POV Crypto Reunites with Christian Keroles | Layer Zero

David brings on his old co-host, Christian Keroles of POV Crypto. Long-time Bankless listeners know of POV Crypto, but if you’re unaware, it’s the podcast that David started with Christian before Bankless! Christian is currently the General Manager of BTC Inc (Bitcoin Magazine & The Bitcoin Conference). On this episode, David and Christian go back to their POV Crypto roots and debate many different sub-topics of the overall Ethereum vs. Bitcoin debate. ------ 📣 Earnifi | Check For Your Unclaimed Airdrops, POAPs, & NFTs https://bankless.cc/earnifi ------ 🚀 SUBSCRIBE TO NEWSLETTER: https://newsletter.banklesshq.com/?utm_source=banklessshowsyt 🎙️ SUBSCRIBE TO PODCAST: http://podcast.banklesshq.com/ ------ BANKLESS SPONSOR TOOLS: ⚖️ ARBITRUM | SCALING ETHEREUM https://bankless.cc/Arbitrum ❎ ACROSS | BRIDGE TO LAYER 2 https://bankless.cc/Across 🦁 BRAVE | THE BROWSER NATIVE WALLET https://bankless.cc/Brave 💠 NEXO | CRYPTO FINANCIAL HUB https://bankless.cc/Nexo 🔐 LEDGER | NANO HARDWARE WALLETS https://bankless.cc/Ledger ⚡️FUEL | THE MODULAR EXECUTION LAYER https://bankless.cc/Fuelpod ----- Topics Covered 0:00 Intro 5:03 Who is Christian Keroles? 5:58 POV Crypto Pod 9:52 The BTC vs. ETH Community 11:07 Metrics of the Winner 14:20 Ideological Backgrounds 18:00 The 2020-2021 Bull Market 20:44 Cantillon Effect 22:55 ETH to $0 24:40 Ethereum Won the 2020-2021 Bull Market? 30:34 Is Bitcoin the Underdog? 32:00 Tornado Cash 33:47 Ethereum is Inside the Bitcoin Ecosystem 36:46 How Bitcoin is Changing the World? 39:15 Bitcoin & Energy 46:19 Distribution & Decentralization 48:44 Energy System Integration 54:47 Does Bitcoin Work If It Isn’t #1 55:39 HyperBitcoinization 56:25 Paradigm Shifts 1:02:20 Recreating the Financial System 1:04:57 Core Philosophical Differences 1:07:17 Disrupting Incumbents 1:08:26 Acceleration ------ Resources: POV Crypto Pod https://twitter.com/povcryptopod Christian Keroles https://twitter.com/ck_SNARKs ----- Not financial or tax advice. This channel is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This video is not tax advice. Talk to your accountant. Do your own research. Disclosure. From time-to-time I may add links in this newsletter to products I use. I may receive commission if you make a purchase through one of these links. Additionally, the Bankless writers hold crypto assets. See our investment disclosures here: https://www.bankless.com/disclosures

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:02David Hoffman?

  Welcome to Layer Zero. Layer Zero is a podcast of unscripted conversations with the people that make up the Bitcoin community. Crypto is built by code, but is composed by people, and each individual member of the crypto community has their own story to tell. The cypherpunks understood that the code they write impacts the people that use it, and Layer Zero focuses on the people behind the code, because Bitcoin is people all the way down, and always has been, which might be an offensive statement to many of the Bitcoiners. And the reason why we're talking about Bitcoin today is because I have on my old co-host, CK Snarks of POV Crypto. So, longtime Bankless listeners will probably have known about POV Crypto, but it was actually the podcast that I started with CK, with the guest here, before starting the Bankless podcast.

• 0:46David Hoffman?

  It was the precursor podcast, and POV Crypto, point-of-view crypto, was me, the Ethereum, and CK, the Bitcoiner, and we also happened to be college friends. So, we were friends before we discovered Bitcoin and Ethereum, respectively, and that allowed POV Crypto to be a different kind of podcast. It got started in 2018, 2019, and it was like a bear market darling of a podcast. People loved it at the time, and it was really because it was something different, where two differing perspectives were able to come to the same place and sometimes aggressively yell at each other, yet still hug it out at the end of the show every single time. And so, it was a nice relief, where it was very important conversations about the philosophical

• 1:29David Hoffman?

  differences between Bitcoin and Ethereum, from two people that very much believed in each other's respective camps. And so, the fact that CK and I were college friends, I went to his wedding, and we're friends, and so we could yell at each other, yet actually not, and then still be respectful. And you can actually move the needle with conversations. And so, it hosted a lot of very important conversations, I'd say, in 2018 to 2020. Since, once the bull market started, CK, who is operations at BTC Media, Bitcoin Magazine, the Bitcoin Conference, all that stuff, and so, once the bull market started, I doubled down on Bankless, he doubled down on BTC Media. But we've always kept in touch, of course, as our respective ecosystems has built out.

• 2:14David Hoffman?

  It's been a year since we have recorded, and so this is the reunion of POV Crypto. So for the long time POV Crypto fans, sorry for going over a year without recording an episode. I hope you enjoy this one, though, because we have a lot to catch up on. But without further ado, we'll get into the conversation with CK Snarks right after we talk to some of these fantastic sponsors that make this show possible. Arbitrum One is pioneering the world of secure Ethereum scalability and is continuing to accelerate the Web3 landscape. Hundreds of projects have already deployed on Arbitrum One, producing flourishing DeFi and NFT ecosystems. With a recent addition of Arbitrum Nova, gaming and social dApps like Reddit are also now calling Arbitrum home. Both Arbitrum One and Nova leverage the security and decentralization of Ethereum

• 2:58David Hoffman?

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• 3:43David Hoffman?

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• 4:26David Hoffman?

  They also have an awesome advanced trading platform called Nexo Pro that pays you rewards when you swap crypto assets. And Nexo also lets you earn interest on your crypto in Bitcoin, ETH, or other assets. And they also give you an instant crypto line of credit with as low as 0% APR. And they also give you access to a crypto-backed Mastercard, of course, earning you more crypto when you use it. So enhance your financial life with Nexo, who ensures all credit lines are over collateralized with insurance on all custodial assets. Nexo, the right place for your crypto. So click the link in the show notes to join over 5 million users who are getting the most out of their crypto. What's up, CK? How's it going?

• 5:05Speaker 01

  Doing good, man. Enjoying your apartment.

• 5:07David Hoffman?

  Well, it's great to have you here. It's been a while. It's been a long time.

• 5:11Speaker 01

  Since we recorded, at least.

• 5:12David Hoffman?

  Since we recorded, yeah. For Bankless listeners that don't know, who are you?

• 5:17Speaker 01

  I'm the general manager of Bitcoin Magazine, but David and I are old friends from college days. And we kind of were partners in crime for a while. We started both of our careers in the Bitcoin and crypto space, doing a podcast together called POV Crypto.

• 5:36David Hoffman?

  Yeah, the POV Crypto Pod was like, I think it was the, there were definitely other podcasts that were a big deal, like Laura Shin's podcast was a big deal. But I think we kind of like dominated the 2018 to 2020 bear market in terms of just like, we had, we had good listenership. But also just like, who listened to POV Crypto as I think, it was an interesting set of people. Again, for the listeners who don't know, you want to describe POV Crypto and how it came to be and what it was?

• 6:03Speaker 01

  So pretty much David and I kind of started our careers with similar-ish perspectives on the market. David was a lot more into the blockchain ecosystem, really into Ethereum, you're mining Ethereum. I was already pretty captivated by Bitcoin and I've since become more captivated by Bitcoin and.

• 6:25Speaker 01

  I don't know, we, we, we tried and failed to do a podcast one time and then we kinda just started, it was like November 2018.

• 6:36David Hoffman?

  I think we

• 6:36Speaker 01

  Late 2018.

• 6:37David Hoffman?

  I think we tried and start, I tried to do the first episode like two times.

• 6:41Speaker 01

  Yeah, two or three times.

• 6:42David Hoffman?

  Two or three times and then we did it like the fourth time. And we're like, this still wasn't what we wanted, but at some point we were like, we just have to ship a goddamn episode. So we just yeeted the episode and like, got like 15 listens or something like that.

• 6:54Speaker 01

  Yeah, I think it was just our friends, but pretty much, pretty much the whole point was like, I was the Bitcoiner. David was the Ethereum and like, we were gonna talk about the market, what we saw. You know, we felt like these communities were already very siloed. And they were really talking at each other on Twitter a lot. So we were kind of the only forum that I feel like had honest conversation with, with both perspectives respectfully over an extended period of time.

• 7:24David Hoffman?

  Yeah, yeah, I think that's right. The way I described POV Crypto is like during the 2018 to 2020 bear market. There wasn't the communities that you see today. Like there was just Bitcoin and Ethereum. Like there were, there were like other like bull market like ecosystems that all went away during the bear market. And like basically all that was left was Bitcoin and Ethereum. Like all the people that like were bullish on public, private key cryptography and some sort of crypto system. The only people that were left were like Bitcoin and Ethereum. And these communities couldn't talk to each other because none of them were friends. They were just like too ideologically like separated. And so like, that's where we had the privilege of like being college friends. Yet one of us was the Ethereum, one of us was the Bitcoiner.

• 8:07David Hoffman?

  We made POV Crypto because we were the only two people that could come together and like argue with honest arguments. And so we had like these hour long, we had called them like fight nights. Also did interviews, but basically we were the place where like the Bitcoin perspective and the Ethereum perspective met.

• 8:23Speaker 01

  Yeah, no, totally. And we had awesome guests on and it was a very unique setting because like David would bring in the cream of the Ethereum space and I would just drill them with all the questions that like Bitcoiners would want to ask them. And then vice versa, I would bring on like a someone who's pushing forward Bitcoin in a big way, a developer, you know, an entrepreneur in the space. And you know, David like, well, why not this? Why this won't work? That kind of stuff. And I thought, you know, one, it was fun, but I thought, you know, we really added something unique to the ecosystem.

• 8:55David Hoffman?

  Yeah, yeah, yeah. It was like, okay, so there was like the Bitcoin episodes, the Bitcoin podcasts. And then there was the Ethereum podcasts. Maybe there was actually only two of us, two of them. There was ours and then also into the ether. But like the difference was that when we would do an Ethereum interview, we would bring on an Ethereum guest, we would also have a Bitcoiner and like vice versa.

• 9:17Speaker 01

  Yes.

• 9:17David Hoffman?

  And so you would, and because we did so many episodes, we got, we were into like two, almost episodes, like 200 episodes. So our listeners got to like, kind of know us and know our perspectives and saw kind of like the character development of the actual episode of the conversation. And you would see where like the Ethereum influence would influence you and you would see the Bitcoin influence influenced me in our thinking. But we also like never wavered from our positions.

• 9:43Speaker 01

  Still to this day.

• 9:44David Hoffman?

  To this, to this day. Yeah. And so it's been like a year or so since we've recorded a podcast.

• 9:50Speaker 01

  Yeah, a little bit less than a year.

• 9:51David Hoffman?

  A little bit less than a year. And it's like, it really kind of, things started to pause when, slow down when the bull market started. Like the Bitcoin communities and the Ethereum communities, we were in the same spot during the 2018 to 2020 bear market. Like the Bitcoin communities and the Ethereum communities, very different communities, but they were still together, right? It was like, we were still on crypto Twitter, interacting with each other, even though we were different communities. And then as soon as like the bull market happened, like the Bitcoiners did their own thing. Like we diverged as communities, I'd say. Would you agree with that take?

• 10:23Speaker 01

  I mean, I always like a little bit more yes and no. I definitely knew that that was very much your perspective, you know, this time last year. But at the same time. I think it's fair to say that like these communities are still definitely, you know, rubbing up against each other in a big way, although like let's just call it like the Ethereum only ecosystem and then the Bitcoin only ecosystem have definitely both developed a lot. You know, back in the day, there was just crypto and blockchain conferences. Now there's, you know, very specific gatherings, very specific meetups, you know, all of these things definitely have defined themselves and become more independent for sure.

• 11:07David Hoffman?

  So I want to definitely get into like, since it's been a year and a little bit more since like the POV crypto was really at its height, we wanted to kind of reflect on like, all right, who was right? Because that was the whole point of the episode or the podcast was like, one of us was right and one of us was wrong and it could only be one, right? That was kind of the air of the podcast.

• 11:29Speaker 01

  That was the vibe. I don't know how true that is though.

• 11:32David Hoffman?

  Well, so yeah, so let's ask that question because I think you and I do agree on like,

• 11:37David Hoffman?

  there's going to be one blockchain to that's going to be the winner, like that sits in a throne. And there was another, there was an argument that I remember having on Twitter where I think it was West Coast Walker, shout out West Coast Walker, who's always been with us ever since the beginning, where they were like, how do you know who's right in the end? And we both agreed like market cap, market cap is the determining factor. Do you still align with that?

• 12:04Speaker 01

  Well, I definitely think that the journey, every metric and every sacred cow is going to like get challenged, you know, across the spectrums as more intense and malicious actors, you know, with lots of capital come in, you know, I don't know if market cap or any specific metric is like the key metric. I think that the... What what matters at the end is where is economic activity happening? And and what I think you why it makes sense that there's going to be one settlement layer for global economic activity?

• 12:43David Hoffman?

  Hmm.

• 12:43Speaker 01

  And we're going to consolidate around whatever works the best for a number of reasons, many of which a lot of people know about, many of which are unknowable to this point. But um.

• 12:55David Hoffman?

  Because of efficiency.

• 12:56Speaker 01

  Hmm. So right now, there is massive inefficiencies in the the wild and massive like in like not connectiveness, uh like the financial system is very, very fragmented. And I think what is going to happen is, uh, I think governance is going to become way less unified. I definitely believe in the sovereign individual thesis, but that's going to be enabled by using a lot of shared common tech similar to, I think it's going to be the Bitcoin blockchain, but let's just call it one global settlement layer for the world, you know, almost like that. You don't have to trust that person in order to settle value with them. Like, that's what having one global blockchain does.

• 13:38David Hoffman?

  Right. Okay, so you do believe in like one, uh, the dominance of one ecosystem in the long term?

• 13:44Speaker 01

  Yeah, I mean, hu- humanity requires.

• 13:47David Hoffman?

  Yes.

• 13:48Speaker 01

  Like, we that we need this to move forward. Like, right now, there's just too much, uh, it's it's difficult to make economic calculation.

• 13:56David Hoffman?

  Hmm.

• 13:56Speaker 01

  Right? So, um, I I think that this is an economic advancement on the levels of the world converging on gold, or, I mean, much, much greater than that, but it's going to bring about an enormous amount of efficiency gain, productivity gains, uh, and capital allocation improvements if we can, uh, you know, gather around one. And I think that we will because we we need it.

• 14:20David Hoffman?

  Right. And so like a hundred percent, I I one hundred percent agree. There's like one, if there's one single standard, if there's one global coordination focal point where we all like, hey, this is what we use to coordinate. That's that is the point of crypto. And I I think one of the reasons why people resonated with POV crypto is because like a lot of the same stuff, we we agreed on a lot of stuff. Like, we have very similar principles, and I think where we disagree is like. The execution of that, like how that actually manifests. And so like that, that's kind of like why we could come together at POV Crypto. It's because like so much of our foundation about like why this stuff is important is the same thing. But you think it's expressed in Bitcoin and I just think it's expressed in Ethereum.

• 15:02Speaker 01

  Yeah, I mean, I, I don't know if we necessarily have the same vision for the future. But I think part of the show too, is you can also look into our base assumptions on life, our political perspectives and that kind of thing. And then see how that's reflected in, you know, how we look at the, the crypto ecosystem. So, I mean, I don't want to get into like too much of like generalizing, but I would definitely say like, even when I was in high school and I didn't even understand politics, like, you know, I would take like a stupid test and be like, yeah, you're libertarian. You know, like that, that was like kind of always part of my character. And then, you know, obviously, you know, you know, you can describe your own political leanings,

• 15:44Speaker 01

  but I, I do think that it was interesting to kind of just see how, yes, Bitcoin crypto, that changes your worldview a lot, but it's also really colored by what you already believe is like how the world works.

• 15:59David Hoffman?

  And I think that was definitely something that we explored at POV Crypto, where we talked about like people's ideological backgrounds and like how they kind of would naturally find themselves in one ecosystem or the other.

• 16:08Speaker 01

  Definitely.

• 16:09David Hoffman?

  I started off very, very liberal and then since getting into crypto, I found myself going just more moderate. Definitely more conservative, but not conservative holistically. But yeah, I would say like coming into the crypto world, it was an interesting exploration of just like, all right, who are you as a person and what values do you have? And how does crypto express those values? And that was, the other thing that was interesting on POV was like all of, we had a mix of listeners, right? We had the Bitcoin listeners and we had the Ethereum listeners. And all the Ethereum listeners were like, that C K guy just rubs my, rubs my, just rubs me the wrong way, man. I can't stand that guy. And like all the Bitcoiners would tell, go to you and be like, that David guy, that guy's an idiot, man.

• 16:53Speaker 01

  People will be like, how can you guys be friends?

• 16:57Speaker 01

  Bro, you guys are so sad. Like, come on. You can't disagree with someone? I think maybe that is a reflection of the times, but you know, yeah, I mean, people, like if you can't disagree and then still respect someone, like, do you even know them?

• 17:12David Hoffman?

  Right. Well, that's why, that's why I think people like really listened to POV Crypto and like really appreciated it because like it was, it was the conversations that a lot of people wanted to have, but no one could do it in a way that wasn't like disrespectful for some, for some reason.

• 17:26Speaker 01

  I mean, even at times I would get disrespectful.

• 17:28David Hoffman?

  Yeah, but we both, we both would, but we would also like not let it interfere with the conversation. Yeah.

• 17:34Speaker 01

  No, I mean, you know, it would call, call back at the end. All right. Good show. Talk to you tomorrow. That kind of thing.

• 17:40David Hoffman?

  Who's gonna edit this one? Blah, blah, blah, blah. Yeah.

• 17:42Speaker 01

  Yeah. No, I remember like my wife, you know, then fiance, but now wife, you know, she would always like clown me like, man, you must've had a really heated episode because I could hear you all the way in the kitchen.

• 17:54David Hoffman?

  There was a lot of yelling. Yeah. The, the names Fight Night episodes were definitely true to their name. All right. So we do, do we want to like recap, uh, the reflect on the year thus far since we haven't done a POV Crypto episode in a year?

• 18:07Speaker 01

  Yeah, man. What a wild bear market.

• 18:09David Hoffman?

  So do, well, also bull market, right? So did, so say we, we stopped, we stopped doing POV stuff in like, uh, 2020 ish.

• 18:18Speaker 01

  So we, we were like doing it two to three times a week up until 2020. All of 2021, it was like, two episodes here, two episodes here, two episodes here, that kind of thing. Uh, and then, you know, just shy of a year ago was like our last episode.

• 18:34David Hoffman?

  So did the 20, because there was this air on POV Crypto that like the bull market will return. We, we were childs of the 2017 bull market. POV Crypto was a bear market podcast. Uh, but it was always under the assumption like, okay, the bull market will return once again. And then it did. Uh, and then like you doubled down on Bitcoin media. I doubled down on bankless. Did, if we want to put ourselves back in the shoes of like 2018 to 2020, Christian and David, uh, did the 2021, 2022 bull market go how you expected it to go?

• 19:07Speaker 01

  I would say yes and no. Uh, this is something we were talking about yesterday, like as the Bitcoiner, the way to have made the most amount of USD or SaaS or whatever would definitely have been to listen to David. Like, there's no question there. Um, but on the flip side, like the bull market pushed forward Bitcoin adoption in an insane way. Like, you know, we, we now have Bitcoin playing on the, the playing ground of nation states. I mean, and you know, that's opening the door for a lot of crypto to happen as well. Um, and we're also, you know, we're seeing Bitcoin mining being integrated into energy infrastructure in a very quick way.

• 19:47Speaker 01

  Like, I, I think that real Bitcoin adoption definitely aligned with my perspective of, of the bull market. Um, but if you're just like, you know, trying to make as much USD, trying to make, and let's just assume not even trading. Just like you're participating in this market, like, I definitely think like there's a very clear answer there. So, you know. And on my end, like Bitcoin's supposed to give you peace of mind. So like, if you understand the protocol, you understand the system, you understand the end result, like, how could you not have peace of mind? So, uh, being, working in this space where, you know, I'm fully aligned with my ideology and my vision for the future. Like, that's increased my earning power an enormous amount.

• 20:29Speaker 01

  Obviously I own more Bitcoin now than I, you know, ever thought possible, but at the same time, like, it is what it is. You know, being on the, being on the alpha end of the Cantillon effect, as I would describe it, it's definitely really fucking lucrative. There's no question about that.

• 20:44David Hoffman?

  Uh, to explain that metaphor, the alpha end of the Cantillon effect, you're saying that Ethereum is where issuance occurs? And so if you're on the Ethereum ecosystem, you have the net effects of the Cantillon effect.

• 20:53Speaker 01

  Yeah, well, so the Cantillon effect is this idea that, uh, if you're closer to where the money or the assets or the whatever is being issued and you get it first, then you have a lot to gain and people get it last, you know, get less, you know, they gain less or they're even maybe, uh, on the, on the short, they get the short end of the stick. Um, so yeah, I mean, you're not creating assets in Bitcoin. Like, really, it's just like, there's, there's, there's not that much alpha in, uh, in being a part of the, it's like, in like, like, the alpha is not the same as like, hey, I can be an insider in Ethereum and I can understand where the trends are going and I can.

• 21:37Speaker 01

  Get tokens that, you know, will appreciate or whatever, get speculated on. It's almost like people like, people like, I want to buy Bitcoin so that way I can get the next airdrop. Like 100, 1,000% of that activity all went to Ethereum. Like that would stop being even a thing in Bitcoin.

• 21:53David Hoffman?

  I do, yeah. I do remember that during 2017, one of the things you were saying in our group chat was like, Bitcoin pays dividends because Bitcoin would keep on getting forked and forked and forked.

• 22:02Speaker 01

  Yeah, that didn't, that did not pay. I mean, it did get forked, just the forks stopped being valuable.

• 22:06David Hoffman?

  Yeah.

• 22:06Speaker 01

  Like, no, it stopped being relevant.

• 22:08David Hoffman?

  Yeah.

• 22:09Speaker 01

  Which is good for Bitcoin.

• 22:11David Hoffman?

  And what do you mean? Oh, because the Bitcoin meme is more dominant?

• 22:14Speaker 01

  Yeah, it just showed like, hey, you can't just fork this thing.

• 22:16David Hoffman?

  Sure. Yes. Yeah, not successfully. But then I would say, okay, so yes, a lot of that same energy of like the desire to fork, the desire to create new assets thing got captured by Ethereum, right? So like the Bitcoin fork phenomenon, like kind of was the same thing, a similar thing to like the Ethereum DeFi summer, like fork and fair launch phenomenon. Like same kind of deal.

• 22:40Speaker 01

  Yeah, yeah. I mean, I would just summarize it down to, it became the place to issue tokens. And there's a lot of alpha that became if, you know, you can, if you can have, you can be on the right side of that.

• 22:53David Hoffman?

  So I can't remember, I think this was true, but during the POV era days, I think you kind of thought that like Ethereum would just like go to zero. And if not you, then like a large percentage of the Bitcoiners that we had at Gas would be like, yeah, all of you ETH heads, like, sorry, your blockchain is eventually going to not work and be gone in the future. Do you still believe that?

• 23:16Speaker 01

  So I would say I've always had like a, I've always had an independent thought in terms of like the crypto ecosystem, although very heavily influenced by Bitcoin intellectuals. I never thought that like Ethereum was like heading straight to zero, but I did think that on a long enough time horizon, it's going to continue to depreciate against Bitcoin.

• 23:39Speaker 01

  Still true right now, but at the same time, still way too early to see. Personally.

• 23:44David Hoffman?

  Wait, so you currently, you still think that Ether will trend towards zero in Bitcoin terms over the long term?

• 23:51Speaker 01

  Well, I think that Ether is just like every other asset in the world, which all of them will trend towards zero in Bitcoin terms.

• 23:57David Hoffman?

  So you're, you are a hyper Bitcoin-er, hyper Bitcoinization-er?

• 24:01Speaker 01

  I mean, yeah, we must move towards a world where we have a unified settlement layer for value that's uncorruptible. I think Bitcoin is the best technology to do that. And I think that there's many layers in which Bitcoin has enormous advantages in implementing itself as that, as that settlement layer. So like for that to be true, therefore, all other assets that store value will trend to zero in Bitcoin terms. Like I 100% still believe that.

• 24:29David Hoffman?

  And so there's, there's nothing about the 2021 bull market that made you question that idea?

• 24:35Speaker 01

  No.

• 24:36David Hoffman?

  No.

• 24:37Speaker 01

  No, not at all.

• 24:37David Hoffman?

  Even so like even the, so like we'll, we'll say that like the 20, I'm going to claim that Ethereum won the 2021 bull market. Do you agree with that? Like if, like if the, yeah, there was, there was a bull market, there was an event, Ethereum dominated it and like categorically, like Solana didn't win, Avalanche didn't win, Bitcoin didn't win, Ethereum won.

• 25:04Speaker 01

  So I've said this on POV Crypto. I think like the whole crypto ecosystem is part of Bitcoin.

• 25:10David Hoffman?

  Right.

• 25:11Speaker 01

  So I think you remember that line.

• 25:12David Hoffman?

  Yeah.

• 25:13Speaker 01

  So with that perspective, like Bitcoin had to gain from, from the world getting on boarded into the UX of leveraging crypto, into understanding that there can be value that is on a public ledger. And like the world is getting educated. We're at, no matter what anyone says, okay, we're at less than 1% adoption. Right? Just world population, people who actually are using and understand Bitcoin and crypto, less than 1% adoption. So that means 99.9% of the planet needs to go from like not understanding this stuff at all and being on the fiat mindset.

• 25:56Speaker 01

  And they have to transition all the way to Bitcoin. So like that is going to be a messy process. That is a long process. People will be making mental errors and mental miss and uh miss uh assessments on the way to Bitcoin, in my opinion. So like, of course, like, they have to love NFTs and all this other stuff that's like on the way to this very kind of extreme and different future that Bitcoin, like a hyper Bitcoinized standard would have. So I don't like, okay, in the short run, could you have made a lot more money if you're in the crypto space versus Bitcoin only? Definitely.

• 26:37Speaker 01

  But in the long run, I don't know if that is actually an indication of like who won. I would say like the things that got the most mass appeal to the most fiat minded people are like, yeah, NFTs. That's the big, okay, the biggest number one winner is NFTs because like that, everyone wants to do that. But like, guess what? What everyone wants to do right now, like in a world that's not a Bitcoin crypto world, is not what everyone is gonna wanna do when the, like, the kind of like, the games are changed. Everyone's playing on a different playing field. So I think we're still living in fiat land. So yeah, hey, you know, on the S curve of adoption, while we're over here at the bottom of the S, you know, there's gonna be a lot of volatility.

• 27:23Speaker 01

  There's gonna be a continued misallocation of capital. So I already, you know, I already gave my spiel. Like, if you wanted to make the most amount of money in this past bull market, you should have listened to David. But I, I don't think that that is like, uh, I don't think, I think it's way too early to say winners and losers. And I mean, Bitcoin advanced an enormous amount. So I know, what do, what do you think? I, I, I, I feel like you've been asking me questions, obviously, you're interviewing me, but uh, what do you think? How do you respond to that?

• 27:51David Hoffman?

  So I think the, the bull market that happened, uh, as soon as the bull market started, like the, the paradigm that we were used to, we as an Ethereum's that were on crypto Twitter, the paradigm that we were used to was like, we fight with Bitcoiners. We definitely think we're right. Uh, when the bull market starts, people are gonna, people are gonna resonate with Ethereum more than they will resonate with Bitcoin. Uh, and it went from like, the, the, as like, in DeFi summer, like,

• 28:21David Hoffman?

  DeFi summer, like the Ethereum app layer grew significantly, even though Ether price didn't. And then the Ether price started to respond aggressively at the end of DeFi summer into 2021. Like January 2021, it went from like $700 to like $1,500, broke through all time highs. At that moment in time, the collective Ethereum community that had stuck around during the bear market, I think mentally claimed victory as in like we, we, all of the arguments came through in Ethereum's favor in a big way. And also at the same time, like going in through 2022, no, 2021, like we as a community stopped caring

• 29:00David Hoffman?

  about the Bitcoin maxies takes on Twitter. Like, remember the whole like supply gate, the ETH supply gate from Pierre Richard? Like stuff like that, like you don't know what the total supply of Ether is. And we were, we just like were facepalming out that, except it was such a big deal because the Bitcoiners had dominated crypto Twitter for so long and did at that point. But we were like facepalming, like this is a dumb argument that no one's going to care about in the future. And like, I do believe that that was the right take and other, along with other things about like the, the takes that Bitcoiners had about Ethereum. As soon as mainstream adoption came around, like I don't, I think the Bitcoiner like memes and narratives and like lessons

• 29:40David Hoffman?

  just did not resonate with them as much. And so we stopped paying attention to like fighting with the Bitcoiners. Because we actually became like as an ecosystem, as a community, concerned with Solana and Avalanche. And then like, we actually learned that it wasn't Bitcoin that was going to be the hard fight. It would be people forking Ethereum and spinning up at this new Ethereum killers in the same way Bitcoin had Bitcoin killers in 2017. Like it was, turns out the actual, the bigger fights that we had to deal with were scale, like, like our own problems. Like Ethereum, turns out it was our, it was our own issues that we needed to fight with, not like a public perception about Bitcoin versus Ethereum. So like the bigger fights that we had during 2021 were like Solana, Avalanche, Terra.

• 30:24David Hoffman?

  And so like as a community, we kind of just like stopped thinking about Bitcoin because we don't, we didn't really consider it like a threat to the ecosystem. And again, this is coming from the perspective of people who think that there's going to be one dominant blockchain that will ultimately win, which both you and I think is probably is, is true. And so from the Ethereum perspective, like, yeah, Bitcoin is just like significantly less relevant than it once was.

• 30:51Speaker 01

  Bitcoin's chronically, chronically underappreciated, chronically, chronically, I guess like talked down to, or, you know, Bitcoin's the underdog. So, that's, that's a pretty comfortable position for me, is betting on the underdog.

• 31:08David Hoffman?

  Bitcoin is the underdog is like a crazy thing to have said if you had said that like on POV Crypto like two years ago.

• 31:15Speaker 01

  So, I don't, I don't think like Bitcoin in terms of like its place in the ecosystem is the underdog. I think it's 100% dominate across what matters. I think Bitcoin in the minds of the populace has, has almost always been, you know, written off and the underdog. Like mainstream media has been very happy to be like Bitcoin's not gonna happen, but DeFi is interesting, blockchain is interesting. It's always been like this other thing is interesting. So, you know, you can win this like little battle here, which is like convincing people that are so far away from what I think is like the future to like like your thing.

• 31:58Speaker 01

  But I don't think that that actually matters for the future.

• 32:02David Hoffman?

  So, what do you, what do you, what's your take on tornado cash? And the fact that the biggest government in the world made something on Ethereum illegal? And I'll, and I'll echo Nick Carter's, uh, words from Nick Carter where he said like, because of this, like you know that Ethereum is like over the target as in like, it's on to something when a big nation state feels threatened by something like tornado cash and actually bans it. And so Nick Carter said like Ethereum is now like the spearhead of the cypherpunk movement. And like, and I see this in stark contrast to Bitcoin where like I, I called Bitcoin like impotent. Cause it's just like not a threat. It's just like Bitcoin. It's just like, it's this thing that has 21 million.

• 32:47David Hoffman?

  Yeah, it's written off.

• 32:49Speaker 01

  Love it.

• 32:50David Hoffman?

  You say you love it, but I say like, yeah, it's because like, it's just, you want to be a threat. You want to threaten the nation state. And if you are, it's because you are super high value.

• 32:58Speaker 01

  It is definitely threatening the nation state. That's why it is the thing that is being attacked most by the narrative. I mean, I don't think that it's mutually exclusive. I think that nation states want centralized control. Anything that gets made, like any sort of volume and traction that. You know, doesn't that that takes away from that like they're gonna attack. So like, I can view Ethereum as like a inefficient, more censorship resistant, no KYC exchange. And then if you frame it that way, then okay, well, there's been plenty of exchanges that have become illegal and attacked by the government. That's still part of the Bitcoin ecosystem. Like, okay, you came up with the UX that like got on their radar, they attacked it.

• 33:40Speaker 01

  Like, that's great. That's like saying like this is now the spearhead of the cypherpunk movement. Like, it's fucking ridiculous.

• 33:48David Hoffman?

  Can you, I think you'll have to explain to the listeners like why something like Ethereum is inside of the Bitcoin ecosystem. Can you explain that perspective?

• 33:56Speaker 01

  Okay, well firstly, like Bitcoin is what started this ecosystem.

• 34:00David Hoffman?

  Sure.

• 34:01Speaker 01

  Secondly, like Ethereum and all other chains like relied on Bitcoin to even get bootstrapped. The proof of work was the very first thing that can enable a decentralized currency. Everything else was either directly or indirectly built off of that existence. I don't think that that can be argued with. But beyond that, like, all of these things are interoperable with each other. Like, I see exchanges as layers on top of Bitcoin. I see the app layers, you know, whether they're centralized, decentralized, whatever, like whatever their server architecture, they're either directly or indirectly plugging into Bitcoin. And I just see Ethereum, like the best way I could describe Ethereum is like a, it's almost like this giant app layer

• 34:44Speaker 01

  for crypto that is much less efficient than a centralized one, AKA you can call it a BNB or an FTX or Solana, but much more censorship resistant and much more permissionless. And it provided KYC free activity. Like, those are the things that it solved for. There's a lot of ways where it like is obviously independent and it's done its own thing since it's bootstrapped off Bitcoin. But I don't see it as being outside of like this layering of like the crypto enabled ecosystem. And at the heart of that, the only thing that like is not fully manipulated by fiat, even though it is still slightly manipulated by

• 35:24Speaker 01

  fiat, is the, is the price of, the, the, the energy conversion into Bitcoin ratio. Like that, to me, like, that is like, that is like the root of all of this stuff. So that's definitely still true, in my opinion.

• 35:41David Hoffman?

  Okay, so your perspective is like, uh, there's, um, you have Bitcoin as the base layer, you have Ethereum as a layer on top of that, you have Bitcoin proof of work as the thing that grounds Bitcoin into the real world, that's outside of fiat systems. Then you have Bitcoin, then you have Ethereum, then you have the Ethereum app layer.

• 36:01Speaker 01

  And all the other, all the other variations too.

• 36:04David Hoffman?

  You go up the stack and you get into the shitcoins as you go further up the stack.

• 36:08Speaker 01

  I mean, up sideways around, you know, maybe, maybe instead of like a root or layers, maybe it's like, uh, it's like a solar system, you know, with like just stuff orbiting around it. But, uh, I mean, I don't know, that's, uh, it's definitely my perspective. I think it's a unique perspective. I don't, I don't think that most Bitcoiners think that way. And, you know, to the Ethereum's or ETH heads who'd be like, what a crazy fuck, like ETH heads have been writing off Bitcoin and have had, in my opinion, incorrect, uh, worldview and perspectives on how Bitcoin is, is changing the world. So of course you're not going to get it.

• 36:46David Hoffman?

  How is Bitcoin changing the world?

• 36:48Speaker 01

  Uh, it's changing the world in terms of it's creating that settlement layer, it is creating a monetary, uh, it's creating a monetary ecosystem where you can count, like this divided by 21 million. Like it's that, like that's the ultimate goal is being able to count and price things, right?

• 37:07David Hoffman?

  This is the meme of infinity over Bitcoin, infinity over 21 million.

• 37:10Speaker 01

  Yeah, the human world divided by, it's like a system where you can count.

• 37:13David Hoffman?

  Everything divided by 21 million.

• 37:14Speaker 01

  It is literally, it's as simple as a system that you can count. That is it. We live right now in a system where we're trying to allocate capital where no one can effing count. Um, and then, and then on top of that, and this might be even bigger than the sound money revolution, AKA a system where you can actually count, is Bitcoins place in the energy infrastructure. Like we're seeing how wrecked our energy infrastructure is in the world, how inefficient it is, how corrupted it is, uh, how political forces are attacking it, how, uh, just narratives, the whole thing is just, it doesn't work. And, and Bitcoin is like it grounds the world in energy, the monetary system in energy. It also does

• 37:58Speaker 01

  an amazing thing to the energy system, which is it becomes the buyer of first resort and the buyer of last resort, and it is geographically independent. You can plug it in. You know, connect to the network from anywhere and that's just never existed before. The closest thing that almost existed like that is being able to smelt aluminum. But even still, like that's like, you can't do that on the level of, hey, I'm just going to cap this one methane flare in this random field and mine Bitcoin like you. That requires an enormous amount of unexportable energy in a very specific place. So like Bitcoin is a thousand, if you think of like Bitcoin proof of work as an improvement on being able to export energy via aluminum smelting.

• 38:42Speaker 01

  Like it's a million X improvement. You can set it up anywhere and you can ship the, you can export the energy with Bitcoin to a liquid market anywhere with no physical constraints. So, I mean, between like revolutionaring our energy grid, which is something that we need to do. It is huge and between creating a monetary system that's uncorruptible, you can count. Like that's a lot and I don't know what world you guys are living in. But that is, those are two massive problems in the world right now.

• 39:15David Hoffman?

  Yeah, I mean, bankless listeners will know that I kind of think almost every single Bitcoin or over indexes on like how strong the relationship between Bitcoin and energy is. I don't know if you want to go into that or not. Do you want to go into that?

• 39:28Speaker 01

  I mean, look around.

• 39:31Speaker 01

  Like energy producers, big and small are getting into it. So I

• 39:35David Hoffman?

  Right, but it's like Bitcoin and proof of work is a boon to energy producers at the cost of Bitcoin. And so like all, all of, because Bitcoin, when you produce energy, you are able to mine Bitcoin and then sell Bitcoins to pay for the cost of producing that energy. So energy production gets cheaper. And then also Bitcoin that ended that, the reason why it gets cheaper is because you can sell Bitcoins to subsidize it. And so it pulls away the value of Bitcoin and then it adds value to the energy grid.

• 40:11Speaker 01

  So Bitcoin is good for the world, man. It's not about the Cantillon effect.

• 40:15David Hoffman?

  Oh, sorry?

• 40:15Speaker 01

  It's not about insiders being able to hold on to their coins. It's not about maximizing. 值钱价值

• 40:20David Hoffman?

  对

• 40:21Speaker 01

  whatever Bitcoin is about making the world a better place making energy

• 40:25David Hoffman?

  The cost of itself

• 40:26Speaker 01

  No, I disagree

• 40:26David Hoffman?

  A value comes out of Bitcoin to pay for energy and the energy grid

• 40:30Speaker 01

  That's just not true

• 40:31David Hoffman?

  That's 100% true. That's what you miners mine the Bitcoin They consume energy to do that. They receive the Bitcoins and then they sell the Bitcoins to pay for their business. Value leaves Bitcoin and it goes into the energy grid, the energy infrastructure.

• 40:46Speaker 01

  So Bitcoin is a mechanism to bootstrap out better energy infrastructure. I don't think that that's

• 40:51David Hoffman?

  At the cost of itself.

• 40:52Speaker 01

  No, I think that that's just a healthy ecosystem. Like, yes, there is selling that has to happen of Bitcoin. Like, there has to be a bigger There has to be a bigger market of buyers. Like, that is part of, like, let's just zoom out really quick. Bitcoin is binary, in my opinion.

• 41:10David Hoffman?

  Yeah.

• 41:10Speaker 01

  Which means that the incentives work or the incentives don't work. So if Bitcoin's incentives are flawed, AKA miners are going to leech onto it and then bury the system.

• 41:24David Hoffman?

  Yep.

• 41:24Speaker 01

  Which is what you're saying.

• 41:25David Hoffman?

  Yep.

• 41:25Speaker 01

  Okay, the incentives don't work.

• 41:27David Hoffman?

  Mm-hmm.

• 41:28Speaker 01

  Okay, but I don't think that that's the case. I think the incentives work. And if the incentives work, then miners will, Bitcoin will help energy infrastructure bootstrap and improve across the planet. Bitcoin is going to become literally at the center of all energy infrastructure across the planet. Bitcoin buyers are going to increase as they see Bitcoin becoming a greater and greater part of the real world that is 100% needed to make any of this stuff that we're enjoying and leveraging in the modern world possible. And it's going, and it's going to increase in buyers. We're at less than 1% adoption right now. There's only 21 million Bitcoin.

• 42:12Speaker 01

  Like, if you actually think through what adoption looks like, I'm not concerned. The miners can sell the Bitcoin. Actually, we need that. That's called healthy distribution of coins. That's how you actually create a monetary system that's fair. There's a reason why the world converged around, you know, metals. It's because Those are everywhere on the planet. They're distributed. They're not just in one spot. So I think that the distribution of coins is is actually a healthy part of Bitcoin's incentive structure. Like, do you need that?

• 42:41David Hoffman?

  Yes, yeah, it's it's good for it's good for distribution. The equal and opposite net effect of that is that it actually creates centralization and security, but we'll go down that path later.

• 42:52Speaker 01

  Look, I I just think that the way that you're analyzing these systems are just wrong.

• 42:58David Hoffman?

  I know, I know.

• 43:02Speaker 01

  You're you're like, hey, that's going to create centralization here. Like, I don't think that you fully understand the Bitcoin system.

• 43:08David Hoffman?

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• 43:50David Hoffman?

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• 44:33David Hoffman?

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• 45:16David Hoffman?

  buying and holding NFTs with a gallery view, and support for hardware wallets. But also much more than that, because Brave is shipping new features every single month with a mission to make Web3 easier to navigate for its over 55 million users. Wallet extensions are a thing of the past, so get started with Brave's Web3-ready browser today and experience a decentralized web seamlessly without all the clutter. You can download the browser at brave.com/banklist and click the wallet icon to get started. We're watching miners right now, the Argo or whatever, like go through the beginnings of like being able to like not make ends meet and go through consolidation as the inefficient miners get washed out by the efficient miners and like yay, like miners are becoming more efficient through the bear market as the inefficient ones like burn out. But that's just centralization of security, but that's also not the point I want to make.

• 46:01Speaker 01

  Wait, no, hold on. So the largest miners in the world, the ones that have been centralizing ASICs, they're all going under and they're selling their ASICs for pennies on the dollar to whoever is willing to buy them. So that's a distribution effect. That's actually, that is the destruction of centralization.

• 46:19David Hoffman?

  Hey, you only, you either get the distribution and decentralization of BTC, the asset, or you get the decentralization of Bitcoin security. You don't get both. Those are equal and opposites.

• 46:30Speaker 01

  Because your assumption is that Bitcoin mining, there's only benefits to in scale. So like the benefits in having large scale, the economies of scale, that's the phrase. You only think that Bitcoin mining equals economies of scale, period.

• 46:48David Hoffman?

  Correct.

• 46:48Speaker 01

  I think like. Bitcoin mining is a very complex ecosystem that economies of scale are not the only element to that. And that there's actually in many use cases, there's a diseconomy of scale. Like if you want to use Bitcoin miners and and collect their waste heat, there's a diseconomy of scale to that. Because you can only use so much heat in one place. And then all of a sudden, heat becomes an issue, then you have to spend energy and resources to get rid of that heat. So if you want to use Bitcoin mining heat to power a greenhouse, well, like there's an efficient size of a greenhouse. And there's a standard, you know, market delivered uh scale that makes sense.

• 47:28Speaker 01

  And then all like Bitcoin mining is an energy efficiency catalyst. So anywhere where you need energy efficiency, Bitcoin mining is going to help there. So there's actually a diseconomy of scale because not everyone is located in the same place. Not everyone needs that efficiency in the same place. So I disagree completely with your assessment of.

• 47:50David Hoffman?

  I think that's such a small in order consequence, like it doesn't upset the rule. Like it's perhaps it slows it down, but it still doesn't break the rule that one dollar of capital produces certain amount of hash, like X number of hashes. And then $10 of capital produces more than $10 of cap of of hashes.

• 48:09Speaker 01

  So the thing that breaks that rule is that energy in specific quantity is not located in the central place. People needing or could benefit from the energy efficiencies are not located in one place. So unless you think the whole world is converging on a geography, like that's the beautiful thing about Bitcoin mining. It's it's geographically independent. It hits the it just hits the geographies.

• 48:34David Hoffman?

  Entity independent.

• 48:35Speaker 01

  Okay, well, you know, I've yet to see an entity take over. So there is literally zero history of the game theory not working.

• 48:44David Hoffman?

  Uh, okay, I want to go back to the point that I I wanted to make in the first place before we go down. We went down like the energy thing. The this and go this goes back to um Bitcoin miners. Uh, mine Bitcoin, cost some energy, sell the Bitcoins to pay for the costs. And that I'm I'm saying that that is a transfer of value from Bitcoin to the energy grid. I think what you're saying is that people. Who will, they'll see Bitcoin being integrated into the energy grid across the world. Bitcoin will be like baked into the energy system so well that people will just notice that. And it'll be beneficial to Bitcoin.

• 49:19Speaker 01

  It's not that noticing it, like it will be, continue to get priced in. Like Bitcoin will be important.

• 49:26David Hoffman?

  It's not a bullish thing to be integrated into the energy grid. That's the point I want to make. Is that like?

• 49:30Speaker 01

  I can't think of anything more bullish than that.

• 49:34David Hoffman?

  No, because it's this one, it's this, it's one way transfer of value from Bitcoin into the energy system. And if Bitcoin continues to like go up in market cap, then the energy system can get better. But it's always a one-way street. And so the only way that value goes back into Bitcoin is if people like just appreciate that fact. And, but it's not a codified mechanism. So there's this codified mechanism of Bitcoin gets sold to pay for energy. And there is no equal and opposite codified mechanism where value goes back into Bitcoin. Other than just like the valence of like positive perception of it being around the energy grid.

• 50:15David Hoffman?

  When people research it and they see that Bitcoin only gets sold to pay for energy. That's not like the perception that you want. That's bearish. And so people aren't going to appreciate Bitcoin more because they don't want to be the bag holders. Because all the miners are able to dump their Bitcoins to pay for their energy. Like it's not a good association. It's a, it's a negative association.

• 50:39Speaker 01

  I think that if you're trying to sell an investment scheme to people, then maybe that you can make that argument. If you're trying to make the world a better place, if you're trying to create an economic system that integrates into the planet and helps humans economically coordinate and manage their energy, then it's going to be okay.

• 50:56David Hoffman?

  But Bitcoin.

• 50:58Speaker 01

  I don't know what else to tell you.

• 50:59David Hoffman?

  But Bitcoin doesn't work if it doesn't go up in price. Like it has to go up in price.

• 51:03Speaker 01

  Look, Bitcoin's incentives work or they don't. If the incentives work, I think it's going to be the most competitive money on the planet. And it'll continue to outcompete and it will reach hyper Bitcoinization. If the incentives don't work, it's going to zero. I hope you got some guns and bullion. Cause we got some big ass problems in front of us. Maybe Ethereum can escape that, uh, that dichotomy. I, I just, I don't know, like.

• 51:32Speaker 01

  Whenever you're like, hey, guess what, like the miners, it doesn't work. Pretty much what you're saying is, I don't think the incentives are going to work into the future. And my response to that would be, well, if you pay attention to what's going on, obviously that dynamic that you're describing is not the actual dynamic. Secondly, there is continuing to be increased people who have faith, have comfort, want to continue to hold and accumulate this asset greater than the miners being able to sell. And then on top of that, if that stops, then Bitcoin will break. So, I mean, maybe you should diversify, like I've always been a proponent to like, hey, if you're actually bullish enough on Bitcoin, you never have to fully leverage yourself against Bitcoin.

• 52:16Speaker 01

  Like, you can be comfortable in your life, you can hold other assets, because one Bitcoin is going to be worth an insane amount of money. The whole point is you need to get Bitcoin from the beginning of the S-curve to the other side. Any amount, literally any amount that you can buy on this side, if we reach hyper Bitcoinization, will be more, will be an insane amount of money on the other end, because it's a fixed supply currency that's also technology. So, if we go from less than 1% adoption to 99% adoption, and then on top of that Bitcoin's a better system theoretically, because you can count and it helps with the energy grid, so theoretically it will help us create more value, then any amount that you own right now, getting it to the other side is going to make you insanely wealthy.

• 53:02Speaker 01

  So, you can, like, you don't have to be over-indexed against Bitcoin. You don't have to put yourself in a position where if the economic assumptions don't work, if the game theory doesn't work, that you're wrecked. Like, that's bad personal finance in my opinion, so... I mean, like, hey, if you, if you, you could argue with me that Bitcoin's incentives don't work, so you're blue in the face, I will just keep telling you that the history doesn't show that, all the trends moving forward doesn't show that. And I don't think that Ethereum like onboarding people onto public key cryptography and signing with your with your private keys and putting value in internet protocols. I don't actually think that that takes away from Bitcoin.

• 53:46Speaker 01

  Like I just think we need to onboard 99% of people. Like, there's not one way to onboard them all because they all have different base assumptions on how the world works. So actually, it's a benefit to Bitcoin that someone can be like, hey, I'm gonna take a system similar to Bitcoin. I'm gonna change the dynamics a little bit to make it fit my worldview a little bit. And and maybe that will attract more people to the space. Like, most people are not aligned to the future view of where Bitcoin's taking us. Obviously, because Bitcoin is a paradigm shift. If everyone was aligned with it, then it like, it wouldn't be that big of a deal because everyone was mentally able to deal with that. But guess what? Before we had electricity, only Nikola Tesla saw the future.

• 54:29Speaker 01

  Right? Like, you ask the average person, hey, is electricity getting a big deal? Like, what's that? But once it became a thing, they couldn't lay down the fiber fast enough. They couldn't lay down the lines fast enough because it was a game changer. It's undeniable. So I just think that's what Bitcoin is.

• 54:47David Hoffman?

  Does Bitcoin work if it's not the number one most valued crypto asset?

• 54:54Speaker 01

  Definitely.

• 54:55David Hoffman?

  Yeah?

• 54:56Speaker 01

  And if anything, like, that's coming 100%.

• 54:59David Hoffman?

  Something is gonna flip Bitcoin?

• 55:01Speaker 01

  Well, I mean, Bitcoin's already not the biggest currency in the world. So like, does it matter if there's a bigger currency that is a cryptographic one? Like, I could definitely see like a stablecoin flipping Bitcoin soon. Like, does that mean because like they're partially like settled on Ethereum that Ethereum is flipping Bitcoin? Like, I don't necessarily know, like... I think like every single sacred cow, that's why the framing of like market cap, it's like, like that.

• 55:30David Hoffman?

  Yeah, Bitcoiners have always hated the market, the market cap.

• 55:32Speaker 01

  Yeah, I mean, but regardless, like every sacred cow is gonna be broken on the way to hyper Bitcoinization, in my opinion.

• 55:38David Hoffman?

  Wait, so if we are in hyper Bitcoinization, is Bitcoin the largest money market by market cap?

• 55:45Speaker 01

  Yeah, and the end result, but like.

• 55:48David Hoffman?

  On the way there, it doesn't matter.

• 55:48Speaker 01

  Yeah, going from zero, you know, less than 1% adoption to 99, you know, to 100% adoption, there's just a lot of confusion. Like, there's gonna be a lot of experimentation. Do you remember the HD DVD versus Blu-ray debacle? And then guess what actually got mainstream adoption?

• 56:04David Hoffman?

  It's Netflix, yeah.

• 56:05Speaker 01

  Digital, streaming. Like, the consumer was wrong the whole time. They were wrong the whole time. So like, hey, you know, did, did video, did streaming, you know, did it matter to streaming that DVD, HD DVD and Blu-ray are all bigger at one point? Didn't matter at all.

• 56:23David Hoffman?

  I think the biggest difference between you and I, Ethereumers and Bitcoiners, is like, we all agree like there's a paradigm shift that's coming. We just don't agree on what that paradigm shift actually is.

• 56:33Speaker 01

  Yeah, I agree with that.

• 56:34David Hoffman?

  And so, like, my big paradigm shift is that we can take human systems that we have already created throughout history, that we've been recreating throughout history, and make them better. And that the better form factor is like a much, much, much better, but it's still the same thing that we've already had. So like, the Dutch East India Company in, in, in the Netherlands, and then, and then the Delaware LLC in the United States, now Dow's on Ethereum. And so like, one of the reasons, one of the reasons why I have like such conviction in Ethereum is like, we see these principles and these structures that humans have been doing for generations, for centuries. And now we're seeing them again on Ethereum, but with more and more just like codified cryptography, shared truth, like objective nature to them.

• 57:20David Hoffman?

  And so like, that gives me confidence in that like, okay, we've already been doing these things, and now Ethereum allows us to do these things better. Since we were doing them once before, now we have a better way to do it. That's bullish for Ethereum, once people can wrap their heads around it. And so we are taking these like, systems that we've already created in the world, stock exchanges, like. Like securitization, like assets, non-fungible assets like a mortgage, non-fungible tokens like a CryptoPunk. We've already been doing all of these things and now Ethereum does it better and it does it in a more trustless way. That is more like more liquidity, more user participation, more freedom, more sovereignty.

• 57:56Speaker 01

  Interoperability.

• 57:57David Hoffman?

  And more interoperability, yes. And so like same, same, but better. And that's a paradigm shift. The Bitcoiner paradigm shift, the paradigm shift that I hear you make is something that is, to me, it's like way bigger of a paradigm shift. It's way more massive of like a proposed what it actually means. I'm not going to do it justice if I try and do it, but maybe you can like articulate what your paradigm shift is.

• 58:20Speaker 01

  Yeah, I think that was great framing, actually. So, you know, the longest monologue that I agreed with that you've said so far. And if anything, like I agree with you that like a lot, like crypto in general is effectively codifying ancient wisdom to some degree.

• 58:39David Hoffman?

  Hundred percent.

• 58:39Speaker 01

  So what I would say is like, sure, all of the, but everything you described to me in terms of like how the layers of society, like we're talking about the layers of a blockchain, the layers of money, all this stuff. Like society is built on layers, right? So like everything you described to me is like the app layer of society.

• 58:55David Hoffman?

  Right.

• 58:55Speaker 01

  Like the revolution is going to happen at the foundation. And that's why foundations, the foundation in Bitcoin is to also codified in ancient in ancient wisdom and technology and Lindy, which is like, you know, looking at the foundation of monetary system. It's like, okay, in the past, there's a lot of arguments on like the history of it. Nick Zabel has a great article, Shelling Out, which kind of talks about, you know, this evolution, but ultimately, you know, the world, we converged around, you know, gold and silver, around precious metals. Bitcoin is codified in the mechanism, similar mechanisms, like inherently similar mechanisms,

• 59:37Speaker 01

  but code and dematerialize and a 1000x improvement on those same mechanism at the very base. So I guess what I'm trying to say is like, I think. If anything Ethereum is like more like this sandbox. But in the long enough time horizon, like the actual evolution happens after the base and is built off of the base of Bitcoin. So I do think that we're, we're seeing a similar trend. I'm just focusing on the foundation and I, I think Bitcoin's attacking that foundation very, very effectively.

• 1:00:11David Hoffman?

  Yeah, and I think my like, uh, my response to that would be like, well Ether as a money is also going after that same foundation. And also if we take away, if we take like Bitcoin is gold and gold has been around forever. I think that's over indexing on like how big of a deal gold is. It's like, yeah, gold's been, gold transcends like empires, it transcends organizational structures. But like, it doesn't actually like, one of the, one of the reasons why empires are created is because they were able to make gold do things like coinage, right? Like we were able to make fiat gold, fiat issuance of gold. And like that created temporary boons, then it created a bust. But like we

• 1:00:50Speaker 01

  Gold's imperfect, I know.

• 1:00:51David Hoffman?

  Yeah, we've been, we've been like creating other monetary systems around gold. Sometimes completely unrelated to gold that created their own innovations as well. It's like one of the bull cases for Ethereum is that like you can express any monetary policy on Ethereum that you want. With, you know, issue a token and make that token do a thing. And if that thing is liked by the populace, then it sticks around. And so any sort of just like monetary policy that we enjoy as humans, as money enjoyers, like we can have that expressed on Ethereum.

• 1:01:24Speaker 01

  Like I, I don't think that money enjoyers enjoy monetary policy. I, I think like, do you have a specific like preference of kilowatts or hertz? Or whatever frequency that is used in order to like make all this tech happen around us?

• 1:01:42David Hoffman?

  No, I don't.

• 1:01:43Speaker 01

  Like you use what works, use what has been built into the system, like that perpetuates itself.

• 1:01:52Speaker 01

  I don't think people are gonna choose a money. I think money is literally shoved down people's throats because you either adopt it or you get fucked. It's a massive efficiency gain or it's fucking poverty. Like it's, I'm not gonna be a money enjoyer. He was like, you know, I kinda enjoy this flavor of money. It's like, no, it's like you're holding pesos and getting fucked or you're getting into dollars in the most efficient way possible. Like that is the paradigm.

• 1:02:18David Hoffman?

  Right. So like, you don't, you don't give any sort of like, uh, credit to the argument that like, if Ethereum recreates the global financial system, it's more likely going to be ether, the currency than bitcoin, the currency that flows through that financial system.

• 1:02:32Speaker 01

  I mean,

• 1:02:35Speaker 01

  like, if you see something that's fucking crumbling and looks like shit, like, why would you wanna recreate it? Like, I'm trying to like-

• 1:02:41David Hoffman?

  Because the form factor that you recreated in is not crumbling. It's actually the thing that replaces it. So like, hey, like, is your stock exchange bad because, uh, like, we still need stock exchanges. We'll just use Uniswap instead of the one that's breaking.

• 1:02:55Speaker 01

  Yeah. No, so I mean, uh, do you remember that famous, uh, Henry Ford, uh, quote?

• 1:03:02David Hoffman?

  Something about horses and cars?

• 1:03:04Speaker 01

  It's like, if I would've asked the people, you know, what they wanted, they would've said, I want a faster horse.

• 1:03:09David Hoffman?

  Right. Yeah, everyone, everyone likes to leverage that quote, but like, I can say that you can, you can always, it's like unfalsifiable, right? It's just like, yeah, you, that's a fun quote and you can kind of make that about anything. Like, pick, pick any sort of thing that you believe in and you can apply that to like the Henry Ford quote.

• 1:03:25Speaker 01

  I mean, I guess that's fair, but I, I was just trying to illustrate my perspective here. It's like, okay, it's nice that you're trying to recreate the current financial app layer on Ethereum and maybe Ethereum doesn't have some of the corruptions that the current financial app layer has. But I think that remains to be seen. We haven't seen the game get lucrative enough and the game get big enough and enough big players, uh, fighting in that game. But I'm saying is like, wow, that is misallocation of capital and misallocation of capital and misallocation of capital and misallocation of capital. Like, the whole thing. We need to burn the whole thing down. Bitcoin is just a new foundation built in first principles and I think that we're gonna build a new system based on that. Because if you don't-

• 1:04:09Speaker 01

  Like, I think it's like a capitalism communism paradigm in the Cold War. It's like, at one point, the president of Russia visited America, the average grocery store. It was like, wow, the average American has more than the richest Russian ever could imagine. Because the system just created much, much more wealth and optionality. And I, I really do think like, zoom forward six or seven years, like, we'll be looking at the traditional system. We'll be looking at the Bitcoin ecosystem. I don't know if you want to include crypto or not in that, it depends on who your opinion is. I think the, the crypto system is like a bridge, almost. But like, it's gonna be, the dichotomy is gonna be the same. It's poverty, it's like poverty and destitution, or Bitcoin and energy and wealth.

• 1:04:54Speaker 01

  Like, that's the paradigm. No one's gonna choose poverty.

• 1:04:58David Hoffman?

  Yeah, you, you said like, uh, uh, one system is like, is poverty, the other system is like wealth and optionality. I think one main like core philosophical difference between Bitcoiners and Ethereum's is like, Bitcoin is like, alright, no more seniorage, no more issuance, no more Cantillon effect, just Bitcoin. It's the best, so much more simple, so much more efficient, one shelling point.

• 1:05:20Speaker 01

  You can count.

• 1:05:20David Hoffman?

  Yeah, you can count. You can count to 21 million.

• 1:05:22Speaker 01

  Bless up.

• 1:05:23David Hoffman?

  Ethereum is like, uh, everyone gets issuance, everyone gets the Cantillon effect. We all get to print money now. Like, and so when everyone can print money, no one can really print money, because since the power to issue is now in the hands of the most marginal user, then it's actually a check on the bigger issuers of the world. It's like, we all get to create tokens, we all get to mint NFTs, we all get to do it. No longer is the power of asset issuance constrained behind the doors of Wall Street and behind nation-state like threats of violence. Now, the individual can make their token and do their weird yield farming thing. Uh, and I think that is wealth and optionality for as many people as possible.

• 1:06:07Speaker 01

  I mean, the current world that Bitcoin has created for us is a world where there's Bitcoin. And it's also a world where the blueprint for blockchain technology allowed everyone to mint stuff. And guess what? That actually drowns out. I think it actually drowns out fiat more than it actually drowns out Bitcoin. So I think what we see is like, there's gonna be Bitcoin. Maybe you're saying there'll be Ether and there'll be everything else and it'll actually be individuals drowning out. Like governments who had a monopoly on money printing. Maybe it's governments and corporations.

• 1:06:41David Hoffman?

  Right.

• 1:06:41Speaker 01

  Right? I think that's part of the revolution is those things have to be drowned out. And I've, I've said this on POV Crypto, I've said this on the internet, like shitcoins are good for Bitcoin. Because there's two things happening. There's Bitcoin and then there's a Hydra of shit. And both things are attacking the state together. The real revolution is individuals and sovereignty versus centralization and statism. So if you see that as the paradigm, all of these things are technologies to empower individual sovereignty. That's why we're mostly on the same team, even though we disagree on, you know, how the sovereignty tech is gonna play out.

• 1:07:17David Hoffman?

  I think if you're saying like, it's shitcoins and issuance that drowns out the nation state. The nation state is the incumbent, right? So whoever gets to dethrone the incumbent is the new Chad. And so if like, if Bitcoin's not doing that, and this goes back to like the Nick Carter quote where he's like, oh yeah, the things that are going on on the Ethereum app layer are the new like spearhead of the cypherpunk movement. It's because like, if we are the ones who, because we have the issuance that we are now drowning out old nation state issuance, that makes us the Chads. And if Bitcoin's not doing it, then Bitcoin's not the Chad.

• 1:07:48Speaker 01

  See, this is like, I love that framing. Great, great rhetoric. Excellent rhetoric. Fantastic, David.

• 1:07:56Speaker 01

  Look, that's fine. Personally, I think that like what the shitcoins do is they DDoS regulators. So it's not like the shitcoins are disrupting regulators. I think Bitcoin, Bitcoin's actually what's disrupting the incumbents because Bitcoin's creating sound money for the people that doesn't have the Cantillon effect. Bitcoin is helping fix the energy infrastructure in a decentralized way. But what the Hydra of shit does is it DDoS's the regulators and it acts as a shield for Bitcoin. So that would be my framing, but I like your rhetoric.

• 1:08:27David Hoffman?

  Alright, I don't have any other topics in my head. You have anything else you want to talk about?

• 1:08:32Speaker 01

  No, man. Beautiful apartment, great studio. I need to get some Shure mics on my own. I need to upgrade my studio, for sure.

• 1:08:40David Hoffman?

  Yeah, I see you, you still have that Yeti Nano microphone. Yeah, we gotta get your microphone.

• 1:08:45Speaker 01

  Yeah, you know, we got like a little studio in the Bitcoin magazine office, but we like distributed the equipment to the people who are on camera all the time. So, I just like don't podcast as much as you anymore.

• 1:08:55David Hoffman?

  Yeah, you're a big operator now.

• 1:08:59Speaker 01

  I miss the days of, the simple days. Yeah, I miss the simple days. Don't get too big. But, y'all, I mean, shit is just getting interesting. I think Twitter and

• 1:09:17Speaker 01

  regulation and Bitcoin and crypto, all of these things are gonna continue to become more important. And like frankly, they're already kind of part of like the political conversation. I think the next presidential election is gonna be a key topic. And to everyone out there who's saying like, "Oh, crypto's gonna be adopted over the course of like 50 years, not in my lifetime." You're all fucking bears. Like, none of you are aligned with how fast this shit is gonna go. So, if I could give anyone on the blacklist side of things a pep talk, it's like, this technology, it either improves the world, it's either undeniable, it's going to,

• 1:09:59Speaker 01

  if that's true, then it's gonna take hold incredibly fast. Like, I really don't think that this stuff is gonna take our lifetimes.

• 1:10:08David Hoffman?

  Right. No, not at all. I definitely agree with that. And I think like we're starting to see it accelerate. Like, that's the main difference between I think this current bear market versus the last one is like, the rate of development is like 10 times faster than it was.

• 1:10:21Speaker 01

  And it's gonna keep compounding.

• 1:10:22David Hoffman?

  Yeah, and I do feel like we are at the part of the S curve where you can actually see the slope starting to increase. I think we're done with the S curve by the end of this decade, yeah. Yeah, that's gonna be, that's gonna be wild. I agree with that. I think, I think 2030, like, that's gonna be a key marker.

• 1:10:39Speaker 01

  Mm-hmm.

• 1:10:40David Hoffman?

  See where the hell we're at.

• 1:10:41Speaker 01

  Oh, boy.

• 1:10:42David Hoffman?

  Mm-hmm.

• 1:10:42Speaker 01

  If, if we're going from the flat part to the, to the up part of the S, more volatility.

• 1:10:50David Hoffman?

  Right, yeah, that doesn't mean-

• 1:10:50Speaker 01

  Not less.

• 1:10:51David Hoffman?

  That doesn't mean that's what prices do. That just means what adoption does. Prices can go up and down, left and right, throughout that.

• 1:10:57Speaker 01

  Oh, yeah. Well, I think it, prices will go up, but it's, it's gonna like-

• 1:11:01David Hoffman?

  Right.

• 1:11:01Speaker 01

  Effectively go up and down again. But when it's going like this, that's gonna be a massive volatility to the upside, like-

• 1:11:07David Hoffman?

  Yeah.

• 1:11:08Speaker 01

  Issue's gonna get wild, man. Issue's gonna get wild.

• 1:11:11David Hoffman?

  Yeah, 100%. Well, CK, it's been a, a thrill being on the ride with you thus far, and it's gonna be a thrill taking this rest of the decade by the horns.

• 1:11:17Speaker 01

  All right, let's eat some food.

• 1:11:19David Hoffman?

  Let's do it. Sorry to all the, uh, Bankless listeners that won't be able to enjoy my smoked salmon, but it's very delicious.

• 1:11:24Speaker 01

  Peace, Sucks, Suck.

• 1:11:26David Hoffman?

  Peace.

• 1:11:26Speaker 01

  Peace.

• 1:11:26David Hoffman?

  Hey, we hope you enjoyed the video. If you did, head over to Bankless HQ right now to develop your crypto investing skills and learn how to free yourself from banks and gain your financial independence. We recommend joining our daily newsletter, podcast, and community as a Bankless Premium subscriber to get the most out of your Bankless experience. You'll get access to our market analysis, our alpha leaks, and exclusive content, and even the Bankless token for airdrops, raffles, and unlocks. If you're interested in crypto, the Bankless community is where you want to be. Click the link in the description to become a Bankless Premium subscriber today.

• 1:12:03David Hoffman?

  Also, don't forget to subscribe to the channel for in-depth interviews with industry leaders, Ask Me Anythings, and weekly rollups where we summarize the week in crypto and other fantastic content. Thanks, everyone, for watching and being on the journey as we build out the Bankless Nation.