{ "episodeId": "SLP342", "speakers": { "stephan": { "name": "Stephan Livera", "role": "host", "tag": "STEPHAN" }, "heavily_armed_clown": { "name": "Heavily Armed Clown", "role": "guest", "tag": "HEAVILY" } }, "segments": [ { "speaker": "stephan", "time": "00:08", "start": 8.45, "text": "Hi and welcome to Stephan Livera podcast, a show about Bitcoin and Austrian economics. Now, what do you think about this idea of getting on zero? That means getting on zero fiat. Now, this has been a topic of discussion, and in fact, I wrote an article about this, so that's in the show notes if you're interested. And so for this one, I invited Heavily Armed Clown, also known as Hack. and we talk about this idea of getting on zero. So we talk about the steel man of the case, we talk about some of the pros, the cons, dealing with CGT, dealing with having an emergency fund, what do you do with your day-to-day expenses? What kind of shifts does it drive in terms of your mindset? And what kind of reasons are there that you might still need to hold fiat even if you are an all-in Bitcoiner or otherwise an all-in Bitcoiner? Now, this show is brought to you by Swan Bitcoin. Swan is the easy way to buy Bitcoin and also About Bitcoin. So for those of you who have your family and friends and you need an easy way for them to get onboarded and to receive education in the process of them purchasing Bitcoin, send them over to swanbitcoin dot com. Over at Swan, there are free resources like the book Inventing Bitcoin by Jan Pritsker. You can get that at swanbitcoin dot com slash free book. Now with Swan, you are not just getting an easy way to purchase Bitcoin, but you're also receiving world class service and customer support. So if you want to help your friends and family Family sign up and also receive some commission for the first year that your friends and family sign up, go to join the swan force. That's swanbitcoin dot com slash enlist. If you're in the Bitcoin mining industry, check out brains dot com. That's brains with two eyes. Brains offer brains OS Plus. This is aftermarket, third party, custom firmware that you can install on your machine to optimize your performance so you get more hash rate for your electricity bill. Now, go and check the website out, they've got currently supported models there, but for- For example, Antminer models S19, S19 Pro, T19, and S19 J Pro are supported. And don't forget, if you use Brainz OS Plus and then you also point your hash rate towards Slashpool, you actually receive zero percent pool fees. So that's a really great feature, and you're also supporting the adoption of Stratum v2, the next generation Bitcoin mining protocol. Also on the Brainz website is the Insights dashboard, so you can go there and use the profitability calculators, and they've got all sorts of useful information there on the website. So go to brains dot com. Now, if you're interested to get started with Bitcoin mining, you can go to compassmining dot io. So if you're in the US, you can purchase an ASIC machine, have that shipped to your home, and use the Compass at home mining guides to get yourself started. On the other hand, if you don't want to use home mining, you can do that using the facilities that the Compass team have vetted. Now, you can have your machine sent to those facilities, you pay a hosting fee, and you can then have your machine plugged in, you select The hash rate towards, and now you're receiving sat, and this can potentially be done without KYC, so that's another benefit there. So you don't need advanced technical knowledge, you can use the tools and the guidance that Compass Mining are making available to you to start your journey of Bitcoin mining. So that website is compassmining.io. And now onto the show with Hack, Hack, welcome to the show. Hey, it's good to be back. Yeah, it's been a while since we spoke, or at least on a call, but I was keen to discuss with you. I know, you, you're, you're responsible for a few things. You're probably most well known for the WTF happened in nineteen seventy one, but also a podcast host and, have been talking a lot about the whole get on zero. So, yeah, I guess just, actually, just for anyone who doesn't know you, can you just" }, { "speaker": "heavily_armed_clown", "time": "03:50", "start": 229.63, "text": "Like around two thousand seventeen, that was when I first started taking it seriously. You know, went through my, my early shitcoining days and kind of finding my feet and, and figuring out, unlike a lot of Bitcoiners, I was kind of into Austrian economics before I found Bitcoin or like tangentially alongside Bitcoin, I would say, and, it really kind of clicked for me. you know, it took, it took some time to kind of marinate, but once I got Bitcoin and it, and it really sunk in, I was like, \"Wow, this really It's just sort of a distraction because I, I was pretty blackpilled, I would say, before I found Bitcoin, just in terms of the state of the global financial system and global geopolitics, and, it, it was all a pretty big mess for me at the time, and I had a, a lot of trouble navigating it in a way that wasn't pessimistic, and Bitcoin kind of- Gave me a ray of hope in the world that I didn't have before, orange pill, I guess you could say. Yeah, and, as I got more and more into Bitcoin, you know, I, I met a lot of other Bitcoiners who sparked a lot of interesting new ways of thinking for me and new perspectives for the world, and one of those people was Ben Prentice, who reached out to me to come onto my podcast at one point in time, and him and I linked up and got super into economics together and digging down the chart rabbit hole, and that's Happened in 1971 came to be with just a lot of late night conversations with Ben and, you know, since then I've had a lot of opportunities in Bitcoin. I spoke at, Miami conference last year, gave a talk on WTF happened in 1971. I've written some pieces for Bitcoin Magazine. And, you know, more recently, I've kind of shifted my professional focus into trying to transition to being a full time software engineer. So that's, that wouldn't have happened with it before Bitcoin, I don't think." }, { "speaker": "stephan", "time": "05:36", "start": 335.87, "text": "Yeah, it can so today I was keen to talk about this whole, you know, get on zero basically. So in terms of fiat. Yeah. Now, I wanna-- Like, I, I'm, honestly, I'm open to the idea, right? I, I wrote an article about it and, you know, and I've, spoken a little bit about it on Twitter here and there, and obviously you've been quite publicly promoting the idea. do you wanna just start with your own explanation, how did you come to the idea and what made it click in your mind for you" }, { "speaker": "heavily_armed_clown", "time": "06:04", "start": 364.36, "text": "Yeah, so let's provide a little perspective, right? So, twenty seventeen, twenty eighteen, twenty nineteen, we were all about like huddle and stacking stats, right? And I think that those are really good memes. They've been really good memes for Bitcoin, in terms of breeding adoption, getting people off zero, right? That was the meme too, get off zero, 'cause that's kind of where get on zero comes from, it's a play on get off zero, right? And, those are what Laser Huddle, I think, coined this term" }, { "speaker": "heavily_armed_clown", "time": "06:34", "start": 394.0, "text": "A lot of us, like, we were probably some of the few people in the world that were paying attention to what was going on in the repo markets, like in two thousand nineteen, prior to the supposed coronavirus pandemic and financial meltdown in twenty twenty. You know, do what you will with recent events in the world, but the fact is that, that global debt to GDP is higher than it's ever been. Negative yielding debt, you know, was- Closing in on twenty trillion a couple of years ago, we're more leveraged than we ever have. central banks have fewer tools to combat that leverage than they've ever had, and the economic reality is, you know, the types of things that Mises wrote about is that when you come to a point in time when governments are covering deficits with the issue of paper notes, well, then the currency collapse of those notes is inevitable, right? So we're really staring down the barrel of a pretty steep precipice here, whereas, you know, whereas before- Stacking Sats was sort of like, okay, I, I know where the future is headed. now I feel like we have a much clearer picture of how it's emerging, and, you know, the future is uncertain, right? So for me, for us, it's, it's kind of like developing new real time strategies for navigating, this emergent paradigm as, as we're stepping through it, right? And in the last year, just here in the United States, where I know I'm probably the most shielded from a lot of these fiscal and monetary forces, inflation Bad. You know, you, you look at things like housing, you look at things like food, you look at things like electricity or the cost of energy, pretty much everything all across the board has gone up and in some cases has been extremely volatile, right? So really the Git on Zero movement is about saying, hey, you know, we're at the opportunity, we're fortunate enough right now, to have the benefit of the hindsight of history and, you know, the, the understandings that we do of economics and this tool that allows us to sort of entirely opt out of the So Git on zero isn't really like a purity test. We're not looking to beat people over the head with our Bitcoin Bibles and say, \"Ah, you still have seventy-one dollars in your checking account.\" It's more of a heuristic for looking for optimal strategies to navigate forward into the future. Like I know for me, my guiding principle is to minimize the amount of time, that I'm holding inflationary cuckoos, right? Because every second that I have a dollar in my checking account, no matter how few dollars it is, those dollars on average are going down in value, and On average, is going up in value, and I've become increasingly convinced that the volatility in Bitcoin isn't necessarily, it, it, it feels more dramatic, right? Because all of our purchases tend to be denominated in fiat, and we tend to still do-- we're all defor-default Keynesians at the end of the day, right? So we do our economic calculation in paper, but, at the end of the day, like, Bitcoin isn't really all that much more volatile than, you know, when you're pricing something like lumber in Bitcoin vs. pricing it in dollars with, with how just insane things have been in the last few years. So that's really the gist of it is like minimize the amount of time that I hold dollars, maximize the amount of time that I hold Bitcoin, and in a lot of cases that ends up meaning I have zero dollars in my checking account." }, { "speaker": "stephan", "time": "09:42", "start": 582.21, "text": "Yeah, excellent. And so I think that's definitely the part that I can agree that there's definitely, in the recent years, we've seen that shift and things have gotten even worse. And so even for me, when I was first getting into Bitcoin and where I would talk about it, I was always being like, \"Yeah, inflation's bad,\" and people would often say, \"No, Stefan, it's not that bad. It's, you know...\" But in recent years, it really is starting to get worse. And so in the US, obviously, this is like the fake number, right agree with that number, we believe it's actually higher than that. So, yeah, let, let's kind of walk that through in terms of what that looks like and sort of give us a steel man argument, like what should people be doing if they wanna get on zero fiat, like basically they are buying as much Bitcoin as they can and then basically what's the sort of normal flow look like? Let's say you have your job, your fiat job, what does it look like for you if as a get on zero practitioner?" }, { "speaker": "heavily_armed_clown", "time": "10:39", "start": 638.8, "text": "So I think it's gonna look different for everybody, and a big part of that is because the tooling isn't really there yet, in terms of-- So, like I said, you know, so let's go back to like two thousand thirteen, right? I mean, being a Bitcoiner was much different back then. Your options were very limited, you didn't have access to like a lot of tools and resources. You were, you were probably buying your Bitcoin off of like Mt. Gox or peer-to-peer, right? Or you were mining it yourself. Things have changed a Bitcoin companies, that are servicing that stacking sats paradigm, have come online and offer those services to bitcoiners, and that really was sort of a product of the demand from the community for those services, was like, hey, we want, you know, I wanna be able to buy Bitcoin and have it go straight to my cold storage, okay? Well, there's companies now that do that, right? But what's happening now is this new emergent paradigm of, of, hey, our currency is collapsing, right? This currency collapse is inevitable, we're safer holding and using Bitcoin, which, which ultimately, you know, at the end of the day, Bitcoin is a money, right? And, and we're looking at, it's not an investment, right? A-and I think that the stacking Sats meme has kind of conflated this in people's minds. T-they tend to think about Bitcoin more of an investment than as a money, when in reality, what we're looking at here is like a very competitive alternative money system. And there's a lot of historical precedents for this, right? Like you look at someone like, George Right, by speculating on currency and basically, essentially shorting the pound, which is kind of what you have the opportunity to do now by leveraging your ability to hold more Bitcoin and, and practically zero or negative dollars. So, I think it looks different for everybody. I know for me, like I can speak to what it looks like for me is that I get paid twice a month, all of my living expenses go into a credit card, you know, when I get paid, I get paid on the first, I pay my mortgage, whatever I have left over goes into Bitcoin, right? And I carry Put all my living expenses on a credit card, then I get paid in the middle of the month, pay off the credit card, whatever I have left over goes into checking or goes into Bitcoin, rinse and repeat, right? And what I hope to see, what I think we're already starting to see is, a fleshing out of that tooling for Bitcoin native banking, right? So I wanna be able to have a bank account, and I wanna be able to have that bank account denominated in Bitcoin rather than denominated in dollars. I wanna have a Bitcoin checking account, and I card and at that point of sale, have that conversion to whatever the local currency my merchant, I call them analog natives, whatever the analog natives prefer, you know, at, at point of sale, they'll instantly receive what they want, but I get to hold what I want." }, { "speaker": "stephan", "time": "13:23", "start": 803.23, "text": "And so I think, well, one small thing, I would say, I do disagree a little bit that the stacking sets companies are out teaching as investment. I actually do think of it, it is savings. It's just that a lot of the newer people coming in think of it as an investment, and that point where you are, no, it's my savings, this is the money of the future. But fine, that part aside, I think to the broader point, as I see it, around having a fiat balance or even having, maintaining a small fiat balance, I think it's probably useful to hear, you know, from the get on zero guys, what's the thought around, let's say, people who hold an emergency fund of in fiat terms? So, you know, if you look at normie finance and, personal finance, they might say something like, keep, three Three to six month fiat emergency fund. So what would you say to that idea?" }, { "speaker": "heavily_armed_clown", "time": "14:13", "start": 853.26, "text": "Yeah, I mean, so ultimately, I, I think savings is really important, right? Because savings is how we accumulate capital. Savings by deferring consumption now, right? We can better plan for the future because the future is uncertain, right? So savings are probably one of the most important things to have. But we're, we're stuck in this rut of default Keynesianism where we still-- that animal part of our brain is still- telling us that, that paper money the government issues is safer to hold in times of uncertainty than Bitcoin, which we know objectively has better monetary properties, right? And, and it's, it's kind of just a function of letting go of that animalistic part of your brain that tells you, \"No, something about this is wrong, this is unsafe, this isn't right. You should be holding these government paper money, this government paper money, which is, you know, just essentially worthless, like it's vapor, it's nothing.\" Vice Bitcoin, right? Which you know is objectively a much harder sounder money, can't be debased, saleable across time and space, right? I mean, all-- It's a bearer instrument, whereas this cash is, is essentially nothing. And that, you know, even worse when you're holding it, in a checking account, you can hold your savings, you can take custody of your savings, like, unless you're taking self-custody of the money in your bank account and hiding the dollars under your mattress, like, you know, you don't have access to" }, { "speaker": "heavily_armed_clown", "time": "15:36", "start": 935.68, "text": "that I think that a lot of the pushback to get on zero is directed at people who, you know, don't have that savings cushion and maybe will be subject to a lot of volatility, and, and maybe we could get into that a little bit later, but I think, having your savings in Bitcoin means you're more likely to not need to service that savings over time, you know, as inflation is eating into it if it's denominated in dollars, and say you lose fifteen percent of your purchasing power over a year, well, now you have to go back and add fifteen percent sent to that savings in order to just be able to service it, to keep it on par with where it was, you know, when you first accumulated that capital. Whereas if you're saving in Bitcoin, right, that, that Bitcoin is becoming worth more over time As the rest of the world is catching up to this, and you're not, not just servicing those savings, you might have to like sweep a little bit out of it, like into, into like a colder storage or maybe you go out to a nice dinner or whatever because your purchasing power is increasing." }, { "speaker": "stephan", "time": "16:33", "start": 993.36, "text": "Right. So the way I'm thinking about it is more like, you might well recognize, and ob- obviously, this is a Bitcoin show, pretty much everyone here is all about Bitcoin, we recognize Bitcoin is the thing to hold, to maximize that you can hold, but I think the pushback would be From my point of view, it would be more like it's recognizing that we still live in a society where a lot of other people won't accept our Bitcoin directly, and so that means that necessitates us either selling some Sats to get some fiat to pay that person, or, you know, using some kind of fiat service to allow us to pay for those bills. So for example, if your rent, your landlord doesn't accept Bitcoin, well, you're obviously gonna have to sell some for fiat, and I think that's where the aspect of, let's say, the, the person who's holding High allocation to Bitcoin, but just keeping a small amount in, in fiat terms, that part to me still, I think it still makes sense to manage these sort of day-to-day liquidity aspects of it, especially in the case where the other person doesn't accept Bitcoin, and especially around the aspect around CGT, which we'll probably get into that also. So from your point of view, what's the issue there then if somebody's holding a small emergency fund as an example?" }, { "speaker": "heavily_armed_clown", "time": "17:45", "start": 1064.82, "text": "It's not even so much as that it's an issue, is that in my mind it doesn't make any sense, you know And from my, my experience, like I still have to pay my mortgage in dollars, and I do every month, right? But that doesn't mean that I'm not, that I'm abandoning my heuristic of minimizing the amount of time that I hold those dollars. Like I would say on average per month, I only hold dollars for a few hours, right? Because I see that money hit my account, I pay my bills, and then the rest goes into Bitcoin. And, and in terms of my savings, like my savings are denominated in Bitcoin, right? And I know, I know with certainty that I know that, that fiat savings that I would have would be depreciating in purchasing power over time, right? And, and really it's just kind of a matter of saying, okay, well, I know that, right? And I'm gonna use that as a guiding heuristic, otherwise I, my savings are being eaten into by the government. And, and really ultimately, like it's sort of more philosophically or more ideologically, like which system do I wanna lend, you know, my liquidity and legitimacy to? Where, where do I want, like, my capital, my mind space is, is That when the government prints more money, they're not stealing purchasing power for me, right? I'm not funding drone strikes in, as Dear Beckerstein or whatever. So, hopefully that makes sense. I think I answered your question." }, { "speaker": "stephan", "time": "19:02", "start": 1141.68, "text": "Yeah, so how I'm seeing it then is there might well be individuals who keep a high allocation to Bitcoin, but for strategic reasons would prefer to not have to, for various reasons which we'll get into. I think probably the first one is if you live in a country or you are a tax resident of a country that has Like capital gains tax, because here's the thing. as an example, let's say, you know, you take that fiat pay, but something happens out of cycle that you need, and let's say, you know, you break your arm and you need to go to hospital and pay this big bill, or your car breaks down, and what, what are you doing then at that point where if you don't have the money to pay for this one-off thing and you haven't received the pay yet or to cover that, then at that point you're having to, well" }, { "speaker": "stephan", "time": "19:50", "start": 1190.21, "text": "Or if you find a way to borrow against your coins or something like that, I mean, do you agree that's essentially the sit-the situation you'd be in? Definitely." }, { "speaker": "heavily_armed_clown", "time": "19:58", "start": 1197.73, "text": "Yeah, yeah. And I don't, but I don't see that as a negative. It's certainly an inconvenience. I don't wanna give the government any of my money. but if I owe them money, it means that I'm richer, right? Like if, if the government is coming to me and attack-with a tax bill, it means that I'm richer than I would have been otherwise, right?" }, { "speaker": "heavily_armed_clown", "time": "20:20", "start": 1220.11, "text": "Or, or depending on just how you're stacking that up, you may actually, you know, be able to take on capital gains, even though like you're net richer because you've been buying Bitcoin and holding Bitcoin for, for long enough that your savings have accumulated massively in value, well, maybe your last paycheck since then the price has gone down, and you can maybe potentially claim that as a capital loss, especially if you have pretty decent income, right? So in a lot of cases, I, I think it kind of nets out, especially if you're buying Bitcoin on a regular basis and the price is" }, { "speaker": "heavily_armed_clown", "time": "20:50", "start": 1249.97, "text": "A little bit of Bitcoin into this local analog native currency to pay the warlords. well, you know, I'm, I'm richer than I would have been otherwise, and, and maybe through some clever accounting, I might not end up owing them anything. It does create a bit of an accounting headache, you know, that, that is certainly a real problem, and that's why I think that an honest conversation about this starts with saying, \"Hey, you know, we need to see more tooling for Bitcoin native banking.\" I, I think there's already some services that are coming online because What you're doing now on fiat with a normal banking system, but if you could do exactly that on Bitcoin, denominate it in Bitcoin fully, then all of that accounting would be taken care of for you, 'cause your paycheck would come in, it'd be converted to Bitcoin, right? And then at point of sale, it'd be converted out of Bitcoin, and all of that accounting would be done for you, like in that checking account. And this isn't to say, like, you know, I am a firm believer of hold your own keys, savings go to cold storage, right? They're Native banking is functionally the same as checking on USD banking or fiat banking, right? So we're not really talking about like abandoning hold your own keys, we're talking about doing what you're doing now, like with your fiat, but on Bitcoin-denominated banking account, right? That would, that would alleviate a lot of those, accounting headaches, I think. But, and then more broadly, like to kind of circle back to what you were saying before, is like it, it'd kind of be like if you were living in, like Venezuela, right? And you had access to" }, { "speaker": "heavily_armed_clown", "time": "22:20", "start": 1340.23, "text": "Like they're going to prefer to accept or be coerced to accept bolivars in, in the majority of transactions, maybe you might run in with a few people who say, like, \"Yeah, you know, I'll take Bitcoin, just send me Bitcoin and I'll give you this good or service that you want from me.\" but in a lot of cases, you know, you're gonna be paying in bolivars. You're not gonna hold the bolivars just because all the people around you are accepting bolivars. You're, you're gonna minim- and, and this Like if you can help it, right? Because you know that they're, they're risk to extreme volatility. this isn't the 1980s, right? We're, we're not-- We're digital natives and we're interacting with these analog natives of if-- as if we're in a foreign land, right? And, and we're using their currency because their local warlords demand it. But, like, technology has made it so easy for us, in many cases, especially with Bitcoin, to be able to transact and like instantly be in and out of the currencies that Go and withdraw cash at the ATM and carry it around in order to be able to pay for things." }, { "speaker": "stephan", "time": "23:24", "start": 1404.37, "text": "Back to the show in a moment. Have you thought about upgrading to multi-signature? Unchained Capital can help you with this, they've got this product called Collaborative Custody. Now, in this model, you hold two keys in different locations and Unchained hold the third key. This can be great to give you additional peace of mind, help you sleep at night, and now we are trying to remove single points of failure, and so when you have this set up, you can potentially How to do this, they offer a concierge onboarding program which you can purchase, so you can pay upfront for that, they will ship you some hardware wallets, they'll do a video call with you to get you set up, even if you've never held your private keys, and then store some Bitcoin in that vault. So go to Unchained dot com and use the code Livera for a discount. Lend at Hoddle Hoddle is appeared to be a Bitcoin backed lending platform, so you can lend or borrow stablecoins globally and anonymously. Now, one benefit here is that there's" }, { "speaker": "stephan", "time": "24:20", "start": 1459.91, "text": "Without verification, you deal directly with other people and together with the other parties, you control your collateral through that whole deal with all the interest paid at the end. Now, on the other hand, if you have stablecoins and you wanna earn some extra on that, you can lend them out and get the highest returns, issuing over collateralized loans with full interest guaranteed. So lend at hoddlehoddle, lend and borrow stablecoins on your terms at your desired interest rate. There are no hidden fees, the terms and conditions are transparent, and you as users control the keys in the deal in escrow and dot hoddlehoddle dot com. And if you're looking to secure your keys with a Bitcoin hardware wallet, look into the Coldcard by CoinKite dot com. The Coldcard looks like a little calculator, you can use it to generate and store your private keys, and you can also use it to ingest other secrets if you wanna do your own entropy, and you can use this together with wallets like Electrum or Specter Desktop or Sparrow, and you can use it quite easily in different configurations, so you can use it as part of a single Single signature setup, you can choose to have a passphrase or don't have a passphrase, or you can use it as part of a multi-signature setup. With Coldcard, you've got all sorts of options and choices available to you. So that website is coinkite dot com, and don't forget they've also got Metal Seed backup products, as well as other tools and pieces that you might use alongside your Coldcard. So that's coinkite dot com, and use the code LIVERA to get a discount. Back to the show. So, I broadly like agree with a lot of what you're saying, right? Like, I broadly agree that you wanna be min-minim-maximizing your Bitcoin, minimizing your fiat. I think the difference or maybe the distinction in our views is more kind of like, I see more of a role for keeping a small sliver of fiat as a way of being able to deal with day-to-day liquidity issues, as opposed to literally going to zero. I think that's probably the main disagreement in my mind here is, you're like, the talk is, \"Ah, get-go to literally zero Whereas I'm sort of thinking of it more like minimize your fiat exposure, because something might come up and you might not be able to quickly be able to sell some Bitcoin at the time that you need it. And if it's an emergency that you need to fix your car or go to the hospital or whatever it may be, that you, you might be left in the lurch at some point there with zero dollars in your checking account. And if your, you know, let's say your credit limit doesn't cover for that or if you don't have access to the right services that enable you to quickly," }, { "speaker": "heavily_armed_clown", "time": "26:43", "start": 1602.98, "text": "Yeah, yeah. I mean, I think, yeah, I think if you're gonna be doing this, you would wanna have access to like a decent line of credit, right? I mean, like there are credit cards that you can get, like, depending on-- Of course, I understand not everyone's circumstance is the same, but like I have access to basically a credit card with unlimited line of credit, right? And, yeah, I don't ever wanna carry a balance on that, but, cause the interest is insane. But, I mean, it has unlimited credit, right? I mean, and If somebody demands payment in, in fiat at that moment and you just don't have fiat, like checks are a lot of times an option. And yeah, yeah, that, that is a problem. It would be great if I had, a Bitcoin-denominated checking account and I could write checks or swipe a debit card right out of that account. but the fact is, like, if, if people aren't accepting credit cards a lot of times, then they're, they're taking checks, and, and I mean, or they're, it's a wire transfer. and in Card, at least in my experience. But I, I guess the way that I'm looking at it is that like, Bitcoin offers me this opportunity to be set free from slavery, right? And it's, it's kind of like, to me, still denominated like some of my energy in, in dollars and saying, okay, like I'm gonna have, ninety percent of myself in Bitcoin world, and I'm gonna leave one foot in the fiat world. It's kinda like going back to the farm once a week to work a day, you know what I mean? Like as a slave. Security, and, and the, the, my master took really good care of me. So I'm gonna go, just like once a week, I'm gonna just go back, and I'm gonna just, you know, like, pick some cotton, instead of saying like, \"No, I'm free now. I don't, I don't have to be a slave in this old system. I don't have to lend liquidity and legitimacy to these slave dollars that are stealing from all of us and, and are literally causing a meltdown of economic calculation and, and, peaceful, of social cooperation is being eroded in front of us. The faster all of us, you know, move to Bitcoin, well, one of the things that I found, Stephan, the ways that this, making this shift has affected me mentally, like affected the way that I do my economic calculations. For me now, it's a lot less about, for, well, for one thing, I'd rather pay people in Bitcoin right now, because it's easier, right? So whenever I interact with anybody, I'd rather pay them in Bitcoin. And to be honest with you, when I'm getting like a quality good or a service, I'd prefer to pay people in Bitcoin, 'cause I'd rather exchange what I know is like a good hard money for like this good quality service or product that I'm receiving. Like, I, I want to be able to have those types of transactions." }, { "speaker": "heavily_armed_clown", "time": "29:27", "start": 1766.79, "text": "The base layer of social cooperation, that's what we want. but beyond that, like, Bitcoin now for me is less about speculating, right? It's less about, like, buying dips and about, sometimes like I would, I would go through these motions where I'd try and be stacking sats extra hard. It's like, okay, I'm not gonna go out to dinner tonight 'cause I'm, I really wanna buy that dip that just happened, right? And, and that's like totally reasonable behavior, like just defer consumption, right? Like, take advantage of opportunity" }, { "speaker": "heavily_armed_clown", "time": "29:57", "start": 1796.59, "text": "Non-zero, right? Like, I don't, I don't have any cash sitting around to buy the dip. I can't avoid going out to dinner tonight to buy more Bitcoin. So it becomes more of a game about maximizing my income, which is a much more socially positive aspect of my personality now, like because it's about, okay, how can I provide value to other people, right? And in exchange get more Bitcoin, right? Whereas before it was about like, what can I defer? And I still make deferment consumptions, probably even more so now than I did before, but Bitcoin on that, whereas before it was like, \"I don't wanna spend my dollars on that so that I can buy more Bitcoin.\" Now it's about, \"Okay, I need to, improve my income, I need to hone my skills, I need to provide better products and services to the market, I need to satisfy, satisfy more people's needs so that I can get more Bitcoin.\" And I think that that's just a much healthier way to look. I think that that's how economic and social cooperation should look. Right." }, { "speaker": "stephan", "time": "30:52", "start": 1851.53, "text": "Yeah. And so I, I'd certainly agree the mindset changes Highlighting there, and I think a lot of those really just come to anyone who keeps a high percentage of their net worth in Bitcoin already, right? Whether you are, you know, I think for me, it's kind of like whether you're at ninety-eight or ninety-nine percent versus a hundred percent, I mean, it's that last sort of one or two percent, depending on where people are at or whatever, that can be really hard for people beca- because of the access to the services or because, as you mentioned, the accounting headaches, right? Like, you might not have accounting software that Exchange transactions tend to be fine because you can normally download some kind of CSV file, put that into your tax accounting software, or send that to your tax accountant if you have one, and they can take it from there and run with it. But if you have Bitcoin wallets on your phone and other things that aren't really connected that you can easily download, that's probably one of the main headaches, as, as you rightly pointed out. And hey, who knows, maybe in the next few years we start seeing more products and services that help Bitcoiners deal with these aspects of it. I'm, and That kind of thing where maybe they do like a credit card where you can collateralize against Bitcoin and spend fiat, but actually it's credit, so that way you're not actually, you know, you're staying on zero in this, in this case. So I think that's probably the main thing, but I think the other aspect Probably the principal objection I have to like literally going to zero, rather than saying, you know, ninety-five, ninety-eight, ninety-nine percent, let's say, is just that risk of an extended bear market, right? And I think that's something that for me as a twenty-thirteener having been through multiple eighty percent drawdowns, it's just always-- and maybe I'm overly paranoid, maybe I'm overly pessimistic on the path or price trajectory that Bitcoin takes or the purchasing power trajectory, if we wanna use that term, that if we- If I were to go through some big eighty percent drawdown, and then at that point, I would have to be spending Bitcoin, or potentially there's a risk that, let's say you, let's say you lost your job during this big downturn, at that point, I think that's probably the main thing in my mind, or at least one of the main things. So I'm wondering what your thoughts are on that." }, { "speaker": "heavily_armed_clown", "time": "33:02", "start": 1981.59, "text": "Yeah, so it's, it's two things. Well, so first and foremost, yeah, if, if you lose your income, that's not a good deal," }, { "speaker": "heavily_armed_clown", "time": "33:11", "start": 1991.22, "text": "Losing your capital, right? Like if you're fully in on Bitcoin, if you're half in on Bitcoin, if you're ninety-eight percent in Bitcoin, losing your job hurts, right? And, and I think we can all agree that like income is one of the most important things in terms of your quality of life and your safety and security, is having that, that regular income stream, 'cause, 'cause especially, and especially like if you're a Bitcoin native, right? Because as you're earning income, even though the price is going down, like let's say we had another extended As the price is going down, you're, you're getting paid like in that equivalent exchange rate. So like, yeah, while your savings might be relatively depreciating in value, like as you're getting paid, you're getting paid at that rate. So your income, like, part-barring any like extreme circumstances, and, and this is again why like savings are so important, because the future is uncertain, right? And I think that we all agree, like, our baseline assumptions, I'm sure, are all the same. But beyond that, like, you know, historically, Bitcoin is In the midst of these bear markets, if, if you've been holding Bitcoin for more than, eighteen months, you know, chances are you've seen your purchasing power appreciate. And even beyond that, like if you've been holding Bitcoin for more than a few years, a major drawdown in Bitcoin's price Still doesn't eat into the appreciation that you've seen in your savings, like, yeah, your, your purchasing power, mark to market, is lower, but your, your net savings is, you're still in a better position than you would have been otherwise, right? So I think I try to look at it a little bit more holistically, like I try not-- because really, it, it's just a matter of like, where do I wanna place my energy? Where do I wanna place my capital? Where do I feel-- Why do dollar-- And, and really evaluating in my mind, why feel safer, because the same way that you feel about these potential drawdowns in Bitcoin, I feel about the paper money that my government issues, right? I'm now more concerned that that is less, offers me less safety and security and stability than Bitcoin, because I know Bitcoin is objectively better, so why, why would I be thinking in my lizard brain that the, the paper money that the government gives me is, is better and safer in times of uncertainty?" }, { "speaker": "stephan", "time": "35:26", "start": 2125.58, "text": "So I think the, the short answer essentially is that there are other people out there who you need to buy products and services from that don't accept Bitcoin. I think that's the short answer, is that it's not that we're insane, it's that the, you know, ninety percent of the world out there is still stuck in the fiat mindset and stuck only accepting fiat. And so we're kind of in this weird situation where we want to be able to pay fiat and hold Bitcoin. And so just to the extent that you keep a small balance of fiat just to sort of satiate the, you know, to be able to satisfy the demands of the fiat people, that doesn't really seem like such a world changing amount or difference in my mind." }, { "speaker": "heavily_armed_clown", "time": "36:05", "start": 2164.97, "text": "I would disagree, and I think, I think that, a lot of this, this system, it operates on the margin. I don't think that very many people have savings in general. Like if you look at the average American, most of them have no savings in the case of an emergency. the majority of their economic energy is in their checking account, and it, and it comes on the first and it gets spent up You know, however often they get paid. most people live paycheck to paycheck, and, and that's a problem with their ability to, you know, maximize their income and, and defer consumption, and maybe it's the lifestyle that they live, you know, it's a whole lot of problems. and, and Bitcoin doesn't necessarily fix that for them until they're ready to take that step and start to save, and defer consumption or max, or, you know, like increase their income, right? 'Cause you have to do one or the other. I think it's kind" }, { "speaker": "heavily_armed_clown", "time": "36:55", "start": 2215.32, "text": "Last two thousand dollars, well, that isn't gonna move the needle. I, I think it's not, it's not really about that for me. It's, it's, it's like I said, it's, it's more about, and, and don't get me wrong, being a pioneer is uncomfortable, right? These are kind of uncharted territories. Like, this is a pretty radical idea, to, to move completely away from what's comfortable and what's normal and what's familiar into uncharted land. Like, it's, it's uncomfortable to be a pioneer, and" }, { "speaker": "heavily_armed_clown", "time": "37:25", "start": 2245.34, "text": "But like right now, it's, it's the few forging the path, moving ahead, saying, \"We think that this is the way forward.\" And there are people that are saying, \"Like, well, I'm not gonna follow you. You guys are gonna die.\" But that's pioneering in a nutshell. That's exploring new frontiers, and, and people may say, \"Hey, it looks a lot better over there. I'm gonna try to catch up.\" And, and what, one of the things that LaserHodl says, says a lot is that really what we're kind of trying to do more holistically here is front load some of the pain of abandoning fiat, right? Because we know currency collapse is inevitable at this point. Like, you can't continue to cover deficits by, with the issue of new paper notes. It's simply an erosion of the base layer of social cooperation and trust. You can't do it. You know, Mises wrote about it. It, it inevitably causes currency collapse. Inflation is always a product of infla- Inflationist policy, not underlying economic conditions. So really what we're trying to do right now is, is front load this pain, right? 'Cause it's, it's not easy right now, and, and it's a little uncomfortable at first. For me, I, I feel better than I ever have, like I feel more secure than I ever have, despite the fact that I hold zero dollars. And, and I understand not everyone's gonna do this, right? And, and that's why I, I think it's important to highlight that it's not a purity test," }, { "speaker": "heavily_armed_clown", "time": "38:46", "start": 2326.04, "text": "Liquidity, legitimacy that I lend to this system that's stealing from us, that's eroding the base layer of social cooperation. That's my mission, right? I wanna, I wanna move to a Bitcoin standard as fast as possible, and I think that this is just one more step as to how we get there sooner. a-and I think debating whether or not, you know, like that two thousand dollars in your checking account is gonna move the needle, I, I think is sort of irrelevant." }, { "speaker": "stephan", "time": "39:07", "start": 2347.2, "text": "Yeah, I think I'd probably agree that it's not gonna really move-- Well" }, { "speaker": "stephan", "time": "39:16", "start": 2355.84, "text": "And, oh no, like that last thousand dollars or two thousand dollars, I mean, whatever, it's not really gonna really matter that much. It's more about how many people are gonna be brought in, an orange-pilled, so to speak, and who are now, who are earning and then obviously stacking as much as they can into sats and hodling the sats is the important part. So I'm curious as well, how much of the concern, or I don't know, maybe this isn't a concern at all for you, but retaining access to fiat services. So for example, in some banks, you have to have a certain balance to, you know, retain access because you might need to be able to make wire transfers or other kinds of electronic fiat electronic transfers. does that play into your mindset there or anything around, let's say, access to credit as an example? They might need- need to see a history, a certain history in order to be able to access fiat credit." }, { "speaker": "heavily_armed_clown", "time": "40:10", "start": 2409.6, "text": "Sure. I mean, you know, we, we've got to be realistic here. Like, there are certain constraints that you have to operate with, and everybody's situation is different, right? And that's why, again, like, I just have to keep reiterating 'cause I feel like a lot of the nuance of this movement was lost on Twitter, which of course, like, like everything. Yeah. Like, we understand. Like, there's gonna be times like when maybe you're trying to Or something, right? And, and you're gonna have to figure out a way to do that, like you're gonna have to sell some Bitcoin, move it to your bank account, take a snapshot, send that over to the adjuster. Like, yeah, do what you gotta do. I, you know, my situation is different than everyone else's. I, I use a credit union, I don't use a regular bank. I don't have to have any money in my account to still have access to those services. You know, I, I have a credit card that, Although for some people maybe it isn't, I don't know. Yeah. I'm trying to figure out this, this path as I go, and I've, I've certainly found a method that works for me with the services that I have access to, and I think that more and more services are coming online that offer like more robust tooling for Bitcoiners to be able to operate like as Bitcoin native bank, on a Bitcoin native bank. I, I think that that's closer than you'd think in terms of being able to access that like directly as Bitcoin native banking, I, I Bitcoin companies pivot to that. I, I would love to see that." }, { "speaker": "stephan", "time": "41:39", "start": 2498.84, "text": "Right. And so one other aspect I'm curious to get your thoughts on, so this is a view you articulate it, now again, I don't necessarily agree with this view, this is just, I'm saying it for the sake of an interesting discussion. There are people like, say, Michael Saylor, for example, who comes out and says, \"Oh, Bitcoin is digital property, and we're still gonna use the US dollar because that's the world reserve currency.\" And in that frame of mind, it's kind of more If you're Michael Saylor, you can access very, very cheap credit, but let's say, you know, the, the average pleb can't access that level or that pricing or those kinds of terms. But should they still be thinking about actually using the fiat system for their own benefit? So for example, if they were to use, fiat loans to be able to stack more, or should they use fiat car loan or fiat home loan, et cetera, to avoid spending Bitcoin and these kinds of things? And of course, it's not a one size fits all, like you were Of course, everyone has their own financial situation and different needs and so on, but to that extent, what do you think about the idea of using the fiat system, the credit available to many people in the fiat system, as a means of either stacking more or continuing to huddle rather than spend?" }, { "speaker": "heavily_armed_clown", "time": "42:54", "start": 2574.07, "text": "Yeah, I think it's one hundred percent a great idea. I mean, like, I'm not against it at all, right? Because that's what George Soros did when, when he was speculating that the pound would fail, right? He was essentially neg- Negative, like he was shorting it by leveraging debt against that currency, right? And, and that's, that's essentially what you're doing as, as a, as a Bitcoiner who's leveraging fiat credit, to obtain more Bitcoin. I would, I would caution people to focus first on income to get to a secure and stable place in terms of savings and income, unless you're in a situation where you have no savings at all, and then maybe it's worth it to take a little bit of risk, to try and acquire some Bitcoin and, and hope that it appreciates in In this environment, and you have no savings, you're in a really bad spot, and you have really gotta get your butt in gear, or this system is gonna crush you, right? Y-you will be destroyed by this. and this isn't, this, this isn't a joke. Like, this is very, very, very serious, and, and I, I worry about people, you know? But the honest truth is that, as this continues to accelerate, like a lot of people are gonna lose everything, and, and I, and I hate to see This happening, right? And we're reacting to it as it emerges. we can't change reality, right? This is what it is. But yeah, I, I totally think people who are, who are in positions, you know, where they wanna take advantage of artificially low interest credit, like, home equity loans or mortgages, or, you know, maybe you're in a position where you can leverage business credit, like Michael Saylor, by all means, you know, have at it, do what you gotta do to, short the dollar." }, { "speaker": "stephan", "time": "44:32", "start": 2672.28, "text": "Fantastic. Now, probably the other objection that I've seen people give around this idea of getting on zero is perhaps what we might call staying under the radar, right? There might be some hodlers out there who, let's say, because they never sold Bitcoin, never had to actually report on it, because they just wanted to be able to purchase Bitcoin and hodle it and only spend fiat, and in doing so, not having to actually do a capital gains tax event and therefore not having to report, how much value do you place on that idea? idea that there might be some value, i-in a broad sense, of people staying under the radar and not reporting, legally not reporting things to the government" }, { "speaker": "heavily_armed_clown", "time": "45:14", "start": 2713.5, "text": "Virtually none at all. And, and the example that I use is that like if, if we were all buying under the table and selling under the table and, and, you know, doing all of our transactions in cash peer to peer, then Bitcoin would look a lot more like Monero than it does like Bitcoin. Bitcoin is where it is because of the adoption curve, right? And the easiest on and off ramps for Bitcoin are through KYCed institutions, right? And, and unless you're accumulating all of your Bitcoin-- So I think a lot of people conflate like when it comes to privacy They conflate, transactional privacy with, custodial privacy, right? Because if you've bought any Bitcoin off of a custodial exchange, well, then some government institution knows that you own that Bitcoin, right? They may not be able to prove that you still have it or that you don't have it, and you can't actually prove that either. But, well, you, you can, you can only ever prove that somebody is willing to sign a message saying that you own that Bitcoin. That's all you can ever really prove at the end of the day. so there Obfuscating transactional privacy, you know, through services like Join Market or Wasabi or whatever. And I think people conflate that problem, but I think that more than ever, our, our most challenging, most urgent, most pressing problem facing us is this collapse of the base layer of social cooperation, which is money, right? And, and what we need is to usher in the adoption curve of Bitcoin, whether that be through KYC, whether that be through no KYC, whether that be through peer-to-peer. The, the honest truth is that the Fastest liquidity on ramps into Bitcoin are through KYC institutions, and that's okay, right? Like, trust me, I'm not a fan of reporting anything to the government. I'm not a fan of giving the government percentages of my net worth. I also don't wanna go to prison, right? So I, I have to play that game. I have to interact with, I have to follow the customs of the warlords, right, so to speak, of the analog natives. But I don't, you know, like, if you think that you've bought all this Bitcoin off of Cash App Capital gains transactions 'cause you've never sold a single satoshi? Like, I'm sorry, you're just deluding yourself. Like, you're, you're living in a fantasy world. I-if you've taken a picture of yourself with your driver's license and sent it into one of those exchanges, then they know you own Bitcoin." }, { "speaker": "stephan", "time": "47:27", "start": 2847.07, "text": "That's correct. And so at some point in the future, or even today, there are, you know, information sharing agreements going, and it depends on which country, of course, and which jurisdiction, and all of this, but it's quite common, and, you know, it could quite-- it could become a thing in the future where, let's say, person A B C is requested, by the government, and they say, \"Hey, person A B C, we asked the exchange, they saw you purchased whatever fifty million sats. Do you still have them now, or do And so while I haven't heard of that yet, it is definitely a possibility in the next, in the years to come. So that's something that people have to think about. And so, yeah, I think that's a good point you make. I would say there is perhaps even for, let's say, people who have KYC'd and purchased coins on some exchange years ago, let's say, let's say someone bought coins in twenty seventeen or whatever, at, you know, a few thousand dollars a coin or whatever, and, you know, now as we speak, the price is forty-three Now, if they had to sell, they would now have to, you know, pay that CGT basically. but I guess again, this comes back to the point you were saying earlier that in this case of the, the get on zero, let's say, that they would have been incrementally hodling a little bit more sat, and therefore they are going to end up net net ahead in sat terms, in Satoshi terms, which is obviously the terms we care about. So I suppose would that be the steel man? Would that be your argument?" }, { "speaker": "heavily_armed_clown", "time": "48:52", "start": 2932.24, "text": "Yeah, a-and, you know, I, one, one of the things that I find adv-advantageous about Git on Zero is that it encourages me to spend my Bitcoin, right? Because, like I said earlier, it's just easier, right? Because I don't have, I don't have dollars, I have a credit card, so if, like, if you have a Stripe account, yeah, I can pay you with that. But it's actually easier for me to just pay people in Bitcoin, and I actually think that we should be encouraging this because the more peer-to-peer If I receive Bitcoin in exchange for like a good or a service, it's KYC free. No one knows that I-- like, unless I'm keeping a record of the transaction and I'm aligning it with like the customer's information, which, you know, I'm not doing for any of the things that I'm receiving Bitcoin for in exchange, like as a service, nobody's come along and said, \"Hey, you need to make sure you do this. I'm not going to.\" Every single time, like, you send Bitcoin peer-to-peer, it's liberating it from this" }, { "speaker": "heavily_armed_clown", "time": "49:52", "start": 2992.2, "text": "that custodial risk irrelevant, like we need to get as many people on board as we can, and we need to increase the amount that people are actually using Bitcoin as money, because then it kind of becomes irrelevant, like whether or not you've been KYC at point of sale or whether or not you were K-KYC at point of liquidation. We wanna, we wanna expand the Bitcoin economy. We want more and more people coming on board, getting involved with this, s-using Bitcoin to store their, economic time and energy, and, and that's how we win, right You know, increasingly accelerating levels of adoption, we win by using Bitcoin as money and, and making the fiat slave money irrelevant." }, { "speaker": "stephan", "time": "50:32", "start": 3031.51, "text": "Right. Yeah. I think that's probably a good spot to finish up. So I think, for me, I'm, for me, at least, here's the way I'm thinking about it, and I'll give you a chance to also respond with your own thoughts on it as well. But I think the way I'm seeing it is I, I, I believe that eventually we're all going to get on zero eventually. But I think," }, { "speaker": "stephan", "time": "50:52", "start": 3052.08, "text": "Business and how you do things, you may be in a situation where you have to wire fiat, and so you might need a small amount of fiat liquidity. But, you know, I don't wanna docs too much of my own personal life, but basically it's, let's say it's, it's in a very high allocation percentage and that it's not, it's essentially, I am, I'm, I'm still operating under that general idea of minimizing fiat, I'm just not literally at zero. That's where I'm at, but if you wanna give any closing thoughts for listeners about # fiat, and of course, where can they find you as well?" }, { "speaker": "heavily_armed_clown", "time": "51:26", "start": 3085.66, "text": "Yeah, maybe minimize fiat would have been a better, like a less, obtrusive hashtag for people, like we would have caused a lot less drama and-- But nobody would be talking about that, right? So get on zero, right? Like it's in your face, it's, it's radical, it's crazy, it, it's, it flies in the face of like what a lot of people think traditionally is smart. but, you know, our world doesn't make a lot of sense Every dollar in our checking account is one more dollar, you know, for them to steal from you to pay for Clown World, right? And, and I wanna raise my kids in Bitcoin World, not Clown World. I don't like Clown World, I don't enjoy Clown World, I don't have fun in Clown World. Clown World keeps me up at night. I want Clown World to end as soon as possible, and, and I can take steps towards that by reducing the amount that I fund Clown World, which Clown World is funded by deficits, Clown World is not funded by tax revenues. So, And, and yeah, I, I think you, you know, 'cause you, you said it's subjective and, and I would agree that it's subjective in the sense that like you have to do what works for you, but I don't think that you're gonna go wrong if your objective, holistic guiding principle is to minimize fiat, minimize the amount of time that you hold dollars, minimize the amount of dollars that you hold, or, you know, whatever your, your fiat currency of choice is. I use dollars 'cause I'm American. America. And, I, I don't think you'll go wrong, you know, I, I, I really don't. I don't know the future, the future's uncertain, future's uncertain for all of us, despite what anybody may tell you, but I know that Bitcoin is objectively the best choice." }, { "speaker": "stephan", "time": "53:00", "start": 3180.03, "text": "Fantastic. And, Colin, where can people find you?" }, { "speaker": "heavily_armed_clown", "time": "53:02", "start": 3182.29, "text": "Oh, they can find me on Twitter at heavily armed c." }, { "speaker": "stephan", "time": "53:05", "start": 3184.83, "text": "Fantastic. Thanks, Hack." }, { "speaker": "heavily_armed_clown", "time": "53:06", "start": 3186.45, "text": "Thanks, Stefan." }, { "speaker": "stephan", "time": "53:08", "start": 3187.71, "text": "Get the show notes at stephanlivera dot com slash three four two, and I'll also include a link to the article I wrote on this exact topic. Thanks for listening, and I'll see you in the citadels." } ] }