A lot of people think digital ID's are only being rolled out
in Europe and the crazy countries like Canada and the
UK. But Twitter went wild embracing
this 34 page report written by the US Treasury that on the
surface does seem to be embracing Bitcoin privacy.
But after spending a few hours reading it, it's clear that not
everyone actually read the full report.
Because there's some very dangerous precedent buried in
this report that could usher in a digital ID in America, or at
very least is engaging and debating whether there should be
a digital ID to protect against scam scams and other criminal
activity with Bitcoin. It it is, you know, it is a very
interesting report. I'm going to give you kind of
the more generous take of what I read and then the more, I guess
you could say, cynical, paranoid view of what is actually in this
report. Now, of course, I am not alone.
I am here today with our boy Kent Halliburton from SAS
Mining. So here's the report, guys.
If you guys saw this on Twitter, you might have saw some very
bullish headlines on this. The report is titled Report to
Congress from the Secretary of the Treasury on innovative
Technologies to counter illicit finance involving digital
assets. So let me do a command F here
and I'll show you guys the kind of very bullish take that
everyone clipped out and put on Twitter.
This sentence in itself does sound very bullish for Bitcoin
privacy in the US. You just take this alone.
It is just it's it's alone a very interesting quote coming
out of the US Treasury. And here's what everyone was
reposting on Twitter. This specific quote, and it is
quote. Lawful uses of digital assets
may leverage mixers to enable financial privacy when
transacting through public blockchains.
For instance, individuals may use mixers to protect sensitive
information on personal wealth, business payments, or charitable
donations from appearing on a public blockchain.
As consumers increase their use of digital assets for payments,
individuals may want to use mixers to maintain more privacy
of their consumer spending habits.
Of course, also in addition, digital asset services that take
custody of user funds and accept and transmit values or value are
currently required to register with Vincent as money services
businesses maintain records and file suspicious activity
reports. This includes custodial mixers.
Now that was basically the clip or the snapshot that was going
around and you know, a lot of our friends, a lot of the
Bitcoin media groups were saying, hey, look, this is a win
for Bitcoin privacy. Now I know Bitcoin privacy isn't
the most sexy topic when it comes to Bitcoin.
Everyone it really, to be honest, everyone likes to talk
about price that it's love it or hate it.
That's what most people like to talk about.
Now again, I'm not going to read the whole page or the whole
report. It is 34 pages, guys.
So I will give you kind of my overview of it and then I did
get a couple of good tweets to kind of breakdown a little bit
of what this report is saying. Now, my more generous take of
this report is you can say that the report, even though it does
talk about scams and criminal activity, criminal cyber
activity, and it lays out a lot of different use cases and of
course ways to fight illicit finance, which is the title of
this article. It does.
If you read it again with a more generous view, it does just lay
out all of the obstacle is that the US Treasury or rather the
Trump administration or just the world at large has to deal with
this new asset class that is of course Bitcoin or digital assets
as they like to call it. And it does basically lay out a
lot of the attack vectors, a lot of the different things going on
where people are able to skirt AML and KYC laws and ways that
they are using mixing illegally. But I think in that in itself,
if you read the whole report, it does bring up a lot of different
questions of OK, well, illegal uses and legal uses, which ones
which? And further, if we see some kind
of dragnet surveillance here, what are the implications?
And the article or rather the report does talk about there are
concerns about this and and therefore they are talking to
the private sector, of course, crypto companies, as they like
to say, you know, stakeholders of a crypto or Bitcoin.
So there is a generous view of this that hey, maybe this
article or this report from the US Treasury is what the title
says. It is that this is them trying
to game theory ways to fight illicit finance.
Again, that's the generous view of this.
Now, when I read this, there was some concerning language in it,
particularly for me was the mentions of digital IDs.
They specifically mention and I'm, I, I didn't bring you the,
the exact quotes of this, so you, you might have to just
trust but verify on this with me.
But they did specifically mention the UK and Europe and
how they're handling illicit finance, particularly with
digital IDs and their digital ID kind of, you know, push their
operations to unleash a digital ID.
And this is where it does get a little worrying.
Further, they do talk about essentially using more chain
analysis and already is being used by institutions to of
course monitor the blockchains and make sure that we're all not
criminals. Though the assumption is
essentially that everyone is everyone that is using
blockchain is a criminal and therefore they have to kind of
stop everyone or rather all of the bad information or all the
bad use cases of of Bitcoin or blockchain activities.
Now, there was one thing, and this is me speculating, guys,
this is me with my tinfoil hat on.
There was specific mentions of AI usage or using AI to monitor
and track all the information on the blockchains from the
financial institutions. And when I was reading this, my
initial thought was this idea of like, OK, so if they're going to
use AI to monitor all of this information, I quote public
private cooperation. It really seemed to me like
they're talking about using Palantir to monitor all of this
information. Now again, hey, maybe I'm a
tinfoil hat guy. I acknowledge that.
But that was the first thing that I kind of popped into my
brain when I read this. So again, the precedent or at
least the the cynical view of this, the more paranoid view of
this report is they are outlining what potentially could
be ways to pretty much tag and bag all the information coming
from Bitcoin and digital assets. And therefore every single one
of us is, you know, guilty until proven otherwise.
And so that's my generous view of it.
My more cynical view of it is some of the implications in this
report aren't as bullish as the headline that, hey, there's
lawful use cases for Bitcoin privacy or lawful use cases for
Bitcoin mixing. I know they said that, but
further on in the article they stopped or sorry, the report, I
keep calling it article, the report, they do mention a lot of
various uses of illicit finance using mixing.
So it's a, it's a little, it's a bit of a grab bag of there's
some positive in it, maybe a less positive than the negative
implications. But reading the report it there
is some worrying kind of wording verbiage sentences in here that
it's like, OK, what is actually happening here?
Is this simply a report to kind of outline the entire playing
field here? Or is this more of a playbook
that they're going to use to essentially tag and bag
everything coming out of digital assets and digital asset
providers and really complicate the process, which is one of the
things I've been saying about the Clarity Act.
It seems like it might do more harm than good.
And again, reading this report, it, it did kind of give me that
idea of like this doesn't sound as bullish as a lot of the
headlines would say. And I'm not the only one that
said that. I will bring up a couple of
tweets from one of my favorite reporters, of course, Lola Leet
from the rage. She's been doing a great job and
this was her take. And and there is some spicy
language in this guy's I'll, I'll you know, I know this is we
try to be a family show, but you know, I, I slip and stumble at
times. So here is Lola Leet's take on
this, of course, from the rage publication.
And she is obviously a lot more cynical and and a lot harsher.
And here's for the official post from the rage and here here she
she does kind of pick some some quotes from the article or sorry
again, the report that are are going to make you kind of see
where this is going. And so she goes.
News outlets are touting a recent report by the US Treasury
on the combating of illicit finance and digital currencies
as a quote win for privacy. This in this is incorrect.
While the report notes that of course, quote lawful use of
digital assets may leverage mixers to enable financial
privacy when transacting through public block chains, the
majority of language on mixers highlights their use in
terrorist financing or other illicit activities, as well as
the challenges mixers introduced to law enforcement, which I can
confirm after reading the whole report.
As the Treasury states, quote, criminals commonly use tools
like mixing to introduce challenges for investigators
attempting to trace illicit digital assets, frustrating law
enforcement investigation as well as digital asset service
providers, transactions, monitoring and tracing efforts.
While the report issues no new recommendations on the future of
mixers, it notes that the Treasury has already proposed a
rule to regulate mixers under the Patriot Act that has been
tasked to finalize by the White House.
According to the report, the Treasurer has additionally
adopted the following recommendations.
Treasury will, quote, incentivize the the development
and integration of digital identity tools aimed at
countering illicit finance. Treasury will also quote explore
working with Congress on ways to better enable third party
services providers to conduct identity identity verifications
and Treasury will quote encourage industry stakeholders
to develop open source and standardized AP is for essential
compliance functions. Regarding defy, the Treasury
further commands that Congress should consider specifying
actors within the decentralized finance ecosystem that should be
subject to a MLCFTC obligations quote, Congress should consider
how to best safeguard the US financial system from money
laundering threats that originate abroad, including
those in D5. That should quote include adding
a six special measure to Section 311 Patriot Act authorizing
Treasury to prohibit or impose conditions upon certain
transmittals of funds that are not tied to corresponding
banking relationships. Congress should consider
creating digital asset specific financial institution types or
subtypes within the Bank Secrecy Act such that the new types of
subtypes would be subject to a MLCFT obligations.
And of course, FinCEN should evaluate whether or how it's
existing guidance related to the digital asset sector, including
guidance issued in 2013 and 2019 should be resigned, it
rescinded, modified or updated to reflect legislative and
regulatory challenge changes. She goes further from her
personal account and this is where she gets a little more
spicy. Okay, so I'll, I'll PG it up a
little bit. She goes, Oh my God, the
treasury said we can use mixers if we promise we won't do crime.
Listen here, you effing idiot. The very notion of quote lawful
uses of digital assets implicates a mechanism to
distinguish between lawful and unlawful uses.
As I mentioned earlier, the report very clearly laid is how
how this will be distinguished, and it isn't a magic and fairy
does. Since no one who claims this
report is a win for privacy seems to have actually read it,
here's some of the recommendations and I I pretty
much read most of them. You know, finalization of the
regulation of mixers under the Patriot Act, the creation of
subtypes under the Bank Secrecy Act, to resign modifier update
2013 and 2019 Fins and guidance to incentivize the the
development and integration of digital identity tools aimed at
countering illicit finance. Nothing, and I mean nothing
about this is good for privacy at all.
So again, the big kind of headline that there is lawful
use cases for mixing, it was a good headline.
It it did kind of perk up all of our ears.
But when you read the report, you're kind of thinking this
doesn't sound that good at all. And you know, shouts at the low
elites and the rage team. I think they're doing very good
journalism, like actually real journalism.
OK, They're they're we're not just engaging or I I'm not going
to say we the rage is not just engaging in, you know, full
engagement plebslop on the timeline.
Yes, that quote in and of itself of lawful uses of mixing does
sound like there is a narrative shift coming out of the the
administration. But again, when you read all of
the report, it, it kind of makes a different case.
Now on top of that, another thing that we saw happening
yesterday, which is very worrying it, it basically is one
of these things of don't watch what they say or don't listen to
just what they say, watch what they do as well.
And this is where you're starting to see, hey, the one
hand is doing one thing, the other hand is kind of doing the
opposite. And as we always say, don't just
follow what they say, follow what they do.
And then you start to see what's going on.
Though there is also the idea that, hey, maybe all the
institutions, all of the, you know, ABC agencies aren't
necessarily on board with the, quote, federal mandate of
becoming the Bitcoin superpower of the world.
But this is where it starts to seem like maybe there is a full
frontal attack on privacy. Now, what am I talking about?
We've been covering this story for a long time now.
And it does have to do with the Tornado Cash.
So here is a tweet here, head of marketing umbrella enthusiasts
at Arkham. I think this guy's a shit
corner. But whatever it is, what it is
it it's still it's still a good tweet.
OK. And he goes, the asymmetry is
wild. U.S.
Treasury openly admits mixers have a legitimate privacy use
case, yet the DOJ wants to retry Roman Storm on 2 counts of money
laundering and sanctions violations.
Developers can't be responsible for 3rd party misuse of neutral
open source software. An appalling turn of events and
makes the update from the US Treasury really bitter.
Free roaming and of course here is kind of the other tweet that
was going around yesterday, United States of Department of
Treasury. Oh, wait, sorry, Rollin.
Here is a post this was from Amanda Tuminelli and she goes
the DOJ has decided it will retry Roman Storm in the fall
despite failing to convince a jury the first time around and
despite making obvious mistakes like calling irrelevant
witnesses and not understanding the forensic analysis of their
own blockchain evidence. And oh, let me, let me, I guess
I'll have to find the, the original tweet here.
But anyways, you're you, you get the, you get the picture here.
They are going to retry the Roman Storm case, the Tornado
Cash case, which we were covering originally because it
did set a a very scary precedent.
And then we saw shortly afterwards they went after the
samurai wallet depths. So there is a continuous attack
on privacy even though we saw a, you know, very interesting
headline coming out of the US Treasury.
At least they kind of embrace, hey, there's some use cases for
Bitcoin mixing and Bitcoin privacy.
But here's the full tweet. Sorry, guys, it goes.
DOJ has decided we'll retry Roman Storm in the fall.
Despite failing to convince a jury the first time around,
despite making obvious mistakes takes like calling irrelevant
witnesses and not understanding the forensic analysis of their
own blockchain evidence, and despite multiple legal and
logical fallacies to their allegations of third party
developer liability, The SDNY will retry Roman Storm on counts
one and three of the indictment. Incredibly disappointing news.
Again, I think we all know that the you know, New York court
system is not very favorable or rather New York itself is not
really favorable for Bitcoin. It's very, you know, with the
bit license in New York, it's not the best jurisdiction for
Bitcoin at large. They really have a bone to pick
with Bitcoin or crypto at large. And here we have a a huge stark
contrast from the official headlines, you know, oh, DOJ
says or sorry, the US Treasury says Bitcoin mixing.
There's awful use cases. You read the report and it's
kind of like, I don't know it. That's I don't I don't think
everyone read the report. I think I think we just got
caught up in in a screenshot and it was like, oh, what a win for
privacy. At the very same time we see
SDNY is retrying Roman Storm because hey, they got what they
wanted with the samurai wallet. Debs, they're in jail currently
for at least five years or at least, you know, at most five
years, probably maybe a little less.
So it's one of these things where the narrative, the idea of
a win for privacy, it sounds really good.
I, I would really have liked to read this report and be like,
OK, you know, this was a win. In reality, as we're seeing,
they are coming after privacy and as we like to say, and all
of us Bitcoiners, I think believe this like privacy is not
a crime. We shouldn't be criminals just
because we want to maintain some kind, some semblance of
financial privacy. It's not that we have something
to hide. You know, that's the, that's the
idea of everyone's like, oh, what, Like I don't have anything
to hide. And it's like, well, you know,
don't we all have curtains on our house?
Don't, don't we like to keep some things to ourselves?
We don't need all of our information blasted on the
Internet. I know we live in the social
media era now where like, we're all OK with posting everything
online, but you know, my mom's always said something.
And maybe this is just some classic traditional, you know,
mom isms here and she's like, hey, you don't have to tell
everything to everyone. Keep some things to yourself.
So again, you could argue this is a win, but it does seem like
we we are seeing a a true true bent or a true attack on privacy
at large. Which does blink bring in the
further implications of well, we know there is some kind of
fights right now around wording and coming out of the the
certain bills. I believe it was the Housing Act
that had a temporary temporary window on a CBDC ban.
That there's an argument about it and you're just like, OK, it,
it really feels like we're just walking into a full panopticon
dystopia where everything's tracked and bagged.
And that's one of the things that Bitcoiners have been saying
forever. That's like, look, Bitcoin is a
tool for freedom, but at the same time, if we're not careful,
if we're not vigilant, it could be a tool for total control of
finances in the world. It's like it is a double edged
sword. I truly believe Bitcoin is for
freedom, but we do have to fight for that.
We are the front line soldiers. This is happening, guys.
This isn't just, you know, me trying to get click bait.
You know, this isn't me just being cynical.
The wording in this report, it's very worrying that oh, wow,
like, OK, we're going back to we're all just criminals and if
you want privacy, you're a criminal.
So I, I, depending on how you want to look at this, could be a
slight win. It could be just a total
abomination. But anyways, Kent, I saw you
shaking your head when you're hearing these kind of sound
bites coming out of the rage. What what's your thoughts?
What does this say? When is the US Treasury
embracing Bitcoin privacy? Is this them just kind of game
planning, illicit finance and how to combat it?
Or is it more of a blueprint to unleash total surveillance AI,
you know, chain analysis on everything?
Like what? What's your take away hearing
all of this? Well, I can tell you had a cup
of coffee. Before you started I.
Have a cup of coffee, OK? No, My, my, my, my take is, you
know, I, I'll land more with Lolita on this one, you know,
and as I'm, as I'm seeing all this language, I have not read
it and I haven't looked at it before jumping on here with you.
But as I'm sitting here sort of reflecting on it, it just
strikes me as this is another, this is rules for for thee but
not for me as sort of a situation.
Like you look at all the corruption in the Congress and
Senate right now, how much the net worth of all those guys has
gone up, guys and gals, once they get elected.
And, and I scratch my head and say, OK, you guys are going to
continue to implement the, the Bank Secrecy Act on us and
continue to lock down on us, us not being able to spend any of
our, our, our validly earned money and going to crack the
whip on all of us. And at the same time, this
oligarchy that we call our, our Congress and Senate is just
going to continue to line their pockets.
And nobody's going to look at that, I guess, just as the, the
hypocritical nature of all of it is just so absurd.
And I think that as Bitcoiners, the best thing that we can do is
just opt out. We can be a self referential
system, right? We don't actually have to use
dollars if we all just agree to buy and purchase goods for goods
and services from one another in Bitcoin.
And by doing that, they actually can't come after us in the way
that this framing looks to be laying itself out, like the idea
of lawful users of Bitcoin, like, I'm sorry, there's just
users, right? That, that, that's kind of an
absurd statement to begin with. So the fact that they're
cracking down on it like that is worrisome.
The fact that they're coming after Roman again, you know,
that Southern District of New York.
I mean, I, I, I would love somebody to go sort of plunge
the, the, the drain there. That just place seems to just
be, you know, the, the enforcement arm of the Federal
Reserve or something. It's pretty crazy.
I don't like it at all. So when I look at all of this, I
think that you know what, there's some statistics that
takes like 3 1/2 percent of a population to resist something
for it to actually not be enacted.
And I think that 3 1/2 percent is a Bitcoin community.
And so really it comes down to us, like if you look at the the
generations before us, right, and what they had to do to
survive and hand us freedom that we've just been born into.
Guys, gals, I'm sorry. I think it's our turn.
I think it's our turn to fight for freedom for the next
generation. And it's coming at us right here
and now. And if we're not fighting for
that freedom with our actions, and we can peacefully do that
with our choice of using Bitcoin, then I think our
descendants are going to be pretty damn embarrassed for us
that we let it slide away. Yeah, no, 100%.
And I really do like the that, that statistic, that number, you
know, 3 1/2 percent is, it's one of the things that us bit
corners have been saying for a while.
You know, the American Revolution was fought by like
that 3% number. And I I really do want to
believe in that number. But one thing that is very
worrying, like you mentioned, it does seem like we are there's
like a stark difference right now where like we we're all kind
of watching and maybe a lot of us don't want to admit it, but
there there does seem to be just unprecedented political
corruption right now. And there does seem to be a
complete severance from what the politicians want to do and what
we want to happen. It's like they don't care what
we think anymore. They're just kind of like, this
is what's going to happen. This is going to push, get
pushed through. Like, don't worry about you
peasants. So I'm like, again, maybe I'm
hedging my own thinking where I'm like, I totally believe in
that 3% number. Like the, you know, the
intolerant minority will always win.
I'm a true believer in that idea.
Then you kind of see what's happening from, you know, the
top down directory, right currently as we speak and you're
like, wow, there's a there's a complete severance from the, you
know, for the people by the people and the politicians are
totally just going rogue. And you know, historically we've
seen these kind of examples. It it I don't want to be the
just classic bitcoiner of like, what's it late empire vibes here
where you know, the people specifically, you know, man
thinks of the Roman Empire. It's like at the end of the
Roman Empire, the people in power just, you know, we're in
for themselves and pillaging as much as they want.
Now I, I do truly believe that we can hopefully turn this
around like they're I got to believe in the hope.
You know, the chat always calls Opti just hope him here.
Like I have to believe in the hope or else, like what's the
point of doing all of this? Like we got to believe in the
good. But it is hard to fight the
black pill and the doomerism when you kind of look at
everything and you're just man, it really, it really is an
uphill battle. I guess that's that's the only I
don't know. Let me let me jump in and just
just say, you know, the the way that I've been framing this is
yeah, it's, it's it's the dawn is darkest right before the sun
comes up. And it sort of feels like that
moment. It sort of feels like like Mr.
Global, to use Castro Catherine Austin Fitz's terminology for
this just Leviathan that seems like we're we're that we're
battling all the time. It seems like we've got Mr.
Global like cornered at this point.
And basically the mask has been ripped off.
And it's kind of like if you have an injured animal cornered,
right? Like it's going to fight until
it's last breath. And it feels like everything is
being accelerated and thrown at us all at once.
And if all we can do is just stand our ground like that, that
phase is going to be over and we'll we'll have turned the
tide. And so I think it's just largely
on us to continue to stand our ground and that Mister Global is
just gonna fade away into the sunset and we'll win.
It doesn't look like it right now, but that's my take.
And you can look at that just by even what's going on in Iran
right now, right? Just like the consumption of
resources to battle that particular war right now.
I think that's one of the reasons why Trump is signaling,
starting to signal like, hey, we won.
You know, it's like, who cares if we won or lost?
Like I don't think we've got the resources to actually put us
through. There is practical limits to
what we can actually accomplish as a nation right now.
And so I think that if the if if the debt based financial system
does not continue to prop that up, it won't continue to exist.
And I think we're at the at the limits of that.
So maybe I'm just like you, an eternal optimist and full of
opium. But I'd like to think that we're
just at that last hour. You know, like the 4:00 AM hour
where it just sucks while you're freezing your our soft waiting
for the sun to come up. But we'll get close.
Yeah, well, I will. I'll give you the credit here,
Kent, because that was a very hopeful like, OK, hey guys.
Like I know it's dark, but we're going to we're going to figure
this out, guys. And maybe it's just because you
got the, you know, the wisdom on, on the, on that beard there
that us young guys. And maybe it's just I drink too
much caffeine this morning. I don't know, maybe I'm just
like jittery in general this morning.
But it it that did, you know, metaphorically walk me off the
Cliff. I'm like, yeah, you know,
actually, what am I saying? We we got this.
We're we're going to figure this out.
And it and it reminds me of the what's the saying?
You know, first they ignore you, then they laugh at you, then
they fight you and then you win. As we can see, you know, it's a
multi front war right now, literally and figuratively, but
we are in the then they fight you stage and no one said it was
going to be easy. No one said it was going to be
quick. Well, depending on which front
we're talking about, because people did say, you know what
was going to happen. The Middle East was going to be
quick and easy, but in terms of this Bitcoin thing, I've been
saying for a while, like I really am convinced this is
going to be, you know, multi decade struggle and it's not
going to happen overnight. I know some friends are like,
now one day, you know, gradually, then suddenly they're
going to bend the knee. And I'm like, I don't know.
I think it's, I think this, I think we're going to be in the
trenches for the next decade minimum.
And we're just going to try to get more people in and try to
make sure, like you said, we stand our ground because that's
really how I think we win as well.
It's like we carved out a little area.
As more people come, it obviously grows, but we can't
budget, you know, from the ground that we've claimed
because that's how we lose. So some wisdom can.
Well, let me let me just throw in a couple of other historical
things that are worth keeping in mind.
Right. Like I was actually old enough
to remember when the Berlin Wall fell.
Now I wasn't old enough to remember what things were like
before that, but you go back in time that what everybody thought
like it was shocking to see the Berlin Wall fall, right?
And that will that largely was like the difference between like
the East and the West. And during that time frame,
nobody, nobody thought within a week or so that that would drop.
But it did, right. And so how radically did
everything shift all at once? And in our lifetime, like I've
seen another historical, this was a negative radical shift,
but was like 911, right? Like that bank and not the bank
secrecy, but the NSA came out and other things.
Uh oh, I'm getting invaded by a little 1 here.
That's my, that's my littlest. But yeah, we'll get them.
Off camera, we'll get them off. Camera.
Yeah. Thank you.
And then and then and then the
third one was, you know, like COVID, like another radical
shift. So I'm just saying there's
historical events that can come about that can cause massive
change very quickly. So things may look hopeless
right now, but it doesn't take but for a shift to happen for
everything to change in an instant.
That's all. And the Berlin Wall is probably
the most +1 that I can think of in my lifetime.
Yeah, truly, I was, I was a little too young for the
actually, I wasn't even born yet, but yeah, I'm a little too
young for that one. But you know, I, I I like my
history though. Someone in the chat, someone in
the chat's. Yo, America, 7382 is like
depressing combo. I know, dude, I, I know you.
I I was really telling Cat before we went live.
A lot of you guys are like, hey, I haven't seen, I haven't been
on the show for a little bit. I need some opium.
I'm like this might not be the show for you, bro.
It's hard. There's not much opium on
today's show. It's like we're we're kind of
this is more of like a sober, you know, reality shock moment
right now. But hey, we're you know, we got
Bitcoin, you know, just keep DCA ING.
I know at a certain point I I am truly actually can't.
We are going a little long, but I do want to get your idea on
this. I, I'm truly, I think becoming
to the point and, and maybe a lot of our critics have been
saying this for a long time where like, I don't think it is
just enough for us to completely opt out of the system, just like
stack sats and chill. I, I am starting to view this
like that is just part of the, the equation here.
Like you need to opt out, you need to save in Bitcoin, you
need to stack sats and chill. But I think it's going to,
there's going to be a lot more work for us to do than just
simply saving in Bitcoin. That is like the the initial
kind of domino that you need to save in Bitcoin to obviously
protect yourself. But I think at a certain point
we are going to have to do more as a community or, you know, as
individuals, however you want to look at it.
But I don't know what's your thoughts on that before we move
on? Like is stacking stats and
chilling enough or will is this just the beginning?
Kind of, you know, entree battle.
No, I don't think just stack and stats is enough.
I think, I think it's, it's one level, right?
I think it's one level, but I don't think you're part of the 3
1/2% that's resisting if you're just doing that.
I think, I think we need to actually be active in building.
To me, there's an event horizon between Fiat reality and Bitcoin
reality. And the more that we build
Bitcoin reality, the more that we secure our future, the less
that we build the Bitcoin reality, the more that we are
have an insecure future. That's it's as simple as that
for me. So me building SAS, mining, this
is part of my effort to resist and to create a different way.
And it's, it's my little simple act in the process, right?
This is just the only way you generate Bitcoin is through
mining, right? So customers that come here,
they wind up getting SAS that are generated outside of the
banking system because they're generated by the network.
So it's my little way of of having some form of resistance
and giving people tools to have their own form of resistance.
But I think that all of us have a part to play, whether you're
an entrepreneur and just accept Bitcoin and then spend it, you
know, amongst your friends, family and other vendors that
you might associate with. I think that we have an
obligation here and now to do that level of resistance.
I'm not calling for anything violent or anything.
Yeah, crazy like that. But no, no, no, no, none of
that. But I think just like, you know,
I was inspired by Mahatma Gandhi and like how he resisted the
entire British Empire, right? Like he just checked out, you
know, how he actually resisted the British Empire.
You refused to buy any of their goods and services.
And So what do you do? He made his own clothes, he he
grew his own food and he just stopped using their system.
And I think that we have that opportunity here with Bitcoin to
opt out in a very peaceful way. And by opting out, we vote with
our dollars not to participate in the system.
And that's the way that we actually can change everything
is simply by opting out. So I think it's, it's strength
in numbers, right? It's not just me or you, Opti
that makes that happen, but it's all of us collectively
realizing, oh, this mathematical certainty, money that is
digitally scarce and and protected by electricity is a
better way for us to conduct value between each other.
And let's just embrace that, you know, we can all kind of have
our version of being Amish, so to speak, by building a separate
reality and just continue to live as a sovereign entity
within the, the overarching system and, and do that as a
network state, a Bitcoin network state, so to speak.
Yeah, I I couldn't agree more. Couldn't agree more.
Though I do have to, I do have to read this comment.
This is actually hilarious. Christopher Barber on in the
YouTube tags like our hopium dealer is telling us to go to
rehab. Hey, sometimes we need a reality
check, OK? Sometimes we get a little too
high on our own side. OK, All right, that's all I'm
doing. You know, but that's a funny
comment. That's a funny comment.
All right, Anyways, guys, we are we're going to keep the show
moving. I do have an interesting clip
that was, you know, circulating on Twitter last night in regards
to inflation. And then on the same note, I
don't know if you guys are watching what's going on in the
oil markets, but the it's it's trading like a shit coin.
And I'm really glad to have Kent here, obviously as a Bitcoin
miner to get his take on the rising and and falling prices of
energy currently and what like what exactly is going on?
And then of course, we're going to get an update from Kent a
little later, might have a little bit more contrarian takes
to wrap up today's show. So that's the layout of today's
show. First commercial special break
and we'll be right back. Today's episode is brought to
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se-ed.com store. All right guys, all right, the
current Bitcoin price is $71,270 guys, I'm starting to get a
little bullish here. I I know you guys want the
opium, but. I don't know I I'm really
leaning into being a Wick off Maxi right now.
OK, maybe I'll cover that later for you guys on the show if if
it holds on the pattern all right.
Anyways, the discount from all time high is 43.5% the market
cap. Look guys, we have reclaimed the
$1.43 trillion dude, a win's a win as long as we're out of the
$1.3 trillion market caps. Like I, I, it feels a little
better. That 1.3 is just depressing to
me for some reason. I, I can't explain it.
Anyways, it looks like let me actually let me double check
this. It looks like we have yes OK,
Clark Moody's dashboard is updated on the block height.
It is the current block height is currently 940,144.
I I don't know what was going on yesterday guys, but it it was
interesting that on the day that we got the you know 20 million
Bitcoin mined we the Clark Moody dashboard just like wasn't
working for us. So that that was like.
I don't know what's going on here.
I got to go to men pulled out space to confirm what the block
height is currently. But anyways, as I was saying,
there was a clip on CNBC and it is by Ron Baron, of course, of
Baron capital. He's a influential person.
Yes, you know, Boomer, but hey, influential and billionaire
investor. So it's not just bitcoiners
saying these things, which is why I wanted to bring it up is
because he is hitting on not just Bitcoin, but inflation and
further what that does to your purchasing power from a
bitcoiners perspective, from someone that's been here for a
long time, you're probably like, this is nothing new.
I've heard this before, but that's the point.
Now our narratives are getting out on CNBC from people that are
in, you know, higher up positions than we are that
aren't just Youtubers that aren't just an ONS on Twitter.
It's like the signal is spreading guys.
So hopefully, again, maybe this is the, you know, the dawn, what
the darkness before the light, but our, our analysis of the
world is starting to get around and people are sounding a lot
like Bitcoiners from positions that are, you know, very
interesting and and of course powerful.
It's it, it, I'm being reminded right now of that, that Fight
Club meme of like, we run the nodes, we're everywhere, You
know, it's like Bitcoiners are everywhere now.
And it's, it's I guess to say like we're still early in this
game, but we have some, you know, at least some key
understanding from some key players that are seemingly
coming towards the Bitcoin side. So we'll play the clip and let
me know what you guys think in the chat.
What happens if the value for money falls and falls 4 or 5% a
year? That's inflation, both 4 or 5% a
year and the economic growth has been about 2% a year.
So it's about 7% a year growth and that means everything double
s in 10 years. The value of the money falls in
half every 15 years. So you got to make twice what
you're making today in 15 years to stay even.
And so stock market, you know, so bitcoins been amazing.
Obviously, it's absolutely not. I'm sorry, guys.
I I thought it was louder. I usually do my best to, you
know, edit that so it's louder for you guys.
But hey, nonetheless, he's out here saying, you know, the real
cost of inflation, even though, you know, I'll pull up
Trueflation for you guys. And even though the official,
you know, CPI numbers currently are very low inflation, I think
most of us in real life here feel what is going on.
So Trueflation at least CPI is saying it's under around 1%, one
point four, 1.04%. So if you're looking at the
official numbers, you're like, OK, it's, you know, hey, it's
1%, that's not that bad. Even even that is not ideal.
You're losing 1% of your purchasing power currently every
year at least via these numbers. Now if you go into kind of on
average, it's usually around 2%. As you know Ron was saying it's
like add that with the SP500 going up around 5%.
So the real inflation is probably around 7% and then
going further, if you elongate this out for 10-15 years, you
literally need to double your income in 15 years just to stay
even. This is why it's all a scam now.
One of the biggest things that really kind of annoys me when it
comes to oops sorry guys. When it comes to people talking
about inflation, is it always frame it in this idea of hey,
guys, it's only 1% inflation, Like it's going down, guys.
Like inflation's going down, guys, you should be happy.
And you're like, I'm still losing.
Like it, It's not that it's gone forever.
I'm still losing my purchasing power.
Yes, it's going down and I'm losing it at a slow like I'm,
I'm my purchasing power is getting destroyed at a lower
rate, but it's still getting destroyed.
And this is how the system works.
And most people are like a man and you know, inflation, you
know, like the gas prices aren't going up that high, you know,
groceries not costing too much more money.
And you're like, doesn't matter. We're still losing in this in
this system that is designed for us to lose.
And you're just like, I remember the first time I heard this.
Can't this idea that in 15 years you lose half of your stuff just
via normal inflation numbers? And that idea in itself, maybe
it's because I was still kind of young at the time when I first
got into Bitcoin and I was first listening to Bitcoin podcasters.
I was like, yo, in 15 years I lose half of my money that I
save. Like, there's no way I'm going
to get out of this. I'm like, I'm going to be broke,
Sir, forever. Like I'm going to be a peasant
forever. What's going on?
And then that's like the moment where it clicks and I was like,
oh, I need to just stack and save and acquire, accumulate as
much Bitcoin as possible because that's the only escape that I
saw. And in hindsight, I should have
gone harder, You know, I should have gone way harder.
It was the right move, but I could have gone so much harder.
And here we are. But anyways, I'm, I'm too geeked
up on coffee, so I got to pass the mic.
Kent, are you surprised that the Bitcoin narratives are starting
to, or rather posed a different way?
Are you surprised that the average person on CNBC is now
starting to sound like a Bitcoiner?
No, it's, it's, it's just a matter of time, right?
I mean, here's the thing, like I think most of us here through
our own curiosity came to Bitcoin.
I think the big print of 2021 for Covad was like a big like
bat signal that drew a lot of us to to Bitcoin.
But those that came before, you know, were drawn by their own
curiosity. I think that cohorts gone, I
think now the adopters of Bitcoin are getting it not
through the orange fill, but the orange Suppository through pain
and the pain is inflation and the pain of inflation.
I think most people don't actually think this all the way
through, right? If let's say 2% is the number, I
know you just showed 1%, but I like 2% better because that's
what the, the Fed, you know, did neuro linguistic programming on
all of us for the last 30 plus years, right?
But 2% means that 2% of the value of the dollars that you've
stored have disappeared. Well, how do you make up that 2%
the next year? I mean, if you're living
paycheck to paycheck? And the answer is.
You have to work 2% more. So it's not just 2% of your
money that disappeared, it's 2% of your time.
And actually when you start to look at that loss of time across
all of humanity, it's an absolute travesty because it's
literally stealing like our lives away from us.
This, this theft. So to me, this is the most
insidious type of theft that there is because it's hidden and
discreet. It's like a snake entering your
room while you sleep or something.
You just, you don't know it's there and you put your foot down
off the bed and holy shit, like it goes half my life, right?
Or at least half my leg. And it sucks.
It's just horrible. I hate it with every fiber of my
being because it's just so unjust and and not right.
And I think as more people wake up to that, I think the type
will turn and and that natural disposition will just be what
the fuck? We don't have to like with
Bitcoin. We have a choice, right?
You don't have to be a part of that system.
And again, opting out and just building in this other system
allows that reality to come more into focus.
And yeah, I think I saw a chat comment here about Jeff Booth,
and I think Jeff Booth has been the 1st and the best at
describing this phenomena. You don't fight the existing
system, you just build a better one.
And by building the better one, it would just cause the the
existing system to slowly collapse in on itself.
And that's where we are. Yeah, 100% I I truly love that
Jeff Boos comment of and it and it really reminds me of and
other kind of truism. You know, it takes more effort
to combat BS and I think that's kind of where the Jeff booth, I
don't know, heuristic comes from.
It's like it takes a lot more effort to try to stop the
collapse of the old system versus does to just build on a
new system. And I know we're still early in
that process, but it it does again, maybe maybe we're ending
the show a little bit with some, some opium here, with some, with
some, you know, white pills throughout the show.
It's like it is going to take effort, but it, it is seemingly
starting to bud and there, there are things that are going in the
right direction and it, and it might just be one of these
things where what's the, you know, bad times create strong
men. It's like maybe we just have to
rise to the occasion or else like what, what's the other
alternative? It's just, you know, society as
we know it is over. I don't know, I, I can't, I
can't function on, on that, even though you guys know, I'm, I am
kind of an accelerationist. I don't like to be, but I'm
like, hey, dude, that's where it's going.
I'm like, could we just like, you know, get to the end of it
so that we can move on? But it's going to be a slow,
slow process as far as I, as I, I can see.
But we all know the goodwill always win in the end.
So hey, we'll, we'll be OK. Well, maybe not us, maybe our
grandchildren or great, great grandchildren, I don't know.
One day, one day we can look down from the sky and be like,
look, it was all it was all worth it.
That was Duber. All right, anyways, let's keep
it moving. I keep trying to lift you back
up. I'm lifting.
I keep trying. I keep trying.
I you got you got it. You I I'm feeling good.
I'm feeling good. It might just be the schizo
energy of this coffee and this room is so hot.
I'm dying and I'm jittery right now, but we're going to power
through. We're going to power through.
All right, guys. So as I said, because I have
Canton today, I, I would have probably done this in the
culture 'cause this is more of a cultural event, but it is a news
event. And of course, Kent is a Bitcoin
miner. And what we're seeing in oil
right now, or rather yesterday and today, it's absolutely
insane. Oil's literally trading like a
shit coin and no one has any clue like what is going on right
now. So I'm I'm gonna talk about what
happened in the oil markets yesterday.
And again, since I have a Bitcoin miner here, it's going
to, you know, the conversation's gonna evolve into what this
means for energy period around the world and in particular what
it means for Bitcoin miners. So that's gonna be the next
segment. I'll be right back.
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OK guys, so before I start pulling up charts for you, if
you are falling along on for lack of better terms, the
political circus going on currently in the Middle East,
one of the kind of talking points or rather one of the
arenas that we're seeing this play out is in oil prices.
And if you've been watching, and I think I mentioned this
yesterday, but if you watch over the weekend, we saw oil futures
shoot up to about $120.00 a barrel.
And yesterday the markets were all over the place.
We we saw literally like almost a once in a lifetime event
yesterday in oil prices, if you're unfamiliar with it,
prices where you know, again, around at least people thought
it was going to be at a like $120.00 per barrel where like,
Oh my goodness, prices of oil are going out of control this
war. Because as I mentioned on
Monday, there was, you know, oil refinery field that was Catching
Fire. There's black rain.
It was Armageddon looking videos on Twitter.
And then around 2:00-ish PM, we got an announcement from Trump
that was very, for lack of in terms of little schizo, he's
like, on the one hand stated that we quote are very complete
in the operation in Iran. And then in literally the same
breath, he's like, this is just the beginning.
And the markets were like, wait, how do I kind of digest this
information? And the price of oil dumped all
the way to $84 per barrel. So again, I really like
Kobayashi letter on Twitter. They've been doing a great job.
So this was around the timing when we got that announcement of
Trump that we have one, on the one hand fully completed the
operation and on the other hand, it is not yet over in just the
beginning, but oil prices seem to dump around that
announcement. Later on in the day, in the
evening, we got this announcement from Trump that
said basically once the markets close, we're going to hit Iran
20 times harder. It was like on the one hand to
kind of persuade the markets like everything's going to be
good oil production's, you know, going to be going as normal.
We got another announced. It's like we're going even
harder on this and the markets are literally whipsawing right
now in oil, which is like you don't see this happen.
Look at this chart here. This this is on the daily.
So you know, open at one O $9 per barrel, it goes as high as
around $120.00 a barrel. Then it goes as low as 81
dollars and closes around $84 per barrel.
Currently it is dumping and we are 81.
I wouldn't say necessarily dumping, but it's under the low
from yesterday. It's like where what is going on
in the oil markets? It literally seems like it's
it's being traded by shit corners.
Now. Here's the latest update by
Kobayashi letter and he goes the oil market is moving at an
unprecedented pace. Trading volume in the United
States Oil Fund ETF jumped to a record 12.4 billion on Monday.
This puts volume up plus 1000% since the start of the year
here. This also surpasses the previous
peak seen during the 2020 oil crash, the 2022 Russia Ukraine
war and the 2025 spike by over 200%.
By 11:30 AM Eastern Time yesterday, trading volumes were
already at an all time high at 7.6 billion.
The surge was driven by a mix of institutional traders and retail
investors chasing the oil price move.
Oil is now one of the most traded assets on the planet.
I saw a lot of bitcoiners basically saying, you know, hey,
this oil price is too volatile. How is this going to be the, you
know, the store of energy for the world?
It's it's a play on what they all say about Bitcoin.
Anyways, another tweet here. Again, I really enjoying
Kobayashi's kind of analytics or rather macro framework of what's
going on. They do have this article that I
highly suggest you guys go read. It's called the conflict
playbook. I, you know, it's, it's a good
read, it's a good framework. It does seem like it's playing
out currently as we speak. And here they go with a chart.
It goes. It doesn't get more textbook
than this. Every step of our March 3rd
conflict playbook has been outlined on this oil price
chart. It begins at step one and Step
2. When Trump sent an Armada to
Iran and ramped up threats on February 27th, we saw the Friday
night strike from step number three of our playbook.
This led to a Step 4 as risk premiums were rapidly priced in.
On March 3rd, President Trump began saying the war could last
forever, as expected in Step 5. Here we are right here.
And then on Friday and last night, markets began pricing in
step number 6A, prolonged conflict, sending oil prices to
$120.00 a barrel. Finally today, this was, I
believe yesterday. Yeah, yesterday at 3:20 PM
Eastern Time, President Trump hinted at conditional de
escalation from step seven of our conflict playbook.
We are now nearing step 8. Keep following along and here
just to kind of give you a little, you know, wet your beak
here. Step 8 here is going further.
Here we go the market and political feedback loop where a
prolonged conflict that drives oil prices sharply higher would
directly conflict with three core policy.
And you're starting to see that in step 9.
We'll see the deal in narrative framing and then step 10, which
hopefully this happens in Bitcoin, which is why I'm
getting a little bullish. I'm becoming a wig off maxi.
Step 10 is a violent repricing. So I'm hearing Bitcoin go back
up to 100K hopefully and the political victory lap.
So we're seeing crazy stuff and and again, here's Adam Kobayashi
from the Kobayashi letters tweet and he goes there it is.
Crude oil prices just rose and fell 30% in the same day and
what appears to be a 5 Sigma event.
In other words, what happened today or yesterday occurs once
in a 3.5 million observations. Again, step seven of the
conflict playbook. So crazy stuff happening in oil
right now, obviously because of the Middle East.
I think we are seeing in general markets are trying to understand
and price what is actually happening in the Middle East,
hence why literally all the markets are whip sawing right
now. And at the same time Bitcoin is
holding up very resilient, which is I think one of the most
interesting aspects of all this. But there are people that are
saying, you know, the oil price, oil price reversing, it didn't
really make a new low. This people were tweeting this
earlier. Now we fully did get a new low.
So look, I'm like you guys, I'm trying to fully understand what
is coming out of the administration.
But as you can see, there is all kinds of volatility in the
market. And I really only brought all
that oil price, you know, energy conversation to 1.
Compare the price of Bitcoin. We're currently at 701K.
In the face of the comp conflict in the Middle East, Bitcoin is
very resilient. And then of course, I have a
Bitcoin miner here. Bitcoin literally takes energy
and turns it into precious Bitcoin.
So Kent, following along that saga, what is your initial
thoughts from a energy perspective, from a Bitcoin
mining perspective, like what is your macro view here?
And then maybe add a little bit of what you think might be
happening in Bitcoin as or sorry, Bitcoin mining as well,
boy man. That's that's, that's a tee off.
Let me let me just yell for before I get going here.
You know, the, the situation politically like, right, I, I
hope that Kabayashi is correct and this is following the
playbook and this is going to wind down soon, right?
I think it's to nobody's advantage that the conflict in
Iran right now with the US and Israel and whoever else was
involved, Russia, China, it's in nobody's interest that that
escalates. Even where I'm located here in
South America, I do not want that escalation because it has
all the hallmarks of World War Three wind up.
And I say that because as opposed to the other actions,
military actions that Trump has taken, you know, Iran is a
civilization. You know, you go back to the
Persians, it's been there for centuries.
And that's a different thing to try to eradicate a civilization
than it is like a Venezuela that's been there for a few 100
years as a nation state. And so I don't, I don't like the
odds of us speaking as AUS citizen trying to stick around
and actually entertain transforming a civilization and
knocking it over because that seems absolutely insanely
stupid. That said, you know the oil
price is being pushed up. It's going to make it more
expensive for anybody that's mining on fossil fuels, right?
It is a commodity and commodities will be be repriced
across the board. It'll make shipping more
expensive. Who knows what 2nd and 3rd order
consequences, but anything that's derived from oil will go
up in price. Electricity that's generated
based on oil and fossil fuel products will go up in price.
So that could impact different areas where Bitcoin miners are
mining. That said, you know, thankfully
we're kind of with a strategic advantage as a company right now
because we've chosen to mine on 100% carbon free energy sources.
So that shouldn't impact us directly.
But electricity itself is a commodity, right?
So if the grid power goes up, then the cost electricity across
the board could go up. So energy is one of the raw
inputs to the economy period. So if energy costs go up, that
should lead to, you know, inflation of prices from costs
increasing and make it just be another inflationary force.
So it sucks. There's no, there's no good
situation there. You know, I could try to spin it
into an angle because we're mine on renewables that it's better.
But at the end of the day, the rest of life is going to go up
and be more expensive. So starting to be a Debbie
Downer on this one. I think the positive silver
lining on this is, is simply the the Kobayashi playbook is
playing out and we're close to the end.
And we're going to wrap it up and say run the victory lap and
prices come down. But yeah, when you see the
global energy commodity trading like a shit coin, you know,
something is really out of whack on the world.
I mean, we're talking about things that are like the
financial tectonic plates that relatively move and I don't move
very often. And to see prices like that is
kind of like they've collided and now there's a new mountain
range that suddenly appeared, right?
Like that's the sort of thing that we just experienced.
And I don't think any of us can really understand until like
many years in the future just how seismic these events are.
But like, our reality is shifting, and I think that it's
good to have a good moral compass and a good character
that's very adaptable right now because we all need it.
Yeah, 100%. I love that taking one interest
and actually guys, I I dropped it in the Rumble, the article
the conflict playbook from Kobayashi later I dropped it in
the chat for you guys. So if you guys are interested
and want to really get the full breakdown.
So maybe, maybe it's the framework that's happening.
It seems that's why it caught my radar.
It's like it seems to be happening, but on on the other
side of to kind of add on to what you said, can I think since
personally, and I'll speak for myself here, what when you watch
what's when I watch what happened in the oil prices
yesterday, It it really didn't like set off my radar because I
am a Bitcoiner and I'm like so used to just Bitcoin going crazy
or dumping crazy. You know, that's like my
baseline. I'm just like, yeah, I'm a
bitcoiner. Like I'm used to the price of
this Bitcoin thing, this digital commodity thing, just go
absolutely nuts. And like, that's what I like,
that's what I'm interested in. That's what gets me excited in
the morning, right. But when you think about it from
a building block of the modern society, like the prices
shouldn't be doing this. And when you hear it's like, oh,
a once in a three and a half million occurrence events,
you're just like, Oh yeah, like I forget not everything is as
volatile and crazy as Bitcoin. Like this thing should not be
moving like this. Like no traditional financial
instrument, commodity equity or anything like that should be
ripping. Like what we've seen gold do
last year, silver do towards the end of the year, what we're
seeing oil do. And someone in the chat said
something funny. It's like we saw oil go
parabolic before Bitcoin. Like what is going on?
Like what is going on like literally the, the foundational
base element input, as you put it, it's going parabolic before
Bitcoin is it's like we are really truly in the middle of
seeing like a, a historic monetary reordering, reshifting
event happen. And that's why it, it is very, I
think hard for everyone. And that's why I think literally
everyone is sort of confused about what's going on.
It's like there is an onslaught of information warfare happening
right now to, you know, for whatever benefit on each side.
It's like it's really hard to understand what's going on.
But when you look at like the charts and the data and, and the
price of Bitcoin alongside of all this, you're just like,
whoa, things are getting really crazy right now.
And I'm just happy I'm in Bitcoin and we didn't dump lower
than 60K and we're at 70K right now.
I'm like, OK, hey, maybe there's a silver lining here.
Maybe as I joke, actually, I've said this already on the show,
me and Sophie were chatting about the, you know, the
operation in Iran. And we're like, wait, like I
know Bitcoin is anti war, but is Bitcoin kind It's like World War
three kind of good for Bitcoin because we're not jumping right
now. It's like, wait, what is
happening? So hey, look, I, I've said it
before. I, I don't necessarily want to
be happy that our bags are pumping when there is a lot of
violence and uncertainty in the world.
But you know, I feel I, I can feel a little good about it.
OK, Hey, Bitcoins not dead. We're we're chugging along.
We're doing exactly as we thought it was going to do and
actually it it I'm, I'm a little surprised at what Bitcoin has
done so far and I just hope it continues to go that way.
So anyway, yeah, exactly right. Anyway me?
Too it's it's this is this is this is seller's exhaustion,
guys. I didn't, I didn't get an insert
at that. So I'm I'm sorry to step on no
go. Far go.
Far seller's exhaustion, man. And and I just remember it so
much from the last cycle where everybody like we were down like
around like 20 K and everybody was like, Oh no, we're all going
to die. We're all going to die.
And yeah, we had one little leg down like 16 K and then we just
ripped from there. And it was the same sort of
vibe. And so I just kind of wanted to
remind everybody that is that, you know, this is what sellers
exhaustion feels like is when the US bombs a nation state and
Bitcoin doesn't move. That means there's no sellers
left in the room. Doesn't mean we go up from here,
but it means that there's there's not too much further
down that we can go before we continue to move on.
So anyway, I just wanted to make sure that everybody knew what
sellers exhaustion looked like because I missed the last cycle.
Truly, truly, it's one last one last comment here because the
chats, the chats buddy, are boy familiar.
Diaz, you go win BTC repricing because Papa needs a farm.
You know, when I heard the conflict playbook, and obviously
I'm biased. I have the Bitcoin lens on
everything. You know, the orange lenses on
everything. I'm like, oh man, you know, step
10 violent repricing, like does that mean we like instantly, you
know, go to 100K like next week and like, OK, hey, I'm OK with
this Like, OK, whatever, whatever, We're cool, we're
cool, we'll be back, You know, like bear market over violent
repricing to the upside. Honestly, it sounds it sounds
kind of fun. Maybe maybe my dopamine will
come back, maybe my life will come back and the all of the
black pill dumerism is just out the window and I'm just
extremely bull tarted on the show.
I, I I'm hoping for it. I'm hoping for it.
But anyways, let's keep it moving because I do want to chat
with Kent, pick his brain a little bit.
I think he's going to have we we chat about it a little bit prep
before the show a little bit. So I, I think you guys are going
to really enjoy this. So last commercial quick one and
we'll be right back with Kent, CEO and Co Founder of SAS
Mining. I want to give a shout out to
our partner Hive Digital Technologies.
Fueled by clean energy, Hive has quadrupled its global Bitcoin
mining footprint and channels that same scale into high
performance compute, where their AI cloud is now ranked number
one in the world for network performance.
At Hive, you've got dual engines, Bitcoin and AI humming,
roaring, accelerating and unison.
They're lean and mean, they're green and clean, and they're
rewriting the playbook on sustainable digital
infrastructure. You can catch the latest buzz at
Hive Digital Tech or at Hive digitaltech.com.
Wait, can't be. Before we go on our our friend
in the chat, Doctor Daniel Howell.
Hey, we could have another God candle, a red 1 going down.
Yeah, you know, when I heard violent repricing, I I meant to
the upside. It would be very violent to the
downside. OK.
But I heard positive, so I still have some positivity left in me.
Anyway, it's Kent. Before we get into maybe some
hope I'm here. You know, you did tell me
something like a bullish kind of, you know, not necessarily an
indicator, but some a bullish sentiment shift that you're
seeing on the back end. And then we'll we'll probably
talk about the AI public or public codes going public
companies, Bitcoin miner companies going into AI.
We covered that last week, but you did just get back from the
heat punk conference. So anything you want to relay to
the audience there before we move into maybe some spicier
conversations? I do there's a couple of things.
So I was at the space, which is the Citadel in Denver for
Bitcoiners. And if you've not been amazing,
amazing location. If you like the vibe of Denver,
you'll definitely love the space.
The heat Punk Summit was there as a second annual heat punk
summit. And I have to say, it's all of
like probably 200 people that were there, but just all of them
builders and was very cool to be surrounded by a group of people
that were just, I mean, the Iran war started.
And I literally was the only person to bring it up while I
was in the room to give you an idea.
So it was pretty, it was pretty, it was pretty radical just how
focused people are on building a different eco ecosystem here.
So love that. Want to give a shout out?
And very cool things being built too, like all sorts of different
ways to utilize the heat from Bitcoin mining so that hey,
instead of instead of mining, you're heating and you're just
getting a discount in sats for doing so.
So that was pretty rad. The other thing though, that's
been happening in in Bitcoin mining for us specifically,
which has been somewhat shocking actually.
Like, OK, we're used to as a company when the price goes
down, our customers generally demand follows Bitcoin price.
We'll put it this way, right? Price is pumping.
We have a lot of people who want to sign up and get started
mining. They like the numbers, they want
to get started, price goes down, fewer people show up.
That's been a very normal trend. However, this, the first quarter
of this year has absolutely bucked that trend because what
we're seeing is that's been true for typical like more onesie 2Z
up to 10 mining rig torque of orders.
But we're seeing super large enterprise show up at our
doorstep and say, no, this is the time to deploy capital.
There's blood in the street buy in and so we've actually had
like an amazing quarter here because enterprise and I'm I'm
starting to think about it as smart.
The smart money in Bitcoin mining is deploying capital.
So if you've been thinking about mining, there's like a truism
that has been accurate over and over.
Doesn't mean it'll play out this time, but it's been true over
and over again, which is you deploy capital when the numbers
look the worst and you reap the rewards afterwards because as
the price goes up, it goes up faster than hash rate.
So that's the that's been kind of the interesting insight and
tidbit. And then I don't know if you
want me to just jump right into the the.
Well, yeah, I, I do. I hey, look, I've been ranting.
I'm jacked up on caffeine, so I will let you rant.
But I do want to add to what with your point of this.
Like, you know, institutional buying or smart money as Tradfi
likes to say. We do also have some data to
back that up from like on chain metrics.
It does seem like currently, you know, the quote UN quote whales
are buying again. Now, obviously we don't have
data on who these whales are buying this Bitcoin, but you
connect that data or rather the on chain charge with what you
are personally experiencing and you're like, oh, OK, maybe,
maybe, maybe the bottoms in. I know, I know you guys are
going to yell at me. But if you're seeing the capital
start to get back into the game currently, it does make you feel
a little hopeful that OK, maybe maybe the worst is behind us.
Maybe we are building a bottom right now.
Not to say it's going to pump overnight, but you build a good
floor, got to have a good floor to jump off from.
So a little there. There's your little opium for
today. But yeah, can't go into the
public because I did talk about this last week.
And you know, before you go in, I'll just do the little context
that we reported on this couple of shows ago that a lot of the
selling we saw was coming from the public Bitcoin mining
companies. They sold over 15,000 coins and
they're pivoting into AI infrastructure.
And you know, everyone's wondering like, who's selling
Bitcoin right now? Well, as everyone kind of found
out, it was the public Bitcoin miners.
And now Kent coming from the mining space, as we joked, he's
like, I might not make any friends from the public Bitcoin
miner companies, but this is my take right now.
So it is going to be a little AI spicy.
But yeah, Kent floor is yours. Keep ripping.
All right. Well, I have a contrarian take
here and it's basically it came about from watching Open Claw.
And so if you've heard of that, it's basically an open source AI
agent that you can put on any device and, and plug in
different large language models, whether it's, you know, Gemini,
Claude, Grok, what, whatever. I'm sure most of you guys are,
are, are poking around with these tools at this point.
But the interesting thing is this impulse to have a device on
desk got me to thinking, and this is an original thought.
The original thought is what happens to Bitcoin miners, but
it's not an original thought. But it just made me realize
that, you know, web 2 point O is really everybody sucking all of
our data from us. And we gave that up and and
trade for free services, but we lost our privacy.
And as a result, I love seeing this, this effort that people
are making right now with the open cloud movement, which let
me put some numbers around this, right?
So like Linux, like the longest running like open source
software that's been on the planet is that runs a lot of
computer devices, even the backbone of I think most like
Google devices, that operating system has less stars on GitHub
than Openclaw does, right? And and that was like 3 weeks
ago, 4 weeks ago. So the adoption is insane, but
it shows that there's demand for devices that people can control.
They want to control their personal AI assistance.
And the knock on effect for that in my mind is something that has
played out multiple times throughout history, which is the
infrastructure providers of the data centers right now may be
the same victims that the people that built the railroads were,
the people that built like the the fiber optics.
You know, if you go back in history, the people that build
these big infrastructure situations, which right now it's
all about data centers, right? So the people that built the
data centers aren't always the ones that get the the fruits of
that afterwards because of a change in the market.
So you know the railroad builders.
The people that built those market changed and it wound up
being that like JP Morgan sucked up most of the, the the
railroads for pennies on the dollar.
There's a similar thing that happened with the fiber optics
boom wound up like Google and I can't remember a couple other
companies bought up most of the fiber optic assets and the
companies have built all that went bust.
I think we're seeing the same thing play out right now with
data centers. And I think we're seeing that
because we're there's an impulse, the market, what they
really want is not the big cloud based AI, but they want the
personal AI assistant that's sitting on their desk that they
can control and manage. Now, whether they understand
that they're still giving their data away through the LLMS to
the cloud or not, I think is not the important part here.
I think the important part is that impulse.
And I think that the models themselves are getting small
enough that the agents can actually sit on device.
So what happens if all the agents are sitting on device and
we're getting what we want or what the market desires is that
that inference that's being built right now from the data
centers is going to be overshot. So getting back to publicly
traded mining companies, well, they're making a pivot and I
think the, the earliest one like Hive would probably be fine
because they got there early and they can navigate it.
But if you're a late stage Bitcoin miner, publicly traded
miner making this pivot right now, you may be just hopping out
of the the the pot and into the fire or hopping out of the
framing pan and into the fire here because the numbers haven't
looked good with Bitcoin mining, even though you've had a lock on
all these resources. But so you think the numbers
look better over here with the AIHPC data center.
But if that whole situation starts to collapse, well, now
you've left behind an entire infrastructure set.
Do you have the resources to pivot back?
Can you, you know, that's going to be kind of an open question
for me now. Could be totally wrong.
You know, better men than me have been wrong.
But it just seems to me that AI is not necessarily a bubble, but
data centers may be a bubble and we're in for an infrastructure
overshoot, which we've seen many times already.
Interesting. OK, sorry guys, hopefully you
don't hear that the AC just got turned back on.
It's super light. So let me let me try to angle
this. What's your idea on the kind of
heuristic that what marks the bottom of a bear market is, you
know, the idea like we need a huge sacrifice.
And I've heard a lot of people say that what usually marks a
bear market, like the bottom of a bear market is we see a lot of
public Bitcoin miners or, you know, bigger Bitcoin mining
farms kind of go down and kind of in the past pivot to other
things. Now it does seem like maybe that
new pivot is into AI. But do you think there's any
credence to the idea that there might be potentially some other
big, like big Bitcoin miners that are going to get in the hot
water? Because obviously we saw the
hash rate going extremely volatile over the last couple of
months. We have been hearing rumors that
public Bitcoin miners are, you know, if the price gets any
lower and stays there for a while, there could be some
trouble. So do you think those rumors,
have, you know, any validity to them or is it just as Bitcoin is
hoping for something? You know, we just want the big
catastrophe. We just want the sacrifice so
that the Bull Run can come back on and we can all, you know,
enjoy the ride again. Burn the man right, you know?
Yeah, we just got our pitchforks like someone.
Go down, please. Yeah, No, I, I, I think that the
pivot actually from these Bitcoin pubco's like I mean bit
farms for instance, like just the CEO came out and straight up
said we're not a Bitcoin company.
Anyway, oh wow, I missed that. Yeah.
I mean just straight up said it in a press release like we are
no longer a Bitcoin company, right.
So I think that that is a part of what happened is that if you
look at the most of the publicly traded Bitcoin miners, they have
a whole bunch of costs are added on to their balance or just on
to their P&L from being public, right that a smaller miners we
don't have. So our cost structure is by
definition lower and so we can get Bitcoin more cheaply.
And that is the name of the game as a Bitcoin miner is you can't,
you can't be the most expensive miner and survive.
And I think a lot of the publicly traded miners were not
operationally as efficient as they, as some of the smaller
guys like us can be. And so I think they were
hurting, they say saw AI and as a way to pivot to make more
money. And so, you know, if they're
jumping out of the frying pan, but I don't think a lot of them
realize that they're probably jumping into the fire because I
don't think that the cycle for AI data centers is getting any
better. So I think it's just a rough
business model period to be a publicly traded Bitcoin miner.
And it's not me slagging on them.
I think if I was the CEO of one of those companies, I may have
done the same. But by definition, I think one
of the things that I like about this pivot for the Bitcoin
ecosystem and for the Bitcoin network is, by definition, they
have to return dollars to their investors.
They have a fiduciary responsibility to do that.
So for them, acquiring Bitcoin was always a stepping stone to
get more dollars and that doesn't put them In Sync or
aligned with the Bitcoin network.
So I actually see this as a wonderful opportunity for us as
the Bitcoin community to take back more of the network and to
move more Fiat hashers off so that there's more Bitcoin
hashers. And I distinguish those too,
because when you come to Bitcoin mining, you have to choose what
your money is. And most people do that
implicitly. But if you choose that Fiat as
your money, when Bitcoin is just a stepping stone and you don't
really have long term alignment with the network.
And I think that's been a massive problem that's led to a
lot of centralization issues on the network.
So getting more of us onto the network caching is actually good
right now when publicly traded mining companies that don't
represent that level of alignment are are are puts and
off to go do HPC and AI. Great, wonderful.
And you know, and I'm, I hope that we're a better on ramp for
a lot of folks that want to do that because that's what I've
been working on building for the like the last five years is a
better on ramp to, to allow people to mine their Bitcoin.
Yeah, well, Kent, Kent's probably not making too many
friends right now talking about this.
So with that in mind, guys, if you like Kent and you like what
he's building and you want to get some wild SAT, I think now
would be the time to go to SAT's mining and potentially, you
know, I'm getting almighty guy as as Kent saying it might be an
opportunity for the little guy out there.
So maybe we haven't seen the final sacrifice yet.
But I think with Kent saying all of that, probably going to, you
know, get a couple of of angry emails coming soon.
So sorry about that, Kent, but hey, that's why we bring you on.
You're the mining expert. You, you keep it real with us
every time you come on. So I, I, I truly appreciate it.
Well, hey, hey, I didn't, I didn't come here to make
friends, just tell the tell the truth.
And it seems like it's one of those days where it's not a
making friends day, but hey, it is what it is.
I, and actually, I mean, there's a ton of people in the publicly
traded mining companies that I have a ton of respect for and,
and really like, you know, and are truly into Bitcoin for
Bitcoin's sake. That said, I I would be remiss
if I did not say that there is $125 off that you can get for
using Opti to it's just for you Opti.
Let's go. I'm glad.
Mining. Out.
I'm glad, yeah. Is it just like always running
or do you guys change it or you know, add it?
Add it when you come on the show?
I don't know the answer to that. My marketing guy does.
Marketing guy, you keep it live. Chaz mining, well, he's he's
running the SAS mining handle. He can.
He can answer. OK, you'll see it in the chat.
But but we also have a fun one for Ethiopia which is going live
this week. I'm stoked that's finally
happening. But anybody that buys a mining
rig there in Ethiopia were given given 100,000 sats afterwards.
So if you want to stack some sats, we'd we'd glad to.
We're glad to help you get that going.
All right, Kent, well, thank you so much for coming on.
I had a blast. Maybe it's because I had way too
much caffeine that you guys saw I was jacked up today.
I was jacked to the gills today, dude.
I needed a little extra kick after the gym this morning and
it might have been you know, Mom, I know I I won't drink too
much coffee tomorrow. She always yells at me that I'm
drinking too much coffee. I'm like, you don't understand.
I I got to drink the coffee. But Kent, really appreciate you
guys go check out sales mining. Actually, Kent, before we go
give people your your Twitter account again.
I, I always mess it up. It's K Halliburton.
Right. That's right.
Yeah. First, first letter, last name.
That's it. OK, OK.
Well, Kent, always a pleasure having you on guys.
I hope you guys got something from the show today again.
We will be live tomorrow. I know you're going to yell at
me. It's we put it at 12:16 on
YouTube and we go live around 12:40 usually.
That's the real time we go live guys.
OK, I saw you guys complaining about it this morning.
If you're a if you're a, you know, regular you, you already
know the deal. So I appreciate the guys in the
chat. They're like, look, they're
going to start at this time. Thank you guys.
I'm always appreciative. I love you guys.
Have a good rest of your day, Kent.
Again, thank you so much for coming on all that note guys,
it's your boy Opti. This has been simply Bitcoin
Live and we'll be back tomorrow for another show later, guys.
Thanks, Opti. Today's episode was brought to
you by bitcoinwell.com, a Bitcoin only platform on a
mission to enable financial independence.