Michael Saylor: The Physics of Bitcoin (110)

hi everybody i just finished a really

long and wide-ranging conversation with

michael saylor

who's been in the news a lot because of

his

really prescient forays into the world

of blockchain and bitcoin specifically

he's the chairman founder

president of microstrategy

which is a technology company in its own

right but has

been very very deep as an exponent

proponent of

blockchain not only for you know

personal

uh gains but really to improve the world

as you'll hear about he really wants to

use

his wealth that he's gaining to educate

everybody on earth for free that's

really his mission sounds crazy

but i think he could do it and uh and i

like that he has an engineering uh

approach to things he thinks about

things he constantly references the

second law of thermodynamics so he's got

to be good

in this physicist book we talked about a

lot of things including science fiction

arthur c clarke

what he'd put in his ethical will i

think you're gonna love it uh

please leave a comment in the in the

section below we're gonna make our

you know kind of investment pioneers

playlist with jim simons

bill perkins patrick bet david and now

with michael saylor he agreed to come

back on a part two someday

so look forward to that put comments for

him in the future

please sit back enjoy this

next episode of into the impossible with

michael saylor and made me think that

maybe they should be giving out nobel

prizes instead of in gold like this one

here

but in bitcoin blockchain no who knows

it could it could go down

who knows what's going to happen this is

not investment advice i wish i could buy

a bitcoin but for now

i'm taking his advice to at least

investigate it and not view it with as

much

derision as i confess i did before so

enjoy this episode

of the into the impossible podcast and

like comment subscribe do all those cool

things that you're supposed to do

and it keeps the podcast going and ad

free otherwise i'm going to be doing

stuff for like

bitcoin and ethereum and

bird no litecoin anyway don't make me

resort to that please uh

help me out and uh leave your tiny

contribution the form of a review or a

or a thumbs up thank you very much enjoy

any sufficiently advanced technology is

indistinguishable from magic

[Music]

so it is a pleasure to welcome to the

into the impossible podcast

none other than michael saylor who is

joining us today

uh to talk about a whole host of things

not only

bitcoin uh and the uh the splash that

he's made

lately but but also his wonderful book

that we will get into as well which is

really prescient for

uh for predicting many things not the

least of which is

is how mobile technology would uh impact

the planet and my question for him is

how can we use new technologies like

blockchain

like mobile uh connectivity 5g

etc to improve the world and improve

perhaps the prosperity of the world i

think that is a major theme of michael's

work so

michael how are you today awesome thanks

for having me brian

yeah it's great pleasure to have you on

the into the impossible podcast so

i uh i was really intrigued by

you know many of the conversations i've

seen you have uh and oftentimes they

relate to

interests of mine aviation i'm a private

pilot

i am interested in the ash uh of you

know act being an astronaut

and i know you are mit trained in

engineering

we've had on a lot of professors and

alum

uh fellow beavers from mit lately max

tegmark who's a current

professor there noam chomsky has been on

the show

we've had on peter diamandis who is a

graduate of mit

and david kaiser who's a professor there

we're a very close connection

despite the distance but the first thing

i want to talk to you about today

uh is your book which is called the

mobile wave and

i always say i disregard the advice to

not judge books by their covers

i always judge books by their covers how

did you come up with the cover design

and the name and the title of the book

and the subtitle what was the impetus

behind those choices that you made

the idea behind the book was

there's a there's a new wave of uh

software engineering

we're moving from the mainframe era

to the mini computer error that was the

second wave the third wave was

the pc error the fourth wave was the

internet wave

the fifth wave was the mobile wave

when software dematerializes

it jumps off of laptops it jumps off of

desktops it jumps onto mobile devices

and it becomes like vapor and it

envelops the entire world

and so i mean the cover of the book was

based upon the idea that software was

going to spread

everywhere in the world and and

transform

the civilization

i was uh i was kind of excited about it

because

i lived through the phase of software

being trapped

on a desktop pc and the internet way was

still

delivered largely through pcs but when

we got to the

to the iphone 3 and it was clear that

the iphone was not a toy anymore

and that the ios and android were going

to be new operating systems

that were going to rise to parity with

the web

and maybe superiority to the web

i think it changed the nature of

software it

software changed from being something

uh something we went to do we we went to

use the software tool

on a desk and then software became

clothing it became fashion accessory it

became

it became in the air it became stuff we

smell

it it became stuff we wear it became it

became things we

sleep with you sleep with your sulfur

and

at the point that we were wearing it and

sleeping with it and living with

it and crying and laughing with it

uh the nature changed and the type of

software you would want to build change

and what you could do with it changed

and that was just

transformational to the companies that

were doing it

to the computer industry to the

civilization and i thought it merited a

book and so i

i got kind of excited about writing that

book with the

alums that i mentioned i'll also mention

andy viturbi

who is a graduate of mit

his book over here in my office which

has a slightly more stark cover than

your book does

zero colors whatsoever besides this

orange type of color

and in it he's recounting sort of his

journey as an entrepreneur as a refugee

coming to america and then founding you

know discovering the the viterbi

algorithm

and really converting you know

intellectual property

into uh into into technology

and of course we use that today in cdma

we use it in 5g

and my question is you know first of all

you know in

in retrospect uh is this mobile what

would be the i don't know i lost track

of how many waves we're at

under your taxonomy system but uh but

sixth wave seventh wave

five it was it was the fifth starting

from the mainframe mini computer pc

internet and then mobile

so peter diamandis has said he uses

these famous five d's presumably because

his name has d so many d's in it

you know but uh democratization d

materialism

uh then there's but exponential which is

an e but but anyway

uh d what do you see is the six wave is

it is it something

completely different than these other

waves is it is it a rogue wave

that we really can't anticipate right

now

well first of all as a disclaimer peter

is a fraternity brother of mine we were

the same fraternity he was four years

ahead of me at mit

and uh quite my role model and we both

had a love of

uh of aerospace engineering and rocket

science and astronautics and the lake

yes and uh so i've i've uh

gleefully followed steve's peter's

career for the entire time period

um the sixth wave is the virtual wave

i mean the mobile wave was software

you know look software on the desktop

was bottled up

to uh to the white collar labor

force an hour two hours a day and if you

could

sit down at a desk you could work with

your spreadsheet or your word

processor or your accounting system on a

computer

but it was a white collar

constrained functionality

when software leaked to a mobile device

it went from 500 million people using it

two hours a day

to five billion people soon to be

everybody

five billion people that could use it 16

hours a day and maybe 24 hours a day

arguably right because

the software could wake you up in the

middle of the night and so you went to

724

365 software coverage for

everybody on the planet which meant that

three-year-olds were using

software and 75 year olds were using

software

whereas the software of the of the

internet

and the and the pc error was primarily

well to do white collar laborers and

and and the affluent uh companies

at their desks and so so the potential

to have software that

that interrupted your and impacted your

recreation and your social life

you know software to drive a car

software to book a restaurant

or a hotel reservation software to pay

bills

software to take photos right all of

that was mobile wave software you

wouldn't have

done anything with your friends while

you're at your desk at three in the

afternoon

so the mobile wave was software leaping

off of the desktop and out of the office

and

into the world of the teenager

and on a saturday afternoon and that's

what made for a facebook

or an amazon uh mobile you know

or google or youtube you know and laid

the laid the framework for entertainment

and

and communications but now um

now we're moving on the virtual wave and

the virtual wave probably has two

primary

um uh primary significant dynamics

one you're seeing the virtualization

of a whole class of products and

services

that previously were delivered uh by

human beings

so like uh that you can zoom anywhere at

the speed of light and bend time and

space

if i'm a sales person i can take 40

sales calls a week

if i want in 40 different cities

and so the complete dematerialization

and virtualization of

of sales and marketing and services and

all of the cycles and energy expended to

do that

that's one element and by the way

that phrase you can zoom anywhere at the

speed of light and bend time and space

put a period on it it's a very important

powerful phrase because the second part

of the phrase and bend time and space

well it refers to the fact that i can

zoom to 40 places in 40 to

40 different cities and have 40 meetings

and be one person and i can be

not in the office so that's pretty

profound but the other profound part of

it is

what you just did when we started our

call which is you punch the record

button

and you and i are having a meeting

cross country and that's about to be

shared with

thousands or hundreds of thousands of

people

anywhere anytime

three years from now someone will be

able to go back in time

three years and be in the room with us

now

for the cost of electricity and so if

you think about it that way and turn it

on his head

i'm a salesperson and uh

i think well i'm gonna convince you you

should buy my product brian

and you asked me a hundred questions

well how does it work with google

and i give you the answer and i think

after the fact man i was pretty

articulate

when i sold to brian i think i'll take

that video meeting

and i'll upload it to my website and

i'll let the next 9 700

customers with the same requirement

watch the video and you can do

transcripts you can do highlighting you

can do

conversion and languages in real time

with ai

i do that and i multi-purpose all the i

mean

not this particular conversation i

certainly will have an ai generated

transcript from it you're absolutely

right

so it scales in a way that ordinary

telecons never could

you ever see uh the watchmen the movie

they're watching with dr manhattan

okay so dr manhattan is like this

guy who can make a hundred versions of

himself

now what if you could you know what if i

could speak with you

and then i could deliver it in a hundred

thousand places at the same

time and now you just blew my mind in 27

languages

yeah so it's it sounds godlike right

it's god-like power

you can bend time and space but you're

kind of like uh

a hundred years ago if you'd said mike

i'm gonna take every sales meeting in

every language in real time but i'm

going to do it

a hundred thousand times faster than the

ordinary mortal

or a million times faster you would say

no

that's impossible but the virtual wave

means that yeah you can basically have

god-like power

bend time and space and you can do

things inconceivable

in ways inconceivable so that that's the

first part of it but

that's the virtualization of the p l of

every company

like the way you you sell your product

market your product deliver your service

has been virtualized and you can

when you virtualize it you make it

possible to be a million times more

efficient

and there are profound implications we

could talk about those we why won't now

but there are profound implications to

how you compete and create value in

society but there's another part to the

virtual wave which is

we're watching the virtualization of

money

and the virtualization of gold and store

of value

300 trillion dollars worth of money in

the world

is stored in cash gold

bonds real estate stocks

they're all 20th century instruments

most of them are fiat instruments

they're they're tied to underlying cash

flows

and this new thing we call bitcoin

has evolved and bitcoin is

digital scarcity it's 21 million gold

coins sitting in cyberspace you can't

make any more

running on a decentralized set of nodes

no human being no ceo no company no

government can stop it from running no

one can screw with it it's going to be

21 million

for the next thousand years quite likely

and that 21 million uh

cyber coins bitcoin can now

capture the monetary energy off of gold

silver bonds stocks real estate indexes

and as we speak you're seeing that

monetary energy

dematerialize and and morph

into what is in essence virtual gold and

uh that virtual monetary network

is growing this year 300 percent

every year for the last decade 200

percent

it's building it's building it's

building and it's virtualizing entire

balance sheets of companies

and it's virtualizing treasuries of

individuals

and there's no reason to think it'll

stop for a decade because

because um a virtual gold coin

or virtual gold bar on the bitcoin

network

has no mass it can move at the speed of

light

it's a million times better than an

actual gold bar

a million times smarter a million times

faster a million times

stronger a million times harder than an

actual goal

bar just like you can speak to a million

people

in a dozen languages you're a million

times more persuasive

as the virtual teacher and so what we've

got

is is a next generation money

and a next generation set of uh

actors in the virtual wave that are

virtualizing everything

and that's going to dominate our you

know our society for the next decade

that transformation now i want to push

back with respect

and say that um do you do you know

so i'm holding up a golden medallion

this is a replica of the nobel prize

uh that one of my nobel prize winning

guests left on my couch over here

uh no it's actually just a fake piece of

chocolate that i have left over from

hanukkah

but uh i'll believe whatever you tell me

honestly i know i know that's your

reputation extremely agreeable

um on the side of these coins and you'll

find this on quarters

and dimes but you won't find it on

nickels or pennies there are these

ridges do you know what the purpose of

those ridges are do you know what those

are called i've always uh

been curious if you're i i thought

they're there to keep people from like

shaving the coins or something that's

right that's exactly

right that was create exactly so it's a

way that since roman times people were

doing what's called coin clipping

and they would shave down just a little

bit of the coin and that was a way that

they could

accumulate over enough of these coins

they could accumulate a full coin

so they were actually devaluing their

money and the romans knew about this

no one solved it until a man by the name

of isaac newton

came about and actually led to a great

deal of catastrophe especially in the

jewish community of england in the 1200s

that were basically expelled

uh from england for vehement suspicion

of

of uh committing committing this type of

monetary fraud and and so forth of

course it wasn't true

and then later when isaac newton became

master of the mint

he said well put these ridges on it now

the reason that we have it on quarters

is because as you know a quarter used to

be a quarter ounce of silver

but a penny was always uh you know it

doesn't have the ridges because it's

made of a base metal more base metal

it there's no profit in shaving down a

penny versus a silver

coin of course now there's no silver in

our currency

in america but the notion that this had

to occur

uh was because of the scarcity of gold

so i can tell you that

gold that i have and if this were a real

nobel prize it would be worth

about 24 000 and uh and that gold came

from

the collision of two enormous neutron

stars

and that happened perhaps five billion

years ago in our region of the galaxy

and the neutron enrichment basically a

giant atom not a 56

neutron but 10 to the 56 neutrons or

something like that

coming together the shrapnel of which

produced the gold

and that we find now you're saying we're

only going to have

you know 21 million coins that are

subdivided into so many satoshis or what

bitcoin

but i don't think there's going to be

another neutron star that

put it this way if another neutron star

collides near the earth we've got much

bigger problems in our monetary

situation but you know the fact is

that's much more scarce than

my friend down the street minds bitcoin

in other words how can we be so certain

that it is it has this permanence and it

has this durability

and resilience that makes it a true

store of money the way that these

neutron stars did for us

many billions of years ago

the history of money is is human beings

looking

for some for some system that they can

use to store and trade value both with

each other and with themself over time

and we've used sea shells and we've used

glass beads and

we've used gold and silver and copper

and

we've used paper that represents gold

and wave u

and we've used fiat and

we are we're moving toward using bitcoin

um in terms of scarcity commodity money

is when i use cattle i mean i trade you

cattle or i trade you wheat by the way

the early americans they use tobacco

right that was

you know i i still do and

they couldn't get money from the brits

and so they actually traded bales of

tobacco

the problem with commodities is that

as the price goes up human

ingenuity and technology is incentivized

to produce more of it

right if if i can do a thing if if i

double the price

of tobacco right then i'm going to go

someone's going to

far more tobacco right if i use wood

i'll

create more wood with some commodities

they're really easy to produce

the hardest commodity to produce

that also had the characteristics that

we wanted for money was gold

i mean because we needed it to be

durable and stable like it needs to

it needs to last a thousand years right

some tobacco doesn't last a thousand

years right so

so some things are hard to produce but

they're not stable at room temperature

and not malleable other things are very

stable but they're not hard enough to

produce

you know some some things aren't

subdividable something

you know i have to be able to you know i

can tell that's gold

maybe easier than i can just distinguish

certain other metals

so mankind pred decided upon gold

but at the end of the day

anything that that is man-made we can

produce more of it so we

we mine gold gold miners produce about

two percent more gold every year

and on average that's been going on for

as long as anybody can remember

that means that if i took all of all of

the money in the world and i bought

gold with it and i had 100 of the gold

in the world

100 years from now i would have 12 and a

half percent of the gold in the world

so so if i'm using gold as a store of

value

then i'm going to have a 2 inflation

rate due to gold mining

um if i use by with oil as a store of

when oil prices were 30 40 a barrel you

know we ended up fighting gulf wars and

we went off to the gulf to fight a war

because we were afraid that the price of

oil would go too

too high there'd be an oil shortage

eventually the price of oil went to 100

a barrel and there were billions of

dollars of capital flow

from the big banks into the frackers

and then oil entrepreneurs like

chesapeake enemy

started fracking oil and the oil

production in the u.s went from 5

million barrels a day to 10 million

barrels a day in five years

and it had not changed in 50 years and

so conventional wisdom-wise we had an

oil shortage

enough conventional wisdom we would

fight a war over it i mean that's that's

pretty strong conviction

but in fact we didn't have an oil

shortage uh what we had was

a price that was too low to justify

human ingenuity and capital solving the

problem

and uh and we have the same challenge

with commodity money like gold

if the price of gold stays about the

constant level

two thousand dollars an ounce you can

expect that the amount

of gold that gets mined will be two

percent more a year and it's it's fairly

predictable

but if the price of gold were to go to

twenty thousand dollars an ounce

then you have um you have three perverse

incentives to make gold uh

a risky bet one is ten times as much

incentive for gold miners produce gold

so they'll be more capital equipment

they'll go faster

they're going to prove out the reserves

faster they're going to

work at a higher rate and uh they will

invent new

new chemistries and new technologies to

mine gold if they have 10x the incentive

to do it

pretty much all those smart mit grads

they come out of school and they take

the job that pays them the most so if

you want to double the salary of

mining engineers you'll get all the

smartest people in the world they'll be

trying to do it

that's the first challenge the second

challenge is

a lot of gold is centralized which means

uh

you can hypothecate it and you can sell

it short

there's no way for you to be sure that

the bank that holds all your gold

didn't actually sell the gold twice

without telling you

because you can't reasonably withdraw

100 million dollars of gold and stored

underneath your mattress

but and so that means that gold has

always been plagued

by people issuing notes against the gold

without enough gold to cover it

the most famous example being nixon

going off the gold standard in 1971 when

the united states printed more dollars

than they had gold to back it and they

had to actually default on that promise

but it's not the only example i mean the

last 2000 years is the history of all

sorts of regimes the romans debased

their currency

and they they cut back the number of

grams and gold coins and

and uh uh this denurturing the denarius

is part of the reason for the fall of

the roman empire

all sorts of monarchs in middle east

medieval

you know europe used to issue credit

notes and the like

backed by gold and when they over issued

them they couldn't make good on it then

they

they also were ruined most

most countries have this issue over time

the

u.s had it and

you have it today you have lots of

examples of banks selling gold short

a naked short without the without the uh

the gold

to back it and even nation states

do it and can do it to manipulate the

price however they want

so it's a corruptable thing and finally

it can be seized

because if you buy enough gold it has to

be centralized in a certain few volts

and it's very expensive to move

it's not practical for a hundred million

people

to take personal custody of their gold

whereas if you look at something like

bitcoin bitcoin is audited every 10

minutes

by 10 000 nodes so it's very it's very

challenging and not impossible to lie

about it

those hundred million people can take

personal custody if they want

because it has no mass and

if the price goes to a billion you can't

make any more of it

the reason it's scarce is because the

protocol

you know by the way we have other scarce

things in the world for example

conservation of energy is this you know

the first law of thermodynamics and the

second and third

and close thermodynamic systems they all

operate based on scarcity or

conservation of energy

and mathematics is based upon the idea

that two plus two equals four

not five and not three i mean

mathematics is

conservative in that regard you take

away

conservative engineering your boats

don't float

your airplanes won't fly pneumatic and

hydraulic systems don't work

electrical engineering systems fail if

you don't have a closed system

the leak destroys them all so

bitcoin is engineered it's an engineered

monetary network

it is a closed system the reason it's

closed is because the protocol

closed it you there's nothing that that

um

there's no law that says you had to

write code to make a crypto network

conservative

they there are crypto networks where

they actually inflate

the money supply or inflate the token

supply every year

there are some that don't have a limit

on it right um

bitcoin happens to be a conservative

crypto network because it was designed

to be that deflationary currency

they could have built a two percent

inflation rate into it it would have

been perfectly light gold right

right but they put a zero percent

inflation rate over

the long period of time i mean once you

accept the fact there's a 21 million

coin cap and then the thing that

actually makes it

truly scarce is uh two dynamics

um the first order second order dynamic

the first autodynamic

is it's a decentralized network running

on thousands of nodes

and no one node can change the consensus

and so it's impossible to change the way

the network

works without taking over the entire

network which is decentralized with

massive inertia

so if you held a gun to my head i

couldn't do it if i wanted to

no country could no company can no

engineer can

and so that's that's why i mean that is

really the

essence of crypto this uh this idea of a

truly decentralized ethos and bitcoin is

pro

is the greatest example of a truly

successful decentralized

crypto network but the second the second

order

thing that keeps from being scarce is

you could

you could that you could copy it you

could clone it the argument is what if i

just clone it and create bitcoin cash

bitcoin gold bitcoin satoshi vision

bitcoin version 42.

cinematic universe 2947

it's like they keep creating more

universes right parallel universes

you know if you're a comic book fan and

finally like would in what universe does

like the wolverine die

or not i forget you know you get lost

that's the problem with cloning the

reason it doesn't work with money

but it got tried it's failed seven

thousand eight thousand

times it's because once

there's a massive network effect and

it's not just metcalfe's law metcalfe's

law

is an imperfect model it's more like

metcalfe's law

with a bunch of newtonian astrophysics

thrown in there

it's gravitation gravitational

uh energy on a network because

when a hundred million people join the

network

of course they're going to resist any

other network

but when 20 of those 100 million people

have a billion each

and they join the network they resist

with a billion times the force

and so as people with billions and

billions of dollars and as

companies join the network like square

like paypal

like uh like 25 billionaires that have

done it this year

when they join the network they join it

with a billion times as much

gravitational pull like i i used to joke

you know rupert murdoch never brought a

billion friends to facebook

right but uh rupert murdoch would bring

a billion dollars to bitcoin

and so this network has a gravitational

effect and it's like

it's like why is it that you don't fly

off of the earth onto the asteroid to

cross the earth and the answer is

because gravity

because there's more mass beneath you

you know

then then then the gravitational pull of

the asteroid flying

out there you're not going to fly off of

the earth

what you're going to have is all of the

asteroids to get near the earth they get

sucked into our gravity well

and what's happening now is that

monetary energy is being sucked into the

monetary energy well

of bitcoin and you could clone it a

million times they're all

you know take a rock and throw it up in

the air and see whether it keeps going

that direction

or it comes back down to earth you know

you could toss it a million times it's

not escaping

you know the gravity well because you've

got a million times more

gravitational pull down than you have up

and that's what's going on with bitcoin

it's past the event horizon

and it's getting power more and more

powerful because of this uh

this uh energy dynamic as brian keating

back with you just taking a pause to

refresh in this episode of the into the

impossible podcast with today's

phenomenal guest michael saylor

asking you to subscribe to the channel

on youtube leave a like thumbs up a

comment

a question for michael for next time

he's agreed to come back on

if you're on itunes listening to this

please leave me a small asterism

a constellation of stars from one to

five

those are the options i read every

review i take them all to heart

discuss them with my therapist and it

really uh is the only thing i ask of you

i'm not taking advertisements as you

know

and so the only remuneration i expect is

one bitcoin per now i

only expect or hope wish

that you would leave me a review on

itunes or wherever you're listening to

this podcast like subscribe please share

it

and please go to my website

briankeating.com you're going to get

the 10 life lessons i learned from jim

simons if you sign up for my mailing

list so please do that as well

and that will really benefit me and who

knows we could do a part two in the ten

life lessons i learned from michael

saylor but you only get that

if you subscribe to my newsletter

briankeating.com i hope you enjoy this

episode of the into the impossible

podcast

if all other money were sound if gold

was not inflating

you know two percent doubling every 36

years of supply

if uh if uh us dollar wasn't inflating

if we were all on some kind of hard

current would bitcoin still be rising

yeah but it would be r but it would be

growing because it's superior technology

so there are three dynamics here right

there's there's adoption

the the rate of adoption which is a

marketing evangelical

thing then there's the improvement in

technical utility

what can i do with the money and then

the

the third thing is the inflation right

so let's take gold if i couldn't make

any

more gold if i agreed that their 21

million gold bars

and their 21 million gold bitcoin

bitcoin would still be better because it

has no mass and it moves at the speed of

light so i can move 100 million of

bitcoin

for a nickel to tokyo but i'd it would

cost me 250 000

in a month to move 100 million in gold

to tokyo

so i can build bitcoin into square cash

and i can buy it

in one click in one second but i can't

buy

ten thousand dollars of gold in one

click in one second

so the technical utility would still be

superior

even if there was no inflation of gold

yeah i would say the efficiency i mean

gold is used in the technology that

you're using to transport the

electrons across at the speed near near

the speed of light

so i mean intrinsic value i think i i

would i would agree that gold

is is more is less efficient and

therefore the velocity in which it can

be transported

obviously as much lower as you're right

you can't take delivery i talked to jim

simons we're going to get to jim simons

um who is another mit grad and he said

you know one of the things he used to

worry about is one of his future

contracts if he went the wrong way he'd

have

800 head of steer in the parking lot at

renaissance technology and

they're not a cattle farm so you know

there are benefits of it there are

disadvantages of it but

when we when you talk about the

technology uh you know i haven't

delved into it probably as much as i

should but but it seems to me that

technology was in place decades ago in

other words you could have a blockchain

type

you could i mean it wouldn't it wouldn't

be operate with the efficiency

it wouldn't maybe have you know as many

nodes and

network law the law of network effects

you know stephen shruggets a friend of

mine who wrote the definitive paper

about network theory with 32 000

citations in nature

and this is about the exponential

geometric growth of networks growing as

the number of squares of nodes

so yes it would have fewer nodes maybe

but what is there any

physical law that would have precluded

bitcoin's adoption in 1987 or you know

earlier than this rise in the last

decade or so

i have a phrase my phrase is technology

fails until it succeeds and that

generally describes all paradigm shifts

it describes the airplane for a thousand

years people tried to fly and then they

you know wright brothers figured it out

but by

if they didn't have an internal

combustion engine they wouldn't have

flown

right it describes mobile phones people

tried and they

and and the breakthrough was like

sufficiently powerful lithium-ion

batteries

you know and and certain chips and some

of some of these uh

you know codecs right um

uh compression algorithms yeah so there

are a few things we needed

in every single industry there's uh

there's always some thing that you need

in order to break through to the next

level

with uh with the launch of bitcoin

we've been working on the technologies

for about 40 years previous

i mean uh and it's well documented you

know proof of work

you needed pretty good pretty good

privacy i mean public

private key encryption and proof-of-work

algorithms

you know and you you needed sufficiently

powerful

cpu chips and there was some there is

some math

involved and uh people tried it uh they

launched a number of them hash cash and

e-gold

in the decade previous this wasn't the

first attempt

bitcoin was the first attempt that was

successful

okay so so they probably attempted it i

don't know a dozen two dozen

times before and they worked on

different elements of it for

for 10 to 20 even 30 years before

it was bound to happen at some point

when you had a critical mass

of network computers computational power

encryption algorithms and they just put

all the pieces together

and that's what bitcoin was and then it

took you know it took 10 years

of they started a fire in cyberspace it

took 10 years of the fire burning

for it to get big enough that it would

work through

all of its risk factors and it would

mature enough

that an institution would be willing to

actually put hundreds of millions of

dollars

of capital on it right like

the early exchanges got hacked like

mount cox

maybe the irs could have destroyed it

with the wrong tax treatment

if they didn't give it the right tax

treatment um it did get

cloned people weren't sure how the forks

would you know would work out they need

it needed to be attacked in every which