Transcript+
Let's be clear, Bitcoin is an international asset. We are spending like drunken sailors. Bitcoin is the only economic entity. Where the? Supply is unaffected by the demand. If you want to preserve your wealth, you have to convert that currency into an asset that's scarce, desirable, portable, durable, and maintainable. Hello, my name is Andy Edstrom and I'm happy to welcome you to the 17th episode of Scarce Assets, a show that examines scarcity, the most fundamental driver of economics and markets, and the scarcest asset of all, which is Bitcoin. I'm delighted to be here with my Co host Jesse Myers and our guest David Zell. Now I'm going to start this chat with a reflection on how I felt when I first learned about the Bitcoin Policy Institute, which David runs. I'm not a religious man, but my gut reaction was, thank God, in a sea of grift, you know, here was a serious organization staffed with credible and talented people that was putting out thoughtful balance content on Bitcoin and helping policy makers and average citizens on both sides of the aisle to understand Bitcoin and its benefits and frankly, risks for the US and the world. So ever since finding the organization, I've personally been continually impressed by it. I hope that came out in our recent interviews here on Scarce assets with both Troy Cross and Matt Pines, who are both fellows of the organization. I'm sure it will also when we interview the organization's founder, Ovic Roy next week. But today I'm delighted to be going straight to the top and welcoming its Co Executive director, David Zell. So David, thank you for the work you do and thank you for coming on scarce assets. And how are you? I'm well, yeah, thanks for thanks for having me. On slight correction though, OVIC is an advisor to BPI but not the founder. Oh OK my my my mistake. My mistake. I thought he was a Co founder. I guess I'm wrong you'll. Have to correct a song. Yeah, that would be me and Grant McCarty, who Co founded the the organization. But Ovic's fantastic. He's he's our senior advisor and he is the founder of another think tank in DC, so. And that's free OP. And I'm sure we'll, we'll talk talk with him about that. Well, thank you for the for the correction. You know, let's since you are the founder, let's start with BPI and it's and it's mission, you know, since day one. What does the organization seek to accomplish? Yeah, Well, I honestly think first of all, I'm just like, really happy to be here. It's great to meet you, Jesse. You are the author of probably my favorite article ever written about Bitcoin, and an article that I think actually really explains what BPI is and why it exists. Which is for I guess people who are watching and don't know why the yuppie elite dismiss Bitcoin. I think that article in a nutshell pretty much explains like why we exist. There are. Amazing. Yeah, there are a lot of people who have like brilliant things to say about Bitcoin who communicate those insights in a way that is non standard, right? Whether it's like the early days, like people sort of talking eloquently and, and you know, intelligently about Bitcoin on like the talk forum, you know, whether it's sort of Twitter or podcasts, These aren't the mediums that policy makers are, you know, sort of habituated to, to trust and, and get information from. And so, you know, early on, I often joked with people that like the goal of BPI was to basically take everything that was ever, you know, thoughtful and insightful from the Bitcoin talk forums and just kind of put it in a think tank wrapper so that people would actually read it. I think the organization has matured a lot since then. And you know, one of my initial theses was actually wrong. Like at the time, I kind of had the view of it's impossible to say anything new about Bitcoin and like all of the smart things one could say about it or probably said, you know, no earlier or no later than like, you know, 2013. But I've discovered that there actually are some insightful things that you can say about Bitcoin as the asset grows in, in size and liquidity and number of users. And for us at BPI, the goal has been to sort of help policy makers think through the benefits and risks, like you pointed out that that Bitcoin poses to to America, to, you know, Western liberal democracies writ large. And so our sort of four research pillars kind of I think help explain like the areas that we we focus on as an organization, right, sort of national security and Geo economics, of course, like extremely relevant, you know, in the past few years, right, whether and to what extent nation states will try to utilize crypto rails or Bitcoin specifically to evade sanctions, the use of, you know, Bitcoin or crypto in in illicit finance, you know, North Korea, like the Lazarus group, right, hacking these like shaky sort of defy bridges and essentially bootstrapping a multi billion dollar weapons program by exploiting the sort of move fast break things philosophy of of like crypto and and defy sort of mining and energy. I feel like that one's pretty self-evident financial inclusion and human rights also pretty self-evident, right. I think some of the most obvious benefits of Bitcoin are, are really conferred on people outside of the West, right on, on, on people who don't have the privilege of using like an awesome currency like the dollar. So sort of showcasing the, the human rights use cases of, of Bitcoin, really taking a lot of the stuff that HRF does and, and presenting that to the policy community. And then this sort of sole pillar, which we call sort of the future of money. And that's where we sort of deal with a lot of the the regulatory stuff. So yeah, you know, our formal mission, that's the long winded answer. Our Our formal mission is to educate policy makers and the public on Bitcoin and disruptive digital technologies and to provide nonpartisan, research based insights that inform sound policy in America. At Onramp, we believe that Bitcoin is the most important asset of the 21st century. The hard part is securing it right. There are shortcomings with keeping your coins on an exchange, but also with setting up your own self custody arrangement. On Ramp solves for these concerns. Our multi institution custody solution maximizes security and minimizes counterparty risk, ensuring that your Bitcoin remains securely in your possession and provides built in inheritance planning to ensure your family is protected as well. On Ramp provides Peace of Mind for your Bitcoin journey, whether for your whole stack or for part of it as a compliment to your existing self custody set up. For more information, check us out at on rampbitcoin.com. Yeah, that's a that's a lofty and noble goal and I don't want to repeat myself, but you know, I think you guys are the best, the best at it out there doing it. Thank you. Maybe we should maybe. Yeah. No, Appreciate, appreciate your efforts. Maybe a question I should ask at this moment is you just laid out, I don't know, probably 5 areas where you're making an impact. Which of those do you think has seen the greatest progress with respect to either policy makers understanding or the public's understanding? Is there an area where you're where you're making more progress lately and that's exciting? Definitely, I think the national security angle a a few reasons, like why, you know, 1 is that the, the people in the national security and sort of intelligence communities are less political inherently. They're less focused on like elections on sort of short term thinking. Like, you know, there's sort of a cohort of people in Washington whose job it is to think deeply about the sort of grand strategy of the United States and who are of course, sort of accustomed to re calibrating strategies after, you know, disruptive technologies like emerge. And so, you know, I, I think we've had an outsized impact in those spheres. You know, there are, I think a lot of progress has been made on the mining and energy front as well. But I mean those it's like sort of the Brandalini's law thing, right? Like the, the anti Bitcoin argument vis a vis climate is just very simple. It's very sticky. It makes a lot of sense. The counter arguments are a little convoluted sometimes. And you know, the the truth is like obviously like a lot more nuanced than mining is bad for the environment. So it's it's sort of a constant uphill battle there with just like the the asymmetry of ease of argumentation. But yeah, I would say I've been pleasantly surprised by the reception that we've had by members of the national security community who are interested in through bitcoins role in the global S where, you know, some of our biggest adversaries like China are spending a ton of money to onboard people to their. I'm sure this is something that Matt talked about with you guys, like sort of onboarding people in those areas who, you know, really don't have many options when it comes to connecting to the global financial system and are being pushed a fairly authoritarian, you know, technology stack. Whether it's sort of the Huawei like 5G stuff, whether it's, you know, sort of I think down the line trying to push the digital yuan and kind of get these people into a a sort of Chinese central bank digital currency system. So a lot of that stuff is just wonkier, right? It's less politically charged. You know, your average voter is not really thinking about these topics. And so, you know, I, I think there's sort of an inverse relationship between how much attention an issue gets and how easy it is to change people's minds and make a difference with respect to policy. And I, I think we sort of have seen that play out in our efforts to help people think through Bitcoin in the context of sort of geopolitical competition. And and this sort of particular strain of geopolitical competition that we're seeing now, which is competition playing out through through tech networks, whether it's like monetary communications, things like that. And do you think that the progress being made there, I may have missed your point? Is it because of the difference in how much, let's say the mainstream media cover that topic as it relates to Bitcoin versus the environmental issues? Or is it, is it because it's more of a Greenfield area and it's been sort of a jump ball, like less people just have thought about Bitcoin in the context of national security? I think that's part of it, but I think the biggest reason is kind of what I said earlier, right, that like this is a community of people who are, you know, for example, the Internet, you know, when when the Internet became like widely diffused, we we went from a world where people weren't using it unless you couldn't use it unless you had a.millorlikea.edu, you know, domain. So sort of restricted to the government and academia. Then all of a sudden, like, you know, the Internet proliferates and it just changes the game. Like the earliest adopters of e-mail were like drug dealers and terrorists because it was like super easy to plan a terrorist attack or plan a drug drop using e-mail. And it's really like you go back and look at the history of arguments around or Internet, specifically regulation in the early 90s, and they just mirror the arguments against Bitcoin and for Bitcoin, like almost perfectly, right? The concern is that this sort of technology that we don't really control is going to wind up in the hands of malign actors and it'll be sort of a tool for them to achieve malign ends. And then the counter argument is that, hey, there's something kind of like, you know, beautiful about the Internet, right? It's sort of embodies some of these like core American values, like the idea that you can speak your mind anywhere in the world. You know, now it's not so true. But at least at the time, the thinking was, you know, the Internet was this like gateway to, you know, to free speech, to free assembly, that it would be a boon for global capitalism that that, you know, sort of talent and capital could connect. Well, you know, transfer borders. Like there's the sort of the same argument. And so, yeah, I just think people in the three letter agencies in the national security community, I've also been paying attention to Bitcoin for a lot longer than the average person. I mean, we know that like the CIA was having, you know, briefings on on Bitcoin as like early as like 2000 and like 12 or whatever. And so, yeah, I think this is a group of people who by and large are fairly clear eyed with respect to disruptive transformations in in society and have sort of asks and incentives that Orient them to paying more attention to like tail risks. You know, their their job is not to sort of decide whether or not Bitcoin is good or bad or even whether it will succeed or fail, but to recognize, hey, like maybe there's a 10% chance that Bitcoin monetizes to reach parity with, say gold. Well, what does that mean? Like we need a plan for that. So I think it's just a bunch of kind of quirks of that community that make. Them more receptive. To the type of stuff that we put out. Yeah, that makes complete sense. The other thing that occurs to me also as we're speaking is it probably doesn't hurt that most of the world's cryptographic talent, you know, up until very recently was employed by NSA, right? Right, yeah. And I mean, there's like credible, there's like credible arguments that you could maybe trace some of bitcoins origins to like research out of the NSA. And so, yeah, I mean, it's a, it's a group of people that I think are are well aligned to thinking about the questions that we're interested in in asking and answering as a think tank. So that makes me curious and and perhaps I'm layering in too much as too many assumptions here, but it sort of sounds like you've enjoyed to date a bit more openness from folks in DC to consider many aspects of Bitcoin as a non partisan topic. Do you fear that that might be shifting and that openness to dialogue may shut down if we continue on the kind of current trajectory we're on? Yeah, truthfully, I'm like really concerned about that. You know, I gosh, there's there's a couple things worth pointing out. One is that I think that Bitcoins most pressing or in consequential public policy decisions and I guess I'll just say Bitcoin, I really get some extra remain Bitcoin users. I, I don't think those are necessarily all going to happen in the next 4 years. And so I think the part of my thinking in this project that's BPI is like, how do we ensure good policy for Bitcoin users in the United States for the next 40 years and not just like the next 4. So I think 1 is kind of like, you know, it, it, it depends on what your goals are. Like, if your goal is to sort of be an industry lobbyist and pass like tax cuts for miners or, you know, whatever it is, you know, your incentives are a little bit different, right? Like if, if a, if a presidential candidate is kind of signalling that, you know, they're willing to pass a bunch of really positive policy for the industry, you know, it's, it's reasonable to, to sort of support that, especially against the backdrop of, you know, the Biden administration who had such a horrendous, you know, crypto and, and, and Bitcoin, you know, policy. But there are really, there are real risks with that strategy. And, and I think the principal risk is turning Bitcoin and crypto into sort of like a partisan football. And I think that would be a bad and unfortunate outcome. If like, you know, you, you mentioned before you started the call, like, you know, some political news may have moved the market up a little bit, right, Like, you know, be kind of hysterical if it's, it's the four year cycle became the four year election cycle. And you know, Bitcoin sort of just trades as like this, you know, privacy for whether or not a Republican will will assume office. I think that's a really undesirable state. I, I really think that part of this is the doing of policy makers and like I, I, I think a lot of the critique online has been levied at individuals who I think are really sympathetic. Like you're you, you, you build a business, you pour your life and soul into it. And one party seems hell bent on regulating you out of existence. And one party is not like, I can't blame anyone for, for voting their, their wallet physical or, or, or, or digital. I think a lot of this is self-imposed by bad policy from the Democrats. And I, I do want to be clear about that. But yeah, I'm, I'm very worried about Bitcoin becoming partisan. And, and it's interesting too, like the split that I'm seeing is crypto is for Democrats, Bitcoin is for Republicans. And I think that's also pretty, pretty bad, right? That's just not the that's just not ideal. I feel like the reasons why are almost not worth getting into. It's just sort of like self-evident, like you, you don't want to live in a world where the ability to prevent seriously deleterious public policy rests on who wins the election every four years. Like that's just a, that's a horrible game to play and I'm very worried about it. And so as a result, like all of our work at BPI is, is tries to be right down the middle. If anything, we try to take sort of more of a center left tone. And it's a huge objective of mine and the organizations to identify Bitcoin champions on the left. And we've had some real success there. I mean, I was really, really excited about Ro Khanna and his participation of the Bitcoin conference in Nashville. He and I were on the news desk together and have had some correspondence like after the conference. He's someone who gives me a lot of hope as a principled progressive Democrat who really does seem to understand the issues at play. So it's, it's definitely a bit of a Sisyphician task, but I'm happy to push this folder up the hill because it, it matters a lot to me that Bitcoin is is non partisan. Yeah, it, it matters immensely that that, you know, I, I, I echo what Andy is saying that in terms of moving the needle for the world, there's nothing more important than Bitcoin. And in terms of securing that that potential, there's nothing more important than policy. So you guys are at the absolute forefront of what's needed right now. And maybe we could talk about the current lay of the land, sort of two questions really, which is how would you frame the political shift of, I don't know, the last year? Some people are saying it's massive, that it's kind of a sea change. I suppose others might consider it massive with respect to one party but not the other. And then related is what are you hearing about what a Kamala Harris administration might look like with respect to policy on Bitcoin and I guess I'll ask crypto as well. Well, I think there are a couple of threads that are worth like sort of pointing out. One big change is I think it's really difficult to like overstate how bad FTX was for, you know, the sort of mainstream view toward crypto and Bitcoin. And I think that it was, you know, an even more sort of outsized event in terms of its impact in policy circles in DC. So I think where we are now, one of the biggest changes is very rarely do I hear the view that Bitcoin's like a scam and that it's going away. Very rarely do I get questions of like, why I run a Bitcoin think tank. When we first started doing this, it was like a little like people were just like what, you know, Bitcoin, like whatever. So I think this view that it's here to stay has become very widely diffused. And in turn, the view that the public policy around it is inconsequential and like important is also like pretty widely diffused, obviously, you know, a sort of former president and a guy running for president again, speaking at the Bitcoin conference like that is just a big deal. You know, sort of absent any like normative judgement about that phenomena of like, that's pretty crazy. Like we went very quickly from being excited that the mayor of Miami was speaking at Bitcoin conference to like multiple senators and like a former president. Like that was a really quick turn around. Like, you know, and I, yeah, I mean, I'm sure you guys are there, right? I remember like Bitcoin Miami 20/21. It was like, holy crap, you know, the mayor of Miami is speaking. So yeah, I mean, I think, I think it's sort of relevance has ascended the sort of political hierarchies like really quickly sort of in fitting with in line with with a lot of things like related to Bitcoin. So those are two big through lines. Could that could that continue? I mean, the Bitcoin the the mayor of Miami speaking and then the following year RFK spoke, you know, made and made Bitcoin a major part of his political candidacy candidacy. And that felt like in a huge moment that felt like an arrival of Bitcoin on on the mainstage of American politics. Granted, it was a fringe, you know, not a one of the two major parties candidate. And then Fast forward one year and it just one year like I was expecting that would take at least, you know, one full election cycle. And then maybe we'd we'd have a Democrat or Republican candidate speaking in 20/20/2024. Sorry in 2028, but here we are with Trump this year and, and not to be outmatched, RFK kind of trots out this new idea of of 4 million Bitcoin to match our relative position of our 19% of the world's gold. To match that with Bitcoin. Now that's incepted and out there like it, it feels like the momentum is is unbelievable, but there's no reason why would necessarily stop like this could become this could climb that ladder further to become one of the most important topics in American politics. Do you see that as continuing in that direction? Yeah, I mean, most important issue in American politics that's. Quite a ways to go before that, but. Yeah, that's like a really high bar. I mean, I think like, you know, I would splash a little cold water on that and say that like, by and large, like nobody gives a shit about this. Yeah, but you? Know yeah but yeah, it's sort of the right yeah I mean I think there's like but I do think that like we haven't peaked in that sense right like it would be amazing if like, you know this had been the year where the leaders of both parties had felt that they needed to come to Bitcoin Nashville to assure the community that they had a good head on their shoulders with respect to to crypto policy and Bitcoin policy That didn't quite happen but we sort of saw like that right and so I think that's like a very clear like next step for me is that like, you know when we live in a world where yeah the the leading political people on both parties feel compelled to come to the Bitcoin conference and make their points to big pointers that's going to be like another kind of big check box that I feel like we sort of half checked this year. The although I don't, I don't go ahead. Sorry. You might be reluctant to, you know, to show your own, show your own product. But, you know, I just want to point out that I'd like to see more policy makers already there a lot, but I'd like to see more at your conference because, you know, let's, let's be real, there's also a lot of noise, let's just say noise and other things that surround, you know, the the Bitcoin conference you're referring to. You know, I think yours is a more sober take, more focused at the various issues you outlined. And yeah, so I just want to point out to people, to listeners that you have an excellent conference that gives a sober and useful and mature take on Bitcoin and how it intersects U.S. policy and and geopolitics and, and all the issues that you already articulated. Well, thank you. Yeah, we're really proud of the policy summit. I mean, so the first year we did it, we had a 90 day lead time. We had no money. We had like maybe $100,000 in a bank account. And at the time that was like maybe three months runway. And so we were all sort of like, OK, you know, what, what the heck are we going to do? Is this project going to fail? And when FTX collapsed, it was like that, I guess sort of around that December, that we made the decision to ape the entire balance sheet into a conference. Like we thought that now is the time to sort of strike, right? Like a lot of our theses have been vindicated. We were the only group in DC that was really just exclusively focused on Bitcoin. We had been telling all these people like, look, look, there's a ton of scams in, in crypto. And it's not to say that crypto is, is, is outright bad. I mean, I think if you'd, if, if you'd taken your sort of regulatory cues from like the 99% of early Internet companies that were like pets.com, you would have never had an Amazon. But at the same time, like you need to call a spade a spade. And if you're not willing to kind of look someone in the eye and say, empirically, 9598% of cryptocurrencies that have ever been launched have gone straight to zero, you're just not going to get anywhere. And so I felt like we had a really differentiated message that was kind of like, you know, vindicated when FTX collapsed. And so we sort of just launched the summit and, and said, look, we, we think Bitcoin is here to stay. And we think that they're really serious reasons why policy makers should, should pay attention. Like, you know, just because FTX collapsed does not mean that you get to evade the admittedly difficult task of crafting good regulation. And then the event was just an amazing success. We had like multiple senators, multiple members of Congress, you know, 20 universities. We had like 250 people in the audience that first year. And the statistic I'm most proud of is that like, I don't remember the exact number, but it was like 40. It was like 60% of the audience basically were not the pointers. They were people at think tanks, at advocacy groups, staffers, people at government agencies. And that was like my vision, right? That was like Grant and I the whole team's vision was like, you know, let's make a Bitcoin conference that's not for Bitcoiners. Like I no offense to every other. I mean, David Bailey's a good friend. Like I love the Bitcoin conference, but like there's something kind of insular about that, right? Like it's a really overwhelming environment to if that were like you're, I can't imagine what it would be like if your first touch point to Bitcoin was Bitcoin Nashville or Bitcoin Miami. So the goal was like, let's do a conference that is geared for people who don't know anything about Bitcoin and, and deliver sort of first rate sober analysis and commentary on where we are and where we're headed. And it, it just, it was a smashing success. We developed a ton of relationships with offices in DC, with agencies in DC. We did it again this past April and we've already outgrown the venue. We, we did those at the National Press Club this year. We literally didn't have enough room. We had three tracks of content. People could barely get around. Like it was standing room only in the, in the mainstage for most of the day. And so yeah, we're, we're really excited to do that event again this April. We haven't officially announced the, the dates, but it should be, should be soon. It's going to be in like late April, like either that third or fourth week of the month. And we're kind of expecting to double again. So looking forward to hosting like close to 1000 people and, and really trying to preserve that balance of like we, we want everybody in the room to be people who are serious, people who are, are pretty green and people who care about this professionally. Like it's just, it's like another sort of big thing about that conference is the entire day of Bitcoin content and there's no mention of price, which I thought was like really cool. Love it. Yeah. Like, yeah, well, no mention of price. For your your tremendous success with the event, I was regretful that I couldn't make it this year. I am going to, I am going to try and make it next year because, yeah, I think it's really very important from a policy perspective that, OK, it's great for us rabid Bitcoiners to, you know, have our have our tent over here, which arguably includes a lot of the other conferences. But bridging the gap between between Bitcoiners and the rest of the normies, as we like to say, is very, very important and especially with the policy makers. So hats off to you and looking forward to an even more successful event event next year. Well, let's see. I, you know, with respect to politics and policy, I am probably going to try and try and pin you down on this little. And if the answer is we just don't know, that's fine. But you know, your thoughts on a Kamala Harris administration and likely, you know, effects on Bitcoin policy, maybe also crypto policy, you know, versus the baseline where we are today with the existing Biden administration. Yeah, I guess I should preface by saying I really don't have any particular alpha here. So my, my take is unlikely to reveal anything new to you. I I just don't think we know. I mean, I think there's, there's been a lot of speculation off of very little like sort of core like sort of true information, right? Like, you know, speculating what the crypto policy is going to be based on who economic advisers are. I just don't think we know. I think there are reasons to be bearish. There are reasons to be somewhat bullish. My base case is that very little happens in a Harris administration with respect to crypto and Bitcoin. And I think that's probably OK. I, I think that the odds of any policy passing in, in Congress, like that's going to sort of depend on elections there. But if the last, you know, 10 years or whatever have have yield any sort of insight for the future. It's like, you know, the, the baseline probability of any single like policy being passed that isn't just like keeping the government funded and all of the associate riders and associated like riders and, and stuff like that being passed is just inherently low. My hope would be that we see better positions coming out of the regulatory agencies that we don't see a continuation of things like you know, operation joke .2 point O, but like you know, I can sort of give you the wish list, but that's nothing new. I, I, I think the Harris administration has, I, I'll say what's different is the crypto and Bitcoin industries have flexed their political muscles in a really tangible way. And I think the, I, I suspect I should say that the incentives for the sort of palpable incentives for Kamala Harris to be more muted and less anti are just like clearly higher. Like there's just clearly more at stake. It's clear that there are a lot of voters, there's a lot of money that cares deeply about the consequences of, of the actions of her administration. So I guess like looking at it from sort of that perspective, like sort of, you know, like cautiously optimistic that it isn't going to be as bad as it was the past four years, but that may well be wrong. Like I I really the only other sort of benchmark that I have is I think Democrats are more open to talking about this. And you know, if you plot the graph of pro Bitcoin Democrats, it is in fact up and to the right. So like, I think some progress is being made there. You should take some, take some credit personally, I think for, for that outcome. I think you've been helping in that regard. Well, I'm glad to see that there. I'm glad, I'm glad to hear that there's a possibility that the, that the beatings will be slightly less frequent and slightly less severe. We'll see, We'll see how it goes. But you mentioned the, I think the the administrative agencies, you know, if Chevron deference is dead and the agencies are perhaps curtailed somewhat, we'll see based on lawsuits, you know, that are coming, I assume. Do you think that is going to be a significant factor, let's say in yeah, in curtailing the the hostile position that the agencies have taken with respect to the industry up to this point? Maybe, but I think there's a lot that a president can do just via executive order. Maybe it puts like somewhat of a ceiling on things. But I wouldn't count on like the Chevron decision to really be a bulwark against like negative policy. Like I think if we're gonna red team this, like if you're a Harris administration and your goal is to be anti crypto, anti Bitcoin, I think you could achieve that end in the status quo. So no, I mean, I think there's still a lot at stake. Does your Bitcoin custody setup keep you up at night? Maybe you still have coins sitting on an exchange worried about hackers? Or maybe you've set up your own self custody but don't feel safe with your Bitcoin savings stashed on a little plastic device in your desk drawer. Gain Peace of Mind with On Ramp and our multi institution custody solution. Here's how it works. Onramp creates a dedicated multi sig vault just for you. 3 separate institutions each hold a key, Onramp bit go and coin cover, but none can move funds unilaterally. Instead only you have control over your coins. With Onramp's multi Institution custody, you'll sleep better at night knowing your Bitcoin is stored with best in class security on chain with fault tolerant multi sig. If you believe your Bitcoin is going to be worth a lot someday, don't jeopardize that future by exposing your coins to hackers on exchanges, $5 wrench attacks in the real world, or perhaps most importantly, the risk that you might screw something up with a highly technical self custody set up on ramps. Multi institution custody eliminates single points of failure, reduces your personal attack surface and technical burden, and provides access to financial services that allow you to confidently secure your Bitcoin, including inheritance planning, insurance backed warranties for all balances and transactions, low cost trading, and more. Bitcoin is a once in a species asset, secure it right. Learn more at onrampbitcoin.com. All right, well, good. Sounds like you're going to be you're going to continue to be busy for the foreseeable future, David Educated. I would love to I would love to not be frankly, it would be. It would be sort of ideal. I always joke that like, you know, our, our incentives as like a, a non profit as an organization are sort of hysterical because most organizations like goal #1 is like stay alive and keep existing. And for us, the goal is like actually inverted, right. The goal is like, you know, how do we get to a world where a, a think tank, you know, about Bitcoin is, you know, pretty much just sort of esoteric and like unnecessary. And so in some ways, like I, I view this project is like working to our own destruction. Like there might still, I think there will still be a need for something like BPI for quite a while. Like, I don't see that that sort of finish line in, in, you know, and on the horizon. But yeah, there's the the the pinnacle. The pinnacle of success would be being able to not run a Bitcoin think tank because it's like completely unnecessary. There are probably not really any Internet think tanks you know there. There are certainly are sub topics within Internet interests, but I I doubt there are general Internet think tanks in in DC anymore. But I'm sure that was a thing for a while in the 90s and. Oh yeah, I mean, the Electronic Frontier Foundation is the best example of this, right? Like they were instrumental in like the Clipper Chip debates in 1992. Like massive deal, they have these huge blow out regulatory battles and the EFF still is sort of an activist, you know, charity, they do a bunch of work on electronic freedom, on privacy and all of that. But like, yeah, like that's sort of the model is that like, you know, they still have the ethos of the Internet that they represent. The stakes are no longer as existential as they were in the in the 90s. So. Yeah, related question, you sort of you sort of mentioned, you mentioned that under Kamala administration that maybe not much would get done. And I wonder are there any advantages in your mind for, for that scenario of, of allowing things to unfold and then developing better regulatory guidance, you know, further down the road rather than too soon? Yes, I think for sure, principally because I I just, and the reason that we are in the Bitcoin Policy Institute, I guess there are a bunch of reasons, but one of the big ones is that Bitcoin just has a completely different set of incentives and, and desiring outcomes in the public policy realm. You know, you've got on the other side of the aisle or not aisle, whatever you want to call it on the crypto side of things, you've got billions of dollars that they've been invested in, things that are ostensibly like unregistered securities, right? Like right, it's like entire funds that are, are they have a lot to be worried about and keep them up at night. In terms of regulation, I think Bitcoin doesn't really need much right. Like I've seen these like things being like sort of like right to right to mine, like right to do well, I, I think those are inherently rights. Like, I think as an American, you just have a de facto right to own Bitcoin and to mine Bitcoin to run a node. Like I, I almost hate like ceding the rhetorical ground that these are like permissions that we have to sort of come before the state to ask for. I think that's just flat out wrong. We have every right to use and operate Bitcoin in the United States. And, and, and there are of course, like regulations and policies that would negatively impact the rate of Bitcoin adoption, that would negatively affect Bitcoin users and Bitcoin companies domiciled in the United States. And I don't mean to downplay the significance of those possibilities. That's like one of the big things that we're working to sort of prevent from happening. But I do see like being this like Canary in the coal mine, being like a watchdog for those bad policies as more of a North star for BPI than trying to advocate for particular legislation that like, say, advantages Bitcoin over crypto that gives carve outs for bit like no, I think that's mostly pretty much totally unnecessary. So yeah, I think like a depending on how you define this, this quote, like we don't want to maintain, you know, the difficulty that that these businesses have in getting bank accounts all of that. But like a do nothing approach from a Bitcoiners perspective is not something to be afraid of. Like that would be that would be pretty solid. But there are sorts of like cool things that, you know, that people are pushing for. Like I'm very excited and energized by Senator Lummus's, you know, strategic reserve bill. I think it would be fantastic for America to have like a meaningful Bitcoin position. So there there are like sort of cool things that could happen. But yeah, no, I, I, I, I think if the question is essentially, you know, should we be concerned about a do nothing approach from the Bitcoin angle? No, like I think that would be kind of awesome. You know, some, but but the truth is like, you know, regulation's going to get passed. We've already seen tons of examples of, you know, ostensibly well meaning regulation like Damla that just effectively nukes everything. So there's a lot to be a watchdog for. But yeah, if, if, if no other public policy was passed in the United States with respect to crypto, I think Bitcoin would be fine. Yeah, that, that, that makes sense. And it would also be interesting you, you, you mentioned how sort of unregistered securities, a lot of, I think pretty much all crypto out is falls under that label. And I, I am bothered by how, you know, the push for Ethereum ETFs went through pretty, pretty much on riding on the coattails of the excitement about Bitcoin ETFs. And, and I think it's my personal belief that that was a, a mistake that you're, that you know, that that was allowed. And now they're sort of starting to draw a line about Solana is, doesn't qualify for an ETF. Now, you know, now you're going to deal with the whole fight there of like, what does that even mean? Only hopefully, hopefully further down the line only to realize, you know what, actually, we should never have done the Etherium thing in the 1st place. Maybe they'll be able to roll that back in some way. Probably not. Anyway, I think that's an example of how, like, if people learn rather than act, I think that ends up in a clearer future where the ways in which Bitcoin is different don't get so muddied up with with crypto trying to ride its coattails. Yeah, I see where you're coming from. I I probably have like a slightly different view, which is that I think the answer, the question of whether or not cryptos are unregistered securities says a lot more about the state of securities regulation than it does about the technologies or the the tokens in and of themselves. Like I, I just generally think that like trying to sort of retrofit like new technologies and 100 year old like policies just is, yeah, it's sort of inherently like fraught. And I also think it's very easy to kind of miss that some of the worst and like griftiest sort of realities of the crypto world are kind of the direct result of the extent securities like regulation. I think that's why like, I think that's like, why a lot of people like, you know, fucking gambling on, on like meme coins or whatever, because there's not this sort of like insider VC cabal, like not endorsing meme coins. But I, I, I think when you look at the incentives that like the sort of current regulatory stack creates for founders of these crypto protocols, it, it, it is in many ways responsible for some of the worst. No, I mean, you're never gonna, no, I'm saying it's responsible for people sort of saying, oh, I've created the next Bitcoin, like sell your Bitcoin and buy my token. Like people have been doing that since, you know, since Bitcoin. But yeah, I, I think the current regulatory stack is insufficient. It's not fit for purpose. There is a need to balance to, to, to care about consumer protection. But I also think that we need to be smart about that. Like we, we don't want to say, well, you know, you know, you need to be an accredited investor to invest, for example. I think that's sort of silly. And so, yeah, my, my hope is that we see to the extent we see regulation with respect to like Icos or, or cryptos that they focus on the actions of people and companies and projects and not on just tech innovation. Like generally, like I am excited about things like 0 knowledge proofs. Like I'm excited about some of the pure sort of cryptography innovation that's come out of maybe some non Bitcoin places. And yeah, again, I I kind of just keep going back to this example of likethe.com bubble, right? Like there were so like every one of those companies just a complete scam, just like through.com in the name, the same way that all of these companies threw blockchain in their name. But I think we'd be worse off as a country and as a world if we had let the scams ofthe.com bubble inform regulation that prevented like genuine innovation from happening. Even if the ratio right now is like 99.9% nonsense and point 1% like legitimate, I think you could have pointed to a time in the internet's history where you would have found a similar ratio of burgeoning Internet start-ups. And yeah, I, I am just sort of as a, as a technologist, as someone who has at least some of the core values of like the cypherpunks, like the idea of the government sort of just banning math in any capacity, banning technology wholesale. That sort of gives me some, some trouble. Like I, I'm, I'm not super keen on that. And I do think that there's like a faction of the Bitcoin community that on the one hand loves to espouse their sort of anarchism and like libertarian values and like this sort of, you know, like sort of indifference to to the state and then loves the idea of wielding the state as like a cudgel to punish the like, you know, the evil and unvirtuous, like crypto people. And, you know, I always just find that a bit sort of silly. Like so, yeah. I mean, I'm not not suggesting that was your, your take, but you know, I, I, it's tough like I, I'm not a fan of the sort of rot of crypto and, and think that it has been quite bad for a lot of people, but I'm suspicious reflexively of looking to the state to solve that problem wholesale. Yeah, it fantastic points and and and yeah, you're right. Like ultimately it comes back to we've outsourced our judgement about what is good actors and bad actors to the state, to the how we test, you know, and and we've relinquished the the responsibility of having to judge for ourselves where to deploy our money. And and I am definitely guilty of and and victim of that, you know, school of thought of like I I feel like, well, the there are these rules and pre mines kind of flout that rule. So I think this is bad and I totally fall into that, that trap, that pitfall that has been constructed for us. And it would be a better world if if we had to assume that responsibility on ourselves and maintain that like individual awareness that like you can't trust anything. You got to do your own research and and you know, because nobody's, nobody's playing cop out there. But that would be a better world And and we don't really live in it right now. Yeah, I'd like to examine. I'd like to examine one of the topics earlier which was the strategic reserve idea and of of two minds here. So on the one hand, in the same vein we were just discussing, you know, Bitcoin doesn't need help basically, right? And Bitcoiners don't need help either. Adoption doesn't need help for special treatment. Let's just say, you know, all users of Bitcoin and operators of the network are within their rights, you know, as outlined in the Constitution. We should keep it that way. But you know, we don't need any special hand handouts. So I think I worry a little bit about the perception of strategic reserve pumping the bags of Bitcoiners. Do you have any thoughts about that and maybe how to optimize the messaging with respect to government policy potentially and that issue there? Yeah. I mean, look, I think you have to 1st sort of take a step back and recognize that the United States government has a, a balance sheet that contains like substantial asset holdings, right, of of all different varieties, right? We have a ton of land through our National Park system. We have a ton of oil. We have a strategic oil reserve. We have a ton of gold. The the land that we own is sort of this serves this like public good, right? You can go to national parks and enjoy pristine nature. The oil reserve that we have, you know, gives us this sort of option value in the sense that when, when oil supply is is low or I guess prices are, are high, you know, the government can release some of that reserve to to ease the burden on on Americans and, and consumers. You know, the massive gold position that we have is probably better understood as a result of kind of just this like half dependence. Like when when the, you know, convertibility of the dollar into gold was suspended, we just maintained this this massive, you know, gold supply. And so, you know, right off the bat, I think you have to kind of the very natural question to ask is in so far as we hold substantial, substantial portfolio of assets, what assets should be in that portfolio? And I think like the Bitcoin Reserve conversation has, I think a lot of people have sort of missed that like first essential premise, which is that like, it's not like wholly out of character for the government to buy assets and hold them for strategic reasons. And so then it just becomes this question of like sort of portfolio diversification, right? Like if you're going to construct a portfolio for yourself, for, you know, an investment firm or for a country, well, you want to make sort of rational assessments about the suite of options that you have that you can put money into and think about what risks and what returns you, you know, may may happen as a result. So, yeah, I think like it's not that crazy for the government to ask, you know, what assets should we hold? I don't think it's a question people think about deeply enough, right? Like the the status quo is that we're already making these active investment choices like by not having Bitcoin. That is sort of as much of A statement as holding Bitcoin would be. And so I think you start there, you start there, right? Like the just, OK, we have assets, we invest in things, what should we invest in? Well, then it's like any, you know, it's like an individual, right? Like you, you guys have written about this and talked about this for years, right? A lot of the same reasons that it's prudent for an individual to have, you know, some Bitcoin in their portfolio kind of translate 1 to one with the reasons that it would be prudent for America to like hold Bitcoin in particular. Though I do think that there are more or less like 3 primary benefits of America having a, a Bitcoin position. I really want to get into the specifics of the size or the funding mechanism. I think those are two sort of thorny issues that could like for a giant tree of like sort of possibilities there that, you know, I don't know. So I'm going to restrict these comments specifically to the notion of like America having a meaningful stack. And here I think there are like 3 fairly clear benefits. The the 1st is, is just pureplay, like signaling. I think like America, I think Bitcoin signals very well, much better than any politician good that your rights as a Bitcoiner will be preserved and maintained. That if you run a Bitcoin business, if you mine Bitcoin, if you engage in financial services on top of Bitcoin, that your business will be safe, that you won't have to, you know, exit the country. So I think that there's like a sort of inherent signaling benefit there. 2nd is the sort of option value of having a, a large like Bitcoin position. I, I think that there's a sort of plausible world that having a Bitcoin reserve creates a sort of reinforcing relationship between the growth of Bitcoin and confidence in, in the dollar. I think it's sort of like this inherent hedge against like risk, right? Like in some ways, like I think if you priced Bitcoin or, or a Bitcoin reserve like an insurance contract from the perspective of the government, it's like a very prudent insurance policy to buy. You spend $60 billion, which we who knows, we probably spent that since we started the recording of this like call on on Bitcoin. And your Max downside is that it goes to zero. Well, OK, that's like one fighter plane. Your Max upside is like quite high, right? And we already have more Bitcoin than anybody else in the world, you know, in terms of like most of the Bitcoin is, is held in the United States. And so I think that America stands in those sort of scenarios where the price of Bitcoin rapidly appreciates. We stand to sort of benefit disproportionately to everybody else already, even without the strategic Bitcoin reserve. And I think an SBR kind of could help kick off that that cycle and whether the reserve winds up being something that helps America pay down it's debt or whether it just kind of creates more of a symbiosis between the dollar and Bitcoin. I think those are very desirable like outcomes. And again, like it sounds really radical, but like when you look at the history of of the US dollar in the last 150 hundred 20 years, like we've seen these like sort of pretty crazy shifts, right? Like going from a dollar backed by gold going to a dollar backed by by like debt to a dollar backed by oil. Essentially, the idea of a dollar being backed by sort of hard commodities and energy is not that radical in the context of the pretty significant phase shifts that the backing of the of the dollar, you know, have have underwent. So, and I, and I think third, like there are probably some good geostrategic benefits to be gained from promoting like Bitcoin, Like I already sort of hinted at this, but I think that there's a very clear and compelling argument that the more Bitcoin is diffused in the world writ large, like the more liberal democracy like wins. Like when you give people Bitcoin, you get so much like right off the bat, it's it's almost like you get to live parts of the American dream without having to move to America. You have property or or a claim to property that can't be revoked, can't be stolen from you at least with with meaningful ease like other assets you have the ability to participate in in global commerce like you. It sort of takes some core values that we have as a country in terms of the right to transact, the right to speak, the right to associate. And I think it very clearly benefits liberal democracies and very clearly undermines our authoritarian adversaries. So, you know, in a world where like, you know, in a, in a world where tons of people don't have access to the financial system, who are sort of forced to use a currency that is rapidly inflating, who live in a country that does not offer them strong property rights. You know, where, where the rate of change is actually down and to the right. Like you look at the rate of sort of correspondent banking relationships and it's dropped like 50% in the last decade. You've gotten billions of people that are desperately searching for monetary alternatives and. We as a country are not offering them much, whereas our adversaries like China are coming in and saying we'll build all of this for you just to use our sort of centralized censored commissioned networks for communications and payments. And so like the emergence of a non state sort of neutral bearer instrument. I think like kind of, it's sort of an obvious like when like you, you give people sort of sort of who, who are forced to make choices about like what monetary stacks they're going to use because their, their country and their currency is sort of busted. And. From the perspective of America, we'd much prefer people around the world hold Bitcoin than buy into the Chinese system. So I think those three are like very good reasons, like why we should have a Bitcoin reserve, right? Like the signaling effect, the, the, the sort of option value of just like having a stack and the sort of acceleration of global adoption in a way that benefits the interests of Western democracies. Like, look, that's a great, that's a great sort of bull case for, you know, when it's simply just a reallocation of assets. Like the question of should we buy a bunch of Bitcoin, like my immediate or, you know, that someone says that's crazy, then my my immediate response is we'll justify our gold holdings. Like, why don't we have that in the Russell 3000? Why Why don't we, you know, stimulating economic growth by investing in American businesses? Like what, what if you're a portfolio manager? Why are, you know, just present the rational case for having this massive gold holding? And so I know I said I wouldn't talk about funding mechanisms, but that is one of the kind of obvious ones, right? Like gave off a little gold holdings hedge with some Bitcoin. It's really not that crazy. It's the same argument that you know you guys would make onboarding a high net worth individual to Bitcoin. It's like almost riskier not to have it just the fractal at the state, nation, state level. Shave some gold to buy some digital gold and and you know, future proof your portfolio for the 21st digital era, right, 21st century digital age. I love that framing that you that you put put out there of like, and I'm sure you're, you're honing this, as you know, in DC circles and that's where it comes from. But thinking of, of the US embracing Bitcoin as a way to export American values and American capitalism to every corner of of the globe without any, without ever having to send any direct aid or any, you know, involvement like that. In the context of our, you know, increasing friction with authoritarian interest in the sort of bricks rough alliance that that speaks that that's, that's everything like that. Like if you're, if you're in DC and you hear that it's, it sounds like a no brainer. I, I would think you know that. Oh, I can, I can, I can provide a, a bulwark. I can shore up American interests just by allowing this thing to, to be out there in the world and trying to spread it at no cost to me. Really. I think that's like a real way to win hearts and minds in DC. I'm I'm I'm sure you're getting good traction with that. Yeah, it's exciting. I can't say anything really now, but there's going to be some exciting stuff coming out in in September and then sort of the following the next few months. I also think it's just like a very good way of almost incepting the they're not accepting. How do I put this? It's a very good way of like having the forcing the Bitcoin debate, right? Like it's almost like a wrapper for asking the question of like, is Bitcoin good for America? You know, when, when you have the context of like should America like what Lummus did is fantastic, right? Just the anchoring, the Overton window shifting of like I'm AUS senator and I think it's important for us to have, you know, 1,000,000 Bitcoin like that brings people to the room and and they want to debate that they want to talk about it. And so whether or not that policy winds up passing, I think just the proposal alone has had a genuine impact in, in terms of people's receptiveness to even listening to arguments like the one the ones that I made a minute ago. Those are all great to those are all great, excellent reasons. I'll, I'll add one more too logistical one, which is for sometimes the US government needs to pay people in foreign countries and areas and it's actually hard, you know, flying pallets of cash on cargo plants. That doesn't always, it doesn't always work out. You know, you might just want to want to send a Bitcoin. Well, it depends on who you're depends on who you're paying, right. It's it might might be better to use the briefcase of gold or cash when you're gonna, you know, fund some insurgency in another country or or, you know, pay off a bunch of drug smugglers. Yeah, for sure. So, so when it when it comes to stuff like that, the dollar may still be the the best Moe. Yes, well, the truth, the truth may be inconvenient, but but that's it. Well, David, you've been really generous with your time. This has been a great discussion. Thank you so much. What other parting words, you know, where can people find you? How should people engage with BPI or the Summit or anything, any other thing else you would want to leave us with? Yeah, you can find me on Twitter at David Zell under score. My e-mail address is dz@btcpolicy.org. We're always looking for, you know, for volunteers and for help, especially around the summit in late April, which I encourage anyone listening to attend. If you are someone who comes from the public policy world or have, you know, an academic background or a background as a researcher, if the stuff that I've talked about today resonates with you, please reach out. We're always looking to expand the the sort of cohort of people to whom we award fellowships to do research and advocacy. And yeah, we're really excited about the next couple of years for Bitcoin And, oh, we're opening up an office in DC in January. So I guess you guys are both formally invited to the launch party and so in a couple months you'll be able to swing into the BPI office in in DC to to chat Bitcoin. That will be phenomenal. I look forward to that. Look forward to meatspace meeting in meatspace, talking, checking out the new digs and looking forward. Well, I'm really excited for everything that you've already accomplished with BPI and all the more for the for the future. So thank you again, David, and thank you for coming on scarce assets. Yeah. Thanks for having me guys. Thanks for listening to this week's episode of the show. 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