The Saylor Series | Episode 14 | Bitcoin’s Seven Layers of Security #1
Robert Breedlove 1:27
So we’ve talked about Bitcoin and how it’s dematerializing these critical security functions traditionally provided by banks and/or governments, and it’s doing this through this proof of work security model. But you’ve laid out this framework that I think is very brilliant and it’s: proof of work has many layers to it. That these are protecting it from disruption? Maybe you could just introduce that model and we could walk through it.
Michael Saylor 2:03
Sure. I’ve called it the seven layers of security, but I think we should start with a fundamental observation: what we’re trying to create with Bitcoin is a digital property network. Something that will last for 1,000 years or 10,000 years. How do I create digital property in cyberspace? And we can call it money if we like — digital monetary network or digital property network. But what I want is I want a decentralized network that will last past the average life expectancy of a human being, or an institution, or a nation-state. So how do I do that? Well the beauty of proof of work is that the network derives its integrity from the interplay of the miners and the nodes and the HODLers, or the wallets if you will. With an especial emphasis on the miners. What do I define a security? Well property needs to be optimized for integrity and durability over time, integrity meaning the protocol can’t be corrupted. It can’t mutate. If the protocol mutates we go from 21 million to 48 million, you get a monstrosity. So you don’t want a mutation. And then I don’t want it to die. So if I said I want to design an immortal creature, something that will live for a million years, and I want it to maintain its integrity, then I’ve got to protect the protocol, and then I’ve also got to feed it energy and resources continually, and I have to protect it from a hostile attack in the near-term. Sometimes we think about security we think just about avoiding an attack, but really security is: you can’t [be attacked] in the near-term, we don’t want it to die, and most importantly, if you live but you go insane or you get a grotesque mutation, then did you really live? So how am I going to achieve my quest for immortality in a network? And the beauty of proof of work is it is an open protocol that is Darwinian and competitive in a way such that it is not just self-correcting on the protocol level to ensure correct money, but it’s also self-healing and it’s adaptive to the environment around it. I like to call these the seven layers of security, so what do you have? You have: an energy layer, a technology layer, a political layer, a financial layer, a network layer, a spatial layer, and a temporal layer of energy. Those seven various dimensions. So I’ll start with the first dimension of security: energy. I have a hashrate — say we’ve got 100 exahash right now. Well I’ve got to feed it energy in order to create the 100 exahash. Bitcoin is a big customer of energy. In fact it turns out that Bitcoin is the most valuable, most compelling industrial customer of energy in the world right now. You can generate about 40 cents per kilowatt-hour in revenue mining Bitcoin. So that makes it interesting because that co-opts all the energy industry. So one way that Bitcoin spreads and stays organically vital is it forms partnerships with the energy industry. If you have a volcano in the middle of Central America, the value of that energy sold within 500 miles of you is like 1 penny a kilowatt-hour. Unless you sell it to Bitcoin, and it’s 40 cents a kilowatt-hour. So Bitcoin is the best customer for your volcano. Bitcoin is a customer of stranded energy, intermittent energy, energy on any frequency, and energy at any scale. And you don’t need to be co-located with an industrial customer or a consumer. And you don’t need bandwidth. So for example, What’s the second-best use of energy? Maybe like running Netflix or Google data centers? But if you want to run a Google data center, you need to be within a fiber-optic distance of the major switching networks because you’re streaming video and streaming a lot of high-bandwidth queries. So they’re bandwidth-intensive, and they need to be triple-redundant because they can’t fail. If you’re trying to operate a car with Google Maps, you can’t afford to have an outage in the network. So Bitcoin miners are so much better than a typical data center because you could monetize the entire volcano or you could monetize the entire waterfall or the entire nuclear reactor — the full bandwidth of it. You could do it at the North Pole. You could do it with a satellite up-link. And you could monetize intermittent energy coming off of wind or wave or solar. And you can also shut it down in a heartbeat with fairly low economic cost. So that makes Bitcoin the most compelling technology for the energy industry that’s come along this decade — maybe in a long time. The last big energy technology was aluminum, when people would use their excess energy to smelt aluminum. Well Bitcoin re-built that but in spades. To do Bitcoin you don’t need a port to ship aluminum in and out of. You don’t need an aluminum factory which is difficult. You don’t need aluminum ore. And you also don’t need the industrial demand for aluminum, which eventually saturates. Aluminum is a specialty metal. So what is Bitcoin? Bitcoin is money! So half of everything that the human race is Bitcoin, or will be Bitcoin in time. So Bitcoin mining is securing and producing something which is of enormous value on a very thin line based upon any flavor and frequency of energy, and there’s really nothing like that. Why does that make the network secure? Well Bitcoin miners are continually looking for new energy sources and they’re negotiating for cheap energy, and when they buy it they become a big customer. So as they become customers of energy producers everywhere in the world, the energy producers become political allies of Bitcoin. So the energy producers are all regulated entities, but they’re all very credible, and they’re all wired into the political fabric of every society. So if you are the best customer of the utility in the city or the state or the country, then that utility has the vested interest in protecting your interest. So Bitcoin co-opts energy companies, and also Bitcoin is hope for a utility. If you are a value stock 100-year old utility company, you’re not getting a high multiple in the stock market, there’s not a lot of excitement. In fact you’re regulated and there are limits on how much money you can make by selling your energy to consumers or to businesses. If the power company in New York City just jacked the price of energy by a factor of three they would get shut down by the regulators. On the other hand, if you get into the Bitcoin mining business, you don’t have those kind of regulations on you. So Bitcoin is a chance for energy companies to become technology companies, and it solves so many of their problems. I can generate more revenue—check. I can generate revenue at much higher price per kilowatt-hour — it’s a very high price customer. The value and use of electricity for Bitcoin miners is higher than any other customer they have, so that’s good — check. It’s portable. And so that means every place I’ve got stranded energy production facilities I can move the Bitcoin mine to the energy — check, that’s interesting. It’s an energy shock-absorber. If I have a renewable energy network say with wind and solar, what I want to do is I want to build it to the level of peak demand, but if I build at the level of peak demand I will over-build it by a factor of two or more, and that means I’ll be running at 50% utilization for my consumer and other industrial customers. So how am I going to find a customer that’s willing to actually take up half of my energy production and then turn off for 10, 20 hours a year when there’s a brown-out without complaining? Like, the hospital’s not going to do that. Homes aren’t going to do that. So I need some kind of industrial producer that becomes a shock-absorber — they’re going to drive up my utilization to 98% and then when I brown out they’re going to turn off and give back energy to the network. So Bitcoin represents a driver for the development of sustainable and renewable energy, it also represents a technology to provide more reliability and fault-tolerance to a power grid. If you think about the role of capacitors or batteries or shock-absorbers in electrical or mechanical machines, that’s what Bitcoin is for a power network.
Robert Breedlove 14:22
Right. So you’ve described money as energy, socio-political energy. So in that framework I guess we could consider banks historically where they were actually providing custody of gold, they were kind of like energy stores in a way — we’re storing this excess productive economic energy in gold that banks were custodying for us. And now with Bitcoin we have this more direct path to monetizing energy, and so an interesting thing here — you’ve heard about a power bank, these little devices that will charge your phone that stores energy. So it’s like banks and power banks — do you see the energy producers and banks somehow converging? Because it seems like on a Bitcoin standard you eliminate the need for a custodial bank, they become kind of synonymous with energy producers. Do you see those industries coming together in the future?
Michael Saylor 15:29
I think once you understand that a bank is storing monetary energy, then you’ve got a bank of batteries that’s storing electrical energy, and then Bitcoin is sitting in the middle. It’s encrypting the energy from electrical energy into monetary energy. And so on one hand it’s upgrading the raw physical energy through the encryption process, and then on the other hand it’s digitally transforming analog fiat energy into encrypted money — digital money. And that makes Bitcoin a bank, an energy bank, a monetary bank. It makes it the world’s greatest battery, right? You could look at it from two angles: banks are bleeding off 1% of your energy a month due to inflation. Batteries are bleeding off 1% of your electrical energy a month just due to battery engineering. You’ve got two inefficient energy systems: batteries and power grids don’t work that well, and fiat banks and monetary grids don’t work that well. And Bitcoin plus Lightning gives you a battery to store all the world’s energy forever without power loss. The other day I sent 1,000 sats on the Lightning Network in 1 second for 1 sat. So literally you’ve got speed of light, nearly — you know, what is the cost of 1 sat, it’s such an infinitesimally small number, a fraction of a fraction of a penny — so Bitcoin’s a very efficient energy system. I think that the significance here is that Bitcoin is disruptive technology for the entire energy market, and it’s co-opting the energy producers and energy investors into Bitcoin. What you see right now is you see a lot of traditional power companies that used to be in the energy business, they’re getting into Bitcoin mining. People with natural gas, people in the nuclear industry, people in the wind and solar industry — they’re getting into Bitcoin mining or they’re partnering with Bitcoin mines. So Bitcoin recruited energy capital, and Bitcoin secures the network with energy capital. Hundreds and hundreds of producers of energy are plugged into the Bitcoin network creating that hash wall. So that’s the first layer of security for Bitcoin. And if you’re going to attack it, it’s no small feat to go and collect that much energy. You almost can’t. You’re not going to collect twice as much energy, or as much energy as is currently in the Bitcoin mining network. Politically, economically, practically, I just don’t know how you’d do it, right? Very, very problematic. And there’s no short-cut. In that regard, there’s an energy wall and you have to jump over it. And it’s a lot, to the point where you’re talking about 100 terawatt-hours of energy or something. It’s a lot of energy. So the second layer though is technology. And this I don’t think people really understand that well and when I talk about technology I’m referring to Bitcoin ASIC miners. Bitcoin is a wall of encrypted energy, so the energy is the first part, but the encrypting, the encryption, the crypto is the second part — the crypto-wall of energy. It’s not raw energy. If it was raw energy you just need 100 terawatt-hours to start to get parity. But when it’s encrypted energy, I need 100 exahash of SHA-256 mining equipment, and since it’s like 10,000 miners to get to an exahash right now, then that’s a million mining rigs of the latest build — how do you come up with a million mining rigs? It’s like, no one’s got a million mining rigs sitting around. It’s not clear how long it would take to manufacture a million mining rigs. Bitcoin’s co-opting technology companies. So Bitmain is a big player, but there are other big players too, and as Bitcoin gets larger, I think you’ll see the Intels of the world and you’ll see other semi-conductor companies designing Bitcoin mining rigs and getting into the space. And this is another example where this is open and competitive. Who wants it the most? Whoever wants it — and what capital do you need? This is semi-conductor fabrication capital. You have to fabricate these ASICs. The S19 family is five times more efficient than the S9s. So if you wanted to generate an exahash on the S9 family, it took 150 megawatts of power — that’s a lot of power. If you wanted to do it with S19s it’s 30 megawatts of power. A 5x difference in a generation. If you get through two generations every 10 years — or three, right? — you’re talking about a 20x improvement. I mean we’re 100x more technically efficient today than we were 8 years ago. Where will we be in 10 more years? We go back and forth — there’s all sorts of people with opinions. There’s Moore’s Law, some people think that ASIC technology efficiency will slow down, but then again people have been predicting that we would hit a wall in Moore’s Law for a while and they’re still not quite right. So when you understand the Bitcoin network, what you can think is that the Bitcoin mining network 10 years ago was very energy-intensive and technology-poor. There was a time when you were just using off-the-shelf chips, and then you were using GPUs, and then you were using ASIC first generation, and then ASIC next generation. So we’re like five generations into this now. In the early time-frame, you threw probably 1,000x if not a million times as much energy to generate a hash. And now you’re throwing 30 megawatts to generate an exahash. But when we get to the next generation it’ll be 5 megawatts. Well what if we get to 1 megawatt? So as you go out, energy is still important, but it turns out that the network is rotating from energy-intensive security to technology-intensive security. What if you imagine one day there will be 10 million mining rigs but they’ll be seventh-generation ASICs and they will be a hundred times more efficient than anything we have today? What that means is that 99% of the hashpower will come from that generation of mining rigs, which means that all this stuff that we have today becomes 1% of the network, right? Which means it gets squeezed out of the ecosystem. All those miners that are obsolete go out of business. And so that technology intensity has a couple of dynamics: 1) that’s what keeps the network from consuming all the energy in the world. I mean, people say silly things like, Oh well the energy usage is going to increase with the price. Well no it’s not. The energy usage maybe will increase with the log of the price. That is, if the price goes up by a factor of 10, energy usage might go up by a factor of 2. And if price goes up by a factor of 100, energy usage might go up by a factor or 3 or 4. But what you’ve got is a situation where the halvings are cutting the block reward in half every 4 years, so that’s a built-in 5x improvement in efficiency every decade, and then if you crank over that another 10x improvement in hardware, you’re talking about a 50x improvement in tech efficiency in a decade, or a 50x50x in 20 years. So the price has got to go way up, and even so, what you’ve got is a rotation: the network is rotating from, I burn a lot of energy to generate my hashes to, I burn less energy, to I burn less energy to generate more hashes. It’s not hard to see this, right? It’s in your iPhone: your iPhone has more processing power than the space shuttle had 40 years ago. You’ve got a supercomputer in your pocket, so you’ve got to assume that the security chips that generate the hashes just keep getting better. And because Bitcoin is unique in the protocol, all of the other processing power is irrelevant, right? Bitcoin is a Darwinian competition to generate the SHA-256 hashes. And it’s 95% dominant in that game right now. There’s a few other crypto-networks that use that but they’re like 1–2%. So that uniqueness with regard to the proof of work protocol protects it from an attack from all of the AWS network or all of the Google network or if everybody turned their iPhones to Bitcoin mining it wouldn’t help them that much, right?
Robert Breedlove 26:41
So is the common theme here between the energy layer of security and the technology layer of security, is that — you said Bitcoin is co-opting these industries — so it’s a source of demand for energy that’s basically unquenchable, and it’s a source of demand for semi-conductors.
For specialized mining semi-conductors. People think, Well 60% of the miners’ costs are going to energy. Well actually the miners are spending money on energy, and then they’re spending money on semi-conductor mining rigs, and then they’re spending money on the mining centers themselves. The heat sink, the heat engineer and the generators and the like. So there’s a competition. The question is: are you better off having inefficient miners and cheap power? Or are you better off having efficient miners and expensive power?
Robert Breedlove 27:46
And do they co-exist? That was my next question. So the new generation miners go to the more expensive energy sources, and then the older generations roll off to cheaper energy sources and they both operate side-by-side?
Michael Saylor 27:59
Yeah well you’ve got three generations of miners. People are running old, inefficient miners in China on free power, and then in the US and North America publicly-traded companies are buying the latest-generation expensive miners because their power is more expensive but they have more capital. If I have $500 million in capital, spend $60 million to buy 10,000 S19s, mine 1 exahash on 30 megawatts and make $120 million a year. Good deal? Probably a good deal, right? So in that case you would rather buy the better equipment. I think you find at any given time there’s like three generations of mining equipment. When the price goes high, if you look at the hashrate of the network back in the first quarter, there was a point when the hashrate got to like 190 or something, and I thought the peak was 170 but there was a surge up by about 10–15 exahash and I posit that that surge was because people turned on third-generation mining equipment, like the oldest, least-efficient stuff. And there’s a relationship: an S19 is generating 40 cents a kilowatt-hour right now. Ergo, it is profitable to buy electricity up to 39 cents a kilowatt-hour. An S9 was 5x more inefficient, so S9s were profitable at 8 cents a kilowatt-hour. But if you go back one generation before that, if you’re 5x less efficient than that you’re profitable at 1.5 cents a kilowatt-hour. So the break-even point is a function of the semi-conductor, or the joules per terahash. And that’s a technology driver, it’s not an energy driver. And most of the people that model Bitcoin mining, they don’t really focus upon the technical efficiency of the miners. And by miner I don’t just mean the one mining rig, I just mean the mining operator that has a mixture of first generation, second generation, third generation equipment. And you may turn off — like if the price of Bitcoin went to $5,000 a coin right now, people would probably turn off the old mining equipment unless the energy was free, right? You can bootleg Bitcoin on free energy if you’re stealing the energy. But if the energy costs 3 cents a kilowatt-hour you’re going to turn off your old equipment, you’re going to keep the new equipment running. And that’s an adaptive correcting system itself. When the price goes up you’re going to turn on the old equipment. And over time though, these are transient phenomena because the more important phenomena to focus on is that over a decade, the technical efficiency of the mining network is going to increase by a factor of 20x–100x depending upon the rate at which people upgrade the semi-conductors. There are a lot of ways that you can enter into the network and you can disrupt the equilibrium. One way as a nation-state is you can start mining off of a volcano. The other way you can design a totally new family of ASICs. Maybe Intel or Apple wants to get in the space — they could disrupt it. A big energy producer could disrupt it. Right now the limiting factor is the number of mining rigs you can get your hands on — that’s good. That creates some predictability to it. And that keeps us from going chaotic. So if you look at these two layers of security, the energy layer is co-opting energy providers all around the world, and the technology dimension is co-opting semi-conducting manufacturers. And if one of them like Bitmain gets too much power, you know Jeff Bezos’s famous line, Your margin is my opportunity. So if one company gets too much power then well this is not that terribly complicated engineering. It’s well-understood how to design SHA-256 ASICs.
Robert Breedlove 32:57
There’s a capitalism difficulty adjustment.
Michael Saylor 33:02
Yeah. And there are a lot of companies like Qualcomm, Intel, when they get squeezed they need a new market — this is the new market for them as the price goes up. And the interesting thing of course is: if there’s only one provider of SHA-256 miners — Bitmain — doesn’t that create an artificial scarcity to hashrate? And if there is a scarcity to hashrate, the profitability of Bitcoin miners goes up, right? And so if the profitability of Bitcoin miners goes up, then don’t more people want to get into the business? And if more people want to get into the business, don’t they need to buy Bitcoin mining rigs? And if they need to buy it and there’s infinite money, don’t they go and find someone else to go break that monopoly? So energy and technology are a key part of the equation. But they’re not the only part of the equation, because if I want to generate hashes I have to set up a Bitcoin mining facility. There’s physical nexus — I have to do it in Iceland or El Salvador or Canada or Texas. And you could probably run your stake validator on a secret machine in your basement, but you can’t run a 150 megawatt facility — you’d need the support of the mayor, the county, the governor. You could look at this as a negative — it isn’t, it’s a positive. What it means is that Bitcoin miners are knocking on doors everywhere in the universe and they’re looking for supportive political jurisdictions. If New York City doesn’t want to mine Bitcoin, maybe Texas does. Maybe Florida does. Maybe Wyoming does, right? And so if China doesn’t, well then maybe Kazakhstan does. In fact, the more irrational one country is, the more appealing Bitcoin mining is to the others. When China actually cracked down on Bitcoin mining, the revenues of Bitcoin miners doubled. The profits quadrupled. And the incentive to get in the mining business jumped. So what you have is an interesting dynamic where Bitcoin miners partner with energy companies, and they partner with technology companies, but they also partner with political jurisdictions and politicians. And this is an interesting situation too because this is so Darwinian: what happens if you’re a Bitcoin miner and you set up a billion dollar Bitcoin mining rig in New York York and there’s a new mayor and he outlaws Bitcoin mining? What happens to your capital? You can’t move it, right? So Bitcoin miners have skin in the game. And because they have skin in the game, that means that they have to do their due diligence and they’ve got a long time-horizon. A person that’s mining Bitcoin is looking out 5 years, looking out 10 years. You kind of want to be in a jurisdiction where you think that a decade from now you’ll still be able to mine Bitcoin, and so it forces you to be more thoughtful. And the next step is, Well I just invest hundreds of millions of dollars in this county, I guess I probably better contribute to the county election and get the mayor elected, right? You put down roots, because you have a vested interest. Because you have something to lose. So the Bitcoin mining network actually becomes a politically lobbying network for Bitcoin. And then every politician that has a Bitcoin mine has tax revenue. You know, when New York wanted to ban Bitcoin mining, that was blocked by a politician because the politician got a letter from the union, and the union said, We’re going to lose jobs. So all the money that flows into creating mining centers creates jobs, creates tax revenue, supports politicians, creates massive revenues for engineering companies, for real estate companies, for landlords, etc. It’s good for the local economy. Bitcoin brings prosperity anywhere on Earth. You might be a limousine liberal in the upper-east side and not like the use of electricity. On the other hand, but if you’re living in the middle of central Africa and if you have a volcano or if you have a waterfall and 90% of your population is living below the poverty level and there is no industry and someone shows up and offers to give you billions of dollars if they can attach a turbine to your waterfall — how do you feel about the situation?
Robert Breedlove 38:41
Yeah it’s incentivizing everyone to interact with it in a way contributes to and I would argue ultimately ensures its success. That’s the thing that’s so hard to get your head around here is like it’s not even something that’s being imposed. It’s really just a game theory that’s turned on people, so people in a way become a core component of the Bitcoin system. It’s like we at every level are incentivized to help it proliferate.
Michael Saylor 39:14
100 megawatts is worth $300 million a year. Netflix is not going to show up in El Salvador and offer them $300 million a year in order to run a data center plugged into a volcano. Google is not going to show up in Zambia central Africa and offer them $300 million a year to run a Google data center. It’s not going to happen. So what you have is Bitcoin is hope for energy, it is hope for your semi-conductor company, it is hope for your political jurisdiction, it solves a problem, and because it can go anywhere on Earth with a satellite uplink, it’s probably a more compelling solution to someone that has natural resources in a poor country even than in a wealthy country. And what you end up with is a self-distributing dynamically distributing Bitcoin mining network, and it has solved for the problem, Where do I find the cheapest energy in a politically supportive jurisdiction? That’s the problem you’re solving for them. That’s not the same as the cheapest energy. It has to be cheap energy from an energy provider you trust, in a political jurisdiction you trust. Okay well what’s the answer? The answer is that it’s a dynamic equilibrium. It’s changing every single week. It was different 3 years ago. 3 years ago there was free electricity in provinces that had empty excess coal electricity capacity in China, and so you could get effectively free energy. Okay, it was free but it wasn’t politically stable. Now you can go to a politically-stable place like Texas and get it for 3 cents. Or maybe you can get it for 1 penny in Kazakhstan, or maybe you can go some other random place. You could go to Cuba or you can get a bootleg thing in the jungle from some warlord. For how long? Well the Bitcoin mining network is continually distributing itself, and it’s organic. It’s just like asking the question, When we settle around the Earth, where should we settle where we’ll be able to make a living and we won’t suffer from famine or a tornado? And the answer is: you don’t know! Until you’ve lived 100 years you don’t know that place floods. What’s the likelihood of an earthquake in your favorite place? Well you’ll find out. So what happens? Well the network distributes itself, some people make good choices, some people make unwise choices. This goes back to antifragile or the like. You make really awful choices you’ll probably be put out of business within 36 months. If you make okay choices you might last 3–10 years. And then maybe there are other choices where you’ll be good for 100 years. But maybe you’re better off to go to the place where you’re good for 6 years where the energy is 1 penny instead of the place where you’re good for 100 years where the energy is 5 pennies. And maybe we could debate it. And maybe you have an opinion and we could argue until the cows come home, but what does it matter? It’s better to just release the entire creature, let the entire world work in a Darwinian, Adam Smith evolutionary fashion, a competitive way, and the lesson of the markets is that the market is smarter than anybody. Every time I think about what I knew, half the time I thought I knew it and I was wrong and sometimes I was right, but the market generally outsmarts the smartest person. So Bitcoin mining is a dynamic market in security and it’s balancing energy versus technology versus political support. And that takes us to the fourth layer of security —
Robert Breedlove 43:43
Let me just ask you one question about that. So it is shopping all of these dimensions, but it’s also stabilizing them. And I wonder does that apply to politics as well?
Michael Saylor 43:54
Yeah! It’s a shock-absorber. It is stabilizing. It’s a political shock-absorber and it’s an energy shock absorber. If you have a political regime and you’ve got natural resources but your economy is tanked, Bitcoin comes in — on one hand the Bitcoin miner can generate $500 million a year in revenue—Okay. On the other hand the Bitcoin miner can say we’re not coming unless we actually feel this is a stable regime to operate in. You know how there’s that phrase, I got married and my wife made me want to be a better man. It’s like, Okay well if you get married you have to give up some of your bachelor ways, right? And if you have a child you have to be even more responsible. So the commitment to a family is stabilizing, because you’re thinking, I can’t do the crazy things I did when I had no other responsibilities. If you don’t actually have any industry you have nothing to lose. And so a country that has a Bitcoin mine has something to gain and something to lose, and if you were to actually seize the Bitcoin mine, no other Bitcoin miners are coming to you, right? It’s the same as seizing the Bitcoin. If you make Bitcoin illegal in your country and you make mining illegal then you lose all that. But if you make Bitcoin legal or welcome and you make mining welcome you gain something. And then if you’re rational you might remember that your prosperity came from the new job you had, and then that way you don’t want to lose the job. If you’re jobless and homeless, well first of all there’s nothing to lose, and then if someone puts a $37 revolver in front of you maybe that’s more appealing to you to use that. If I had nothing I might be more prone to violence. And then why do people resort to violence? Maybe because it’s hopeless? If I feel like things are hopeless I either kill myself or I kill somebody else. Bitcoin is hope, and so yeah it is politically stabilizing, because it’s a way out for someone that can’t find another way out, and once you adopt Bitcoin you see something that worked, and you have something to lose, and you’re part of the multi-national Bitcoin network and that is civilizing in its own special way. Because after the mining it draws you into Bitcoin HODLing and then Bitcoin banking and then Bitcoin commerce and Bitcoin philosophy and the like.
Robert Breedlove 46:59
So I guess you could say in a broader scope that digital technologies are already changing the distribution of population thanks to remote work and things like this, but Bitcoin mining itself sounds like it could have a significant impact on where people live. We’re going to migrate to these cheaper energy sources and set up a politically stable environment and get to work.
Michael Saylor 47:26
Yeah Bitcoin mining lets you create an oasis of prosperity around a stranded energy source. If you have stranded raw materials, whatever the energy is, you can drop the miner on top of it and then you can create prosperity, because it’ll monetize any flavor of energy, any frequency of energy, with no bandwidth and minimal infrastructure around it.
Robert Breedlove 47:58
Alright guys, that was Episode 14.