{ "episodeId": "SLP443", "speakers": { "stephan": { "name": "Stephan Livera", "role": "host", "tag": "STEPHAN" }, "conza": { "name": "Conza", "role": "guest", "tag": "CONZA" } }, "segments": [ { "speaker": "stephan", "time": "00:09", "start": 8.79, "text": "Hi, you're listening to Stephan Livera podcast, a show about Bitcoin and Austrian economics brought to you by Swan Bitcoin. Today we're clearing up Bitcoin misconceptions with my friend Conza. He is an Australian, but also an Austrian. He's an australie libertarian writer and organizer of Mises M and R Australia. So he joins me to talk about praxeology and common Bitcoin misconceptions. We get into various- These ideas, such as this idea that it's not merely just preference, why accuracy is important, classifying Bitcoin, as well as clearing up inaccurate analogies about Bitcoin as stored energy or stored time, or notably in recent times, this idea of Bitcoin as violence or a weapon. The show brought to you by Swan Bitcoin, and Swan is launching a new service. It's called Swan Premium, and for those of you who sign up soon, it's got a free twelve-month trial. So it's called Swan Premium. Premium, it's normally going to cost twenty dollars a month, but it is free if you sign up and join the waitlist. What is Swan Premium? You're going to receive exclusive research reports, educational content, discounts on Bitcoin products, and privileged access to many Swan events. So go and sign up, it's over at swan dot com slash premium. Are you ready for something huge? BTC Prague is coming in June twenty twenty-three. The dates are June eighth to June tenth. Prague is a beautiful city, I've really enjoyed it when I've been there, so it's a great opportunity. And it's quite cost effective also. So this is going to be a three day event with a awesome lineup of speakers and companies, and there'll just be so many people to network with. It'll be educational and fun. I'm gonna be one of the hosts, I'll be an MC for the main stage for one of the days, and you can expect a relaxed summer atmosphere. There's famous Czech beer, but don't get me to pour one for you. And go to btcprague dot com, use code Livera for a discount there. When it comes to securing our Bitcoin, there's a Most notably, the Coldcard Mark IV, which is the latest and greatest. It has a range of features. You can set it up without even phoning home to the manufacturer. You can spin it up on your own, just plugged into the wall. So that's a really cool feature. It has a range of other features. You can use it in single signature mode or multi-signature mode. You can use the various air gap features also, so you can use the SD card or use the NFC function to move transactions or multisig data back and forth. So it's a fantastic device. I am a big fan of it. You can get it over at coinkite dot com and use the code levera for a discount there. Conza, welcome to the show. So far, thank you." }, { "speaker": "conza", "time": "02:39", "start": 159.29, "text": "It's great to be here." }, { "speaker": "stephan", "time": "02:40", "start": 160.07, "text": "Yeah, I'm a big fan of your work online, as, as our friend Safety says, you're like the attack dog. You know, the guy who just kind of knows every little point about every little, quote, quote, but whether it's Mises or Rothbard or some other Austro-libert" }, { "speaker": "stephan", "time": "03:00", "start": 180.04, "text": "About, you know, your perspective as, as an Australian australie libertarian, and, get into some Bitcoin misconceptions, 'cause I think there's a bunch out there. but yeah, so for people who haven't heard you, of course, I recommend, my friend Safteens episode as well. But just for anyone who hasn't heard that one, tell us a little bit about yourself." }, { "speaker": "conza", "time": "03:17", "start": 196.95, "text": "Yeah, well, probably about fourteen, fifteen years, so I'm like a product of the Ron Paul revolution. You can probably see the, the image in Pathway introduction to these ideas and very much gone down that rabbit hole, around two thousand and seven, and from there it was no labor of love, but like almost autistic or obsessive with just, hey, there's this new, new, new, you know, to, to, to throw myself under the bus, just like the love of passion of, you know, I was intellectually honest is, is kind of a key principle I have and being open to reason and it was just going down this rabbit hole of like, you know, my word, there's this whole school of knowledge, like why And, and you know, I was parroting that for a while, but it was then really like thinking about, I got tripped up on, on a, on a forum, you know, one of Ron Paul forums or, you know, one of those in, fields way back, and it was, okay, how, why does he think what he thinks? And it was Austrian School of Economics, you know, what Mises and, you know, Rothbard, and so from then on, it was instead of, you know, studying university, it was, it was that with libertarianism and how they pair together. Yeah, so it's, it's born out of a passion for justice and an original point of going, \"I'm completely ignorant and being kind of, seeing the light of, of what Ron was saying, but it was also where he was saying it. It was kind of, his proof of work, you know, he's a rep- in the Republican debates and he is, you know, on the, on the stage with the, the Republicans and calling them all war mongers, and making these- You know, emphatic points that just hit home to myself, you know, being a young person who was more idealistic, you're like, \"Wow, that, that makes complete sense.\" Oh, the, the free market stuff is a bit radical, but you then learn, there's, you know, you go down the pathway and, you know, give it a benefit of the, give it a benefit of the doubt, and then wait, you learn You know, you, you read Human Action, and you read, you know, Economics One Lesson, and, and, you know, Bastiat's The Law, and you, you get all these introductory texts, and, away, away you go. Yeah, so that's kind of my bit of the background about the Austrian economic side and libertarian side. And it then dovetails, you know, I looked at this the other day, you know, everyone's kind of the story of when you first, you know, heard about Bitcoin, and where, you know, where, where were 2007, 2010, sorry. And someone had piped up like, \"Oh, it's gonna, you know, it's not gonna be paying taxes, it's almost gonna end the state.\" And I kind of, I was critical of that, but, you know, and I think that's probably-- I was kind of looking back on it when I did the other days, like we got the archives are still up, if you wanna check them out at mises dot community. It was like, \"Wow, I was kind of right, like, you know The system and, you know, FU money is a good, you know, free to money is, you know, the, the good kind of monikers that symbolize that, or summarize that. But it allows, so I was, I was like, alright, because there's taxation, you know, in Swedish cantons, you know, accepting Bitcoin, for taxes. And so it's like, there's still an avenue, I think, for these liberty related arguments in Austrian economics to help make these, this case that against the state, because Bitcoin's all about separating money" }, { "speaker": "conza", "time": "06:51", "start": 410.62, "text": "There and, and, you know, partly I was right, specifically, but wrong in all these other ways in terms of I, you know, had a similar mindset of, you know, the Peter Schiff argument, like, \"Oh, no one's so much value, you know, in-- value is intrinsic, but they're like, it needed an objective use value using mis-McCloskey's regression theorem, tracing that back to a commodity or like an other use case, and I was wrong.\" Conrad Graf, I give a lot of homage to and respect to, Early two thousand thirteen or so, but yeah, that, that's kind of the, the origin story of sorts, and sitting on the sidelines for quite some time, you know, following in a little later, you know, not this class, but previous class, so, not an OG, but, I've been on the sidelines for quite some time and, and very much fully loving the community and, you know, the pathway we're all, we're all on now." }, { "speaker": "stephan", "time": "07:47", "start": 466.54, "text": "Yeah, for sure. And I think you mentioned Conrad, and Early influences, if you will, right? Like back in twenty thirteen when I was a noob and I was learning, it was Conrad Graf, Tua Demista, Trace Mayer, Roger Veer back then, before he went, you know, Bcash, and of course, you know, my friends Michael Goldstein, Pierre Rochard. I think they were probably some of my initial influences at the same time that I was talking and writing about Bitcoin. And so I think one thing that I wanna hit as well is this whole-- well, we're gonna get into praxeology and all of this stuff want to come at it is when I talk to people about Bitcoin or sometimes I see this sentiment out there, people talking online about Bitcoin or they'll say, \"Oh, you libertarian people, you're just kind of coming at it with your ideology and, you know, you just kind of- You kind of want it to be a certain way, but, you know, they sort of make this argument as though it's like preference, right? I'm curious from your point of view, why is it not, you know, just a preference or certain aspects of it, not like everything about the Bitcoin view is, you know, ordained in stone or whatever, but why is it that certain aspects of this aren't merely a preference?" }, { "speaker": "conza", "time": "08:57", "start": 536.97, "text": "Yeah, great question. And just before kind of diving into that, I wish there was a bit more, you know, and you've discussed this as well," }, { "speaker": "conza", "time": "09:07", "start": 546.89, "text": "From an ideologic, ideological kind of point of view, it'd be like, \"Well, I wish that was a bit more the case.\" where you know, with libertarians, we've engaged with, you know, it's like this is almost the solution of separation of money and state. before, you know, you'd, you'd hear about, I can just take a bit of a tangent, but like, the taxi cartel, I'd be like, \"That's a one of the last things that, you know, would get wound back,\"" }, { "speaker": "conza", "time": "09:37", "start": 576.75, "text": "Discussions theoretically with friends like, who heard about, Uber early on, they're like, \"That's insane, like, you, you know, you, you're gonna jump into a ra- random stranger's car.\" And it was a much bigger proposition to, convince them, and then literally booked it, and he came along, his lawyer, and his mind was blown, and, and then like, practically speaking, you don't need to make those little arguments anymore. Similarly with Bitcoin, and you know, separation of money and state, like, \"Oh, you know That's, you know, crazy. We, of course, we need, you know, the state to define what money is and, you know, all that angle. And it's like, well, can Bitcoin-- The practical example, it's like proof of work. It's like, you know, it's there, it's working, medium exchange, and we'll go into, that a bit more. But it's, yeah, just on that tangent, I thought, yeah, it'd be good. Some of the libertarians don't-- haven And I wish there was more uptake. and maybe we can talk a little bit more about that later on about why, but, yeah, so coming back to your question, about, you know, why is it not just a preference, like a personal opinion, right? You always hear the, \"Oh, that's just your opinion,\" and it's like it's, that's, that's one, your one thought, your individual hot take, versus my own individual hot take, and it's this kind of sea of almost, there's no objective" }, { "speaker": "conza", "time": "11:07", "start": 666.83, "text": "Well, you know, oh, that's just your, your opinion. So the rich body is a praxeology, which yeah, we can get into, it's just the logic and science of human action. There's a lot of different ways you can come at it from a philosophical point of view, like a Kantian take, so it's like a priori, the knowledge is prior to experience, and you've got a posteriori, which is knowledge that's, you know, post experience, so you, you requires experience. or there's an Aristotelian kind You can call them, you know, self-evident truths. So with the p- you know, the, the commentary that Austrians and, you know, and libertarians, you know, or praxeologists come up with, it's, it's all is based, it's descriptive, it's not ought, it's, it's, it's not prescriptive. It's essentially, you know, a value-free, so taking a scientific approach, and it's all about not having, you know, imparting you know, unscientific, you know, premises or preferences in, in the body of, on the field of knowledge that it is. So kind of the praxological method begins at, you know, with the self-evident reality of human action and its immediate implications. You know, establishes universal val-- universally valid laws of human action, laws that, you know, claim validity without respect to the place, time, race, or nationality or class of the actor. And, yeah, the easiest way to summarize it is, is it furnishes laws in the form of if X and Y remains unchanged, then Z will result. So it's, at its core, yeah, it's, it's, is based and, did, and that- That follows the axiomatic deductive approach, so it's like based on logic, it's akin to applied logic and, you know, economics being one of the biggest, best developed branches of praxeology, and it, you know, from that You know, you start at the, the, the premise that, you know, or the axiom that humans act, they use, you know, means to obtain, you know, certain ends. you know, there's a, the fact of scarcity is involved. There's all these different little avenues can have, but at the, the core of it, it's not an opinion, in the sense of, if the process of, you know, there's no flaw in the process of deduction. So it's not like we're just like, it's, Or like, you know, absolute, it's like, there's a deduction process, and there, if there is a flaw in that deduction, like pointing it out, you know, is valid, but if there isn't one, it's conclusions that are reached, you know, along that line of chain of reasoning, they yield, like, essentially must be valid a priori because the validity, ultimately goes back to that, Yeah, it ultimately goes back to nothing but the indisputable action of Axiom, and it kind of helps-- the, the, the element is like a mental tool, right? So, and we can go into some examples, in a little bit. But it's, you know, if the situation changes, like you might be operating, you know, from, you know, Robinson Crusoe kind of like a, an individual perspective trying to make the principles clear in a Robinson Crusoe world, you know, this is, you know, this is what happens. it's obviously I, I prioritize only for the, that circumstance and what it is. So it's like, think of it as like a formula that's being cast of sorts, or, you know, it's like a mathematical proof essentially. And then, yes, you know, what Apply or not. And, and that's, you know, I guess the, the idea of economics as praxeology, it's, you don't need to, if, for instance, like on the other hand, the situation hasn't changed and it can be identified as real, perceived and conceptual, conceptualized by real actors, and then the conclusions are obviously, you know, are they a priori true propositions about the world as it is? And that's the key distinction between, so schools of economic thought, like, you know, economics, there's, there's a variety of different- Schools. That kind of is the key difference between the Austrian school and, you know, the, the Chicago school or the monetarists, the Keynesians, you know, neoclassical, Marxists. It's that the ultimate disagreement between Austrians and their col-economic colleagues is their pronouncements cannot be deduced. Also, the Austrians' pronouncements can be deduced from the axiom, axiom, axiom of action, and they still stand in clear-cut contradiction to the propositions. Also, the colleagues stand They're the arguments of Ca- Keynes, Marx, you know, Friedman, that it's all, standing in clear-cut contradiction to the proposition that the, that can be deduced from the axiom of axiom. So often it's like Needing testing to be done, we need to go get a grant, you know, often handed out by a central bank or a university, it's like, \"Okay, we need to go test, to see if the minimum wage, you know, increases or decreases, you know, employment.\" And, you know, it's absurd proposition, but there's some other clear-cut praxological laws, academic laws, right? Yeah." }, { "speaker": "stephan", "time": "16:12", "start": 972.07, "text": "So let me summarize. I think so Austrians are, it relates to the method of reasoning, and I guess it comes in that bucket of Well, we know what we know, right? That's kind of the bucket that we're dealing with here. And so, as, as I'm sure you're very well aware, a great book to read on this is Economic Science and the Austrian Method by Hans Simon Hopper. Great book, he really spells out very clearly the chain of reasoning. And so, what we're trying to get at here is this idea that it's not just merely subjective preference, it's actually a kind of objective reasoning style, and it's deductive. So the idea is we start from certain ideas, like so, for Purposefully, right? We start with that, right? Because if you didn't want to change something, then you wouldn't act. So therefore, you, you have a reason, you're acting purposefully, and then from there, you can, you can sort of reason out various other ideas, like this idea of the law of diminishing marginal returns, or, you know, various ideas like that, right? So could you give us a couple examples of that chain of reasoning so that people can be a bit more clear about what's going on here?" }, { "speaker": "conza", "time": "17:19", "start": 1039.03, "text": "Yeah, absolutely. that was probably one of The, Safarine, you know, giving elaborate, all the clear-cut examples. So yes, some examples of those typical economic propositions, and, you know, one being, so whenever two people, A and B, engage in voluntary exchange, they both must expect to profit from it, and they must have reverse preference, orders for the goods and services exchanged, so that A values what he receives from B more than, more highly than he get, more highly than what he gives to, to him, and B must evaluate the same thing. The other way around. Or consider that, you know, whenever an exchange is not voluntary but coerced, one party profits at the expense of another. you've got obviously the, the law of marginal utility, so that whenever the supply of a good increases by one additional unit, provided each unit is regarded as equal serviceability by a person, the value attached to each unit must decrease, and then any additional unit can only be employed as a means for the attainment of a goal that is considered less valuable than the le-least- Value of good satisfied by a unit of good, if the supply were one unit shorter. And then you've got Ricardo Law of Association, you know, there's minimum wage, like as an example for minimum wage laws, they're essentially when they're enforced, they require wages to be higher than existing market wages, and then involuntary employment will result. And then one last one is like a quantity of money. So whenever the quantity of money is increased, while the demand for money to be held as cash, cash reserve on hand is unchanged, The purchasing power of money will fall. so similarly like if x, you know, the quantity of money i-is increased, while the demand, so then y, the volume of demand for money to be held as cash reserve is unchanged, then the result will be yet purchasing power of money will fall." }, { "speaker": "stephan", "time": "19:10", "start": 1150.08, "text": "Yeah." }, { "speaker": "conza", "time": "19:11", "start": 1150.54, "text": "Yeah. So there, there's some, I guess, clear-cut examples." }, { "speaker": "stephan", "time": "19:14", "start": 1154.27, "text": "Yeah. And so just to contrast an Austrian way of thinking with, let's say, what you might see at university, they'll sort of-- I mean, they'll get some part- That's right. They may say, \"Okay, we're trying to do things under this idea of sator are paribus, right? Which is that same idea, which is that Latin saying for basically all other things equal, we're gonna try to assess this.\" But then what happens in typical university, in the fiat universities, is they will get into these crazy economic models where they'll start with this crazy idea of a perfect and then relax assumptions, or they'll start and then do all these really complicated computer mathematical statistical modeling and then come out and crunch out some idea Idea that, oh, see, see, in this example, historically, at this time, in this place, when we change this one thing, but the problem is, there's no alternate reality to go to and test, right? It's not like we can go and test, oh, imagine Australia with a minimum wage of ten dollars versus Australia with a minimum wage of eleven dollars. Well, there is no, you know, it doesn't exist like that. And at best, what you can find is maybe like a so-called natural experiment, like let's say maybe two neighboring towns, maybe one town Another town has that other rule, but fundamentally it just-- that's the reasoning issue, that's the problem with the reasoning that I think an Austrian would take issue with that and say, \"Hey, actually, you're not reasoning from a priori, you're not reasoning in a" }, { "speaker": "conza", "time": "20:37", "start": 1236.8, "text": "deductive" }, { "speaker": "stephan", "time": "20:37", "start": 1237.32, "text": "way, right?\"" }, { "speaker": "conza", "time": "20:39", "start": 1238.68, "text": "And often the premise there for that, their modeling, it's with its mathem-- mathematical modeling or, you know, the premise of like, \"Oh, p-perfect competition\" or things that aren't, aren't, you know, real per se. It's, Mischa has a good point that there's, there's no constants in human action, and so there's always a, with the ma- there are these formulas, you know, it's, it's a, there's a human element to it, and, you know, I think, you, why do, why do we think in this method or like that would be more appropriate? So, and Mischa's have got this quip that he used to use in his lectures, it's kind of, you know, obviously the purpose of, the end of science is Sciences like slash social sciences versus natural sciences. And a good, you know, quip that Mr. Sorry, Mrs. has is to capture those difference between the natural sciences and the, the, the human sciences. You throw a rock in water, it sinks. You throw a stick in water, it floats. But throw a man in water, and he must decide to sink or swim. So he was not denying like, yep, the scientific nature of economics with that tale of human volition, but rather he's getting across the essential- Natural defining character of human sciences, and that must study man and his purposes and plans. and with the, the modeling and all that, it's like, well, there is no constant, you know, human action, you know, humans can adjust, to those tests and, you know, the models. Generally speaking, yeah, yeah, there's no knowledge to be gained from that, and there hasn't been, you know, in terms of the field of economics, the, the rich history, there isn't really any valid knowledge has been gained from, like, doing empirical studying and tests." }, { "speaker": "stephan", "time": "22:26", "start": 1345.93, "text": "Yeah. And I'm curious your view as well, because while we're talking about what actual economics is, what, let's say, the TV economics is, right? There's these macroeconomists who come on TV and basically these are financial talking heads. And so they'll get on and say, \"Oh, look, this guy's an economist, and he's from whatever.\" And can you explain how you're viewing that as opposed to how, you know, is that economics?" }, { "speaker": "conza", "time": "22:50", "start": 1369.59, "text": "Yes, it's an interesting one. Almost like trying to distinguish from, you know, another example is that, sorry, maybe it's going in, in, in many different directions here. So like there's, at the essence of it, there's theory and there's history, and so Misra's got a, he's got a book called that. Yeah. Yeah, exactly right. And one of his, most underrated ones, tends to be the, the name of it, but it, it, it kind of hits on the point that he goes, \"There's no such thing as historical method of economics" }, { "speaker": "conza", "time": "23:22", "start": 1402.13, "text": "History, the two must never be confused. All theories of economics are necessarily valid in every instance in which all the assumptions presuppose are given. Of course, there are no-- they have no practical significance in situations where the conditions haven't been, established. so the theorems referring to indirect exchange are not ap- are not applicable to conditions where there is no indirect exchange, but that doesn't not impair their validity. And what he's really getting at is that distinction. So when I-- here then has a little quip about Milton Friedman. And so he's asked about, you know, or what, you know, almost what do you think of, you know, Milton Friedman as an economist, and he's like, he's, he's not an economist, he's a, he's a historian. And so like statistics, modeling, all that stuff is, you know, history is, is economic history. So Milton, from being a positivist or empiricist, you know, that going back to that fundamental distinction before about, and what's a priori, what's, you know, what's a So it's like focusing on that, distinction there's the human sciences, one that's got a valid method, and then the natural sciences with a different valid method. It's a scientific method for the natural sciences and particularly when it's like for universal laws and in human action, you know, praxeology, which is the logic, and science of human action is, a massive player. So where Freeman isn't that, so it's, it's almost, it's hard to distinguish where, yes, like, okay, maybe they're in the economics profession You call them like they're not economists, doing economics, and, you know, the distinction, so Frederic Bastiat also has a, a good, you know, quip around, you know, the good economist and bad economist. The good economist see the whole picture, so it's the seen and the unseen, and you have the bad economist, which is basically all of them, who will call themselves that, where they focus on, you know, very minute kind of like hyperspecialization in one particular area, and they give it all these different- Names, yeah, institutional economics, whatever it is, historical method economics is different stuff that really isn't applicable, and it's just looking at one, you know, from the scene and not, not understanding the whole big picture, the, the unseen as well." }, { "speaker": "stephan", "time": "25:35", "start": 1534.98, "text": "Right. Yeah, because there's a big world out there in terms of what could have been, right? The unseen, or I believe, Per Bylund also has a book, kind of trying to explicitly call that, that out as the unrealized. That's another example, right? Like we can imagine, okay, imagine That monetary intervention, what kind of world could we have had? What kind of businesses would have been created? What kind of jobs would be there? What kind of technologies would have been invented? What kind of prosperity would we have had in this unrealized world that we unfortunately didn't get to see because of government intervention? And so I think that's an interesting way to think about it or at least clarify and understand. Now, that's not to say there aren't market commentators who maybe have, you know, an excellent knowledge of the market of, you know, the gold or the copper market or the oil- Oil market or something, things like this where they are very intricately familiar with, you know, the market for oil around the world or something like this, and maybe they can offer an interesting comment because they have good knowledge of that. But at the same time, the whole point of all this stuff is that we need prices. Well, firstly, we need private property rights, which give us exchange, which gives us prices, which reflects a lot of the information in ways that no one human mind could have done, even if you were some super genius." }, { "speaker": "conza", "time": "26:51", "start": 1610.89, "text": "Yeah, absolutely. And, yeah, prices are, it, you, you nailed it when it's like the private property rights a- angle, like you need property, before you can get prices, and it's, yeah, some, some really good, interesting exchanges you can now down there where people might, you know, reflect on prices as like the, the signal and it's a-as a, the communication mechanism, and Holzman Guido goes into it, fairly well where he's like, it's not actually the, which talks about bigger- About bigger point we could talk about that, but in terms of, misconceptions, you know, metaphors and analogies where pricing, it's, it's more the anticipation for entrepreneurs anticipating how much, you know, they can get. there's a historical price that is, it's, it's historical, it can potentially help inform, but there isn't necessarily any direct connection to prices that, you know, will abide by in future and the entrepreneurs will put in place to try and get their products. And so like, you kind of now- down whether it's a, there's a Hayekian, Hayekian kind of notion, around what is communicated by prices, and it's like, he's like, no, it's not so much that, it's more the, the existence of private property, which is the, the kind of bedrock of it," }, { "speaker": "stephan", "time": "28:05", "start": 1684.68, "text": "the necessary precondition, if you will. Absolutely. So let's get into that. You were talking about this idea of misconceptions, so this is one topic I wanted to hit, is I think in the, let's call it Bitcoin Twitter world or kind of podcast circuit Sometimes that's because people are making analogies, and I understand sometimes that's useful to spark the curiosity in somebody. Like, let's say somebody isn't in this world already, they're not interested in Bitcoin, and if maybe you make some analogy and it pulls someone in, it, it kind of, it energizes them to think about it. But then the downside could be that it's imprecise and, and then it's leading people in a wrong way, like, you know, the map isn't the territory, right? So there's this idea that they're kind of, you kind of From your perspective, what are some of the common Bitcoin misconceptions that you see?" }, { "speaker": "conza", "time": "28:56", "start": 1736.13, "text": "Yeah, great question. And before I dive into another tangent, it's, the essence of why-- and I'm, I'm, I get, I can be appear to being, being hypocritical or very-- I have a preference for accuracy or like I appreciate it, and partly that, the reason for that is, yes, there's this Bastiat quote, which is the worst thing can happen to a movement or a good cause is not to be skillfully attacked, but ineptly defended. offended. And absolutely, yes, like metaphors, you know, analogies, there's, there's a value to that, certainly, you know, piquing interest, but there's also a risk where, you know, maybe if someone hasn't done the work per se yet and understand, oh, that's like, that's a good way of, you know, framing it or trying to pique that interest, but then they take it literally, and then there's, you know, some maybe things aren't so good that come from that. Just on the terminology, like the benefits of using clear terminology, you know, as an essential to understanding. So, Bombalwick, so, yeah, early Austrian, student of Menger, the founder of Austrian school, he kind of goes on, you know, for, and since, for it would be an absurd undertaking to banish from the language of economic theory every manner of speaking that isn't literally correct, correct? But it also would be sheer pedantry to prescribe every figure of speech, particularly since, we could- Could not say the hundredth part of what we have to say if we refuse, if we refused ever to take recourse to a metaphor. one requirement is essential that economic theory avoid the error of confusing a practical habit indulged in for the sake of expediency with scientific truth. And ironically, in his memoirs, Mises also accuses von Boehmberg, in, in their dispute over cantilever effects, of being led astray by the idea of friction, and other metaphors from the physical sciences. But so there's a few misconceptions, with that, with that disclaimer out of the way, yeah, there's a few we can kind of nail, nail down. Now we don't wanna tackle them later on, but obviously the, the Bitcoin is violence one is probably the, do we say the best to last? There's, you know, Bitcoin is energy, which we can kind of go into, you know, it's digital energy. Bitcoin is stored time. so there, there's a few there. And I know there's other misconceptions, you know, maybe Recoiner perspective, like where there's the usual fud, so fear, uncertainty, and doubt about talking about, you know, thinking a whole Bitcoin is all that is, there's no sats, not, you know, a hundred million, not aware of that. Also, not gonna focus on the misconceptions from a technical perspective. I know there's some good points about, you know, it's not like a wallet, it's more of a key-- instead, it's a keychain, that's a better framing as opposed to wallet. You know, miners are chronologists instead, and Chain, but yes, we can get particularly about any of those, but I think, no, that's been handled a lot better, a lot of those everywhere else. But specifically on, on some of these, misconceptions, yeah, where would you like to start? Yeah," }, { "speaker": "stephan", "time": "32:03", "start": 1922.96, "text": "sure. So I mean, I think the stored time one is a good one to talk about because I think we'll kind of get into like, what is money? Why do we hold it? And what more precisely is it, as opposed to this idea of stored time. Now, to be clear, we" }, { "speaker": "stephan", "time": "32:19", "start": 1939.21, "text": "Time is not about this idea. I think I've seen other people though put out this idea and sort of promulgate this analogy that, oh, it's kind of like you can store your time with Bitcoin. And it's like, it's an overly loose, imprecise way of framing it. So what's the issue with this idea of Bitcoin as storing your time?" }, { "speaker": "conza", "time": "32:39", "start": 1958.58, "text": "Yes, and that's it. It goes like, it's interesting because it's all about trying to economize, right? Like economizing time. So like, okay, people talk about saving time, and it's It's interesting because it's not time itself that can be economized, rather it's like the attitude of how to spend time, you know, choosing this way over that way. But yeah, it refers, which really more refers to the content of action and experience, experience in time rather than time, you know, to the time itself. So time itself really is, is, it's like a given fact which can be addressed in different ways but never altered. You know, it's the ultimate basis of preference. So like the preferring is in the how The where, the doing, you know, of what, the with whom, of how to, quote unquote, spend time, but it's spent somehow and, and how that And how that somehow is the sphere of choice and, you know, human action. So there is that. So in a way, it's also, it's not really economized. You can't economize it directly. You know, the easiest way to think about this is go ahead, try not to spend some time and save it for later instead. right? You can't. So, yeah, yeah. So it's like nailing down that, but all this talk about saving time is obviously metaphorical. None of this does any actual effect on time. You know, it's passing, but all it is ever gonna do is pass, and that's inalterable, but the risk is treating it as a resource, and that-- and you have seen similar, yes, that Bitcoin is a quote-unquote, a claim on time, and, yeah, so like I, I think it's like linked to, obviously, like a almost Bitcoin, a timestamp server is one way it's been characterized, is, is like there's a link, there's a reference to time, obviously, you know, difficult adjustment, it's a layer versus in the economic layer." }, { "speaker": "stephan", "time": "34:31", "start": 2071.37, "text": "Gotcha. So, so let me, let me try to frame this then. So the, the typical way it might have been framed is this idea that, \"Oh, look, see, you work so hard for, for your fiat dollars, and those dollars are going down in time, and then it's kind of framed like, \"Oh, see, why don't you save your time with Bitcoin? \" Right? Like this is kind of-- And it's sort of like, it's imprecise in, in a few ways, right? Or at least, Right? Like we think of it as the most sale-- that's the way Menger explained it in the Origins of Money back in like 1871. And so, but the thing is, money doesn't have a stable purchasing power. So you can save money, and we can, we can, we can analogize to the idea of store of value. I think most people are comfortable with that idea, but I think the danger might be that if you thought that you could store your time in Bitcoin, it's not gonna-- like, let's say I store my time into Bitcoin," }, { "speaker": "stephan", "time": "35:30", "start": 2129.87, "text": "Of like what that will be in twenty twenty-five or whatever, right? Like we just, we just don't know that because the purchasing power-- and even if you think in terms of purchasing power, that is changing all the time too. So that's how I would critique that" }, { "speaker": "conza", "time": "35:42", "start": 2141.9, "text": "notion. I'm curious how you would. No, you're absolutely right, and it's very close to the Bitcoin as energy angle where it's like Bitcoin is digital energy, like Bitcoin allows you to store energy over time or transport it from one place to another. So that similar conmonica is very close to, I think I think of the storing of, of time, like it's just the different resources being referred to instead of energy, you know, it is, you know, time. And there's a few memes to that digital energy piece as well. So, I mean, if we kind of slightly segue into that, like Bitcoin obviously doesn't allow one to store, transport, or transfer energy, of course. Although, yes, absolutely, miners use energy to create Bitcoin, but they, you know, cannot convert that Bitcoin back into energy used to create it, at another time or another place. Place. So the energy used to create Bitcoin in Sydney today, cannot then be used to heat a house in Sydney next year or a power a stove in Melbourne today because it was used, already used to create Bitcoin in Sydney. There's no getting that energy back now, right? We, I think that's fairly understood, but it's, it's recognizing that Bitcoin miners might use energy that might otherwise would have been used, so recognizing that fact that Bitcoin is, miners use, might use energy that otherwise would have been wasted elsewhere. doesn't change that fact. And that kind of does dovetail into the, the Bitcoin is a battery meme. And so there's a, there's a great article that, of the same name essentially, \"Bitcoin isn't a Battery\" by William, Luther. And like, yes, it is a metaphor, and yes, energy is used to create Bitcoin, but they can spend that Bitcoin at some point, and yes, it can be used to be spent in the future that energy is put in, but you can't get that energy back out directly. But it's, it's again that, Energy, rather, you could, yeah, like, I think stores value, but value is subjective, and so there's like an almost slight danger in that as well. But the na-the name, the name kind of like leads, many to believe that the source of Bitcoin's value is the energy used to create it, which kind of goes into like cost theory of value, so like where, you know, good cousin of the, the labor theory of value, where it's like, well, like that's why, you know, that's where Bitcoin gets its value from, and that's-- A bit where you should, as a general rule, you know, never reason from cost to value, it's the other way around. You should always reason from value to cost, which should be obvious. Yeah." }, { "speaker": "stephan", "time": "38:09", "start": 2288.66, "text": "And also related, I think it'd be good for you to touch on this, is this idea that, oh, like, and I, I can understand where this comes from, right? So the argument might come, some, like, the no coiners will say, \"Bitcoin isn't backed by anything,\" and then the bitcoiners, the some bitcoiners will say, \"Oh You know, like there's no central counter that I can take my Bitcoin to and redeem into energy. Yes, I can use Bitcoin to buy energy, but I don't think it's precise to say Bitcoin is, you know, backed by the energy consumption or the miners, right? In that sense." }, { "speaker": "conza", "time": "38:43", "start": 2322.58, "text": "Yes, and it's almost like-- So this when we kind of get to a point, point of how do we categorize, categorizing Bitcoin, from an Austrian or from-- I think, which I think is the best way to do it, is a rivalrous digital commodity, on To your point, it's like, what's, you know, another talking about a, a, another commodity, so like, oh, what's co- gold backed by? Well, it's like, it's the commodity itself. Like, i-it is the, and so with Bitcoin, it's not a claim on something else, it's not, you know, credit money, it is the rival dig- rivalrous digital commodity itself. And yeah, asking what's it backed by kind of indicates you don't understand what it is. I, you know, which is what, obviously, You indicate to, to refer then to the energy, like, yes, that is, you know, an input into it, and there's a cost involved with that, but it's still, you know, ultimately, talk about Mises' regression theorem, there, where it's traced back to, at certain point, in terms of a commodity, you know, its origins as a medium of exchange, you can trace it back and, and I think Conrad Graf's take is eventually, it convinced me what was the, the best, it's actually Bitcoin's the best example of Yeah, and" }, { "speaker": "stephan", "time": "40:01", "start": 2401.09, "text": "I think he really squared the circle really well back in twenty thirteen with that on the origins of Bitcoin. yeah, but, but go back, sorry, go back to your" }, { "speaker": "conza", "time": "40:08", "start": 2408.02, "text": "point. Yeah, so elaborating about like summarizing, so cat trying to categorize Bitcoin, so yes, the top line summary, I think it's like it's a rival, it's a digital commodity on an open source monetary network, but Conza kind of goes through as a, you know, one, yes, it's like, it's an economic good, two, it's a rival" }, { "speaker": "conza", "time": "40:29", "start": 2429.45, "text": "Kind of elaborate that so like a, define a non-rival good is a good that is copiable with perfect remainder of the original and usable by multi-usable by multiple actors simultaneously without mutual interference, and then a rival good, so like, yes, the blockchain, essentially like, you know, it's, but a rival good is a good that is not copiable with perfect remainder, that's not copiable with the perfect remainder of the original and isn't usable by multiple actors simultaneously without mutual interference between physically incompatible- uses. And it's the b-- in the broad economic sense of the word scarcity can, can encompass both rival and non-rival goods. But yeah, so kind of it narrows that down. And then three, it's a type of rival good known as a commodity, as we've elaborated. And then four, it's a new type of commodity called a digital commodity. And then five, which is really is, it's a digital monetary commodity, with unprecedented monetary characteristics. And yeah, it kind of creates like an almost new asset. Asset class, but there is a, a very handy image from Guido Holsman's book, A Theory of Money and Fiduciary Media, that Updates, a theory of money and credit in terms of there were some mistranslations for Mises' book, and so like credit, theory of money and credit, credit really should be probably translated to fiduciary media, we can kind of go into that a little bit later, but there's a lovely chart there that maybe we'll have in the show notes, or I can try, try describe, but within that, it's kind of a taxonomy of, of money, and we get to very specific breakdowns of, of where Bitcoin sits, and you've got like commodity There's the precious metals and then below that there's Bitcoin, which is kind of a rival as digital commodity, it's new, on the scene and, and, but I think it's the most accurate way to categorize it." }, { "speaker": "stephan", "time": "42:21", "start": 2541.06, "text": "Back to the show in a moment. Build on L2 is a community for Bitcoin builders by Blockstream. So this initiative, it's a community led effort by contributors and companies building on Core Lightning and the Liquid Network. It's an interactive community platform. There will be builders ranging from product managers, designers, engineers, testers, all coming together through events. And there'll be a mentorship program to fast-track success or simply explore the community space to learn something new alongside other Bitcoiners building the future of Bitcoin layer two. So sign up now, you can get early access on the platform. The website is buildonl2 dot com. That's L and then two, the number, dot com. When it comes to Bitcoin transactions, mempool dot space is my favorite Bitcoin block explorer. It's a multi-layer ecosystem and mempool dot space is helping show this. You can see mempolls, you can see the blockchain And you can see the second layer networks like Lightning Network and search the Lightning Network as well, so you can see what Lightning nodes are out there, what fees they're charging, you can see the on-chain UTXOs that relate to those Lightning channels also. So it's very comprehensive. With Mempool.space, you don't even have to trust a third party, you can host it yourself. And if you're with an enterprise, Mempool.space offers custom mempool instances with your company's branding, increased API limits, and more. It's a very popular block explorer, arguably the most popular in the community Exposure there. So go to mempool dot space slash enterprise if you're interested. And finally, Unchained Capital, they are helping you with multi-signature to secure your coins and remove single points of failure. Now, for the time period coming up to the 25th of December, they are having the possibility to gift concierge onboarding. So if you have somebody in your life that you want to help make sure they are controlling their keys, Unchained can can let you gift the concierge onboarding program where they will do a call, they'll ship the hardware, they'll teach And withdraw into your own multi-signature vault. So this can give you that peace of mind and help you remove single points of failure. So if you're interested in this program, go to unchained dot com slash concierge. And now back to the show. Yeah, I think you're right, and I think it's important to get that classification correct, because I think if you do-- if you get that classification wrong, there's all these downstream errors or knock-on errors that happen from that. So for example, I agree with people like, let's say Michael Saylor, who would categorize as securities. Like I think they qualify more like an equity, but the reason is Bitcoin, like Bitcoin is different because it's, it's, it's trying to be money, and it's a specific kind of money, right? So for example, when you hold Bitcoin on your own keys, ideally verified with your own Bitcoin node, you just have so much more certainty about that, that you know for sure it's not an IOU, it's not a money certificate, it's not, you know, it's, it is the thing. And I guess it's so hard to convey that, right But how would you like, you agree, disagree, or how would you, how would you put that?" }, { "speaker": "conza", "time": "45:15", "start": 2714.78, "text": "Yeah, absolutely. Like, a-and very much the distinction, there's Bitcoin, you know, it's a, it's a rival digi-s, a rival as digital commodity, and looking at that framework, it's, look, there's money in the broader sense, and then there's, which we can kind of speaks about, you know, it's everything under the umbrella of there's money in the narrow sense, and then there's the, the clear-cut distinction there is money" }, { "speaker": "conza", "time": "45:41", "start": 2740.9, "text": "In a narrow sense, you've got commodity money, there is credit money, and there is fiat money under that. But then under money, money substitutes, that's where, so like historically, you've obviously got the physical gold, the commodity money, but then money certificates would be like the piece of paper that's backed, say, a hundred percent bank deposit would be, you know, the money certificate, it's, it's meant to be one to one, and then within the realm of money substitutes, there's also money certificates being a hundred percent backed, and then you've got Fiduciary media with a categorization is that it's not backed, you know, freely at face value. So essentially, the definition of money, FTX Bitcoin, it's exactly right. FTX Bitcoin, yeah, is fiduciary media. And exactly right. And it gets into, there's the free bank, quote unquote free bankers, and, gammon, and then there's a variety out there that, like, and even a Bitcoin magazine article posted recently about how the answer is to, to, I guess the The, the free banking, trying to, to jump on that bandwagon and like it's necessary, you need a growing money supply to, you know, for, for, for civ- for civilization, which is nuts. But just spit back on, yeah, Fiducia, exactly right, like FTX since, and when you're, the, the whole point of, of Bitcoin is to remove trust and one of the whole point, a bit, a large point, like the, you're trusting, you know, financial institutions and with centralized exchanges, exactly like FTX, you know Others. It's, there's that risk that you're either at best gonna have a, a money certificate, so some maybe could claim that where it's, you know, all the customer funds one to one, you know, a hundred percent, backed. And then, yeah, there's the fudi-fiduciary angle where, hey, that looks like you've got Bitcoin, it says you've got Bitcoin, but unless, yeah, as we know, you're not your keys, not your coins, and, and you know, if you don't have full control over that, True media, it's n- backed by, it's doesn't, there's no real reserve there, it's, it's just, essentially, what is it? It's, you know, a money substitute freely accepted at face value, which consists in claims to payment on demand for specified sums, but it's in excess of those reserves. So there's a few things there, but it's like, yeah, you're really risking it not holding, like, why wouldn't you hold the asset yourself?" }, { "speaker": "stephan", "time": "48:07", "start": 2887.41, "text": "So I think on this point, I think it, it would be Does it, in your view, does it come down to a debate then on, like, let's say, whether that exchange is full reserve or fractional, whether it is a money certificate or whether it is a, whether it's fiduciary media, right? So as an example, if, I mean, the debate is going, is raging now about Binance, is Binance fractional reserve? Are they, you know, so would you qualify that then as a bank deposit or a money certificate? Like, let's say you, let's say you deposit one Bitcoin to Binance, and I I deposited one Bitcoin with FTX, well, sorry, bad luck, it's Fidelity Media, like they clearly have, you know, they were running some kind of Ponzi or fraud operation. But in the case of, let's say, a Binance, does it turn on whether they actually have the coin?" }, { "speaker": "conza", "time": "48:54", "start": 2934.2, "text": "Yeah, great question. And it's certainly, you know, I've had these discussions, with some fractional reserve, proponents, free banking proponents who look at, like, striking the root, okay, what's in the contract, but this is the, the So, speaking with some of the fractional bank, I was like, \"Yes, FTX, like a clear-cut example of, you know, there's rehypothecation, like the contract stating that they, the customer funds are theirs, and then they've gone and violated that essentially and committed fraud, and, you know, loaned out more than they don't, that they don't actually have or sold, but that they, you know, Bitcoin that they don't actually have.\" And so, yeah, it's, it kind of comes down to, yeah, really, And even with that, say banks, so like the, the current banking establishment, right? so fractional reserve banking, you know, has been in full effect for, for, for, for many, many, decades. It's even then, customers who have, say, signed the contract, there's a good study, a empirical study that looked at in, in the UK banking, and, you know, polled, you know, ten thousand people, and the question was several, it's like, do you, you know, do you think you own the funds in" }, { "speaker": "conza", "time": "50:11", "start": 3010.92, "text": "Yes, absolutely, that's my money, like a demand deposit, like that I can, demand my money back at any time. It's like, it's like a savings account essentially. And then the other contrast, given this debate, is a term deposit, where, like, yes, there's no problem if I agree to contract, I give that to the bank, and I know I'm not gonna use it, and there's a certain period of time they can loan that out. There's nothing wrong with a term deposit or time deposit, but where the fraud comes in with fractional banking," }, { "speaker": "conza", "time": "50:41", "start": 3040.92, "text": "I'm just a savings account, it's my money, I'm, you know, I own it, I can control it, they can't loan that out. But on the contract, in the current state, the, the state has essentially enabled this kind of fraud to, exist, given a state approval, and that's like essentially the, the modern banking system, where they can take people's impressions of ti- term deposits or like their de-mi-demand deposits, sorry, their, their money, and the banks then can lend it out willy-nilly. And so looking at FTX and exchanges, like, okay, specific probably what is on the contract, but absolutely I, even after Rothbard has equipped, even after months of him, you know, dran-drilling into his students that, you know, the bank, given the banking system is like, it's not there, like, it's not your, it's not yours, like, e-essentially, people still think and feel that it is. So it's a hard thing to, to overcome, but the real solution is like, again, it's a-- there's a trust element Things like Bisc exist, you know, decentralized exchanges that are still on chain and verifiable, non-custodial. I do think there is a, a, a spectrum. So obviously there's, you know, institutions that allow auto withdrawal, that, you know, they're gonna be, that, you know, they're gonna be far better than, you know, the old, o-others alternatives, you know, so there's a less risk, you know, potentially, but yeah, there's, there's a slight spectrum. It's either, but within that, like, yes, the Or, or fully backed, maybe it's multi-sig signature, it's there, you know, verifiable. Then there's the, the zero percent tokens in fiduciary media where it's not. and I, more often than not, I, I'd almost-- It's, it's not. And partly this is as well, you see, you see some of the pushback, you know, Twitter like, \"Ah, you know, it's why people giving you notes FUD on Binance or whatever.\" It's like, no, like if it's actually there For me with, you know, either withdrawing or, you know, they're gonna come back on, you know, if, if there's, they're, they're solvent, it's, it's not, it's a non-issue. But if they are insolvent and the, there's a run on the banks, you know, the, that, that's certainly an issue, and you don't wanna be the last person, you know, in that line to get your funds out or hope that, that they, they are there." }, { "speaker": "stephan", "time": "53:03", "start": 3182.61, "text": "Yeah. Or your funds." }, { "speaker": "conza", "time": "53:05", "start": 3184.97, "text": "Yeah. Well, yeah" }, { "speaker": "conza", "time": "53:11", "start": 3190.92, "text": "Yours, it's not Bitcoin, it's, paper Bitcoin, it's, you know, almost like, say, oh, an example like, Binance B dash BTC, you don't have Bitcoin, you, unless" }, { "speaker": "stephan", "time": "53:23", "start": 3203.38, "text": "you've got the" }, { "speaker": "conza", "time": "53:24", "start": 3203.78, "text": "keys." }, { "speaker": "stephan", "time": "53:24", "start": 3204.47, "text": "And I think this is an interesting point as well, because this is where the fractional reserve comes in, right? Is it, particularly if those fiduciary claims trade around and circulate in the economy as though they were Bitcoin. And I think that's probably the crucial thing, and I was- We've spoken about this on the podcast many times, even with Michael Goldstein and others, but that's the crucial thing, that let's say a Kraken Bitcoin isn't treated the same as an FTX Bitcoin, as a Binance Bitcoin, as a Swan Prime Trust Bitcoin, as a-- like each of those things should be treated separately, as a Mt. Gox Bitcoin for what it's worth, right? Like each of those things should be treated separately, and Bitcoin that you hold in your own wallet is actually Bitcoin, right? That you have self-custodied, and I think that's an" }, { "speaker": "stephan", "time": "54:11", "start": 3250.94, "text": "Now, I think this is like the full reserve case, let's say, that these fractional reserve casinos don't survive long term without a bailout, without, you know, daddy government coming in to bail them out." }, { "speaker": "conza", "time": "54:21", "start": 3261.44, "text": "Exactly right. And, and that was, you know, question posed in the, the Mises seminar, Australia group, and one of the, the, the gents there going, \"Well, we used to have these epic debates, frac-reserve banking, like, you know, it's almost a, a, a dead horse you have to beat, like" }, { "speaker": "conza", "time": "54:41", "start": 3280.92, "text": "Hashing those things out, but it was almost like this is a use case in essence of the, you know, quote-unquote free market, the, you know, the wild west, if you want, with, with crypto, and, and not so much state intervention, yet. And what have we seen? Like these exchanges, they don't last long. Like there's a run on the banks, and Rothbard used to talk about like having like anti-bank vigilante leagues where people would encourage, like, hey, you know, oh, this bank, you know, doesn" }, { "speaker": "conza", "time": "55:11", "start": 3311.0, "text": "Yeah, yeah, bank runs, and similarly here, we can see, well, I guess at the beauty of the internet, that can happen a lot quicker and faster, but it's, again, yeah, if you don't-- There's nothing wrong if it's actually solvent, like those funds being withdrawn, and it's the system, you know, indirectly cleansing itself, like shouldn't happen to begin with, and that's why I'm a big, yeah, proponent of BISQ, and like things like that where there's that non-intrud-- You know, what Bitcoin does with exchanges, essentially of separating that need for, for trust. So, yeah, hold it yourself, you know, no, there's, there's nothing but risk for, I think much more risk than, you know, keeping it on the exchanges. Yeah. And just" }, { "speaker": "stephan", "time": "55:57", "start": 3356.95, "text": "more, maybe more of an academic point, but I, I'm curious if you view something like LBTC as a money certificate, because this is a system where you can verify every Bitcoin that has gone in. So if you can- So, oh, whatever, let's say there's a thousand bitcoins locked into liquid, and LBTC is controlled by multisig, so obviously it's not self-custodial, it is controlled by that multisig of the federations basically. But I think fundamentally it would count as a money certificate, right? Because we know one hundred percent you can, like one hundred percent it is verifiably backed by Bitcoin. So each LBTC is a money certificate for one Bitcoin." }, { "speaker": "conza", "time": "56:36", "start": 3395.59, "text": "Yes. I'd say yes. So money, like under the categorization, yeah, categorization, and you got money Certificates, and then within that, yeah, it's, it's a, how is it being treated on the market essentially? And so I think as a con-contrast, LBTC was a liquid with, say, Lightning, and I think Lightning is operating on a one-to-one, you know, with Bitcoin. So you got, in this framework, you got on the, the, the money in narrow sense, Bitcoin itself is, you know, the, the rivalrous digital commodity, it's, it's on the far left there, as a Commodity money, yeah. and then you have within the money substitute side, the, the, and then specifically money certificates, then a new category which would be Lightning on its own, where it's one to one with, with Bitcoin, essentially, you know, Lightning is essentially is, is treated as Bitcoin. Now, LBTC, I think is maybe just because of that trust element, right, the federation, that slight objection, yeah, i-is, is why it might not be as one to one or maybe- Is not getting such play and treated as, so like for anyone asking themselves like, \"I could have Bitcoin or kind of Lightning,\" it's like, \"Yeah, sure, right?\" Like it's, you know, there's no real feeling of objections there really. And then, we have Bitcoin or, you know, LBTC, you know, maybe there's some very, you know, niche use cases or like, you know, traders or people who are like, \"Oh, yeah, absolutely.\" But for the vast majority of folks, I think it's like, \"Uh," }, { "speaker": "conza", "time": "58:11", "start": 3491.32, "text": "Yeah, as a money certificate, you know, maybe it's like still that, quote unquote, hundred percent bank deposit piece, but there's like this, this newer or the, the category of lightning, I'd probably put it slightly different where it, where it is currently being treated as one to one." }, { "speaker": "stephan", "time": "58:24", "start": 3504.38, "text": "Yeah, right now, look, at the end of the day, what we hold, when I hold, when, let's say I have a lightning channel with you, what we really hold is a pre-signed Bitcoin transaction, it's a valid pre-signed transaction that we can broadcast to the network" }, { "speaker": "stephan", "time": "58:39", "start": 3518.67, "text": "to And confirmed in the mempool. So, I mean, theoretically, it probably just counts as the same as Bitcoin on chain. It's just there is a security tr-trade off though, there is an aspect where you need to be able to get that transaction confirmed, you know, hypothetically. So that is there, but, you know, I think it's" }, { "speaker": "conza", "time": "58:56", "start": 3535.93, "text": "probably fair to say it's what the market's treating it as, and for most people, yeah, it's, it's one to one essentially. If it's seen" }, { "speaker": "stephan", "time": "59:02", "start": 3541.93, "text": "as interchangeable, yeah. Although that said, I mean," }, { "speaker": "stephan", "time": "59:07", "start": 3546.85, "text": "there are Like that, maybe that's more of like the operational aspect of having to swap between on-chain and lightning or kind of the liquidity flows and being able to, you'd like paying, you're, what you're paying for is that certain liquidity or certain channel, being open to you from this direction, let's say. Yeah. So maybe a bit more complicated. But, okay, so let's move on. we got to chat about, this whole, you know, Bitcoin is violence or I think he, he has, shifted away from that term" }, { "speaker": "stephan", "time": "59:41", "start": 3580.9, "text": "Bitcoin as a weapon. So what do you think about that?" }, { "speaker": "conza", "time": "59:43", "start": 3583.38, "text": "Yes, look, it's, ideas are important and, and like, you know, there's a, it's the narratives set the fr- setting the frame is such a, a big, big thing in terms of like movements and how things are, are characterized. Look, I'm, I'm not going to, I was gonna try and start a clip, there's this like Rothbard on Keynes, it's like a thirty-second clip and it's like, look, this is a preemptive strike He's like, \"Oh, I'm using an ad hominem, \" and it's like an ad hominem argument, it's like obviously attacking the person. And he goes like, \"And this is a clip he's talking about Keynes, \" he's like, \"No, first, you know, I'll attack the arguments and then the person. \" And there's a, there's a lot of laughter and chuckles. But look, so my, my approach is obviously like being intellectual, honest, honest and open to reason. And, you" }, { "speaker": "conza", "time": "01:00:34", "start": 3634.77, "text": "know, there's a very-- So we'll He sees the, the certain individual, sees, sees things, in, you know, through the lens of violence or like, you know, Bitcoin being a weapon, but yeah, I, I think there's, I'm being very heartened by the plebs in terms of, you can, who've done the proof of work essentially, like proof of work from them understanding Austrian economics, praxeology, those who've done that work Get it, and they can see very easily how, you know, it's an obvious attack vector from the state to cat-- like for it to, or at least setting that up, you know, even whether the intentions are that or not, but that being the, the consequence, you know, almost inevitable consequence, of that narrative. so yeah, completely absurd, and really it gets to, you know, we can talk about, you know, we talked about epistemology, like going from first principles, his, you know, in the, Indicated that's what he's doing, but it, it's, we know that's not the case, so it's very, you know, scientific approach where, you know, appeals to physics and it's like that's, you know, there's no use for economics, you know, quote unquote, doesn't work. and look, you can try and get benefit of the doubt in terms of, if he's referring to economics and, you know, what we've previously critiqued isn't economics, but it's not, that's not approach for the social sciences and natural sciences. And what he does is often, like, you know, partly of what this line, you know, framing it as violence or as a weapon, it blurs the line between voluntary and aggression, and, you know, he uses a physics definition of force, but then conflates that with, you know, within the realm of, of human sciences, and so we can kind of, there's the epistemological approach, which is like the foundations are essentially in- Invalid and it's like everything that kind of goes on top of that, you know, we, we can dress like, address and like whack a mole a little bit, but if it's like your, your premises are incorrect, you know, invalid, then so are the arguments built on top of it. And that's partly a little bit of like, you know, there's, there's a great clip from Hopper, it's about how to talk to, address Paul Krugman, right? And it's, you know, we don't-- The trouble is you shouldn't get into technical" }, { "speaker": "conza", "time": "01:03:03", "start": 3783.44, "text": "To a child, like, how does, you know, increase in the m-money, you know, pieces of paper in society, you know, for money, you know, increase society's wealth? And similarly, a little bit with, with, with this is the, the narrative of Bitcoin is violence. It's like, how is running a node, like, you know, choose an individual action, voluntarily choosing to, you know, adopt a savings technology or a rivalrous digital commodity, you know, mining that, like, It's just absurd, on the face of it, and I know a lot of supporters are, you know, of, of his or his, I don't think have done the work, the vast majority, I, I think, if you-- they hear this narrative and it kind of makes sense, but when you do have the backing of, you know, the Austrian School and Praxeology, you can kind of see quite clearly that the premises aren't, aren't there, aren't valid." }, { "speaker": "stephan", "time": "01:03:53", "start": 3833.46, "text": "Yeah. So he seems to be making this idea that, oh, see, Protection and this idea that somehow, you know, that's gonna help stop the government from stopping Bitcoin or intervening in Bitcoin, and that, you know, he sort of goes down, he seems to have been going down this pathway of saying, \"Oh, but governments are gonna do mining somehow.\" And to me, it just seems like I saw that actually Safteen had a good thread on this also, because he was saying, \"Look, mining is a business like any other, Bitcoin mining, to be clear, it's a business like any other. There's not a specific reason why a government would need" }, { "speaker": "stephan", "time": "01:04:31", "start": 3871.24, "text": "It's not like you're just, you know, you're, you're mining, it's kind of like the overall network is being chronologized, let's say, you're kind of helping chronologize or, help the validity of transactions as opposed to the security. So it's not like some particular specific country has to mine in order to defend their own transactions or like, it doesn't really work that way. And I think it's more precise to think of it as the node is what's defining the validity and the security of Bitcoin as opposed to mining, right? So I think that As well. So that's kind of a high level of how I've seen his arguments, but yeah, anything you wanna touch on there?" }, { "speaker": "conza", "time": "01:05:07", "start": 3907.37, "text": "Yeah, no, definitely. there's many, many. so we've talked about, yeah, the, the first principles piece and, and probably it's the frame that he-- so it's like obviously the coming, coming back to that simplified approach of like, there's political means versus the voluntary means, you know, kind of goes back to Oppenheimer, but it seems like he's got almost a, it's a, it's a And look, it's almost a, a might is right, which is Ragnard Redbeard's kind of take, and Hopper gives a good breakdown of this. It's like you can give two very different interpretations to that statement. So, you know, obviously the first one he goes is, you know, there's, I know the difference between might and right, and as a matter of empirical fact, might is in fact frequently right. in most, if not all, public law, for instance, is might masquerading as right. And then he's The second interpretation is like, \"Well, I don't know the difference between might and right, because there is no difference. Might and right is might.\" And it's, the interpretation there is, it's, he talks about self-contradictory, because if you wanted to defend this statement as a true statement in an argument with someone else, you're in fact recognizing your opponent's property right on his own body, you don't aggress against him in order to bring him to the correct insight. You know, you allow him to come to the correct insight on his own, That you do know the difference between right and right, like right and wrong, otherwise there would be no purpose in arguing. And so the same incidentally is true for Hobbes' kind of famous dictum that man, that one man is another man's wolf. In claiming that statement to be true, you actually prove it to be false. And that, like, as a zooming out, like, it's that, that kind of draws down, that strikes at the root of, I think, the underlying, you know, force philosophy that he lens, he looks everything through Everything. one, example is like part of the, there's a particular series he has which I, you know, there's a thread I, paints, paints, I was line by line essentially, Henry Hazlitt approach, to the fair of new economics, where it's like a line by line refutation of Keynes. Yeah. did the same take and look, one call out was he has Lowery saying, \"All law, the thing that predates all law, the military that exerts the power to establish, is essentially the, the Military exerts power to establish the rule of law. Contrast to, you know, Bastiat and property in law, it's like property doesn't exist because there are laws, but laws exist because there is property. So like he's got, again, flipped it completely around the wrong way, but also honing in more on that. So he talks about like an agrarian society, you know, and what he's really dancing around, not particularly aware of in his thesis, I think, is talking about the origin of the state and really whether it's exogenous, so conquest versus endo- endogenous or internally, and the answer i-is endogenous, it's internal, so how the states come about, and he erroneously claims exogenous or conquest. so Hopper talks about this best in Political Economy and of Ma-uh, Monarchy and Democracy, and he's like, \"Yeah, it's difficult to accept, but histor- historically, like natural elites, you know, you know, being around and with in terms of a monarchy, he's like, \"This is the f-the fundamental- Social, sociological insight, and that is that the maintenance and preservation of private property based exchange, exchange economy requires, as its sociological pre- presupposition, the existence of voluntary acknowledge, acknowledged natural elite. Now, the natural outcome of this voluntary transactions between various private property owners is non egalitarian, so he kind of talks about this hierarchy, with his elitist, but the issue is that, Over time, so these individuals who've got, you know, superior achievements of wealth, wisdom, bravery, and a combination thereof, you know, they kind of become a possessor natural authority. So when you've got a conflict between two individuals, hey, let's go to this independent third party. This guy is, you know, the kind of the first among equals, and he can give us his decision. And so over time, though, these heads of families, with long-established records of superior achievement, far sightedness, and exemplary personal conduct, that, that men go to for that Decisions or judgments of on, they then essentially have, you know, quoting, you know, having a essential principled approach to justice. But then what's happened is that over time, so monarchy as opposed to, so he goes on here, it's like in fact, the endogenous origin of a monarchy as opposed to its exogenous origin via conquest cannot be understood except for the, the background of a prior order of natural elites and then small but decisive step in that transition, to Monarch or rule, the original sin per se, consisted precisely in the monopoliz-monopolization of the function of judge and peacemaker. So like they've, you know, through their skills and talents, like become the go-to person in society, and then, you know, families and, you know, it's a tradition, and then it's become, they've at some point monopolized that, and then from ever, for a, for a, so moving on from that, you know, law enforcement became more expensive, you know, instead of being offered free of charge or as and then, you know, it kind of goes on to, how that eroded, and the issue, so that was like their downfall with democracy, so the confusion that it caused though prevailed, where people recognized that the problem lay-- they didn't recognize that the problem lay with monopoly, but they thought it was with elites, and nobility, and so then like, you know, democracy all about the people, you know, rising up. so yeah, he's got a lot to say about that, but coming back to-" }, { "speaker": "conza", "time": "01:11:00", "start": 4260.79, "text": "I don't believe, any of that is understood when he talks about like in a Guggenheerian society and the, the premises and the foundations he builds his, you know, kind of power projection thesis, it's, it's, you know, incorrect. But then even more than that, when, you know, there's, he talks about the chain of custody for these assets is written in blood, and there's like a, maybe add to the show notes so everyone's probably aware, there's this like little diagram he has, and it's, you know Gold, oil, equities, you know, none of those assets have a monetary premium. He, he specifically says every one of these assets carries a monetary premium that we defend with human lives, but yet none of those assets have a monetary premium anymore. Like gold essentially lost it, you know, we're not on the gold exchange standard anymore. You know, when I buy a house, you know, or, or some oil, like, not ridden in blood, like when that voluntary exchange, like, you know, you think, \"Oh, but what about Iraq War and whatever?\" Like, yep Texas, like so it's not a priori, it's not prior experience, like there's rights violations potentially in some of the stuff, but not at the level that it's just ingrained is, is what is the premise is. And yeah, so look, a-and then he also goes on about, when he talks about power, he literally means joules per second, you know, so where the question becomes like, okay, political power, like, and for him it's all about being able to plan ideas in other people so that they steer their joules, their energy. And it's like Okay, well, how much power does, like, what's the joules per second power of, you know, the POTUS, like, President of United States, or like a politician? Like, it's comical, but coming down to the sort of the Second Amendment argument, right? Like, it's, again, it's very clear he's not ready at Rothbard's Anatomy of the State, you know, or Ethics of Liberty, like, which talks about the inner contradictions of the state. It's almost you're destroying, it's a, it's a narrative. I really feel it For a rationalization for the Bitcoin as violence or it's a weapon narrative. Now, I can understand 'cause he's paid by the state, he is this, you know, state employee, that's his employer, like, he, he's, he can see everything from that angle. but out of the, out of the, the anatomy of the state and ethics of liberty, it's, you know, if you understand any of that, it's, it's pointing out like that the Constitution won't be able to keep government limited, you know, it's a monopoly, the Supreme Court, you know, selected by the same self-government, and grants the power, like they've been granted of ultimate decision making over, you know, all the political ends will favor always the, you know, a broader or a looser misinterpretation of the wording of the constitution, and as you can see, like, you know, like Sander's arguments, it's, it's been powerless, the constitution's been powerless to stop the growth of the state of the last two hundred years, like America's become the, you know, world's, you know, leading superpower despite, you know, the Bill of Rights and all that, and so- Putting, it's almost like you're destroying the na-- the narrative, or peaceful narrative around like savings technology on the pipe dream hope that you'll get a favorable court ruling from the, from state courts by state judges, pa-- who are paid out of taxes and like whose incentives are completely aligned to continue such a system they spent their whole life in and sworn an oath to, you know, serve, as you'll get a favorable outcome for Bitcoin, like, it's, it's absurd. but even on top of that, like from a libertarian perspective, the Second Amendment isn't valid from, you know, isn't valid from that, from that proper, proper point of view, in that you don't have a right to guns, what you have a right is to private property. It's like speech as well, this gets conflated, you get a First Amendment, you get like a right to speech, it's like, no, you don't have a right to speech, you've got a right to private property to hire, hire a hall, you know, and so yes, if a property owner, they, they can set the rules, or, you know, it's only justifiable, justifiable for them to set the rules on their property, if they don't wanna have any guns in their property, that's their right. Like, it's not necessarily wise, but, you know, you get this rich mosaic when you focus on private property rights and all these other areas where it's, it's a rich mosaic of choice, and so even just the, on the face of the Second Amendment argument appeal Yeah, it's, it, it's, it's, it's just, I find it incredibly hard to feel, to think that someone's genuine with that, I mean, I kind of understand, you know, you are in the military and that's your worldview, and, you know, he calls himself a spook, you know, he puts it out there, but it's almost like owning it, is trying to diffuse it, and even if his intent is genuine, and that's actually worse, it's almost like you're doing the Elite, you know, deep state for free, and I'm sure like, if, if, if you were, if you had like all these alphabet letter agencies, just think about, like, if you're trying to run a psyop, which we know exists, has existed, it's like, and you're trying to get the Bitcoin is violence narrative out there, Bitcoin is a weapon going, like, I don't see how it would play out much differently to what it, how it has, and, yeah, you know, it's, it's regardless of, you know, what the To, okay, he wants to get invited to the White House and it chase the clout, chase the career. Yeah, there's all that personal things, but it's like almost that can be irrelevant. It's, it's again, comes down to the premises which we can point to, you know, like he's, it's almost the nation state, like it's a national security issue, but it's Bitcoin is critical for national security, as kind of said, it's like if you ke- there's a distinction between nation state and nation. So like the American people, amazing. Nation state To have them hold the asset that Bitcoin is for, and to like, get enriched by, like, you know, with hyperbitcoinization, and you're empowering the ruling elite, or the, the, the ruling class versus the ruled. So like, you're wanting to encourage your nation getting better ahead, if that's the case, it's not encouraging the nation state to get more empowered in mind bitcoining, it's to create laws that allow your citizens to get- the benefits of that get out of the way, set private property rights like a proper framework. and yeah, it, it's, it's like you, you understanding that this proper class analysis of rulers versus ruled can really set the, the scene, and that's why I think so many plebs get it, but certain individuals don't. And it's funny you see those that tend to be promoting, I don't know, Dennis Porter or whatever, it's like their policy, their, you know, Washington or whatever, like they're talking to politicians, that's their world. They're, It's like another narrative that they can, you kind of push and get some, some, carry some favor with, but to me it's like a, there's that, that Trojan horse meme, you know, Bitcoin is in a citadel Essentially, and you got Larry kind of like, \"No, offering in the Bitcoin is violence or Bitcoin is a weapon narrative,\" and most, you know, Bitcoin is, are, are well aware in crypt with the proof of work they've done of understanding philosophy, philosophy and economics, yeah, else off ranting, but yeah." }, { "speaker": "stephan", "time": "01:18:27", "start": 4707.93, "text": "Yeah. I mean, I'm, I'm with you there, like in terms of the libertarian analysis and obviously starting from the framework of private property, right? Obviously, I'm, you know, I'm with you there. Now, I'm curious I think it's better to use the one A, the First Amendment, and kind of frame Bitcoin as speech, right? Like it's a message. My node is sending a transaction to you, it is a cryptographic message. Do you agree with that idea or how would you try to, if you're talking to a status?" }, { "speaker": "conza", "time": "01:18:56", "start": 4736.81, "text": "Yeah, I'd, I'd be like, \"What's your-- What, try and figure out what the end goal is, the, the end is, and how Bitcoin can, can help cater to that.\" If, yeah, like you're cater talking to courts, you know, making a legal case like, you know, in a defensive nature, I think certainly the, the Bitcoin is, is speech or co-narrative is far superior to a Second Amendment approach, but again, i-i-it's like, it's a rivalrous digital commodity, like it's, I, I think that just nailing down that i-i-is simply, you know, then the whole narrative of, you know, it's a weapon or whatever, it's like, it's, it's almost, you can see it's like, you know, saying Okay, you're crazy, mate. Like, no one's-- it's, it's not a narrative that gets anywhere. and so it's like by blurring these lines and definitions, like, and almost seemingly getting really technical language, but if we bring it back to the simple case, it's like, it's voluntary, you know, it's-- Yeah, the framing matters. It does. And hopefully I'm trying to convey a bit of" }, { "speaker": "stephan", "time": "01:20:01", "start": 4801.54, "text": "that. Yeah. Because if it's framed like this idea of it's savings technology, you use it to protect yourself and your family, but it" }, { "speaker": "stephan", "time": "01:20:11", "start": 4811.6, "text": "If I stop funding somebody, am I attacking them? Well, no, I-- it's more like I'm choosing to put my funds elsewhere. Like I'm choosing to put, finance some other thing instead of, like, let's say there's a very violent man who thinks he controls the neighborhood and he purports to rule over the neighborhood, and I have some way to withdraw my funding from him and put it towards my family instead, am I somehow attacking him or is it a way-- weapon that I'm using against him, not really, right? Like it's only in a very loose analogy that you could even argue that, that it's, at best, it's like a very, very loose analogy and really it's not the right way to categorize what's going on there, right?" }, { "speaker": "conza", "time": "01:20:56", "start": 4856.99, "text": "Yeah, like it's only like if you say your, your target audience is, say, want, you know, gun nuts or whatever or like, you know, and I'm, you know, no issue with, with that, but as a wider narrative, like it's almost the Population, you, you know, just understanding of like using that term or anything, he tries to, he's almost tried to walk it back recently, and I've recently, you know, I think because of the pushback, it's like, oh no, it wasn't really money this way, I mean, you know, I haven't used that for over a year, you know, that phrasing, but it's very strongly implied in terms of, it's like recently, again, he, it's peer, he calls it a peer-to-peer electrocyber warfighting" }, { "speaker": "conza", "time": "01:21:41", "start": 4901.6, "text": "Implications of that is like, yeah, it's like a weapon, right? Or it's, it's, it's violence is the image of how people fight, how people do" }, { "speaker": "stephan", "time": "01:21:48", "start": 4908.79, "text": "warfare, and it's just not accurate in the slightest. Yeah. So, yeah. A-anyway, I think we've done that topic. We've, we've also got to chat a bit about this idea that, like, I think, I mean, I think we've covered a lot of the stuff, but I think one other area that, that are, that would be good is just, just to There's, there's some people, and some of this is kind of coming back to what we were talking about with the fractional reserve people and the so-called free bankers, where they seem to buy into that idea, like, you know, they seem to buy into this idea that somehow the money supply has to grow, otherwise the economy won't grow. And, you know, of course, we have, like you said, that, that standard hopper kind of two minute clip where he basically says, \"Look, if printing more paper money tickets made us richer, why, why haven't we just gone and This idea is coming from, this notion that somehow the money supply has to grow in order for the economy to grow." }, { "speaker": "conza", "time": "01:22:46", "start": 4966.99, "text": "Yeah, and you're right, like, and his other point to that with the Hobbit, Hobbit clip, it's like, well, if it's been done, like the, the amount of printing of pieces of paper like Quanty's and like trillions of dollars, why isn't everyone, you know, a lot wealthier, right? so if it worked, well, if that's the case that their premise is right, why hasn't it is of, of asking that simple question to, to those that have this, you know, that premise to get a, a valid answer. And it's, it's even particularly noting you talk about free bankers, so like George Selgin, you know, Nick Carter's gone down that pathway of, of, it's, it's, again, it's kind of like a mind virus that, you know, the fractional reserve banking or the quote-unquote free bankers, where they do feel this need that there needs to be an increase in the money supply, you know, for society to be better" }, { "speaker": "conza", "time": "01:23:41", "start": 5021.94, "text": "you know, that, that society ca- just can't, you know, can't, can't function with, there's many myths there. But it comes back to, so like banking theory, Rothbard points out, has taken a, took a very bad turn with the coinage-free banking. and it's really just the old currency and banking school arguments rehashed. And it's the doctrine there that, the banking school doctrine that, yeah, you, business, the needs of business require an expansion of money supply and, and credit, and then Moreover, that essentially violate the, the basic principle regarding doctrine that every money supply, every supply of money is optimal. So it's essentially like, once the money, the market in money is established, a market in money is established, there's no, no longer any need for, for more money. And the key point is there. And so yes, like Mises in Human Action, you know, there's a quote I, I roll out a lot is, \"Yeah, as the operation of the market tends to determine a final state of money's purchasing power at a height at which the supply Of and the demand for money coincide, there can never be an excess or deficiency of money. Each individual and all individuals together always enjoy fully the advantages which they can derive from indirect exchange and the use of money, no matter whether the total quantity of money is great or small. the services which money renders can be either improved nor repaired, by changing the supply of money. So the quantity of money available in the whole economy is always sufficient or secure for everyone, and all that money does and can do. And so it's like, even if, for instance, taking Bitcoin, if there's, you know, everything is doubled, so like it's, the, there's 42 million Bitcoin, and, you know, everything else like translates down, you know, in terms of, 20 minute blocks or like, you know, every, you know, the, the time framing, if all that Was the case, and the still supply schedules like, h-h-doubles, as it, as it's, you know, nearly goes down, the purchasing power of money, like as it, as it's getting adopted, would, you know, reflect that maybe naturally the price, whatever it is now, would be double, but that's in fiat terms or, you know, whatever it is, there's still supply a-and demand that impacts it and purchasing power. So people, Mr. Talks about it, they don't, you don't want units of money, it's, it That can purchase, like in terms of goods and services. Yeah. yeah. So it's, it is one way to think about probably is, is, you know, I guess the impact of the money supply and if something's already established a-as illustrative of, like, talking about inflation, about how some of that can be stolen, that purchasing power, through legal tender laws. a, a lovely analogy, it's, there's a Ducktales episode actually, where Scrooge has got, he's like- pile of gold, money, and then the, the other little guys, have a, a particular ray gun that doubles, can double things. And almost like, you know, think of an angel, like everyone in society, they've got your bank accounts, and overnight, an angel comes and doubles the money supply, everyone's bank accounts are doubled. those who woke up first in the morning would, you know, \"Oh, wow, what's this? \" you know, gonna go out and spend that. and the prices might not initially reflect that, like they won You know, a different, different prices rising in different areas and different sectors of the economy, and then as people wise up, yeah, you're at the end of the day, and words got in out, you know, there's a general tendency like the, the cost of everything would have, would have doubled. so yeah, it's, look, speaking specifically about, they feel this need that, you know, and often a confusion it comes from sort of like talk about credit. So, you know, Nick Carter and others are like, go, go on a little, Based on nothing against Rothbard, you know, type, type folks such as myself and yourself all reservists that, you know, we're against credit. We're against credit. And it's like, no, we're, you know, there's commodity credit, which is backed, you know, savings backed by real things. And then there's, yeah, fiduciary media, circulation credit, yeah, circulation credit. So there's nothing that's wrong with, yeah, that's the con- the contrast, Mrs. Has, like, commodity credit versus circulation credit. And with circulation credit In the form of bank notes or, you know, demand deposits, but as opposed to credit, so it's credit extended by banks in the form of bank notes or demand deposits, specially created for this purpose, as opposed to the credit granted by the loan of a bank of its own funds or funds deposited by its customers. And so the extension of circulation credit makes available to borrowers newly created funds which don't, decrease or restrict the funds available to anyone, as they do in the commodity credit. So it's like, if this someone's not you be able to use something? And quantity credit and circulation credit, you know, which is what you refer to as being" }, { "speaker": "stephan", "time": "01:28:34", "start": 5314.83, "text": "ex nihilo created, yeah, credit" }, { "speaker": "conza", "time": "01:28:36", "start": 5316.61, "text": "expansion, that's what is again- So just" }, { "speaker": "stephan", "time": "01:28:37", "start": 5317.99, "text": "to explain that, so the idea is, let's say, you know, you've got Conza Bank and you're a full reserve bank, and I come and deposit, you know, my hundred, well, hundred thousand sats or whatever, right? But the idea is, if I'm giving them to you in a term deposit, I have relinquished control, and so now we're in a full reserve context That's the crucial difference. In a fractional system, it would be kind of like, \"I still think I have access to it, but actually, you've actually also gone and issued out credit to somebody else, and we both think we can access those coins or sats and spend them freely.\" But that's where the problem, where we run into this problem, because even though there's only twenty-one million Bitcoin or just under, we're acting as though it's not like that, and that is what Mises calls-- like he says, \"That's the reason for the business cycle. That's the" }, { "speaker": "stephan", "time": "01:29:31", "start": 5371.55, "text": "Easy, simple way to understand that distinction, commodity credit versus circulation credit, and of course, Caitlin Long has also been very vocal about that too over the years, as have all the other, you know, full reserve people like yourself, myself, Safdean, and others out there." }, { "speaker": "conza", "time": "01:29:45", "start": 5385.72, "text": "And I think that's the biggest attack vector as well, like the biggest risk going forward. So you see, oh, Fidelity's got a new app or something, and it's like, oh, you can buy Bitcoin, but it's like, well, can you own-- can you withdraw it? Can you" }, { "speaker": "conza", "time": "01:30:01", "start": 5401.61, "text": "That's why we've got to encourage a run on the, run on the exchanges, withdraw those funds, use BIS, you know, peer-to-peer stuff. It's, you go to the ones that are, you know, the least trusting you require, the better, and own em yourself, you know, to have your own node. It's, it's key to, with, minimizing their ability to do that." }, { "speaker": "stephan", "time": "01:30:21", "start": 5421.5, "text": "Yeah, so I, it, it kind of remains to be seen where it all goes, but I think, like as our friend Pierre Rochard would say, world where people, they just simply don't use as much of this fiat credit like they do today. And so I think that's where it's diff-diff-difficult for some people, they're still trapped in the old paradigm. And I think maybe people like George Gaiman are kind of in that paradigm, where even though he is mostly libertarian and mostly free market, he seems to be still trapped in this idea that you need the money supply to expand for, again, similar reasons that we've, we've gone into, right?" }, { "speaker": "conza", "time": "01:30:56", "start": 5456.3, "text": "Yeah, absolutely. Yeah, he's got a com- it" }, { "speaker": "conza", "time": "01:31:01", "start": 5461.51, "text": "News and then, you know, his comments about, you know, if each IU is fungible, you increase money supply, and he's like, \"It's so simple, either you have a fixed money supply or you have fractional reserve, but you can't claim to have both.\" And like, yeah, as we've broken down, you know, it's not, if you've got Bitcoin on exch, quote unquote, Bitcoin on exchange, it's not Bitcoin, it's fiduciary media, or, you know, it's not money in the narrow sense or money proper." }, { "speaker": "conza", "time": "01:31:30", "start": 5490.67, "text": "\"Quote unquote, Bitcoin or, you know, hundred, it's a hundred percent money certificate at best, at worst, fiduciary media. It's literally backed by nothing, a zero percent, you know, token coin of sorts, it's been reappropriated. so don't fall victim to the fiat games, that are being played, would be my suggestion. And there's a lot of, alternate ways to, to, to take o-- take control of...\" And, and don't reintroduce trust. Like the very first sentence of Satoshi's white paper in, is, in the abstract even is, it's a, you know, what's Bitcoin? It's a purely peer-to-peer version of electronic cash that would allow, online payments to be sent directly from one party to another without going through a financial institution. So, yes, again, naturally some do it better than others, like instant withdrawals, you know, so there's a bit of a spectrum, non, non, non-custodial type stuff, but very much encouraged, you know That type stuff where, you know, it's all, all verifiable, and, you know, peer-to-peer. Get, get, get to those local meetups, if they don't have one, start one. I, I think that this parallel kind of, you know, making our own economy, especially with seeing some like the World Economic, kind of, World Economic Forum, you know, what's kind of coming out, like the plans are. there's nothing but good come from, you know, meeting with like-minded folk you know, discussing those ideas, these ideas and, and really like different offshoots of skills and division of labor, you know, we've got Bitcoin meat groups, you know, direct connection to the farmers, like, there's all these other different rabbit holes, and, you know, we can all go down, but, couldn't-- I know you pushed the, the community, angle a lot, and, yeah, couldn't agree more how vital that is. Yeah, fantastic." }, { "speaker": "stephan", "time": "01:33:22", "start": 5602.05, "text": "Well, look, I think we're, we've been going for a while," }, { "speaker": "conza", "time": "01:33:29", "start": 5609.31, "text": "so There in the Twitter sphere, also YouTube, you know, if you're Australian, like, look at mises dot org dot au, so M I S E S dot org dot au. So like, from a few seminars way back, we had Hopper out, Walter Block, Jeffrey Tucker, there's, you know, fifty odd lectures with an Australian context there, all principled, timeless, universal stuff that isn't going out of date. And call out is, yes, get, get your, your quote-unquote Bitcoin off the exchanges so you can verify you've," }, { "speaker": "stephan", "time": "01:34:00", "start": 5640.67, "text": "Fantastic, thanks Conza. Thanks Stephan. I hope you found this episode informative and useful. You can get the show notes over at stephanlivera dot com slash four four three. Thanks for listening, and I'll see you in the citadels." } ] }