No! And as we went through history, many of these custodians and nation states have fallen over, so if you wanted to transport wealth across 100 years, you would necessarily need to change locations rather frequently just to avoid and minimize that risk! I just thought it was super interesting, as always! So I think it’s kind of saying the same thing, but just speaking to a different audience in a way. [inaudible] And so every businessperson forever has always strived to avoid being commoditized! And the 1% will say, I think I’ll just go try it! And then finally, we’re gonna start looking at Bitcoin as the ultimate means of wealth settlement and preservation. If you look at the history of railroads, the biggest thing in the 19th century was railroads. Robert Breedlove: Yeah! It’s something truly remarkable! And what could you do if the friction went completely away? Robert Breedlove [58:24]: Alright guys! And if you look at the price action of Bitcoin historically on the log scale matched over these halvings you see it perfectly! What’s the entire size of the — you know what the spreads are in the bond industry? Now, what’s the most efficient energy network in the history of the world? Everyone knows and can agree to what the supply is and what the supply ever will be! And the other attack vector we didn’t discuss is that temptation is always given into! What are the transaction fees across any monetary network? The politicians will run the airline below variable cost. So as Bitcoin is undergoing this downward pressure to cost of production as people figure out how to generate hashes more cheaply with cheaper energy or better ASICs or whatever the breakthrough is, the algorithm pushes back every 4 years! That’s a brilliant idea! You could argue that Ethereum allows you to do that, but Ethereum is subject to political attack vectors, we don’t know its whole supply, there is a small group of people that control its functioning, whereas it’s just not true for Bitcoin. It’s not a new idea to charge transaction fees! How good was that? So that’s what happened with fracking. This is why you don’t ever want to be a budget airline because a government will operate airline flights at a variable cost loss in order to avoid shutting down the airline, right? Robert Breedlove [54:53]: And this has its roots in what I would say is kind of the Malthusian fallacy. Florida? Fire was harnessing and channeling chemical energy, missiles were kinetic energy, and water was gravitational energy! In that case, assuming a 2% mining rate, assuming a stock to flow of 50 and miners mine 2% more gold a year, the half-life of a gold battery is 35 years. What we need truly in a monetary network is zero unexpected energy loss or inflation, which Bitcoin provides. That’s why those cities are cities! It is excellent and worthy of multiple views. Press question mark to learn the rest of the keyboard shortcuts. Bitcoin’s significance in the minds of people and subsequently its place in the world is shifting. Whereas Saylor is very focused on the energy, which is much more of an engineering or physicist aspect of reality, and much more measurable and objective than even time! So that’s okay. That was Episode 7 with Michael Saylor here on the Saylor Series. It’s something that’s just altogether unique and we’ve just never had it before! I don’t need to worry about the stability of the United States and J.P. Morgan to transmit Bitcoin 100 years into the future, you only need to be concerned about the stability of the energy network, which is maintained by the collectively self-interest of the world, in theory! It’s a lossless energy network. ... Be sure to check out a series of interviews he did with Michael Saylor called “The Saylor Series“. source You can’t move $100 Million worth of property in 30 days to another country! Let’s put it into a gold network: I put $100 Million into gold. Now we’re working with modern batteries. “The Saylor Series” by Robert Breedlove and Michael Saylor examines human history through the five primal elements from an engineer’s perspective. For example, Apple Computer — worth $2 Trillion today — Google, worth more than a Trillion, Facebook. In 22 years, holding your value in gold, you’re gonna get cut in half! — they all think, Oh, well it takes 30 minutes and $5 to move Bitcoin! So Bitcoin mining is this race to produce hashes more cheaply. It’s a field you wouldn’t have thought you would’ve heard about even 5 years ago! And at what scale are we doing that? So a very low entropy medium, and by getting the entropy out of the channel, it maximizes the flow of energy! The Saylor Series | Episode 6 | Digital Gold: Harder, Smarter, Stronger, and Faster By Robert Breedlove. But, I love this part where Saylor went into the math behind why gold sucks! Well it’s about to be Bitcoin! Apple can ship a better camera to a billion people overnight for a nickel! So if we come back to this idea, Bitcoin is the ultimate energy network! If I had pure energy at the power plant, I’m gonna lose 6% of the energy to put it into your house 250 miles away! The other thing there is the price signals that it would propagate. It’s such a leap forward in innovation and in potentially civilization advance as well that it’s hard to even comprehend how big of a deal this is! What we have in each of these networks is: we have the collapse, a dematerialization of some product or service or virtue or some ineffable quality be it friendship or mobile devices or information. [1:16:27] And it’s also what defines civilization in a way. We need something to push against to move forward. Now it has to get stepped down to 240 volts or lower voltage even, to get into your house. And we could think, as Saylor alluded to, the goddess of wisdom always introduced a little bit of friction! If you wanna actually carry a $1 Million house 100 years — in Florida, there’s a 2% real estate tax. But because Bitcoin’s pushing back, instead of all of that energy flowing into producing cheaper Bitcoin, it’s actually pushing us to just seek out cheaper energy, so it’s created this global perpetual incentive scheme to figure out cheaper ways to make energy. And every commodity is channeling human ingenuity into making it worse, as a money! Automobiles and airlines! Because the gold has to be secured, and it has to be secured by institutions! If we can harness it and store it in a medium that’s reliable and then transport it somewhere else and redeem it at later times for later uses, that has a lot of value as well! Now I can move that $100 Million of gold 100 miles — would I lose 6%? It’s collapsing into a much more efficient form, it’s giving off energy! Mr. Saylor brings the heat! Saylor made a great point that, if you want to compare the cost to settle in Bitcoin, you have to compare it to gold, because with gold, you are settling in finality. And that once you get — you know there’s a huge expenditure to get into orbit — if you imagine a rocket, how much fuel it has to expend, how much ingenuity and design and science has to go into building a rocket to get it going fast enough away from the Earth to escape Earth’s gravitational field — but once you get into orbit, all of a sudden your returns on energy expending go to like near-infinity! But if I go to New York City and I pull the plug on the power company, it’s deadly! And this becomes an interesting question! For me this when a lot of the light bulbs started to go off and started to have a lot of those little, mini epiphanies during our conversation, which you might see me having as we engage. And yeah there’s a price to pay! So they’re best satisfying wants or best solving problems for the demands of market participants! And then Saylor was so kind to actually answer the question that we always ask on this show, which is, What is money? So it kind of provided this floor for human energy, and it was a medium through which we stored and transported it. Now a typical battery — a good one — is gonna lose 2% per month! I think that’s a great point too that you bring up the transaction fees on the Bitcoin network are set at fair market value. Whereas ostensibly these government fees—they’re non-consensual, they’re conducted under a monopolized area. Robert Breedlove is a freedom maximalist, ex-hedge fund manager, and philosopher in the Bitcoin space. So gold is a more efficient way to move large amounts of energy for short distances. The Saylor Series A great 9-part series where Robert Breedlove and Michael Saylor talk about everything from the rise of man (ep1), the virtues of strong money (ep7) and Sovereignty (ep8). There’s this phase transition, and we see it throughout all areas of science, but right now this is just the first time in human history that we see this creation of pure digital monetary network! And the flaw in the reasoning is: it’s a linear interpretation of the world instead of a closed feedback or a non-linear interpretation of the world. We hit on some major concepts today! They said it in the ’50s, ’60s, ’70s, ’80s, and ’90s, and the world always predicted that we were gonna run out of oil or energy in about 10 years. But let’s come back to the outer space analogy: take your flashlight and shine it in your basement. You’re in outer-space! You could think about when you encrypt monetary energy on the Bitcoin network, it’s like achieving escape velocity out of the gravity well! And by domain I mean perhaps governmental domain — like how do I move my energy from New York to Tokyo? It exists in an orbit that’s beyond man’s reach — which is really important, so it’s not vulnerable to counterparty attack vectors — we all know what the inflation rate is and ever will be, so there’s no unexpected inflation. My understanding of Bitcoin, and money itself, is expanding. Now get into outer space and take your flashlight and shine it, or flip it the other way: the Hubble telescope! There are toxic things that kill us! Nothing wrong with that! Divide that into 70 and every 22 years — that’s the half-life of gold. And you want to change your life? And that’s your phase change and your state change, and that’s why I would say: Bitcoin is the most efficient system for channeling energy through time and space in the history of mankind! Because that’s the only way to access cheaper Bitcoin production, effectively, although Bitcoin just keeps getting harder to produce! I think we’re starting to see things coming together in this episode where all of this foundation we’ve been laying starts to relate and highlight the significance of Bitcoin in the modern age. If I want to keep jobs — and how many countries want to project jobs — if I want to project jobs, I will produce something and sell it below the variable cost. So very high switching cost on the cap-ex related to gold mining, and this leads to specialized producers overproducing! You would pay $20,000 a year every year for 100 years, assuming that the house was capped and not reappraised, and so you’re in essence going to lose the house in 50 years! And it just fails to take into account the non-linearities associated with innovation! When a government decides: education, healthcare, transportation, automobiles, local manufacturing, security, defense — defense is a great example of something that we produce whether we like it or not at a cost that’s higher than potentially the value and use of it! That’s my idea! So that’s 50,000x cheaper! We do that with anything that is politically charged! Well what does that sound like? People have a tendency that when you tell them they’re about to run out of something, they reprioritize, they think a little bit harder, and they come up with an innovative solution! Or I’m running a water wheel, or I’m floating a 2-ton block in the water and the gravity’s pushing down on the water and the water is pushing up! Michael Saylor: You want stability, right? I could probably move $100 Million of gold 100 miles for $10,000-$100,000 depending on how much security I need! And so this is the loss on the network. When you’re unlucky — I mean there’s a reason people refer to free ports. I think there are other commodities that are harder to produce! The last part I thought was cool about the absolute zero superconductive monetary network for achieving escape velocity, was the example of the Hubble space telescope. So I hoped you guys enjoyed that episode! So when you have a commodity business where people have specialized capital and they make those investments, what happens over time everywhere in every industry in every commodity in the history of the world is: the producers overproduce the commodity because, in the phrase of Hotel California, You can check in anytime you want, but you can’t ever leave! Who would you complain to? I take energy, I sell it on the grid, you give me money! Robert Breedlove: And the mountain is not mounting a defense of any kind. It’s expensive to get to near-zero, and then the impedance disappears in the network and the friction goes away! But when rules are bendable or breakable, you’re actually creating incentives to behave in a corruptive or exploitative way. It is a freely competitive industry such that all of the transaction fees are a consensual exchange, and the value paid in those transaction fees goes — with very little loss — directly to supporting the security of the network! So that’s an impedance! But commodification — the history of it, and the economic principles behind it — actually point towards why that’s a really bad strategy for the long run! 9-part series | Zulfikar Ramzan, Kahn Academy. So at the halving, the operation and energy expense being allocated to generate a hash—which is to create Bitcoin basically—that same cost flows into half as much Bitcoin being produced! So people don’t ask the question, Why is it that I get my electricity for nothing? And this also points to Bitcoin and the uniqueness of it in that Bitcoin is like the ultimate store of value through this lens of commodification, because it actually resists commodification! Michael J. Saylor. So any group that commands one of these forms of energy can be commanded themselves by money. MicroStrategy CEO Michael Saylor is comparing Bitcoin to the disruptive video sharing giant YouTube. But my variable cost is $1.50 a gallon, because I’ve got all these billions of dollars in the factory! The other thing that’s interesting to me about that is it’s inverting the economic principles behind commodification. If I put it into a copper energy network, I have 24% bleed rate per year by the time it gets to the battery. Then the temperature starts to increase again as it goes into water, and then it flatlines again before going into steam. So that’s another reason it doesn’t work! The personal transformation is thanks, in no small part, to discovering The Saylor Series with Robert Breedlove and MicroStrategy co-founder Michael Saylor. There is no scarcity of energy in the universe, only our ability (or lack thereof) to harness and channel it. They’ll say, We just decided to tax this in order to pay for something unrelated. So in that lens, historically at least, gold was energy money! The Saylor Series | Episode 9 | Economics, Inflation, Interest Rates, and Natural Competition Episode Summary. Unless a government’s gonna be subsidizing the crypto rails which create the 21st economy, and that’s a reason why mining is a bit riskier as a business than owning Bitcoin! A lot of that value being extracted — 10% in, 10% out — is not going to securing the property rights that you’re bringing in and out! Michael Saylor: Okay so now, let’s say I want to take $100 Million. And also a point that leads them to realizing these winner-take-all dynamics in digital competition. And you pull energy into your house. If I invest $10 Billion into gasoline refinery, my fixed cost are $10 Billion. At around 56:20 Breedlove asks about the dangers of … And when you think about that you realize that Bitcoin would move it in 30 minutes instead of 30 days. So to argue that a crypto asset needs to eliminate the transactions is just sort of ignorant of this fundamental truth that we need it in a monetary network. So I put it in a vault and I pay for custody fees and going in there’s a fee, and then I’m paying, whatever, 20, 30, 40 basis points a year to keep it, and then the miners are out there doing their mining thing and it’s probably 200 basis points worth of additional gold. Through space, it has a slight loss in the form of transaction fees, but it’s a good thing, and the transaction fees on the Bitcoin network are like a little bit of impedance and/or a little bit of gravity, a little bit of friction. Whereas things like Amazon or Google, they haven’t been commoditized yet. We’re gonna run out of oil, we had a crisis, and eventually the price of oil went high enough. We’re also gonna get Saylor’s answer to that all-important question: What is money? In Episodes 1–3 we covered the Stone Ages, the Iron Ages, we went into the Dark Ages, we went forward into the Steel and the Industrial Age. They’ve been saying it since the Club of Rome in 1973 or something! And they’re comparing it to a new crypto network that has no value on it! And the answer is: because those two things got declared as public utilities — that they’re so important that nobody have a monopoly on it! It’s like, No! It’s like you just can’t really imagine the world when you’re trapped in an energy well. It’s not like 10x better, it’s not 100x better, it’s not 1,000,000x better, it goes to infinity, and it never stops! So how long does it take me to move the $250 Trillion around? Episode 8 just dropped. If we just sit with that for a while and really think about the profundity of something like that, and that we are the species that channel energy across time and space. California? That’s why the idea that I’ve gotta drive transaction fees to zero is a silly idea! But my first job at DuPont was I built computer simulations of commodities and specialty chemical networks, and let me tell you what people in that business think: they think commodity is a dirty word! So I guess what you’re getting at is that energy becomes transmuted into the next state before it can start to give off energy in the form of profit, productivity — it’s giving back economic substance to its users. Your worst case is 100% because of confiscation outright, or theft. 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