Subscribe
Share
Share
Embed
The Honest Money Show is your guide to understanding what money really is — and why today’s system isn’t working. Hosted by Anja Dragovic, this show cuts through the noise to explore how money shapes our lives, where it’s gone wrong, and what a better future could look like. Along the way, you'll discover how Bitcoin fits into the bigger picture — not as hype, but as a serious response to a broken system. Whether you're curious, skeptical, or already down the
Hi Brad, welcome to Honest
Money Show.
Thank you for having me.
Awesome.
I am so glad you said
yes to this episode.
Um, so I've got your book
Resistance Money Here, which is.
An absolutely wonderful read.
Um, I know quite a few people in
Australia that quite like this.
Um, the, this book, um, I'm
also interested to know now
on behalf of a friend, is
the audio book coming out?
I am told about a month.
Yeah.
Oh,
awesome, awesome.
There's a very busy dad who
just had his second child
and he's very keen to get
it in the audio version.
Um, so yeah, I'm so
happy to hear that.
Um, oh, I wanna start
by, uh, talking a little
bit more about your book.
So.
In your book, you make a great
philosophical case for Bitcoin.
Uh, it's like, uh, essentially
the foundation for a more
just financial system.
Do you wanna sort of give a
high level view of, of what the
case is?
Sure.
There's two parts to it.
So the first part is the framework
for, for how to evaluate Bitcoin.
And then the second part is
sort of walking through, um.
Bitcoin when you're thinking
about it in, in that framework.
So the framework is, uh, we
thought, so this is a, a co-written
book with Andrew Bailey and Craig
Warmke, who are also philosophers.
And so much of the discussion
around Bitcoin comes from
either people who have Bitcoin
and thus are incentivized to
get other people to have it
so that the price will go up.
Um.
And on the other side, people who
don't have Bitcoin and who could
have maybe had Bitcoin a long
time ago and now are incentivized
to have been right all along.
And therefore they want the
price of Bitcoin to go down.
So they turn out to be right.
And it's really hard to
figure out how do we evaluate
things that we're, that we
can literally invest money in.
And there's an old
thought experiment.
From the 1960s and seventies in
philosophy and economics called
the Veil of Ignorance, and that
tells us that when we want to
evaluate something that we're
caught up in, that we're a part
of, in this case that, that
we have a financial stake in.
What we can do is step behind this
veil and stepping behind the veil.
F um, makes you forget who
you are, so you can still know
all the facts about the world.
In this case, all the facts
about Bitcoin, but all the facts
about, uh, what governments are
looking like, what money looks
like in different countries.
What the political situations
are, et cetera, the distribution
of wealth, all that kinda stuff.
So you know all of the facts.
The only fact you don't know
is which person you are.
And then you imagine if I, when
I wake up tomorrow morning, I
could be any one of these people,
there's an equal chance, would
I want to wake up in a Bitcoin
world or a non Bitcoin world?
So the world exactly as it is
or the world exactly as is.
As it is.
But without Bitcoin.
And when you, so that's part one is
just setting up that framework and
introducing that thought experiment
and then letting people decide.
Um, but what we also wanna
do is help people think about
what Bitcoin looks like from
the perspective of each of
these people who they are not.
So obviously if you wake
up as Michael Saylor, you'd
want Bitcoin to exist.
Um, but also if you wake up
as someone who is living in an
authoritarian regime and you're.
You know, on the, the naughty
list of the, of the authorities,
they're, they're searching
for you, they're blocking
your bank account, et cetera.
And similarly, maybe if you are
a woman living in a society where
you're not allowed to have a bank
account where all your property
belongs to your husband or your
father, or if you, and so the,
the list goes on of people who we
think would prefer to live in a
Bitcoin world than an onco world.
And you from behind the veil.
Could be any of those people.
And once you step back through
the veil and you're, you, you
shouldn't now forget everything
that you learned and say,
oh, well I still don't care.
You should think, oh, those
are, those are also people.
I should care about what
life is like for them.
And so I should promote Bitcoin.
Not necessarily buy,
own, even use, but.
At least think that Bitcoin is good
and that, that the world is better
off for having Bitcoin in it.
Yeah.
Yeah, absolutely.
And do you, do you believe that,
um, it's not only a matter of
holders versus non holders, but
um, I guess where I'm trying
to go is, is it also about like
those who understand versus
those who don't understand?
Um, going back to, to, to a quote
that I heard someone say, um, is.
Um, education leads to
inevitable allocation.
So is there an element of people,
um, who are anti Bitcoin just
simply not understanding it?
I'm sure there are a lot of people
who are against Bitcoin because
they don't understand it, or, but
there are, there are plenty of
people who understand some of it.
Maybe even understand
how the blockchain works.
There are computer scientists
who are against it.
Um, but I think that's because
they're not aware of how
Bitcoin is being used by the
people that I care about, uh,
who are, you know, trying to,
to resist authoritarianism.
And it's really hard to read the
stories of all of these people
to go to the Oslo Freedom Forum.
That the Human Rights Foundation
puts on and hear person after
person talk about how they
were able to escape political
persecution because of Bitcoin,
or overthrow a dictator because
of Bitcoin, and then in the
end, say still it's bad.
Yeah.
Yeah, absolutely.
I think it really matters
what someone is exposed to.
Um, if you're a police officer
who's dealing with crime and you're
constantly exposed to, I guess,
uh, people using Bitcoin as, as a
tool to commit those crimes, then.
That's kind of your worldview,
that's what you're exposed to.
And I can understand why you might
be anti Bitcoin, but I also can
see and appreciate that if someone
like that did go to Oslo forum,
that they might, you know, expand
that, that, um, awareness and, and
understanding of what, what it is.
Um, my,
my neighbor is a police
officer, actually.
Oh, okay.
And when I told him, you know, I
work on Bitcoin, and he said, oh
yeah, we, we are just getting more
and more calls from people who are.
Uh, reporting scams where
people are trying to
extort them from Bitcoin.
Uh, I just, I just really hate
Bitcoin, um, because it, it
makes it easier for people to
do illegal things and I said,
oh, yeah, it totally does.
Um, but it also makes it easier
for people to do illegal things
in countries where what's illegal
isn't necessarily wrong and.
He said, oh yeah, that's,
that's a really good point.
I said, not, not all laws are,
are just laws, even in the us
but especially in other places.
And for example, Lexie Navalny,
who you know, was fighting against
Putin's regime for such a long
time was using Bitcoin to do it.
Oh yeah, he said that.
That's really good.
So I gave him a copy of the book.
Uh, we're gonna, we're gonna
talk about it at some point.
But I think even people who care
about their own laws and wanna
see their own laws followed
can really easily see both how.
Other laws are bad.
And also how our laws aren't
guaranteed to stay, um,
the way that we want them.
You know, it, it requires
constant vigilance.
And laws have changed throughout
the years, and you might think
that people should have a backup in
case, uh, law, the laws go south.
Yeah, absolutely.
And you know, my, my background
is I'm ex U Yugoslavia, um,
and now live in Australia and
Australia's such a. Good and
stable country that a lot of
people here can't imagine it ever
turning into something undesirable.
But I'm like, I kind of
have the life experience
that it is possible.
Um, it is more than possible,
so I'm always like a little
bit vigilant and Yeah.
Um, but I, I, um, also wanted to
speak about, I. You know, when I
started this podcast, obviously
I started talking about all the
good things about Bitcoin and,
and how it's, um, how it's great
and what problems it solves.
But, uh, it's interestingly, a
few people are coming out who.
Don't yet have an allocation,
but they are very curious
about Bitcoin as a solution to
some of the world's problems.
And where they're particularly
getting hung up on is, is like,
okay, I understand Bitcoin.
I understand what a deflationary
world might look like.
I understand, uh, the value
proposition for me personally, for
the community, for the whole world.
But they don't necessarily
see the transition between the
current world and a potentially
a hyperized world, and also
how that might impact things
like government services.
Um, so I know that's a very
speculative question, um, and
there's a lot to unpack there, but
they, do you have any thoughts?
Yeah, we, we talk about this
in the book and I think there's
a couple things to be said.
So one is.
Uh, the Hyperized world where,
where Bitcoin is the only money
and is used for everything
is by no means guaranteed.
That depends on both government
action and individual choice.
Governments will not stop
running their own currencies
until nobody is using them,
and so that's up to people.
People can decide whether
they want to keep using the
government currency or not.
So the other thing to say is I
think Bitcoin, whether or not the
entire world uses it as money all
the time, still serves an important
role for now, which is perhaps
disciplining some of these central
banks or people who are running
currencies by letting them know
that people have this option.
That they can invest in Bitcoin,
that they can use Bitcoin as money,
that they can accept Bitcoin for
their goods and services, and
that might make it that any, for
example, central Bank digital
currency has some guaranteed
privacy features, because if not,
people will use Bitcoin instead
that they can't seize it from.
From people, um, because
if they could, people
will use Bitcoin instead.
And so on down the line of, uh,
monetary policies and rules and
things like that, if Bitcoin is
around as an option, then central
banks and, and people running
currencies know that at any point
people could use Bitcoin instead.
And so they have to incentivize
you to use their own currency.
Now, one of the ways that
that's happening, of course, is.
As taxes.
Um, if you live in the US you have
to pay taxes in the US dollar.
They don't accept Bitcoin.
And I think most
governments are like that.
They only accept
their local currency.
Um, so that's one kind of
incentive, but it might be the
case that people just keep all
of their, uh, money in Bitcoin,
use that for trend and only pay
taxes in the local currency.
And I'm not sure how
long those would last.
So, um.
So I think incentivizes
governments and banks to behave
more responsibly than they
might otherwise have done.
Yeah.
Yeah.
And, and that is very
important 'cause sometimes
government spending tends
to get out of control.
Um, and I'm particularly worried
because in the last month alone.
Um, both Ray Dalio and Elon Musk
have alluded to the debt crisis
being a lot, um, sooner than what
most, most people might think.
So I think I've read somewhere like
two to three year horizon, which
is obviously scary to think about.
Um, and how.
That will impact the US and
the whole world if, if there
is some sort of a debt crisis.
Um, obviously I've never
lived through something
like that in my lifetime.
I have no idea what to expect.
Um.
And also I can only speculate
how Bitcoin is going to
fit into that picture.
Um, I've also read that Russia,
for example, is accusing now
the US of, um, using Bitcoin and
stable coins to manage their debt.
So it's just, it's wild to think
the times that we are living in.
If you had asked me 10, 20
years ago, if all of these
things would be like a topic
of discussion, I wouldn't have.
Believed it.
Um, I'm very curious
to know your, um, your
students at the university.
Are they, do they talk
to you about Bitcoin?
Is that a thing?
It's really interesting.
Most of my students, when I
tell them that I work on Bitcoin
in a, say, intro to philosophy
class or something like that.
A good number of them ask
me what crypto I think
is, is gonna pump next.
And I say, you know, I'm, I'm
just interested in Bitcoin.
Well, they all feel like they
missed the boat on Bitcoin.
Yeah.
And that's because they no
longer are thinking of savings.
When I was growing up, we,
you know, I was taught to put
away 10% or, or whatever I
could in a savings account.
And the savings account would
get four or 5% a year and.
Now a savings account gets
basically nothing there.
They, there's no interest
on savings accounts and
the price of things that
students would wanna save for.
Like homes are going up faster
than what they can get as returns
on any sort of investment.
And uh, I think the main
reason they're interested in
cryptocurrencies is because they
think the only hope they have
to achieve the American dream.
Is to basically hit the
lottery and crypto is their
version of the lottery.
The, it's these pump
and dump tokens.
And if they can get in at the
right time and get out at the
right time, then they can make
enough money to actually have
some, some sort of net worth.
And this idea of
slowly and steadily.
Investing in something like Bitcoin
or even the s and p 500, they just
think is not gonna make them ever
able to buy a house or to afford
to have kids or things like that.
And that's really
disheartening to me.
Yeah, I, I, it breaks my
heart that this is how
the youth of today feels.
Um, I can understand
why they do it is.
I, I don't really, I'm not
that close to the US but
I know in Australia we're
definitely experiencing a
cost of living crisis, and I
can't see it getting better.
I can only see it getting
worse if I'm completely honest.
And.
Yeah.
It's interesting that a
lot of people are now deed
to even think long term.
Um, they want the quick wins.
They don't wanna Yeah.
It's, I don't, I don't know
how to, how to, how to yeah.
Solve for that problem.
But, um, I want to know,
um, I'm curious from you
is how would we navigate.
The world today into a Bitcoin ice
world without extreme casualties.
Um, do you mean a, a hyper Bitcoin
ice world or a, i I mean, I think
we live in a Bitcoin ice world.
Um, yeah.
Where Bitcoin is now pretty
much, no matter where you
live, an option for you.
Mm-hmm.
And everyone can, can
opt in to Bitcoin.
So I guess I haven't really.
Thought all the way
through what happens.
Yeah, if every or, or what would
need to be the case in order for
everyone to opt into Bitcoin?
I would guess that that would
have to be because of some severe
monetary and financial unrest.
Like a debt crisis or something.
Otherwise, there are,
there are gonna be.
Still a large number of people
who don't see the need for it.
So I can't, I can't really
see a way that it happens
without substantial
suffering along the way.
So I'm hoping that that in, in
some ways, I'm hoping that we don't
get to a hyper Bitcoin ice world.
I hope that we get to a place where
governments still have money, they
can still use it to help people
who need it by, you know, providing
food and things like that.
And.
Then Bitcoin exists
as a way to save.
Yeah.
Yeah.
Um, so you, you essentially
are hoping for that Bitcoin
stays as, as a, as a store of
value rather than a medium of
exchange or a unit of account?
Um, as, as the only medium of
exchange or unit of account.
Mm-hmm.
I think that would be bad.
Yeah.
So I use, I use Bitcoin as a medium
of exchange as much as possible,
which is not very much due to.
Laws about capital gains,
but I know a lot of people
who use Bitcoin exclusively
as, as a means of exchange.
And I think that's great.
Um, but for people to be
forced to use it as a medium
exchange means other mediums
of exchange have failed.
And I think that would be only
because of a catastrophe that
I would not want to see happen.
Yeah.
Yeah, absolutely.
So I'd love, I'd
love for more businesses
to accept Bitcoin.
I'd love for the government
to have, uh, exemptions
for, um, certain amounts
of Bitcoin transactions.
I'd like to be able to buy
groceries and all that sort of
stuff with Bitcoin and instead,
um, and I'm, I'm working towards
that future, but that wouldn't
even be a, a hyper bitcoin s world,
that would be a world where still.
Weirdos like us who understand
money and things like that can use
it and other people will go along
and their lives will be just fine
with, with not having Bitcoin.
Mm-hmm.
Um, if we get to a point
where everyone in America
feels like they need Bitcoin,
then I think it, it will mean
something has gone terribly.
Yeah.
And that's my fear.
That's my fear, that there will
be some sort of a catastrophic
event that will trigger people
to need it, rather than,
you know, being motivated
to get into it proactively.
It will be a reactive thing.
Mm-hmm.
And I can see how that would
go terribly wrong because.
It's not the type of thing
that you just adopt overnight
under duress and under panic.
Um, a lot of things can obviously
go wrong with self custody and just
the technical understanding of it.
So I really hope that
that doesn't happen.
Um,
we, we don't encourage anyone
in the book to, to buy Bitcoin,
but we do say, you should
probably know how to use it.
Maybe experiment with it so that
if it, if it comes to a point where
you do need it, perhaps you find
yourself on the wrong side of.
If you're government or something
like that, at least you know how
to use it and, and you're not
gonna, you'll, you'll know how
to transfer your wealth into it
and then you won't lose it by
mismanaging your keys or something.
Yeah.
That's really important.
Do you think there is a role
to play, um, with, I guess
the existing bitcoiners who
understand it, um, helping educate
governments, local communities?
Um, about Bitcoin, not so much the
price, but the foundational stuff.
Um, is there a responsibility
in us all to do that?
Yeah, I think absolutely
everyone who has taken the
leap into understanding Bitcoin
themselves should, I think
probably start with whoever's
in your sphere of influence.
It's much more likely that
you're gonna be able to help
your neighbors and friends
and family understand Bitcoin.
Then that you're, you're gonna
be able to help your prime
minister or your president
or, or what have you, um, or,
or even member of Congress.
Um, also those people can,
can serve as practice.
If you ever do get the opportunity
to, to talk to someone, uh,
who's in power, you'll have
understood where other people's
hangups are and the parts that
are more difficult to explain.
So I think it's really hard.
Once you feel like you understand
Bitcoin not to talk about it,
you feel like you've made this
huge leap, uh, in understanding
something really important.
And, and once you've made the
leap, it's almost hard to imagine
how other people haven't and you
think it should just be easy and
that that's really interesting
how we can forget so easily.
The mindset that we were in before,
before we found out about it.
Um, but the more of the kinds of
conversations you have and the more
you hear the objections and things
like that, I think the easier it
is to have more of them, the better
you get at explaining it to people.
Yeah, it's, it's, it's so true.
How, how easy we forget.
I remember when I took ski
lessons and, um, yeah, the ski
instructor, uh, admitted that,
you know, he's been skiing for
15 years, so he doesn't know
what it's like to be a beginner.
Um, and I feel like we
transition from A to B in
a much shorter timeframe.
Um.
You know, only a year ago
or just over a year ago, I
thought Bitcoin was a scam.
I absolutely didn't,
didn't care for it.
And now I, I care
about it very much.
Yeah.
From thinking it's a
scam to having a podcast.
Yeah, exactly, exactly.
Um, in Australia we have the
Australian Bitcoin industry body,
and this is like an entirely
voluntary organization where
we speak to government bodies
about Bitcoin and try help
inform some of the policies.
But, um, yeah, it's, we're
still so early, Brad, we
are so early in Australia.
Uh, there's only been.
One politician that has
proactively reached out, um, to
the body, to the industry body,
to, to speak about Bitcoin.
And other than that, it's,
um, a few people are talking
about it, but not very
proactively doing anything.
Um, but yeah, I, I would like to
talk about the human rights more.
That that is, yeah.
Something that's dear to my heart.
Um, so yeah.
What can you tell us about the
human rights aspect from the book?
Well, the, the first thing that
got me interested in Bitcoin was
I had a friend who had come back
from, uh, the summer break that
we had during graduate school, and
he was, had just done the whole
summer, just spent researching
Bitcoin, which ended with him,
like sending off a wire transfer
to some random bank in Russia.
And he was telling me about it.
It's this, it's this currency
and it lives on the internet.
And you can send it
for like no money.
And I had lived in Singapore
as a child growing up.
And I remembered watching people
stand in line to do foreign,
uh, remittances from like back
to the Philippines or back to
Bangladesh or things like that.
And I knew that it was like
20, 25% that these people
would pay to send money.
Their family members would
have to walk, get the money
in cash, carry it home, hiding
it under their clothes, trying
to pretend they didn't just
come from the Western Union.
And I was like, oh, this
will save them so much money.
Um.
So that was like the, the
first light bulb moment was
international remittances.
And then the second was shortly
after this reading a story in
time about, uh, time Magazine
about Roy Abbo, who had started
up a software company in
Afghanistan and was hiring women.
And women couldn't
have bank accounts.
They couldn't have money.
The people, the women who
were working for her were
going home and getting the
money taken from them, and she
started paying them in Bitcoin.
So just some small percentage
so that their, their families
wouldn't know what was happening,
but she wanted to give them sort
of financial freedom, the ability
to, to build wealth for themselves.
And a lot of them were
able to live much more
freely after she did that.
And so that was really for me.
Uh, as much as the first one got
me interested, this convinced
me of the value of Bitcoin.
That when there are people
who have authority over you
and can dictate how you live
your life, it's important to
be able to get away from them.
But if you don't have anything,
you don't ever think that
you can do that you think
that your options are.
Um, you think that you
don't have options.
So for a whole lot of people
around the world now, this can
work with husbands or fathers.
It can also work with
governments or bosses.
A lot of people think that they're
beholden to someone or some
group of people and they can't
imagine their life changing.
But having access to Bitcoin
and being able to build wealth
in a way that's private,
that nobody knows about, that
nobody can take from you.
I think it's really important
for, for them and, and, yeah.
Yeah, and, and obviously
love hearing those stories.
You've just inspired me to,
to travel to Oslo, to, to
listen in on these stories.
Um, and I'm distracted
by the Hamilton poster
and behind you as well.
I actually love the play.
I was listening to that
before we started recording.
Yeah.
It, it's, it's, um, one of
my favorite soundtracks.
Sometimes I'll listen to
it when, when I, when I'm
in the gym because Yeah.
And also it just somehow also
reminds me, weirdly of Bitcoin, but
that's just, I guess a, a me thing.
Um,
well, Alexander Hamilton
started the, the National
Bank of the United States,
so there's a lot of, uh.
Lot of foot for them.
Yeah.
Um, but, uh, uh, you know, you
being a professor at University
of Wyoming, I'm more interested as
well to understand the, the young
people's mindset and perspective
when it comes to Bitcoin.
Um, how, how, what is, what are
some of the, are, is there another
entry point into their curiosity
other than just the price?
Yes.
So I said, I mentioned that
one group just asked me about
these, these pump and dump
tokens because they, they
view it as a, a slot machine.
Um, but then there, there's a
sizable group who have grown up.
I mean, they, they've now all
grown up understanding that.
There's really no privacy on
the internet, um, that your
ISP is tracking what you
visit, and there's cookies
on every website and, and
your data is very valuable.
Commodity that is collected
and bought and sold and
traded and things like that.
And they know that every
purchase they make with a
credit card or using their bank
account online is tracked and
correlated and things like that.
So they've grown up thinking this
is just, this is part of life.
It's impossible to get away from
these violations of privacy.
And they basically think that
they don't have privacy anymore,
that it's nearly impossible to
get if you wanna live a somewhat
normal life now, right now.
Using Bitcoin means not
living a somewhat normal life.
'cause it's really hard to
find places to, to spend
Bitcoin and still a lot of
you have to enter your address
and, and things like that.
But, um, I explained to them
that with Bitcoin, your name
is not associated with your,
uh, Bitcoin address and.
There's no way for someone
to look at the Bitcoin
blockchain and figure out
which transactions are yours.
Now, that's less true
than it was when I first
started saying this to them.
'cause there are now firms
that specialize in that.
But, but for most of my students.
Nobody's ever gonna dedicate
the computing resources that
it would take to do the kind of
blockchain analytics that would
enable companies or governments
to figure out who they are.
Right?
This is trivially easy for
credit card companies to do.
It takes absolutely no effort.
It takes a lot of effort in the
case of Bitcoin, so it's not a
guarantee of privacy using Bitcoin,
but it's, it's pretty good.
And for people like them.
It will almost certainly be
the case that their Bitcoin
transactions will never be linked
to them, and that's a really
valuable thing I think on, on
today's internet where it's really
hard to find that level of privacy.
Um, they also have grown
up learning about people
being cut off from financial
services and they've.
None of them have have, at least
I haven't had a student come up to
me ever and say I was de banked or
Visa wouldn't let my transactions
go through or something.
But they, they know about marijuana
companies who've been forced
to hide all of their cash and
massive safes in the basement.
'cause no bank will
take them on and.
They're aware of Visa and PayPal
and Venmo and these other providers
blocking transactions from
certain places or about certain
topics, and so they understand the
value of a currency where nobody
can, can block transactions.
Nobody can prevent you from
sending Bitcoin to someone else.
No one can prevent
you from receiving it.
That's.
A novel thing for them, but they,
they see the importance of it.
So yeah, for most of them,
I actually approach Bitcoin
not as a store of value,
but as a medium of exchange.
And through the lens
of financial privacy.
You thought, I'll say to them
that it was impossible to have any
privacy anymore on the internet.
Uh, but it turns out that it is,
and it's, it's because of bitcoin.
Yeah.
And I'm very curious to know is
when, when you talk about the
medium of exchange and this seu
unanimous nature of Bitcoin with
your students, do you have some
students asking, you know, I guess
bigger questions and having alarms
going off in their head about,
well, if that's the case, how would
people pay tax hypothetically?
Um.
If, if they, if it can't be tracked
by governments, um, I can see that
being a concern for many people.
Yeah.
Not, not so.
So they'll ask about that.
Well, how do you, how do you
effectively tax a population
that's using a private money?
Also, how do you effectively
enforce sanctions?
On countries, if they can just
turn to Bitcoin, how do you
effectively track arms sales or
human trafficking, things like
that, if they can use Bitcoin.
So to the I, those are, I
think, three really distinct.
They require three
really distinct answers.
So in the second case with
sanctions, um, you basically can't
enforce small scale sanction.
Uh, you can't, you can't.
Sanction entities from spending
small amounts of Bitcoin, but
at the level of, say, Russian
oligarchs, it's really hard
to transfer a billion dollars
of wealth into Bitcoin as
an individual these days
without people noticing.
Um, so that's one way of, of
responding to this idea that.
Uh, criminal ma major drug
organizations or crime syndicates
or oligarchs or things like that,
we'll just use Bitcoin instead.
Mm-hmm.
It's really impractical at
the levels that they need.
Maybe that won't be the case.
When I first started saying
this, the market cap of
Bitcoin was, you know, 10%
of what it is now or less.
So the bigger that gets,
the easier it is for them.
In response to the human
trafficking and drugs
and things like that.
I think there's two responses.
One is we've actually seen a
lot of those be tracked and, and
people be associated with their
Bitcoin transactions because
governments dedicate significant
computing resources to doing that.
And the other response is that.
People already have a
vehicle for doing that.
That works far better than Bitcoin
that doesn't have a blockchain.
That's an immutable record
of all the transactions, and
that's just physical cash.
A hundred dollars US a hundred
dollars bills are by far the
most used currency for drugs and
human trafficking and arms deals.
And I, I remember learning
at some point that 95% of us,
a hundred dollars bills had
traces of cocaine on them.
And I remember being
shocked by this, but it,
it makes perfect sense.
Physical cash is it, it's bulky and
it's heavy, but it's untraceable.
And unless you're there to see the
transaction, there's, there's no
traces of it left in the world.
We can still go back to the very
first Bitcoin transactions and
see them on the blockchain and run
analytics and, and so it's a really
bad idea if you want to transact
large amounts privately to do that.
Uh, and then in terms of taxes,
you can do the same thing.
I mean, people get paid
under the table in cash.
And governments can't
really tax that either.
So I don't think Bitcoin,
one of the, one of the things
we try to show in the book
is that Bitcoin privacy is
very similar to cash privacy.
And if you're okay with cash,
which you should be because
we've been using it for
thousands of years, then you
should be okay with Bitcoin.
And yes, you're not gonna,
you're not going to.
Be able to do the same kinds
of things as a government that
you can do with digital money
on, you know, people's apps.
Um, but that's good.
We should, we should support that.
People should be able to have
privacy and then Yeah, we
trust them to pay their taxes
like they're supposed to.
Yeah, absolutely.
And um, also I think there's a lot
to be said about the incentives.
A lot of people don't
actually have the incentives
to have a large stash of
Bitcoin that is not somehow
traceable because eventually
everyone wants to potentially.
Utilize their Bitcoin for something
in the future, whether it's buying
a house, whether it's taking a
holiday with your family, so you
don't wanna just all of a sudden
have a large sum of money that you
can't explain where it came from.
Um, yeah, so I, I'm, I'm personally
not too concerned about that.
Um, but let's talk a bit a
little bit about Bitcoin culture.
What is the built Bitcoin
culture in your local community?
Um.
Uh, it's interesting, I get a lot
of people passing through who,
uh, want to talk about Bitcoin.
They've, they've heard about the
Bitcoin Research Institute, or
they've read the book or heard,
heard me on a podcast or something
and I just had a guy pop into
my office last week, so it was
the, the first week of classes
and I thought he was a faculty
member or something like that.
And he said, oh, I'm,
I'm moving from, uh.
Somewhere on the East
coast to, to San Francisco
to to work on Bitcoin.
And I was driving down the
highway and I saw signs for
Laramie and I thought of you.
So, um, so yeah, the, the culture
within Laramie is not, um,
not what it is, I think in
Nashville or San Francisco.
We don't have a, a central meeting
place that that draws people in.
Um, but there are.
Businesses that accept Bitcoin.
We have a center for blockchain
and digital innovation on campus
as well that has a few bitcoiners.
Uh, and you know, Stu, I
think students are being drawn
into this, uh, this idea that
Bitcoin is interesting and per
perhaps, potentially important
to the future, and maybe
they should learn about it.
Yeah.
And is there an appetite
from the university to
offer Bitcoin courses?
The university will offer
whatever courses will fill up.
For the most part, yes.
So we're given quite a bit of
autonomy in what we want to teach
as long as we can get enough
students to take the class.
I encountered no resistance at
all when I went from researching
metaphysics and philosophy of
religion to researching Bitcoin,
and I was a little surprised,
but, but really happy about that.
One of the things that tenure
gives you is the freedom
to explore, potentially
fruitless, but potentially
very fruitful, uh, areas.
And so once I got tenure, I could
kind of do whatever I wanted and
I think they've seen how good
that has been for me and for the
department and the university.
So that, that's been
pretty cool to see.
Yeah.
Yeah.
And Brad, what is your role at
the Bitcoin Research Institute?
We launched the Bitcoin
Research Institute, or I, I
launched the Bitcoin Research
Institute maybe two months ago.
And so we announced it a year ago
and it took a year for the, the
academic bureaucratic wheels to
grind through, but the institute.
Exists to produce academic
research on Bitcoin.
One of the problems is that
Bitcoin, even though it to
many people, feels like it's
relatively new, um, in terms of
like developments and interesting
new things, a lot of academic
researchers are drawn to the.
Cryptocurrency networks that
can do more things that you can
build more stuff on, and that
that also have more complexity
and are easier to break.
So there's not a whole lot
of academic research that's
done on Bitcoin outside of
things like price prediction.
So I, I get a Google scholar.
Email every day that tells
me the new papers that
are published on Bitcoin.
And almost all of them are
some sort of price modeling.
And I think that's just about the
least interesting thing in Bitcoin.
The prices is do gonna do whatever
it's gonna do, and that's based
on whether people want it.
Um, but people want it based
on other, other things.
So.
I wanted to build a place where
people who were interested in
Bitcoin but couldn't quite see
how it would fit into their
academic research, could get
together and talk about it, get
feedback, build a community,
develop projects together.
So.
That's what I'm doing here
as the, so I'm the director
of the institute and I see my
role as mostly a facilitator.
I'm trying to identify people
who are working on Bitcoin in,
you know, places, scattered
throughout the world, and
bring them together to have
conversations and, and build
collaborative projects together.
Yeah.
That's awesome to hear.
I actually have come across,
um, some academic research
and I'll, I can tell you about
that after, after the podcast,
but it isn't price related.
Some of it is, but I think some
of it is also like related to
energy consumption or adoption.
Um, yeah.
So is there a particular area
that you might be interested
from, like an academic
standpoint of what you, what
kind of research you personally
would like to see coming out?
I think a lot of it depends
on what the prevailing
discussion about Bitcoin is
in, in the wider culture.
So one of the reasons to do this
is that I think people when they
hear about Bitcoin, don't quite
know where to go, and they'll often
hear about it from news media.
When news media wants to write
about Bitcoin, they don't.
Know who to trust.
And as I mentioned with
individuals, there's all these
people with incentives to tell
you the truth, to, to say Bitcoin
is good, say Bitcoin is bad.
And so they tend to lean on
academic research thinking that
academic research is gonna be the
the thing that's most likely to
be neutral and unbiased and fair.
And I think by and large
that's true, unfortunately.
Bitcoin is very complicated and
difficult to understand, and a
lot of the scholarship that's been
done about Bitcoin has been done by
people who don't really understand
all of the moving parts and the
complexity of the blockchain and
the energy use and the market
price and miners and nodes
and all these sorts of things.
So in addition to producing.
Academic research on
Bitcoin and bringing
people together to do that.
I also want to help vet, um,
the research of people who are
writing papers about Bitcoin,
but, but kind of know that they
don't know enough about it and
sort of help them with that.
So for a long time it was.
Stuff about criminal behavior then
for a long time it was mining.
People were really worried about
the amount of energy Bitcoin was
using for a really short time.
It was, uh, hardware
device, uh, obscurity.
So the, the miners.
Don't last very long, and
then they go to landfills
and isn't that terrible?
We're filling up landfills
with Bitcoin miners and so
the, the public conversations
change and I, you never know
quite where it's gonna go next.
So I don't really know where
it's gonna go, and therefore
I want to have academic
research about everything.
And it, it's been one of
the things that's been cool
is getting emails from.
People who have heard me talk
about it at some point on, on
some podcast or something and
say, you know, I'm a, I'm a
tourism professor and I also
am interested in Bitcoin.
What projects could I do
about Bitcoin and tourism?
I was thinking like token something
or other, and I said, well,
what about, what about Bitcoin?
Circular economies?
And looking at places like
that and how much revenue they
take in versus nearby locations
that have many of the similar
features but don't accept Bitcoin.
Does, does accepting Bitcoin and
getting, like, what's the level
of, of local merchant adoption
that's needed to actually attract
people to fly across the world to
your place instead of somewhere
else because you have Bitcoin?
Um.
I talked to a marketing professor
at the, the Bitcoin Policy
Summit, uh, who has historically,
you know, done work on other
things, but is now interested in
Bitcoin and wants to figure out
a, a Bitcoin marketing project.
Um, political science,
you know, what's the
makeup of Bitcoin owners?
Do they tend to have a
certain demographic profile?
Uh, one of the things we're
finding from a whole lot of
surveys, which costs a lot
of money to do, is that.
Bitcoiners look very much
like the, the average person.
Um, they're not particularly,
uh, politically one
direction or the other.
They do tend to skew
more male and younger.
Um, but, and, and they tend to
skew, at least in the us, uh,
tend to be more racial minorities.
So the, the percentage of,
um, black and Latino bitcoin
owners is higher than the
percentage of, of white owners.
Uh, so that, just interesting
things like that, that uh hmm.
Yeah, I'm, I'm always wanting
to, anything that's not about
Bitcoin price, I'm interested in.
Yeah, I, I'm definitely
interested in that as well.
I would love to know more about,
like, specifically the demographics
of people who hold Bitcoin.
I know there were two
research papers done.
Um, I don't wanna quote where
I think one was the US and one
could have even potentially been
Australia, but regardless of
that, um, it was, uh, done on.
People who own crypto.
So it was broad.
It wasn't just Bitcoin, um mm-hmm.
And how they score higher in
the dark tetrad personalities.
Um, and I looked at this
research paper, the, the.
Again, there was no distinction
made between Bitcoin and
other forms of um, currencies.
Uh, I think there was definitely
a bit of a bias in the way
that the study was formulated.
And also the correlation
coefficient wasn't that strong.
So I was like, there was all
these news articles that came
out supporting it, but looking
at the study, I'm like, it's
kind of a bit meh, but I would
love to see more studies.
Um.
Yeah, academic
studies done in that.
'cause that's kind of what
I'm, I'm always interested
in the people side of things.
I, one of the, one of two things
that I've learned is, one,
it's really hard to ask exactly
the right questions to figure
these sorts of things out.
So you can ask people, for
example, do you own Bitcoin?
And a lot of people who don't
own Bitcoin will say yes
because they own Ethereum or
they own some other thing.
Um.
And they don't even know
enough about Bitcoin to know
that it's different from, from
these other sorts of things.
So, so the way that you word
questions in order to get answers
is, uh, really important and takes
well-trained sociologists and
political scientists and people who
are used to crafting these kinds
of questions to know where people
are likely to misinterpret it
and, and somehow correct for that.
And then number two.
People jump all over the
academic research that
confirms their biases.
And so if you see a research
paper that says Bitcoin
owners largely reflect.
Normal, like standard demographics.
That's not very interesting.
If you get Bitcoin owners have
dark tetrad personality traits.
Ooh, that's interesting.
Um, and that's what we wanted.
We wanted bitcoin owners to
be the shadowy, super coders.
Psychopath.
Yeah.
So that's gonna get a lot
more traction, even if it
turns out not to be true.
And I think that's what happened
with, um, back in the day,
this, this bitcoin mining.
Paper that that went viral for a
while was being cited everywhere
on the likelihood that Bitcoin
would raise global emissions.
Uh, and thus.
Raised the temperature
of the planet 1.9 degrees
Celsius within five years.
Um, and it was based on a lot
of misunderstandings of Bitcoin.
Like not knowing that there was
a difficulty adjustment, not
knowing, uh, that blocks, you
know, had to come every 10 minutes.
You couldn't get faster and
faster blocks, et cetera.
Um, so.
It is, you know, we can, we can
put out as much academic research
that's correct and accurate as
we want, but it might still be
the case that people seize on.
The bad academic research because
that's what they want to be true.
And I'm not sure
how to change that.
Yeah.
And you possibly can't.
Maybe not.
Yeah, you can.
You
can only do what you can do.
Um, but,
but the more that they're,
the more that, that everyone's
friends and neighbors.
Are the ones who own Bitcoin,
the less sort of mysterious
and and bad it seems.
If everyone's just, if that's a
part of everyone's portfolio, uh,
you know, 2% or 1% or whatever, it
sort of demystifies the whole thing
in a way that I think is good.
Yeah, if we can just de
weird Bitcoin a little
bit, that would be great.
Like city doesn't become this
like dirty thing to talk about.
It's something we can all Yeah.
Have a conversation about.
But I'm curious, um.
I kind of asked you this, but
I wanna ask you the same thing,
but from a different angle is
obviously there's still a lot of,
um, fud about Bitcoin and a lot of
misconceptions and some things, you
know, might have, um, some merit
but are grossly misrepresented.
Uh, so is there anything, any
particular area or persistent
myths that you think need
more research right now?
There are some things that
if true would be, I think bad
for Bitcoin, but we don't have
nearly enough evidence of their
truth, and in some cases we have
evidence that they're not true.
So I think especially around
Bitcoin mining, there's this
question of how much energy
Bitcoin mining is using and.
The early fud.
So FUD for those who don't know
is fear, uncertainty and doubt.
The early FUD around Bitcoin
mining was just the number.
The number was bad all on its own.
Bitcoin is using as much
electricity as the Netherlands
or Sweden or whatever, and
that was just bad by itself.
Then it got more sophisticated.
Not only is Bitcoin
doing that, but.
It's using carbon and, and things
like that, and it's pricing out
people, so energy in certain
parts of, in my case the US
is, is getting more expensive
because of bitcoin mining.
So it got more and more
sophisticated, the objections
to Bitcoin along the
lines of, of energy usage.
And if true, some of those things
would be bad, if it was really.
Stealing the energy from,
you know, people who
needed to heat their homes.
That would be terrible
and I wouldn't like that.
I think there's not necessarily
academic research, but,
but reporting that shows
that that's not happening.
That it is.
Too expensive.
The, the Bitcoin mining is too
competitive, an industry to
pay market rates for energy in
most countries in the world.
So what's happening is that Bitcoin
mining is doing one of two things.
Either it's chasing non-rival risk,
energy, energy that that exists
in the world but couldn't be used
for anything else 'cause it's too
far away or something like that.
Uh, or.
Bitcoin miners are cutting
deals with energy providers to
take the excesses, and this is
what's happening in, in Texas.
For example, Bitcoin miners have
a deal that they'll, they'll
purchase a certain amount of
extra energy from the grid
if if needed, at low rates.
And then when the grid is
being taxed because there's
a weather event, then
they'll turn off the miners.
You know, they can't compete
with people who need to in
Texas, in the middle of summer,
use it for air conditioning.
We're willing to pay a lot more
to be comfortable, and they're
having to compete with miners
across the world, many of whom
are getting free energy, so
they're not gonna pay that much.
So.
There is, there is academic
research being done on this.
I know Margot Paez, who's at, I
believe the Georgia Institute of
Technology is, uh, doing her PhD
work, uh, specifically looking
at Bitcoin mining corporations.
But there's also a lot of
people just from the industry
who are telling us how.
Much hash rate, they're
contributing to the Bitcoin network
and where the energy's coming from.
I met someone from, uh,
who's working on this
massive dam in Paraguay.
They're having to sell the
Paraguay can't use as much
energy as the dam's producing.
They're having to sell most
of it to Brazil and they wanna
start mining Bitcoin with it.
Mm-hmm.
I talked to a guy who's going
around villages in Kenya
that have, uh, hydroelectric
power and setting up.
Power stations to harness the river
and paying off the construction by
mining Bitcoin with it, and then
also providing homes with, uh.
With power that,
that's really cool.
And
yeah,
hundreds of Kenyan villages
that didn't have electricity
now have electricity
because of Bitcoin mining.
And he's not, he makes
this point regularly.
He's like, I'm, I'm helping
so many people that.
Everyone thinks it's a charity,
but I'm actually, I'm making money.
This is a profitable enterprise
and I could use, I could
have a hundred competitors
here and still make money.
People should come do this with me.
We can electrify Kenya, uh,
and, and much of the rest of
Africa while being profitable.
So, um, I'd like to see
more, more academic research
done in, in these areas too.
Yeah, absolutely.
And those are such
feel good stories.
I love it.
Um, do you guys have a,
are you, are you going
to send out a newsletter
that is, that is on the agenda?
Yeah, so we hired, uh, one
of my co-authors on, on
the book, Andrew Bailey.
Um, we hired him to start this
fall and he and I were supposed
to do a lot of that together.
He, uh, is unable to move
here until next year.
So while I'm running
things on my own.
A newsletter is not
in the, in the cards.
Um, but hopefully starting
next year when there's two of
us here, uh, then that'll be
one of the, the early things
that we'll want to get started
with.
Yeah, yeah.
Makes sense.
Makes sense.
Um, yeah.
Do you have any final
thoughts or, or messages
that you'd like to share?
Um, I think the, the
main takeaway is.
That everyone evaluates Bitcoin
from their own perspective.
And I think it's just really
important to remember that you
are one of 8 billion people in
the world and the vast majority
of people live lives that don't
look anything like your life
and try to figure out when
you're evaluating things like
Bitcoin, that's a global thing.
Uh.
How they might use it and, you
know, pay, pay attention to them.
And for a lot of them you can
actually find out stories of,
of how people in other countries
who live lives very differently
than yours are using Bitcoin.
And so that, that's important to
keep in mind as you're thinking
through what you think about it.
Yeah, absolutely.
Love it.
Such a powerful message.
Thank you so much for your time.
Yeah, absolutely.
Thanks for having me.