimited power and wealth, as they possess the ability to confiscate the wealth of their citizens.
Such gatekeepers are not only governments but also private monopolies or cartels.
- Rockefeller with Standard Oil - owned the whole end-to-end distribution of oil.
- Big Tech - Apple gets to tax **30%** of any transaction on their App store.
- Commercial banks get to tax any operation with money, including financial asset purchases (they’re often the only market maker)
-- an excerpt from the Saylor Series Episode 2 - the Rise of Man through the Dark and Steel Ages, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/saylor-series-episode-2-the-rise-of-man-through-the-dark-and-steel-ages-robert-breedlove

2023-05-24 01:57:30

In the same way a stock certificate is title to company capital, money is title to human time. People sacrifice their time for money, which enables them to trade for commensurate sacrifices from others. When prices are distorted, we are each inhumanely robbed of making fully informed personal choices with our time.
-- an excerpt from the Stone Ridge 2020 Shareholder Letter, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter

2023-05-23 22:48:23

Today's volatility in Bitcoin is nothing more than the logical path of price discovery, bubbles, leverage, and manipulation as adoption increases by orders of magnitude.
See the gold price during the german hyperinflation to get a sense of how these things naturally work:
https://i.imgur.com/fm89Mur.png
- an excerpt from the 2-minute version of Gradually, Then Suddenly (2019) https://www.2minutebitcoin.org/blog/gradually-then-suddenly-bitcoin

2023-05-18 23:18:15

- reply

hmm, interesting point!

2023-05-18 23:09:55

Money becomes more useful and more valuable the more people use it.
As more people begin to hold money, its value and utility both rise. The rational response of everyone else is to try to get more themselves, resulting in a positive upward spiral.
This incentive is at **the polar opposite** of conventional stocks. If a stock gets too expensive, its value decreases because an investor buys a smaller share of the company's revenue for more dollars.
Contrastly, $100 of Bitcoin today is **much more valuable** than $100 of Bitcoin years ago because it is spendable at **more** places.
This unique positive feedback between price and value makes the growth of Bitcoin self-sustaining. There is no top until everybody adopts it.
- an excerpt from the 2-minute version of It's Not About The Technology, It's About The Money (2016) https://2minutebitcoin.org/blog/bitcoin-is-about-the-money-not-the-blockchain-technology

2023-05-15 20:31:19

Sound money – along with language – were the first, and have forever been the most important, human networks responsible for human flourishing.
Imagine life without them.
-- an excerpt from the 2-minute version of Stone Ridge 2020 Shareholder Letter https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter

2023-05-15 17:29:34

Bitcoin differs from other cryptocurrencies by its soul.
Reinventing a monetary system takes irrational zeal and an unwavering commitment to a firm vision of the future.
No other project is building a system to last **decades** and face the State head on.
Success for other cryptocurrencies is an exit. At a stark contrast, for Bitcoiners, success is the day when **no exit** is required.
People confused the blockchain revolution as a technological one - “if we can create the most advanced algorithm for securing a blockchain, we will win”. It was always a political revolution.
Going against the state requires hundreds of millions of diehards that believe in a **stable set of values** - clever cryptographic gimmicks cannot inspire and win devotion.
- an excerpt from the 2-minute version of A Most Peaceful revolution, originally posted at
https://2minutebitcoin.org/blog/bitcon-a-most-peaceful-revolution

2023-05-15 14:23:56

In Nazi Germany in the 30s, all the Jews had their money locked up in Germany. Bankers allowed people to launder their money out, but would take a haircut of 10%, 20%, 30% which progressively grew to 90%. At that point, nobody wanted to leave!
-- an excerpt from the Saylor Series Episode 2 - the Rise of Man through the Dark and Steel Ages, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/saylor-series-episode-2-the-rise-of-man-through-the-dark-and-steel-ages-robert-breedlove

2023-05-15 11:22:44

Gold is expensive to store securely. Bitcoin is not.
Gold is very expensive and risky to transport securely in significant amounts. Bitcoin is not.
Gold can be detected and confiscated. Bitcoin cannot. (so long as the seed phrase is properly secured).
Gold's supply is flexible. It increases when prices increase, as more miners mine. Bitcoin's is not.
Gold's supply is theoretically infinite. Asteroids contain gold. Bitcoin's is not.
Gold is subject to counterfeiting. There is a lot of gold-coated tungsten in circulation; it requires special equipment and knowledge to be able to detect it. Bitcoin is not.
Bitcoin can be sent over the Internet. Gold cannot.

2023-05-15 08:15:52

“We’re not even thinking about thinking about raising rates.” – Jerome Powell, Chairman of the Federal Reserve June 10, 2020

2023-05-15 05:13:41

We have forgotten what immutability is.
Back in the day, people would construct huge factories - essentially computer programs made of steel.
You give them one input - milk/eggs - and they give you an output - 50,000 boxes of chocolate bars an hour! Perfectly uniform and without bacteria.
Back then, there was no version 2 coming. You had to design it really well from the start before constructing it, as changes were either impossible or prohibitively costly.
-- an excerpt from the Saylor Series Episode 2 - the Rise of Man through the Dark and Steel Ages, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/saylor-series-episode-2-the-rise-of-man-through-the-dark-and-steel-ages-robert-breedlove

2023-05-15 02:12:08

***Money becomes more useful the more people use it**.*
As more people begin to hold money, the rational response of everyone else is to try to hold more than they already have as they see its value increasing and usage increasing.
Everyone, therefore, will try to increase his cash balance at the same time, and they will do this by bidding larger amounts of other goods in exchange for it.
In other words, the money becomes more valuable, leading to all prices tending to go down priced in that money.
Effectively, everyone with an existing balance ends up with more money, except that they end up with **more valuable units** of money rather than higher sums of it.
-- an excerpt from It's Not About The Technology, It's About The Money (2016), its 2-minute version can be found here: https://2minutebitcoin.org/blog/bitcoin-is-about-the-money-not-the-blockchain-technology

2023-05-14 23:02:57

2023-05-14 15:02:58

Railroads are very instrumental to logistics and the movement of armies. They therefore drove economic and political power.
The British war in Sudan was critically about taking Khartoum. The entire outcome depended on that - whether they could build a railroad to Khartoum. If they can’t build it, they can’t provision the army with all the heavy equipment.
As soon as the railroad arrived, a bunch of heavily-armed guys with explosives and Gatling guns showed up and decimated the enemy. It wasn’t a fair fight.
Similarly, in the American Civil War, the Union Pacific Railroad sealed the U.S’ control over the land.
-- an excerpt from the Saylor Series Episode 2 - the Rise of Man through the Dark and Steel Ages, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/saylor-series-episode-2-the-rise-of-man-through-the-dark-and-steel-ages-robert-breedlove

2023-05-14 12:01:24

You can’t afford 100-story buildings in Manhattan unless you’re the center of a financial empire!
The skyscrapers in New York are constructed from the value extracted by financial intermediaries.
As they say in Vegas - those hotels aren’t built by winning gamblers.
There are a lot of securities where there are only two market makers - bank A and bank B - which simply trade with each other. Two bond traders working in opposite buildings, going together for lunch/dinner/etc.
If you’re buying the security, you’re buying at the top of the spread.
If you’re selling, you’re selling at the bottom of the spread. The spread is 2%.
So if you turn over $1B of bonds, you’re paying $20 Million in commissions to the banks.
Life is full of gatekeepers. It’s ultimately a competition for power - to be the ultimate gatekeeper - to gain the most claims on taxing an ever-greater network.
-- an excerpt from the Saylor Series Episode 2 - the Rise of Man through the Dark and Steel Ages, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/saylor-series-episode-2-the-rise-of-man-through-the-dark-and-steel-ages-robert-breedlove

2023-05-14 08:52:14

Rockefeller originated the cartel model.
Through Standard Oil he created a monopoly on the energy network.
He got to be the incipient of the path dependence of the network he’s creating.
They bought the refineries - they refined the oil, stored it, owned all the tanker cars, tanker ships and had an energy network. They even had retail distribution, and even give away furnaces in order to sell the energy -a freemium model!
They monopolized everything to get rid of the volatility in the industry and drive efficiency through standardization.
This was the world’s first serious energy network - so powerful that even 100 years after his death, those companies are still worth $1 Trillion

2023-05-13 09:17:19

Bitcoin’s utility as a unit of account **today** depends on what you already believe about Bitcoin.
There is **no objective unit of value** that is measured with a unit of account.
It is all a matter of perspective, and relative value - how valuable is **this unit** relative to the unit of account.
Someone still lost in the dollar world looks at Bitcoin and sees wild and extreme volatility, whereas someone in Bitcoin looking back at the dollar sees a crash and subsequent bleed/stagnation.
-- an excerpt from the 1-minute version of Bitcoin is the Best Unit of Account (2014) https://www.2minutebitcoin.org/blog/bitcoin-is-the-best-unit-of-account

2023-05-13 06:15:50

“There are two ways to enslave a country. One is by the sword. The other is by debt.” – John Adams (1826)

2023-05-13 03:14:18

When the Fed creates $3 trillion in a matter of weeks by pushing a button, it consolidates the power to price and value human time. In the U.S., humans are not supposed to have that kind of power over other humans.
-- an excerpt from the Stone Ridge 2020 Shareholder Letter, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter

2023-05-13 00:05:08

The benefit we get from money is the **optionality** it gives us. The **ability to defer our decisions** on what to get in exchange for our work/goods.
Someone who does not want to use money must by definition have a very good idea about what he wants to get in exchange for his value.
When one has money, then one is not committed.
This benefit explains why we would want something that is good for keeping in storage - like gold.
-- an excerpt from It's Not About The Technology, It's About The Money (2016), its 2-minute version can be found here: https://2minutebitcoin.org/blog/bitcoin-is-about-the-money-not-the-blockchain-technology

2023-05-12 08:44:40

As we moved beyond traveling by foot and horse, beyond the development of affordable commercial air travel, and then, especially, beyond the internet’s Cambrian-like explosion of network power, gold’s **low spatial salability** became an acute flaw even the most ardent “goldbugs” miss.
**Gold is simply hard to transport**.
This is where the Fiat Standard shines. Though fiat’s periodic, human-nature-induced hyperinflations made it a huge step backward in terms of salability across time (storing value), it was a substantial leap forward in terms of salability across space.
However, contrary to common misconception, **Bitcoin moves much faster across space** than fiat, increasing our capacity for long-distance international settlement by about **96 times**.
It completes settlement in about an hour, rather than the current state-of-the-art 3-5 days, or longer, for final international fiat settlement.
Do not confuse the speed of your Visa payment with its final settlement. No settlement occurs when you buy your coffee at Starbucks. Rather, your bank and Starbucks’ bank generally settle 2-3 days later, with each bank taking credit risk to the other along the way, with rare, but occasionally disastrous results.
Bitcoin not only safely settles about every hour, but more importantly as a bearer instrument it has **no credit risk**.
Bitcoin’s protocol and network topology renders national borders irrelevant, which is especially empowering to the world’s most vulnerable and unprepared for fiat hyperinflations (e.g. Venezuela, Turkey, Lebanon).
From this perspective, Bitcoin is better at being fiat than fiat – it’s **even more salable across space** and, because it’s not debt like fiat, **has no credit risk**.
-- an excerpt from the Stone Ridge 2020 Shareholder Letter, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter

2023-05-11 22:16:11

Due to **group psychology**, newcomers arrive in waves. Bitcoin's current adoption trend is to increase in value on an exponential trend line with said waves.
The waves have a destabilizing effect on the Bitcoin exchange rate:
- speculators are unsure of the amplitude or wavelength of adoption
- amateurish punters let their excitement as well as subsequent fear overwhelm them.
Regardless, once the tide has pulled back and the weak hands have folded, the price is a few multiples higher than before the wave.
-- an excerpt from Speculative Attack (2014), its 2-minute version can be found here: https://2minutebitcoin.org/blog/bitcoin-speculative-attack-on-the-dollar-2014

2023-05-09 20:18:42

Another massively underappreciated reason for why Bitcoin is volatile - it's decentralized!
Centralized sectors have low volatility because it takes just a handful of actors to suppress it.
This was literally one of the reasons Rockefeller established the oil cartel he had - the volatility would otherwise hurt the sector too much.
Of course the stock market won't have volatility when there is a centralized exchange that stops trading for 15 minutes if the S&P drops 7% in a day (this is real, google it).
Of course the bond market won't have volatility when there are only a handful of big institutional players trading it.
Under Communism we also had no price volatility... until it collapsed.
We have been diluted to believe that lack of volatility is natural and a mark of health. It's the opposite.

2023-05-09 17:09:36

Back in the day, new tech was dangerous.
You mishandle nitroglycerin and everything blows up for half a mile in every direction.
You mishandle nuclear and the whole country gets contaminated.
Today, we are spoiled by thinking technology is easy and has little repercussions if you get it wrong.
Bitcoin should be treated like old technology. Once you get it wrong, the cost to fix it, along with the reputational damage, is either impossible or prohibitively costly.
-- an excerpt from the Saylor Series Episode 2 - the Rise of Man through the Dark and Steel Ages, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/saylor-series-episode-2-the-rise-of-man-through-the-dark-and-steel-ages-robert-breedlove

2023-05-09 14:00:21

Bitcoiners are driven by a collective interest in exploring how to evolve money for a better society and make the global financial system more stable and distributed. They can’t fix the holes in the current system because of powerful incumbents who have a strong interest in preserving the status quo, so they compete.
But not in a hostile takeover attempt. Bitcoin’s purpose is not to destroy but rather to offer us ***freedom and choice***, and in doing so - spark a conversation about the nature of money and its crucial role in our society.
- an excerpt from the 2-minute version here https://www.2minutebitcoin.org/blog/an-honest-account-of-fiat-money-2018

2023-05-09 11:00:13

As you go mine fiat today, remember that there is a greater mission out there - the adoption of sound money (Bitcoin) and the elimination of the crime against humanity - the profoundly unfair fiat money system.
Thank you for contributing to this cause.

2023-05-09 07:50:59

The State always grows. Participating in the democratic process only empowers it as devotees reward it through votes in exchange for entitlements.
Bitcoin challenges the State’s most treasured privilege: **the ability to finance itself through inflation and seignorage**, as well as other repressive tools a large fraction of the world lives under - **capital controls** and **local exchange rate manipulation**.
This predictably enraged the State-dependents.
It is no coincidence that Bitcoin’s most hysterical critics overwhelmingly benefit from the state:
- academics, beneficiaries of the rampant government-guaranteed student loan bubble
- (ex-) politicians, who always turn their political clout into personal wealth
- journalists who were disrupted by the internet and reduced to simply peddle State messaging
- economists, forced to peddle Keynesian narratives for grant and tenure
- an excerpt from the 2-minute version of A Most Peaceful revolution, originally posted at
https://2minutebitcoin.org/blog/bitcon-a-most-peaceful-revolution

2023-05-09 04:50:51

The haunting memory of bank runs from the past should serve as a stark reminder that banks are not as bulletproof as they seem.
In 1929, the stock market crash marked the beginning of the Great Depression, leading to widespread panic and a series of devastating bank runs.
In just the first few months of 1933, over 5,700 banks failed, and depositors lost approximately $140 billion (in today's terms) of their savings. By the end of 1933, 11,000 had failed.
Fast forward to 2001, when Argentina faced a massive economic crisis. A run on banks led to the government freezing bank accounts and converting dollar-denominated accounts to pesos at a fixed rate, causing many people to lose a significant portion of their savings. In just a few months, the country witnessed a decline in GDP by 11%, and the unemployment rate skyrocketed to over 20%.
The threat of economic collapse and bank runs is still very real today. In a world where central banks continue to print money at an alarming rate, and financial systems teeter on the brink of collapse, the security of your savings is anything but guaranteed.

2023-05-09 01:50:12

Hidden taxation through inflation is also an advantage in war.
A country that taxes a lot through printing massive amounts will collect more money than one that only taxes through income. Said country can allocate more to military purposes and win a war against the other country.
The game theory of a world-wide sound-money standard is unstable - once one player abandons it, it incentivizes others to do so as well.
A similar dynamic was the rise of the nation-state itself – it proved stronger than the feudal state due to having larger national armies, and that forced feudal states to turn nation-states too.
-- an excerpt from the 2-minute version of An Honest Account of Fiat Money (2018), originally posted in https://www.2minutebitcoin.org/blog/an-honest-account-of-fiat-money-2018

2023-05-08 22:48:42

The world has experienced [an astonishing 56 hyperinflations in the last ~100 years](https://web.archive.org/web/20121019134717/http://www.cato.org/pubs/researchnotes/Hanke-Krus-Hyperinflation-Table.pdf).
This means that in some country, every other year, an innocent population lost their life savings and their dignity, simply because they stored it in the wrong vessel.
- an excerpt from the 2-minute version of Stone Ridge 2020 Shareholder Letter https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter

2023-05-08 19:39:36

You may deride Bitcoin, no matter - it will be there for you when you need it.
You may not need it now, but as we plunge into a more despotic, financially-repressive, authoritarian, and chaotic world, you may one day feel comfort knowing that the world’s [highest assurance](https://www.2minutebitcoin.org/blog/its-the-settlement-assurances-stupid-2019) wealth protection system in history is waiting patiently for you.
- an excerpt from the 2-minute version of A Most Peaceful revolution, originally posted at
https://2minutebitcoin.org/blog/bitcon-a-most-peaceful-revolution

2023-05-08 09:51:51

In many countries, it is illegal for women to have a bank account, or even work, while the men learn, earn, and create independence for themselves.
Trapped in a restrictive, oppressive, domestic cage, these women have historically been forced to do as they’re told, with no freedom to make a living, develop professional skills, or cultivate a sense of self, let alone create financial independence.
Bitcoin is fixing this. Leveraging Bitcoin’s growing network, and their smartphones, these women can, and do, find jobs online – secretly for now – and get paid. In Bitcoin.
They become copy editors and transcriptionists. They proofread, do data entry, and take surveys. Remotely, and quietly, they do anything that’s doable online. Bitcoin offers them an exit option, an offramp.
Bitcoin demolishes their cage. Today, gradually.
In the hundred-plus countries of authoritarian, repressive and inflationary regimes, primordial forces are being unleashed in a one-way torrent of increasing human liberty, one impoverished, caged human at a time.
While lurching in fits and starts for now, the power of the movement is unstoppable because it rides upon, and accelerates, our Darwinian propulsion towards freedom and survival, enabled by sound money.
Fate-changing topological shifts – the Arab Spring, Brexit, Bitcoin – can quickly render the powerful weak, and the powerless strong.
-- an excerpt from the Stone Ridge 2020 Shareholder Letter, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter

2023-05-07 22:47:12

Protocols win out.
The Romans standardized everything. They built every wagon with the same parts. The railroad tracks around the world today are the exact same size as a Roman chariot.
Logistic, military, political and monetary protocols allow us to globalize cooperation and free mental bandwidth to focus on other productive things.
Protocols experience path dependence - once they catch on, they have strong inertia.
- an excerpt from the 2-minute version of https://www.2minutebitcoin.org/blog/saylor-series-the-rise-of-man-through-the-stone-and-iron-ages-episode-1-2020

2023-05-07 19:38:02

Some criticize Bitcoin for not generating any sort of income.
They don't understand that money is inherently a speculative asset - speculating on the fact of whether other people would adopt it, at which point its value rises.
The key point here is that a fixed-supply money's upside is practically unlimited, because its value is not bottlenecked by something small like the income it produces.
- Some even go as far as to say that something like Ethereum at least generates an income from staking it - but that is simply not true. Ethereum's model has it dilute the supply of other shareholders at the expense of those who stake it.

2023-05-07 15:28:41

Bitcoin's current trend is to increase in value on an exponential trend line as new users arrive in waves. The good money is "slowly" driving out the bad. Two factors drive this:
1. **Reduction in information asymmetry** – people are Bitcoin Education|learning about Bitcoin and coming to the realization that bitcoins are indeed the best money.
2. **Increasing liquidity** – buying bitcoins is more convenient and has fewer fees attached today than many years ago.
Due to **group psychology**, these newcomers arrive in waves.
The waves have a destabilizing effect on the Bitcoin exchange rate:
- speculators are unsure of the amplitude or wavelength of adoption
- amateurish punters let their excitement as well as subsequent fear overwhelm them.
Regardless, once the tide has pulled back and the weak hands have folded, the price is a few multiples higher than before the wave.
This 'slow' bleed is **the Bitcoin adoption**, and commentators generally assume one of the following:
1. Slow bleed never occurred, it's a fiction based on misleading data
2. Slow bleed has stopped, the above motives only affect deluded bitcoin proponents
3. The process will taper off now, as all the super tech-savvy people are already getting on board
This slow bleed has shown no signs of stopping and in fact, has only been accelerating as the market cap increases. The second step will be speculative attacks that use bitcoins as a platform. The third and final step will be hyperbitcoinization.
-- an excerpt from Speculative Attack (2014), its 2-minute version can be found here: https://2minutebitcoin.org/blog/bitcoin-speculative-attack-on-the-dollar-2014

2023-05-07 12:19:30

**Bitcoin mining is the only profitable use of energy in human history that does not need to be located near human settlement to operate**.
The long-term implications of this are world changing and hiding in plain sight.
Before Bitcoin, the problem of energy has never been its scarcity, but only our ability to channel it geographically where it is needed most. Before Bitcoin, that was exclusively where humans lived.
In contrast, Bitcoin’s mining energy is solving a different problem. Because of satellites and wireless internet connections, Bitcoin mining can be located anywhere.
For example, remote, destitute areas blessed with moving water can monetize their natural resource good fortune by creating clean, hydro energy and using it to mine Bitcoin. Thus, **Bitcoin can make monetizable isolated energy sources all over the world** – like waterfalls, running rivers, or creatable dams – now entirely untapped because they would be cost-prohibitive to connect to electric grids close enough to residential or industrial areas.
In doing so, Bitcoin can fundamentally change the economics of energy by introducing a highly profitable use of electricity that’s **location independent**.
The world **has never** had a profitable use of energy that’s location independent. Now it does.
And since fossil fuels are already too expensive to be a profitable source of Bitcoin mining energy, I believe the only long-term, profitable Bitcoin mining will be powered by hydro.
Imagine a future with Bitcoin mining firms, unsubsidized, in extraordinarily isolated locations – visualize a waterfall in a largely population-free part of an African country suffering from abject poverty – easily connected to the Bitcoin network, building serious energy infrastructure to monetize the local clean energy source for mining. However, once the industrial-strength, profitable infrastructure is in place, let’s extend it. Let’s build roads. And housing. And schools. And hospitals. Ultimately leading to human settlement. The net result can be people locating around new, Bitcoin-driven hydroelectric energy infrastructure, with more and more of humanity clustering around cheap, clean energy sources.
Historically, our energy challenge has been to move the power to the people.
With Bitcoin, **we can move the people to the power**
Consider that the world’s major population centers – think New York, London, Paris, Tokyo – each developed where they are geographically because of natural seaports, waterways, and trade routes. Energy was a nonfactor because placement of these cities was all pre-energy (i.e., pre-fossil fuels). As Bitcoin finances the for-profit development of cheap, clean energy infrastructure on a massive scale, it can lead to a future in which more and more of the world’s population lives near abundant energy with an extraordinarily low marginal cost of production. This matters because cheap energy equals human flourishing. That’s an equation. Cheap energy = human flourishing. Beyond the revolution in monetary policy that Bitcoin already represents, Bitcoin may also represent the biggest catalyst the world has ever known for developing abundant, clean, cheap energy. And, therefore, one of biggest catalysts in the world for human flourishing.
-- an excerpt from the Stone Ridge 2020 Shareholder Letter, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter

2023-05-06 16:29:01

The rules of the contract are decided and renegotiated continuously on the social layer - the bitcoin protocol automates them.
Bitcoin, the computer network, comes into existence when many people run bitcoin implementations following the [same rules](https://www.2minutebitcoin.org/blog/saylor-series-the-rise-of-man-through-the-stone-and-iron-ages-episode-1-2020).
This distributed social contract practically rules out any controversial changes which could never get a broad social consensus.
It makes Bitcoin resilient to bad changes but open to good, obvious incremental improvements.
- an excerpt from the 2-minute version of Unpacking Bitcoin's Social Contract (2018), originally posted in https://www.2minutebitcoin.org/blog/unpacking-bitcoins-social-contract-2018

2023-05-06 09:18:03

Keynesianism has conquered the hearts and minds of politicians and ordinary people alike because it provides a theoretical justification for irresponsible behavior. Medical science has established that one or two glasses of wine per day are good for your long-term health, but no doctor would recommend a recovering alcoholic to follow this prescription. Unfortunately, Keynesian economists do exactly this. They tell politicians, who are addicted to spending our money, that government expenditures are good. And they tell consumers, who are affected by severe spending problems, that consuming is good, while saving is bad. In medicine, such behavior would get you expelled from the medical profession: in economics, it gives you a job in Washington.'"
- https://www.marketsandmorality.com/index.php/mandm/article/viewFile/1254/1049

2023-05-06 05:56:38

Critics:
> Bitcoin offers no social benefit beyond speculation
Bitcoin offers little social benefit to westerners in first world countries, but can be a lifeline for people in opressive regimes, unbanked third world countries, etc.
The western media typically under-reports this and we are understandably blind to some of these problems (e.g see [this panel](https://youtu.be/hrRy05w2rNc?t=4251) from the Oslo Freedom Forum)
For example, bitcoins have been used as a medium of exchange by [girls in Afghanistan](https://www.reuters.com/article/crypto-currency-afghanistan/feature-salaries-to-remittances-afghans-embrace-crypto-amid-financial-chaos-idUSL8N2QU39A), by [Russian political opposition when their bank accounts get frozen](https://www.reuters.com/article/us-russia-politics-navalny-crypto-curren/bitcoin-donations-surge-to-jailed-kremlin-critic-navalnys-cause-data-idUSKBN2AB2GR), by [Nigerian merchants and protesters](https://www.theguardian.com/technology/2021/jul/31/out-of-control-and-rising-why-bitcoin-has-nigerias-government-in-a-panic), by [people getting capital out of China](https://www.cnbc.com/2020/08/21/china-users-move-50-billion-of-cryptocurrency-out-of-country-hinting-at-capital-flight.html), by [people getting their money out of Venezuela, Iran, Palestine, and elsewhere](https://www.theinvestorspodcast.com/bitcoin-fundamentals/bitcoins-international-impact-w-alex-gladstein/), by [under-banked people in El Salvador](https://medium.com/ziglumoney/how-bitcoin-could-bank-the-unbanked-of-el-salvador-917c3588857c), and more. It’s also used in developed markets for some natively-online services, [such as Substack](https://www.prnewswire.com/news-releases/substack-is-now-accepting-bitcoin-payments-on-the-lightning-network-powered-by-bitcoin-payment-processor-opennode-301360039.html) or [buying VPNs](https://www.vpnmentor.com/blog/best-vpns-buy-bitcoin-crypto/), and many others.
(from [this](https://www.lynalden.com/lightning-network/))

2023-05-06 02:55:04

Money is unique among all the goods we seek because we value money not for its own sake, but rather solely for its prospective exchange utility.
A medium of exchange’s value is related to each holder’s **expectations** of being able to use the unit in future trades.
> “How many people will accept the unit, how readily, and for what?“.
- an excerpt from the 2-minute version of Bitcoin Hypermonetization: Bubble Talk (2013)
https://www.2minutebitcoin.org/blog/bitcoin-hypermonetization-bubble-talk-2013

2023-05-05 23:45:55

Technology is the only meaningful way of increasing prosperity in the world and fixing its problems.
This Tuberculosis White Plague killed a billion people - more than any war! No other political event (World Wars) had a greater statistical mortality rate effect.
Through technology - the discovery of antibiotics and sterilization - we completely solved it.
The impact of technology completely dwarfs every political thing that took place during that time period.
All the activities/ideologies we fought over turned out to not be as relevant as defeating Tuberculosis!
But there’s asymmetry in the history books - for every 1 page about an important event like curing Tuberculosis, theres 100+ pages for the World Wars - despite them being insignificant in relation.
Politics are overrated; Technology is underrated;
Bitcoin is counter-intuitively both - it is a political revolution re-ignited and ultimately enabled through a technological breakthrough.
-- an excerpt from the Saylor Series Episode 2 - the Rise of Man through the Dark and Steel Ages, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/saylor-series-episode-2-the-rise-of-man-through-the-dark-and-steel-ages-robert-breedlove

2023-05-05 18:11:16

Nothing can stop an idea whose time has come.
The things that make bitcoin valuable is the individualistically-driven human nature that powers every human on the planet.
In many ways, this **is actually safer** than a traditional centralized investment. You are betting on the decentralized general action/desire/incentives of billions of people, each of whom share the same human nature as you. This is inherently a much more predictable action than what a group of a handful of directors' actions will be.
Because it is spread across so many people and jurisdictions, the power required to change its momentum has to be much greater than just what a few people can do. (e.g a centralized government limiting a centralized company)

2023-05-05 14:30:22

When the Fed doles out billions, or trillions, of fiat currency, it has the immediate effect of helping the favored few cantillionaires who first receive it, directly or indirectly, plus all pre-existing financial asset owners, at the expense of everyone else.
When Chairman Powell says, “Inequality is… not related to monetary policy,” he may pass a lie detector test. That doesn’t mean it’s true.
-- an excerpt from the Stone Ridge 2020 Shareholder Letter, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter

2023-05-05 09:01:06

The US is blessed with limitless natural resources, giant oceans protecting them on the left and right, and friendly neighbors to the north and south. They’ve got a military that any other country would trade for theirs, a political class constrained by an ingenious system of checks and balances, and a built-in, self-correcting mechanism of free elections.
Almost 250 years later, it’s easy to forget how uniquely successful the American experiment has been.
Unsound money just isn’t American, and hyperinflation is something only “other people” sometimes have.
The world has experienced an astonishing 56 hyperinflations in the last ~100 years.
This means that every other year, in some country, somewhere “over there”, every other year, an innocent population lost their life savings, and certainly their dignity, simply because they stored it in the wrong vessel.
What will protect your US money from this? What will continue to keep you different?
- an excerpt from the Stone Ridge 2020 Shareholder Letter, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter

2023-05-04 03:11:10

The global financial crisis was principally caused by the fact that the financial system was leveraged approximately 150-to-1 (!!!)
This was only enabled due to central bank policy, which consistently prevented system-wide deleveraging over three (!) decades.
The solution - quantitative easing (QE) - merely caused an unsustainable credit system to metastasize over the next ten years, making future quantitative easing inevitable.
Therefore, the existing financial system is living on borrowed time.
- an excerpt from the 2-minute version of Gradually, Then Suddenly (2019) https://www.2minutebitcoin.org/blog/gradually-then-suddenly-bitcoin

2023-05-04 00:01:58

Gold has been a reliable store of value because of its scarcity and historically low annual supply growth of only 1-2%/year. There has never been a “gold hyperinflation.” Indeed, gold has held its value over the centuries, while hundreds of other monies have come and gone.
However, gold’s supply is not impervious to its demand. If, hypothetically, gold went to $100,000/oz tomorrow (up more than 50x overnight), we can be sure enormous resources would immediately shift to gold mining, and the miners would find some way, somehow, to accelerate its supply growth, driving its value down.
In contrast, there will only ever be 21 million Bitcoin. Bitcoin’s annual supply growth, which asymptotically approaches zero over time, is now down to about 1%, on par with the historical annual growth in the supply of gold. While far from perfect, gold is Bitcoin’s closest real-world analogy.
However, the ultimate supply of Bitcoin is fundamentally limited by the design of the protocol itself and cannot be increased regardless of its value or the level of demand. Bitcoin is the first store of value in history for which its supply is entirely unaffected by increased demand. From this perspective, Bitcoin is better at being gold than gold – it’s even more salable across time.
-- an excerpt from the Stone Ridge 2020 Shareholder Letter, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter

2023-05-03 20:52:44

Would we have more prosperity without central banks?
Let's think about it. Money is most critically a signal of the value of something - the price conveys information in real time how hard it is to obtain something.
When we allow unaccountable bureaucrats to print money and cantillionaires to benefit from it, we massively distort the price signal of money.
In the same way a stock certificate is title to company capital, money is title to human time. People sacrifice their time for money, which enables them to trade for commensurate sacrifices from others. When prices are distorted, we are each inhumanely robbed of making fully informed personal choices with our time.
**First**, as discussed, this impairs the fidelity of economy-wide price signals, thereby,
**Second**, inefficiently draws human and capital resources into activities that cannot be lastingly maintained, thereby,
**Third**, drives temporary illusions of relative prosperity in certain economic segments, and despair in others, and therefore,
**Fourth**, leads inevitably, and repeatedly, to booms and busts.
Modern central banking is the cause of severe economic problems. NOT the cure!
https://i.imgur.com/Y7e8HPd.png
-- an excerpt from the Stone Ridge 2020 Shareholder Letter, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter

2023-05-03 17:52:36

Bitcoin will become mainstream.
The Bitcoin skeptics don't understand this due to:
1. their biases and lack of financial knowledge
2. being in as strong an echo chamber as Bitcoin proponents
3. rabidly searching for evidence that confirms their view of Bitcoin
4. misunderstanding how good money drives out the bad. Strong currencies like bitcoin overtake weak currencies through speculative attacks and currency crises caused by greedy investors - each pursuing their own self-interest. Not through the careful evaluation of tech journalists and 'mainstream consumers'.
-- an excerpt from Speculative Attack (2014), its 2-minute version can be found here: https://2minutebitcoin.org/blog/bitcoin-speculative-attack-on-the-dollar-2014

2023-05-03 11:20:03

The majority of our innovations occur through trial and error. The tinkering impulse people have all over the world and communicating it so that we built on top of each other leads to these breakthroughs.
This all just points to the fact that free exchange and experimentation are the ways humanity can optimize for creating wealth in the world.
Almost no inventor of a new technology could foresee the major impact it would have.
A large part of science is accidental - e.g antibiotics. Further, a large part gets discovered but does not become commercialized or does not get engineered into the right solution for a long time after.
The quote “The Future is already with us, it’s just not evenly distributed!” applies very well here.
Similarly, it is an accident as to how large Bitcoin has become. It is unlikely Satoshi predicted how large it would become. But through the free, unencumbered borderless exchange of people, it morhped into what we have today.
-- an excerpt from the Saylor Series Episode 2 - the Rise of Man through the Dark and Steel Ages, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/saylor-series-episode-2-the-rise-of-man-through-the-dark-and-steel-ages-robert-breedlove

2023-05-02 23:30:21

How is #plebchain doing? 🫡

2023-05-02 22:03:26

- reply

not if the credit bubble is against a weak currency and the collateral is actually bigger.
What government would "pop the credit bubble" in this particular example?

2023-05-02 15:17:51

SPECULATIVE ATTACK: How does Bitcoin gain further adoption?
The idea is simple - people borrow fiat and buy bitcoins. This process creates a self-feeding doom loop which erodes fiat's value and propels Bitcoin's value.
As the expected value of bitcoins solidifies in people's minds and fiat continues to be debased in front of them, it becomes appealing to borrow fiat via a loan whose value they believe will erode at a faster rate than the interest rate they're paying.
At that point, it becomes a no-brainer to perform a carry trade - borrow the weak local currency using whatever collateral a bank will accept, invest in a strong foreign currency like Bitcoin, and pay back the loan later with realized gains.
In this process, the banks create even more of the weak currency, amplifying the problem.
The effect of people, businesses, or financial institutions borrowing their local currency to buy bitcoins is that the bitcoin price in that particular currency would go up relative to other currencies.
EXAMPLE: Let's say that middle-class Peruvians trickle into bitcoin. Thousands of buyers turn into millions of buyers.
They borrow Peruvian Sols using whatever unencumbered collateral they have – homes, businesses, gold jewelry, etc. They use these Sols to buy bitcoins. The price of bitcoins in Peruvian Sols goes up, - a premium develops relative to other currency pairs.
A bitcoin in Peru might be worth $23k, while in the U.S. it trades at $22k. Traders would buy bitcoins in the U.S. and sell them in Peru for a $1k profit. They would then sell their Peruvian Sols for dollars.
This would further weaken the Peruvian Sol, causing import inflation and losses for foreign investors.
The Peruvian central bank would have to either increase interest rates to break the cycle, impose capital controls, or spend their foreign currency reserves trying to prop up the Sol's exchange rate. Only raising interest rates would be a sustainable solution, though it would throw the country into a recession.
As of February 2023, Bitcoin's market cap was $424B and Peru's GDP was $223B. Who would win that fight?
There's a huge problem with the Peruvian central bank raising interest rates: bitcoin's mean historical return is 93.8% per year (as of 2023). Even if investors expected future return is 1/3 of that - 31%, the central bank would have to increase interest rates to unconscionable levels to break the financial incentives of the attack. There's no way the Peruvian economy would be able to sustain an interest rate greater than the mean historical return of Bitcoin.
The result is evident: everyone would flee the Sol and adopt bitcoins, due to economic duress rather than technological enlightenment.
This example is purely illustrative, it could happen in a small country at first, or it could happen simultaneously around the world.
Who leverages their balance sheet and how is impossible to predict and it will be impossible to stop when the dam cracks.
But it doesn't stop there - a speculative attack such as this is prone to spread and cause contagion.
Because it pushes the price of Bitcoin up dramatically, different citizens with slightly-stronger local currencies are incentivized to perform the same sort of attack, especially after seeing that such a thing worked out. They may buy bitcoins simply because they want to speculate on their value, but the reflexivity of this action works such that the reduction in demand for their local currency would actually cause higher-than-expected inflation and thus begin creating a problem with it.
The feedback loop between fiat inflation and bitcoin deflation will throw the world into full hyperbitcoinization.
https://i.imgur.com/nEoBGgM.jpg
-- an excerpt from Speculative Attack (2014), its 2-minute version can be found here: https://2minutebitcoin.org/blog/bitcoin-speculative-attack-on-the-dollar-2014

2023-05-02 12:08:34

A traditional empire exports security - it acts as a policeman in the local area (or world), ensuring the law is followed.
Similarly, one of its basic functions is to honor private property rights.
Bitcoin's #1 value proposition is itself security too - but decentralized security.
It acts as an alternative and immediately outcompetes less-competent states that do not enforce property rights well.
-- an excerpt from the Saylor Series Episode 2 - the Rise of Man through the Dark and Steel Ages, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/saylor-series-episode-2-the-rise-of-man-through-the-dark-and-steel-ages-robert-breedlove

2023-05-02 08:30:41

It is hard to see a lot of use for some kind of general “blockchain technology” outside of its application in Bitcoin as a currency and store of value.
In Bitcoin, the blockchain is a way of solving the double-spending problem without privileging any party as to the creation of new units or of the establishment of a consistent history.
This is an extremely costly and complicated way of maintaining an accounting ledger.
How often does one really need to do accountancy in this way?
It is only a good idea when the game being played is so important that no one can safely be put in the position of referee.
There are not a lot of things that one would really need that for, but there is a good argument to be made that a blockchain is a reasonable alternative to the monetary system under which the rest of the world is currently oppressed, at a minimum the monetary system at a geopolitical level.
There are no applications of blockchains which do not involve
a double-spending problem.
A blockchain that was used for an application with no double-spending problem is nothing more than a database, so you could just replace it with a distributed hash table.
People have also used the blockchain for timestamping. This only works because Bitcoin has become well-known as a point of reference. If you had a need for timestamps, you certainly wouldn’t invent a blockchain to do it.
-- an excerpt from It's Not About The Technology, It's About The Money (2016), its 2-minute version can be found here: https://2minutebitcoin.org/blog/bitcoin-is-about-the-money-not-the-blockchain-technology

2023-05-01 17:43:50

Things can be forgotten. Nothing is guaranteed - missing a key insight can have you waste 1,000 years!
- average life expectancy in Rome around 100 A.D was 72 years! (civilization, sanitation, aqueducts, roads). Then Dark Age happens and it plunges down to 30 years. It only recovers to 70+ years in mid 1900s in the U.S.
- The way Romans created concrete was [lost up until 2017](https://www.nature.com/articles/nature.2017.22231)! It is stronger than the concrete used today
- The Chinese invented the printing press 2,000 years ago. Gutenberg got it just in 1453.
- 100 A.D. the Trajan knew the world was round, then 1,400 years later Europe pre-Columbus thinks it’s flat
There is always the possibility of significant civilizational regression if we ignore learnings we’ve accumulated over time.
We believe we are living in such an era with relation to Sound Money.
Humanity has forgotten what it’s like to have money that doesn’t lose value, and deludes itself into thinking such a world cannot work.
-- an excerpt from the Saylor Series Episode 2 - the Rise of Man through the Dark and Steel Ages, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/saylor-series-episode-2-the-rise-of-man-through-the-dark-and-steel-ages-robert-breedlove

2023-05-01 13:36:03

The skyscrapers in New York are constructed from the value extracted by financial intermediaries.
As they say in Vegas - those hotels aren’t built by winning gamblers.
The nature of an intermediary is one that can extract perpetual profits from anyone doing business in its network.
And that’s what money is - a network of trust. This is why the governments have been so keen to monopolize it - it gives them essentially unlimited power and wealth, as they possess the ability to confiscate the wealth of their citizens.
They extract rent - siphon value off - for the privilege of protection.
That’s not necessarily a bad thing - but it becomes so once it’s a non-consensual rate - i.e, you have no bargaining power, and it’s too much.
-- an excerpt from the Saylor Series Episode 2 - the Rise of Man through the Dark and Steel Ages, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/saylor-series-episode-2-the-rise-of-man-through-the-dark-and-steel-ages-robert-breedlove

2023-05-01 09:24:47

Oil was about kerosene and lighting → heating → automobiles.
Cars were its killer app. They enabled the density of a city (commute in and commute out). They even changed people’s self identity - cars today are an avatar of who we are - a status symbol.
Critically - Oil was not only an energy producer but also an energy storage device - it was a battery.
Oil was kept in tanks as a battery. To this day it is one of the best batteries, with no leakage of charge!

2023-04-30 22:26:23

Everywhere you see a big city on earth, it was the center of an empire. Paris/London/Hong Kong/New York/Venice/Rome.
And everywhere you see a city that’s fallen on hard times, that’s been destroyed - its empire lapsed. Carthage, Troy. It’s because you can’t physically create this kind of economic density without a large source of revenue. The historical way to generate such a city is by taxing all the empire's commercial value.
Many great cities were a transportation hub - at the center of a railroad juncture, or a key port. In such places, you can tax all the trains/ships even if they aren’t arriving at your destination.
-- an excerpt from the Saylor Series Episode 2 - the Rise of Man through the Dark and Steel Ages, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/saylor-series-episode-2-the-rise-of-man-through-the-dark-and-steel-ages-robert-breedlove

2023-04-30 19:17:15

Regardless of Bitcoin’s future ascent, or descent, the long-dated monetary liabilities of individual Americans are denominated in U.S. dollars.
Tackling their collective, fiat-based societal retirement challenge head-on leads to an interesting and important question: “what do you have to believe to be true for Bitcoin to be your vessel for savings?”
The answer: point to point – meaning, from today until your long-dated liabilities (e.g., your retirement spending) start coming due – and regardless of USD paper currency volatility along the way – you only have to believe one thing; that USD will depreciate relative to Bitcoin over that time period, as it has ~80% in the last two years (2018-2020) alone.
Remember that the most important trades are the ones we make with our future selves, that our search for eversounder money is an individual, intuition-based optimization, and that, instinctively, we know our survival depends on durably storing of our life force.
In this context, is it any surprise that millennials voting with their dollars, and with more distrust for traditional institutions than their forebears, have already made Bitcoin “the millennial savings account”?
-- an excerpt from the Stone Ridge 2020 Shareholder Letter, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter

2023-04-30 14:34:12

In a way of looking at it, a store of value is captured energy that does not decay.
The invention of cereals (stabilized starch) and later frozen food both unlocked humanity the ability to store food energy for longer periods of time.
These were essentially stores of value - captured energy that would not decay. They took the entropy out of food.
Similarly, fiat money today can be seen as a high entropy storage device. It bleeds value (energy) continuously.
Bitcoin contrastly can be seen as a deep freeze - the absolute zero of storing your monetary energy. It sucks all the entropy out of it, knowing you are guaranteed the same percentage fraction of the money supply of all time -- something no other asset in the world can offer.
-- an excerpt from the Saylor Series Episode 2 - the Rise of Man through the Dark and Steel Ages, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/saylor-series-episode-2-the-rise-of-man-through-the-dark-and-steel-ages-robert-breedlove

2023-04-30 11:17:34

In our current system, **money creation** and money destruction is mainly done through private banks. New money is created when these banks create credit, and through fractional-reserve banking they only keep a small fraction of deposits in reserves.
The financial system then becomes hopelessly intertwined - if too many borrowers default on their loans, the **entire system** will fail – even for customers who never agreed to have their deposits invested in risky schemes.
This intertwining creates **terrible incentives** through a severe disconnect between risk and reward for the financial sector.
The government becomes obliged to bail out banks once they get into trouble from risky lending, which drives banks to take even more risk knowing that their potential losses are capped, but their upside is not.
- an excerpt from the 2-minute version of An Honest Account of Fiat Money (2018) posted in https://www.2minutebitcoin.org/blog/an-honest-account-of-fiat-money-2018

2023-04-30 11:10:04

few #plebchain
https://i.imgflip.com/7a3y4f.jpg

2023-04-29 23:58:23

Money is basically just a socially-established number that is objectively associated with a person. We each agree on how much everybody has, and have the ability to add/subtract from each other.
- an excerpt from the 2-minute version of It's Not About The Technology, It's About The Money (2016) https://2minutebitcoin.org/blog/bitcoin-is-about-the-money-not-the-blockchain-technology

2023-04-29 20:56:52

The unique utility that money gives us stored optionality - the ability to defer the decision of what to receive in exchange for your work/goods.
This explains why people value money with gold-like properties more - they enable this behavior much better.
Someone who does not want to use money must, by definition, have a very good idea about what he wants to get in exchange for his goods/services.
- an excerpt from the 2-minute version of It's Not About The Technology, It's About The Money (2016) https://2minutebitcoin.org/blog/bitcoin-is-about-the-money-not-the-blockchain-technology

2023-04-29 20:42:11

https://i.imgflip.com/79tfsd.jpg

2023-04-29 17:56:45

Everything Satoshi did in inventing Bitcoin was non-original – his genius was in seeing how combining a specific set of previously solved problems could, together, solve certain unsolved problems – except **the Difficulty Adjustment**. The Difficulty Adjustment is Satoshi’s most underappreciated breakthrough - a truly genius application of game theory.
Suppose Bitcoin’s price rises, creating an incentive for more Bitcoin miners to mine because their rewards are greater.
More hashpower will join the network and on average, blocks will be mined faster than 10 minutes, therefore Bitcoin will be minted more often.
In this case, the Bitcoin protocol will automatically raise the difficulty of mining, such that the creation of new Bitcoin, and the timing of transaction verification, does not accelerate beyond its preset schedule (about every 10 minutes).
Analogously, suppose Bitcoin’s price falls, and higher cost Bitcoin miners turn off their machines. The Bitcoin protocol will automatically reduce the difficulty of mining, such that the creation of new Bitcoin, and the timing of transaction verification, does not decelerate below its preset schedule.
The Difficulty Adjustment is what drives Bitcoin’s **salability across time**.
Unlike gold, even amidst periods of surging demand for Bitcoin, Bitcoin miners have no ability to mine Bitcoin faster, making unexpected inflation impossible. Forever.
Typical of Satoshi’s understated style, the Difficulty Adjustment was described in just two sentences in his original Bitcoin whitepaper: “Mining difficulty is determined by a moving average targeting an average number of blocks per hour. If they are generated too fast, the difficulty increases.”
The Difficulty Adjustment has now been continuously tested for fourteen years, at total global network power levels ranging from a just a few laptops, all the way up to enough energy to power New York City, and with lots of total network power volatility along the way.
The total network power volatility is what requires the Bitcoin protocol to continually adjust the mining difficulty, akin to continually adjusting the number of digits of the product of the two primes. And, astonishingly, just as Satoshi designed, no matter the global mining capacity, or its variability - a new block is verified every 10 minutes.
Tick Tock, Next Block!
-- an excerpt from the Stone Ridge 2020 Shareholder Letter, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter

2023-04-29 10:35:43

Banking is inherently unstable. Bankers are making it up as they go. There are numerous examples throughout history that prove this, each with different outcomes.
Numerous examples to keep you going:
1. [Cyprus Banking Crisis](https://en.wikipedia.org/wiki/2012%E2%80%932013_Cypriot_financial_crisis) (2013) - Cypriot banks got in deep trouble due to Greek debt exposure, leading to bank runs and capital controls. Uninsured deposits were controversially used to rescue the banks through a "bail-in."
2. [IndyMac Bank](https://www.bankinfosecurity.com/indymac-inside-story-bank-failure-rebirth-a-1432/op-1) (2008) - During the 2008 financial crisis, IndyMac, a California-based bank, saw depositors withdraw over $1.3 billion in just 11 days, leading to its collapse and takeover by the FDIC.
3. [Northern Rock](https://www.suerf.org/studies/2141/the-failure-of-northern-rock-a-multi-dimensional-case-study) (2007) - The first UK bank run in 150 years happened when the subprime mortgage crisis hit, with depositors withdrawing £1 billion in only three days.
4. [Argentine Financial Crisis](https://economics.rabobank.com/publications/2013/august/the-argentine-crisis-20012002-/) (2001) - A huge bank run during the economic meltdown led the government to freeze bank accounts and convert dollar-denominated accounts to pesos, causing many to lose their savings.
5. [Barings Bank](https://www.e-education.psu.edu/ebf301/node/569) (1995) - London's oldest merchant bank went under after rogue trader Nick Leeson caused over £827 million in losses, leading to a run on deposits and the bank's eventual bankruptcy.
6. [Continental Illinois](https://www.atlantafed.org/cenfis/publications/notesfromthevault/1604) (1984) - Risky lending practices led to a bank run and the collapse of the seventh-largest US bank at the time, requiring a massive bailout from the Federal Reserve.
7. [Banco Ambrosiano](https://en.wikipedia.org/wiki/Banco_Ambrosiano) (1982): Nicknamed "God's Bank" due to Vatican ties, Banco Ambrosiano collapsed because of fraud and a run on deposits, leaving a $1.4 billion hole in its balance sheet.
8. [Herstatt Bank (1974)](https://en.wikipedia.org/wiki/Herstatt_Bank) - A bank run on this Cologne-based bank, triggered by massive forex trading losses, led to its collapse. An event widely referred to as the Herstatt crisis, this highlighted the importance of settlement risk in foreign-exchange markets and was a key factor that led to the worldwide implementation of real-time gross settlement (RTGS) systems
9. [Bank of United States (1931)](https://en.wikipedia.org/wiki/Bank_of_United_States) - During the Great Depression, a run on the Bank of United States caused it to fail, making over $200 million in deposits inaccessible for its 400,000+ depositors and worsening the economic crisis.
10. Great Depression Bank Runs (1930-1933) - After the 1929 stock market crash, a series of bank runs swept the nation, [causing over 11,000 banks to fail](https://thegreatdepressioncauses.com/great-depression/banks/) and wiping out about $140 billion in savings (in today's terms).

2023-04-29 08:42:03

https://i.imgflip.com/7atipk.jpg

2023-04-29 07:35:02

We think of tech exclusively as computers today but that isn't correct.
All the great growth companies in history were technology companies in their time.
Things like Standard Oil, Post Cereal, U.S. Steel, Boeing, IBM - all of them brought new technology to the market - that is why they grew so fast!
Any such growth business is therefore a technology business.
And almost by definition - they stop growing once they’re no longer cutting edge.
There are other ways to grow companies - financial engineering (loans/leverage), political/regulatory capture (rent-seeking) or breakthrough marketing - but they’re not gonna be $1 Trillion companies
-- an excerpt from the Saylor Series Episode 2 - the Rise of Man through the Dark and Steel Ages, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/saylor-series-episode-2-the-rise-of-man-through-the-dark-and-steel-ages-robert-breedlove

2023-04-29 04:33:29

New York may look majestic and unlike any other city - but that is expected. Its funding is unlike any other too.
It is built from the value extracted by financial intermediaries. The institutions that rule the dollar system - the so-called Cantillionaires. They are the ones that benefit the most from all the new money creation and over-financialization (read: house of cards) of the economy.
And to not forget - bailed out by the public socializing their losses. They have unlimited upside, as they get to privatize their gains, but limited downsde - as somebody comes to save their "too big to fail" bums.
https://images.pexels.com/photos/313782/pexels-photo-313782.jpeg

2023-04-29 01:24:21

Bitcoin mining has the potential to bootstrap the development of cheap, clean energy infrastructure in remote areas, possibly leading to a more sustainable energy future.

2023-04-28 20:41:50

https://nostr.build/i/nostr.build_de592285647a95c99a3769bc5fbaaa271c523106797bb94132c0408e81d6ca93.jpeg

2023-04-28 19:23:29

The ultimate conclusion about Bitcoin is that a global network of rational economic actors operating within a voluntary, opt-in currency system would never collectively form a consensus to debase the currency they have all independently and voluntarily determined to use as a store of wealth.
It's not just code that dictates there will ever be 21 million bitcoin - it's the game theory surrounding much of our daily lives.
That can't be understood overnight by any individual.
It is a reality that is reinforced and strengthened over time by reading more and seeing it repeatedly work, every 10 minutes.
- an excerpt from the 2-minute version of Gradually, Then Suddenly (2019) https://www.2minutebitcoin.org/blog/gradually-then-suddenly-bitcoin

2023-04-28 16:21:56

The foundational fallacy is that people try to explain money in physical terms when it is purely a sociological phenomenon.
Gold is not valuable because it is durable, fungible, portable, and scarce; it is valuable because of the **self-sustaining tradition** around it.
Its properties enable this, but don't guarantee it.
The same applies to Bitcoin. It’s why you can't copy Bitcoin's value by forkingthe blockchain and adding extra features - the shared socially-reinforcing belief of billions of people is impossible to replicate.
Similarly, if a new metal better than gold was found - it wouldn't inherit all its value.
- an excerpt from the 2-minute version of It's Not About The Technology, It's About The Money (2016) https://2minutebitcoin.org/blog/bitcoin-is-about-the-money-not-the-blockchain-technology

2023-04-28 09:26:14

We make tools, protocols, technologies that improve our productivity and that’s how we advance - it’s all on layers of innovation.
See fire, water (hydraulics), railroads & logistics, oil, internet - all as foundational technologies that got us where we are today and allow us to work on today's innovations.
-- an excerpt from the Saylor Series Episode 2 - the Rise of Man through the Dark and Steel Ages, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/saylor-series-episode-2-the-rise-of-man-through-the-dark-and-steel-ages-robert-breedlove

2023-04-28 09:00:20

new podcast summary dropped 🔥
We summarized a community call consisting of Lebanese Bitcoiners. It's fascinating to see the local plebs in different parts of the world. We will be doing more such summaries - it really exposes the strength of Bitcoin.
Topics covered were:
- Lebanon's Financial Crisis (ever had a currency's USD value depreciate from 1,500 -> 100,000 in a day?)
- History
- People
- Bitcoin Community
Learn more about the Lebanese Bitcoin community 🇱🇧
https://www.2minutebitcoin.org/podcasts/summaries/lebanon-bitcoin-community-global-bitcoin-fest

2023-04-28 08:41:44

repost if you relate
https://i.imgflip.com/7a3ys0.gif

2023-04-28 08:22:00

- reply

Insane! Kudos on rowing though!

2023-04-27 14:57:39

When a freely chosen unit monetizes through market processes, one can expect volatility. Bitcoin’s volatility is not surprising because it:
1. is not widely understood
2. is in early stages of development
3. derives value from government instability, which itself increases market uncertainty and market volatility
4. has uncertain expectations of future utility, especially in the face of legal hurdles.
5. is decentralized. Centralized sectors have low volatility because it takes just a handful of actors to suppress it. Communism had no price volatility (until it collapsed).
Bitcoin’s exchange rate can be in a temporary bubble phase at a given point in time.
-- an excerpt from the 2-minute version of Bitcoin Hypermonetization: Bubble Talk (2013), originally posted in https://www.2minutebitcoin.org/blog/bitcoin-hypermonetization-bubble-talk-2013

2023-04-27 12:37:17

This picture is the very definition of clown bankers that have no idea what they're talking about.
https://i.imgur.com/PpjHqec.jpg

2023-04-27 11:56:07

Human psychology is herd-like and has proven to exhibit periods of euphoria and fear.
A new monetary asset that regularly grows in both popularity and usefulness will always be volatile - that's just human nature.
The establishment will fight to suppress it and instill fear, uncertainty and doubt in all participants. Even without intervention, volatility is part of the course as Bitcoin's price goes too high during bull runs.
Gold was similarly volatile during the Weimar Republic's hyperinflation. Notice how the monthly percentage change was all over the place - many times more volatile than Bitcoin today.
gold volatility during weimar hyperinflation
In theory, we should expect Bitcoin to be even more volatile than this during extreme periods.
One can expect volatility when a freely chosen unit monetizes through market processes. Bitcoin’s volatility is further not surprising because it:
1. is still not widely understood
2. is still in early stages of development (Lightning, etc.)
3. derives value from government instability, which itself increases market uncertainty and market volatility
4. has uncertain expectations of future utility (regulatory clarity).
5. is decentralized. Centralized sectors have low volatility because it takes just a handful of actors to suppress it. Communism had no price volatility (until it collapsed).
So next time someone rehashes the same old argument against Bitcoin - "it's too volatile" - tell them that's expected. Not only that - it's good.
Unless Bitcoin becomes heavily manipulated or human nature changes, a new monetary asset that regularly grows in both popularity and usefulness will always be volatile.
To complain that nobody will use Bitcoin because it’s volatile is to say
> “Bitcoin’s adoption rate is so astonishingly fast that it will never be popular!“
If Bitcoin were less volatile, would it have an even more rapid adoption rate?
Bitcoin’s price has to go up as more people start using it, and if a lot of new people start using it, then it has to go up fast (that is, be volatile).
Unlike everything else, a higher price for Bitcoin does not reduce its utility - you just trade with smaller amounts.
In fact, a higher price makes it more useful because more people want to use it.
There is no reason to think that Bitcoin will stabilize in terms of other currencies. Once Bitcoin starts killing the other currencies, it will still be volatile, which will still indicate its success.
https://i.imgur.com/FV9hKtp.png
-- parts of this is an excerpt from the 2-minute version of Bitcoin Hypermonetization: Bubble Talk (2013), originally posted in https://www.2minutebitcoin.org/blog/bitcoin-hypermonetization-bubble-talk-2013 and another part is an excerpt from the 2-minute version of I Love Bitcoin's Volatility (2014) accessible here https://www.2minutebitcoin.org/blog/i-love-bitcoins-volatility

2023-04-27 11:46:43

2023-04-27 04:03:31

On the liability side of the Bitcoiner's balance sheet there are mortgages, student loans, car loans, credit cards, etc.
Everyone admonishes people not to borrow in order to buy bitcoins.
The reality is that disposable cash is fungible: if you buy bitcoins instead of paying down your mortgage's principal, you are a leveraged bitcoin investor.
Almost everyone is a leveraged bitcoin investor, because it makes economic sense within reason. The cost of borrowing (annualized interest rates ranging from 0% to 25%) is lower than the expected return of owning bitcoins.
How leveraged someone's balance sheet is depends on the ratio between assets and liabilities.
The appeal of leveraging up increases if people believe that fiat-denominated liabilities will decrease in real terms, i.e. if they expect inflation to be greater than the interest rate they pay.
At that point, it becomes a no-brainer to borrow the weak local currency using whatever collateral a bank will accept, invest in a strong foreign currency, and pay back the loan later with realized gains.
In this process, banks create more weak currency, amplifying the problem.
-- an excerpt from Speculative Attack (2014), its 2-minute version can be found here: https://2minutebitcoin.org/blog/bitcoin-speculative-attack-on-the-dollar-2014

2023-04-27 01:01:54

The State always grows. Participating in the democratic process only empowers it as devotees reward it through votes in exchange for entitlements.
Bitcoiners reject this. Understanding that the only winning move in politics is **[to not play](https://www.2minutebitcoin.org/blog/an-honest-account-of-fiat-money-2018 )** - they abandoned the rules with a totally independent monetary system.
Bitcoin challenges the State’s most treasured privilege: **the ability to finance itself through inflation and seignorage**, as well as other repressive tools a large fraction of the world lives under - **capital controls** and **local exchange rate manipulation**.
This predictably enraged the State-dependents.
It is no coincidence that Bitcoin’s most hysterical critics overwhelmingly benefit from the state:
- academics, beneficiaries of the rampant government-guaranteed student loan bubble
- (ex-) politicians, who always turn their political clout into personal wealth
- journalists who were disrupted by the internet and reduced to simply peddle State messaging
- economists, forced to peddle Keynesian narratives for grant and tenure
- an excerpt from the 2-minute version of A Most Peaceful revolution, originally posted at
https://2minutebitcoin.org/blog/bitcon-a-most-peaceful-revolution

2023-04-27 00:37:13

highly technical diagram of #plebchain
https://nostr.build/i/nostr.build_49a8af82c4cd6a3950509a3d9f7ef7304f4e4f82de88a64bd57d94c99a3eb956.jpeg

2023-04-26 18:52:14

If you go on a rowing machine and row as hard as you can for an hour, you’d barely get a kilowatt-hour – 29 cents.
We got to where we are by channelling 10,000x more energy.
People used to hunt whales in order to get kerosene to burn a lamp. Then comes oil - 1000x more efficient
Oil was like fire - a primary energy network which allowed us to radically accelerate how quickly the economy produced new wealth/innovations

2023-04-26 15:51:34

The value of money is a macroeconomic phenomenon, even for a tiny, quirky cryptocurrency like Bitcoin.
Bitcoin can be worthless one year and valuable the next without a fundamental change to the software or protocol. It can and does range in price by enormous margins over short periods of time for reasons that seem inscrutable.
The reason for this is that the value of money is a shared hallucination, and the price is caused by the vividness of that hallucination. It is all based on future expectations of utility.
-- an excerpt from It's Not About The Technology, It's About The Money (2016), its 2-minute version can be found here: https://2minutebitcoin.org/blog/bitcoin-is-about-the-money-not-the-blockchain-technology

2023-04-26 12:44:39

Green energy is largely a political narrative - look at what people do, not what they say.
Grandstanding and social media outrage gets attention, but has shown to do nothing.
[60% of the EU's renewable energy](https://energy.ec.europa.eu/topics/renewable-energy/bioenergy/biomass_en) is biomass - largely trees [imported from the U.S](https://www.nationalgeographic.com/environment/article/europe-burns-controversial-renewable-energy-trees-from-us). Yes, burning firewood is green apparently
The problem with renewables is it's not economically viable at scale. We waste more energy than we consume.
- 70% energy waste globally.
- 59% lost in generation process.
Energy producers can cut production costs by mining with curtailed energy waste. Not only does it make renewables economically viable, it allows energy producers to further invest in and expand their operations.
Here is one example where [Bitcoin mining saved Mechanicville hydroelectric plant, the oldest renewable energy facility in the world](https://www.timesunion.com/news/article/Mechanicville-hydro-plant-gets-new-life-16299115.php#photo-21206639)
And with regards to methane and flaring - methane is over 80 times more potent than CO2.
1. It's not economically viable to install flaring - most don't do it unless regulation (good luck to get e.g Africa to prevent that)
2. Even when flared, some methane does escape.
In the US alone, there are 1404 landfills without any methane capture or flaring infrastructure.
Bitcoin mining not only makes methane capture economically viable but 100% of methane is combusted and nothing vented into atmosphere.
Here is one example - [Exxon is mining bitcoin in North Dakota as part of its plan to slash emissions](https://www.cnbc.com/2022/03/26/exxon-mining-bitcoin-with-crusoe-energy-in-north-dakota-bakken-region.html)
If you want to get people to do something, all you gotta do is make it profitable to do. If it's not profitable, it's just a useless political narrative. Same old grandstanding and social media outrage while nothing gets done.
-- an excerpt from the Stone Ridge 2020 Shareholder Letter, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter

2023-04-26 12:36:55

#plebchain
https://i.imgflip.com/7ati9h.jpg

2023-04-26 03:14:02

The word blockchain is thrown around with the idea of solving major problems, but there isn't much apparent use outside of currency. There are no applications of blockchains that do not involve a double-spending problem.
This is why Bitcoin is the only cryptocurrency destined for success.
Bitcoin offers a 1000x improvement over fiat currencies, but no other cryptocurrencies offer a 1000x improvement over Bitcoin.
- an excerpt from the 2-minute version of It's Not About The Technology, It's About The Money (2017) https://2minutebitcoin.org/blog/bitcoin-is-about-the-money-not-the-blockchain-technology

2023-04-26 00:07:10

Bitcoin is practical money.
Ethereum is fantasy finance.

2023-04-25 10:21:14

https://pbs.twimg.com/media/E2b5lRpXEAA9VBh.jpg

2023-04-25 10:08:15

- demonetization - a widely used medium of exchange ceasing to be one
Historically, demonetization has happened through
1. hyperinflation - the money is devalued
2. bimetallic standard - changing from using gold to silver
3. metallic standard is abolished/defaulted on (e.g. 1971 - https://wtfhappenedin1971.com/)
When the EU adopted the euro, it demonetized local currencies (e.g. Italian lira) and monetized the euro.
-- an excerpt from the 2-minute version of Bitcoin Hypermonetization: Bubble Talk (2013) originally posted in https://www.2minutebitcoin.org/blog/bitcoin-hypermonetization-bubble-talk-2013