WBD406 Audio Transcription

Bitcoin & the Financial Transformation with Greg Carson

Interview date: Wednesday 6th October

Note: the following is a transcription of my interview with Greg Carson. I have reviewed the transcription but if you find any mistakes, please feel free to email me. You can listen to the original recording here.

In this interview, I talk to Greg Carson, a Managing Partner at XBTO Humla Ventures. We discuss how technology can reshape society, $20 trillion market disruptions, and Bitcoin’s inevitable design.

“Move glacially slow and design for inevitability, that’s the bitcoin thesis...I think that thesis makes bitcoin hard to beat, it’s hard to beat someone that never gives up, and bitcoin is never going to give up. ”

— Greg Carson

Interview Transcription

Peter McCormack: Hi, Greg.  Hey, man.

Greg Carson: Welcome, man.  It's good to see you again.

Peter McCormack: Good to see you.  I've been pestering you to come on for a while, because we've become friends over this last year.  And every time I see you, we have these really good conversations where everything is fucked and how do we raise our sons, and sometimes a little bit of Bitcoin.

Greg Carson: A little bit.

Peter McCormack: A little bit.  And you're hugely well-read; you've recommended loads of books to me that I haven't even got round to, but I've been pestering you for ages.  I was like, "You've got to come on the show.  I want to have one of those conversations we have over tacos, and everyone else to hear it".

Greg Carson: Yeah, we're big on Mexican food.

Peter McCormack: Yeah, big on Mexican food.

Greg Carson: I'm big on Mexican food.

Peter McCormack: And you've just sponsored Inter Miami.

Greg Carson: I've got the Jersey on.

Peter McCormack: I know.  My hero, Beckham.

Greg Carson: Philippe and Walton, they've basically the big commit, so we're on.

Peter McCormack: And it seems like you're a good omen for them, first game?

Greg Carson: Yeah, they totally crushed it, kind of!

Peter McCormack: I've got a present, I'm going to share this, because I don't even know what camera I'm looking at.  Look, I've got a Beckham shirt, my absolute hero.

Greg Carson: It's pro, there's like 16 cameras here!

Peter McCormack: Yeah.  Danny made a good point; why is it not signed?

Greg Carson: He heard I was going to be on and he said, "I want to do it in person".

Peter McCormack: Well played!  How are you, man, are you well?

Greg Carson: Awesome.  It's been a great year, it's been a great five years.  It seems to be the world keeps getting more interesting, but in our space it's transformative; everything's transformative for me.  The Bitcoin introduction to the world has changed almost everything in my life, I think the same for you.

Peter McCormack: Same for me, absolutely.  We're very lucky.

Greg Carson: It's not just good investment, which is my role.  My role at XBTO Humla Ventures is investing in companies and these projects and stuff, but that's just the tip.  Everything in my life has transformed around this change in the world, mainly the relationships.  We've become good friends, and there's so many other people in this space that I would consider my closest friends, and I've only met them in the last five years.  So, it's amazing!

Peter McCormack: Yeah, I completely agree.  It's changed my career; obviously, I do this now rather than advertising, and it's changed my finances.

Greg Carson: It's not really working, but just chilling and hanging out and talking with us and stuff!

Peter McCormack: Yeah, they do all the work, these people here, and Emma over there.

Greg Carson: Totally kidding by the way; we know Peter works harder than pretty much anyone, and he's really good for the space.

Peter McCormack: Do you know what, I used to.  I don't have to work as hard anymore, because I've got a team that makes a difference.  But it's changed careers, changed finances.  And when I say finances, approach to money and consideration and spend and future.  I'm not there yet on the diet; I'm trying!  But it changes a lot of things, man, but we've had some really good conversations and like I say, I just wanted to get you here.

Greg Carson: I'm grateful, really.

Peter McCormack: Any time, man.

Greg Carson: Super grateful.

Peter McCormack: You should do a bit of a background.  Look, I know your background now, because we've hung out, but some of the people listening, watching, they might not know you.

Greg Carson: Okay, I guess there's two backgrounds; there's me and then there's me with XBTO and how we've come to where we are, and even who XBTO is, because I know we're really well-known in the market transformation space, the Bitcoin liquidity space, because XBTO is the first institutional liquidity provider in the Bitcoin space and the crypto space, in some degree, early on.  And so, Philippe and Walton founded XBTO end of 2014, formalised in 2015, started trading Bitcoin on many of the major exchanges.  They built the whole infrastructure, because back then you couldn't get any infrastructure from prime brokerage or anything like that.

My background goes back to growing up near Silicon Valley, starting my first company when I was 21, going back to business school, working on Wall Street, doing M&A.  I became good friends with Walton 20 years ago.  We've done four or five projects together.  I met Philippe and Walton back in early 2017 where we started talking about, they made an investment into venture capital and they were looking at their second one.  We started talking about, "Okay, well maybe there should be a formalised part of XBTO", then I joined by the very beginning of 2018, and we formalised the first fund where we started investing in companies, and that included -- the first one was Deribit and then Xmargin and then Paradigm Trading and Lukka, and maybe up to 20 companies now.

Peter McCormack: Wow!

Greg Carson: And going fantastically.  I mean, essentially top decile of venture capital performance.  I just want to make some disclaimers here.  Past performance does not -- you know, that kind of stuff, but really --

Peter McCormack: This is not financial advice, yeah, yeah.

Greg Carson: This is not financial advice and my opinions are my own, definitely not the opinions of the firm!  But it's been a really fun ride.  Philippe is the CEO and an amazing visionary, and Walter I've known for 20 years.  He's our CIO and Co-founder and one of the smartest guys I've ever met.  So, the firm is just an amazing culture.  We're behind the scenes on a lot of the institutional parts of the community for many, many years now; and now we sponsor the IMCF, we moved to Miami, our headquarters are now Miami.

Peter McCormack: I've been to the office, you invited me down.

Greg Carson: Yeah, reasonable okay office, yeah!

Peter McCormack: Got a little beach down there!

Greg Carson: Yeah, it's right on the water.  So, XBTO has now evolved, so now we're edging up towards 100 people.  We have offices in Paris, New York, headquarter Miami, Bermuda.  We have a product streaming markets, where we provide pricing and various things on the streaming parts of all the crypto markets.  We have an options desk.  Walton and Philippe come from SAC Capital, where they were basically one of the foremost hedge funds.  So, we do a lot of algorithmic trading, market making, we're a proprietary investor.

My role doing the private investing, all the venture capital and private deals and negotiations around partnerships and stuff, means that we now started, since I came on, to start to now take outside capital for investing in stuff.  So, now we're raising our -- we had such good performance, people started asking us to invest.  Now, we're raising a new fund to do early-stage stuff, and just to deal flow, a lot of deal flow, a lot of really great investors coming into our partnership system.  Great times.

Peter McCormack: Yeah, man, great times for everyone.  It's been an incredible year and I just feel like every time I take a step back and think about where we are with the Bitcoin ecosystem, it's like, "Holy shit, look where we were four years ago and look where we are now, and look where we're going".  We had a President tweeting last night on buying the dip!  El Salvador up to 700 Bitcoin.

Greg Carson: Amazing, amazing.

Peter McCormack: It's in a very interesting place.  But I think one of the things that's really on my mind, which is why I like talking to you, is when we have those conversations over tacos, is that there's a lot to consider about in the world and you and I share this lens where it's not just about, how do I get by in this world; but what does it mean for our sons?  We've got sons of pretty much the same age.

Greg Carson: Yeah, my son's 17.

Peter McCormack: Yeah, my son's 17.  Yours is more orange pilled I think than mine.

Greg Carson: Yeah, he's really into this Bitcoin maximalist and he's coding Rust.  I'm super proud of him; a super smart guy.

Peter McCormack: My son's an artist and he's like, "Yeah, whatever".

Greg Carson: I'll definitely be working for my son in a decade or two.

Peter McCormack: We'll hopefully be retired!  So, we're thinking in that separate lens about the world that they're going to live in and what it's going to mean for them.  One of the things that's really interesting about the bitcoiners is that some of them are very good at seeing the future.  They have crystal balls; where I'm like, this vision of the world they talk about, hyperbitcoinisation or the breakdown of the state. 

Yesterday, a couple of days ago, I interviewed somebody who said, "The great thing about Bitcoin is it's going to delegitimise the rent-seekers in government and academia", and I think therefore seeing a collapse of a world shift, which I don't because I live in this comfortable space thinking, "Everything's fine", and everything will be how it always was.  But the world's gone through really transformative times, and we're in a transformation now.  I see it happening, I see the good that's going to come, I fear some of the implications; but I don't see it the way others see it.

Greg Carson: Fear is the mind-killer.

Peter McCormack: I know, man, I know.

Greg Carson: To quote Dune.

Peter McCormack: How do you take in where we are at the moment, because there is weird stuff.  I mean, the Evergrande thing that's happening now?  We could have a Chinese version of the Big Short.

Greg Carson: Yeah, I think the world is going through massive transformations.  I think we're quite lucky.  I think Bitcoin and our side of the world gives us some insulation to realise we're kind of protecting ourselves both financially and mentally.  It's a mental pill as well as an orange pill, you might call it.  And the transformation markets is the first step of that.  I think the whole world's transforming, and at XBTO Humla Ventures, we're investing in the transformation of the markets, but the whole world is changing and that's what I think the fear comes from.

If you look back in the 1920s, before 1920, was it 1917 when they made the Federal Reserve Bank?  So, there was no Federal Reserve Bank back then.  1900, all currencies in the world were on the gold standard, so you didn't have exchange rates.  You basically just -- Rockefeller had a 55-country company with the telegraph, one accounting books, he managed 55 countries before the television and the telephone, I mean before planes, can you imagine?!

Then, they partially came off the gold standard and then Bretton Woods came, which was a massive transformation, military strategy from the United States, and the dollar.  And then, in 1971, when Nixon took us off the gold standard, that last 50 years has been an experiment.  So, I think what we're seeing now is not necessarily a transformation forward, but a transformation where Bitcoin has introduced a series of catalysts for the global mentality to realise there needs to be some fixing.  It might be going back in some cases.  It looks like it's going forward, but it's going backwards.

Peter McCormack: It's going back to a standard.

Greg Carson: Something.  I think what we didn't realise before is, technology is not always pushing us forward.  There are a lot of things we're now realising weren't that great.  Technology, social media, is not necessarily making children happier.

Peter McCormack: Did you see the Facebook thing?

Greg Carson: No, I didn't see, even though I'm on Facebook 24/7.  No, I'm not!

Peter McCormack: Well, there was a Facebook study, Danny, can you look it up?  I don't know the details, but essentially Facebook ran a study, and it was quite interesting, because there was an interview, I think it was Jonathan Haidt on Rogan, where he was talking; he did a presentation and it was a graph showing young girls' incidents of self-harm and suicide, and it was quite a steady chart.  Then, there was just this uptick, this hockey curve.

Greg Carson: Social media?

Peter McCormack: Social media, yeah.

Greg Carson: Instagram, probably.

Peter McCormack: Instagram was the main culprit.

Greg Carson: Probably less from Facebook, because I think Facebook is really our generation.

Peter McCormack: Yeah.  I think it's mainly Instagram.  This is why my daughter's not allowed Instagram.  She fights me over it, but I'm just not having her exposed to this kind of pressure.

Greg Carson: That's great, that's good advice.

Peter McCormack: It's something I've agreed with her mum, and we've stuck to it.  It's also not great for boys, but it's much worse for girls.  But Facebook did a study --

Greg Carson: Snapchat too.

Peter McCormack: What's the detail?

Danny: It was an internal study that found that it was damaging to children's mental health.

Peter McCormack: And they buried the study.

Greg Carson: Who did?

Peter McCormack: Facebook.

Greg Carson: No surprise.

Peter McCormack: Because they knew.  Of course, I mean, we knew.

Greg Carson: Because they're altruistic, so why would they do something like that?!

Peter McCormack: Well, I wonder what the obligation is there when they do a study like that.  Is the obligation to release it to the public and let people know, or is the obligation to change the product?

Greg Carson: Well, effects of technologies is a super interesting subject.  I mean, there was a famous case early in Ford, when they found out that the Ford Pinto had a chance of blowing up.  Then they did a calculation internally of how many deaths would come from the Ford Pinto, and they calculated, "Okay, we can afford it.  We can afford to pay those lawsuits off".  Then it went into production anyway.  So, it was a major thing.  So, this is the same kind of thing.  It's even worse though, I would say.

Peter McCormack: I mean, it reaffirms my point that social media is dangerous for children.

Greg Carson: Oh, yeah.

Peter McCormack: I mean, it's also dangerous for adults really; we have a lot of mentally unstable people shouting all day on Twitter.

Greg Carson: Well, television's the instigator of these new echo chambers, and then people take these one-liners that they learn on television, which is the devil's medicine; I mean, television is everything dumbed down to simple liners that people can remember that have no basis in the actual depth of the knowledge.  Then, they go into Facebook where it basically starts to rebound.

Peter McCormack: Well, I think we were out for dinner last night, and one of the things we were talking about is that one of the few places that you can fix this is in long-form conversations like this, Clubhouse, Twitter Spaces; it feels like you're having a conversation with people.  I mean, last night at dinner, we had a Bitcoin maxi and an Ethereum maxi sit down and have dinner, and by the end of the night, they've exchanged phone numbers and they're going to hang out.  But on Twitter, I mean those two, maybe not.

Greg Carson: Definitely not those two!

Peter McCormack: But on Twitter, it can be arguments.  And one of the other issues is, a lot of the people I notice that recognise the problems of social media and media, when they tweet about it, they also do it in an inflammatory way themselves; so, they're contributing to it.  They're recognising it, but social media's rewarding them for being inflammatory about it.  I mean, I'm a hypocrite at times, I know, but I do think --

Greg Carson: In person, you have that kind of social feedback though, like as I'm saying a sentence, you see the face of the other person reacting to what you're saying, and then you have this response.  On the internet, you just have this sense of just shouting out to the masses; you've no idea.  People are trying to get attention, I think.  A lot of it is approval-seeking, or just attention-seeking, I guess.

Peter McCormack: I don't think some people realise the consequence.  Someone might tweet something out about a person, be particularly critical personally, and they get the rallying support of the people watching, but they don't understand --

Greg Carson: Well, they find the six other people that agree with them, and then that becomes --

Peter McCormack: Or 600, or 6,000.  But they don't understand how that person who sees it might feel.  I put a thing to Danny earlier, a tweet, and I didn't end up sending it in the end, but some people have been criticising this, and other people will respond saying, "Look, this is just people being mean on Twitter".  But I think if you say, "Oh, it's just people being mean on Twitter, you perhaps haven't been subjected to continual harassment and abuse, which does happen.

There are a couple of people I know within the Bitcoin community I'm watching now, getting harassed and abused, and I think sometimes it gets normalised, "Oh, this is just people being mean on Twitter; you need to get thicker skin".  Well, can't we flip that and say, "No, this is not acceptable.  We challenge that person not to be a dick"?

Greg Carson: Well, it seems that standing up on the internet is not so easy to do, I guess.  And then people see this, they see the 6 people, or 600 people, and then socially people just think everyone thinks that way, because they just see the 6 responses and they identify with it.  If you kind of loop it back to our business, it's the same with markets.  There could be some change in the markets, a new company or a new opportunity, and everyone jumps onboard, even though it's a bad idea or a good idea.  So, there can be too much social proof either way.

But I think it seems to me that Twitter, depending on who you follow, changes the whole experience for you.

Peter McCormack: Yeah, and how much time you spend on it.  Somebody earlier put, "I just had a 48-hour Twitter fast".  He said, "I felt great".  I was like, that's such an interesting point.

Greg Carson: Well, fasting, the concept is a really good idea actually.  With Twitter, for me, it's a better news source, but it's also a place where you can get down rabbit holes, because if you curate who you follow, then you can basically get much better first-hand knowledge, or first-hand news, if you follow and read it the right way, and search after that.

I like to read books, I like to read deep-dive content, so you see the initial part on Twitter, and that's where I get ideas of what to look at.  I haven't watched television since I was in my 20s, I think.

Peter McCormack: No telly?  You don't do a little bit of Netflix?

Greg Carson: Well, Netflix binge-watching, for sure, like Game of Thrones-type things.  I can't wait to see Asimov.

Peter McCormack: What's Asimov?

Greg Carson: The new Foundation series.  I think it's on Apple, or something.

Peter McCormack: What's that, a Game of Thrones spinoff?

Greg Carson: Asimov is the most famous science fiction writer of all time.  You've got to read the Foundation series.

Peter McCormack: Oh, hold on, this is the thing coming out on Apple?  This was the precursor to Star Wars?

Greg Carson: Not precursor; it took a lot of ideas from Asimov, who's the most prolific science fiction writer of all time.

Peter McCormack: Yeah, I've seen the trailer.  There's two trailers; it looks insane.

Greg Carson: The book is epic.  I mean, the books are amazing, really.  If it's produced well, it should be one of the best things ever.

Peter McCormack: Do you watch any of the documentaries, because I've just watched this five-part on Netflix about 9/11, Turning Point; it was very well made.

Greg Carson: I haven't seen that one yet.

Peter McCormack: It's really good.  It just covers what happened, why they went to Afghanistan, then into Iraq, and how that undid Afghanistan, and how we get to where we are today, the shitshow of the exit.

Greg Carson: No, I need to watch that.  I haven't watched the documentary.  I like documentaries, but I tend to read non-fiction books, and then if it's a Netflix movie, or something like that.  The good one, there's a Netflix one on the Samurai, and the introduction of gunpowder.  I mean, you read Sovereign Individual, right.

Peter McCormack: Yeah, I mean Breedlove -- it completely changed the logic of violence with the introduction of gunpowder.

Greg Carson: Right.  So, the Gunpowder Revolution is this whole concept of the returns on violence being transformed.  If you watch this non-fiction history of the Samurais, actually the whole story's about one Samurai clan got gunpowder first and took over Japan.

Peter McCormack: Oh, wow!

Greg Carson: It's happening in this book.

Peter McCormack: That's a documentary?

Greg Carson: Yeah, it's on Netflix, you've got to definitely see it.

Peter McCormack: Oh, I have to watch that.

Greg Carson: It's done kind of dramatised, then fact, then dramatised fact.  But it's this whole concept that gunpowder changed all the returns of violence, and you see it right there.  They've got all the peasants, and they just hand them guns to go with the Samurais, and they kill all the --

Peter McCormack: It's so interesting, because later on today, I'm interviewing Jack Murphy, I don't know if you know him; he's just an interesting guy.  He was with Tim Pool yesterday and they were talking about the government mandates for all companies with over 100 employees, which is just a weird arbitrary decision, have to be --

Greg Carson: Because there are no other arbitrary decisions from the government!

Peter McCormack: Yeah.  So, let's just make it 100 and you have to be vaccinated, or I think the firm is fined $14,000 per person; I think that's it.

Greg Carson: That's very strange.

Peter McCormack: I might not have that bit correct, but they were talking about these fines and that basically, the government can just basically go into your bank account and take the money.  Jack Murphy said --

Greg Carson: It's going to be a fast move towards crypto.

Peter McCormack: No, Tim Pool said, this was it, he said, "Your AR15s can't stop them stealing your private property from your bank accounts", and I was screaming, "This is why you need Bitcoin.  This is the moment that Bitcoin needs to be in the conversation".

Greg Carson: Bitcoin, yeah, Bitcoin fixes this.

Peter McCormack: Bitcoin fixes this.

Greg Carson: Again, we just invested in this company, Bitwave, which is accounting for companies that have Bitcoin or crypto on their treasury, and that's their whole mission.  Earlier, we did Lukka, which is fund administrators and stuff like that as well.  I mean, companies start to -- you know, there's a lot of reasons to have stablecoins on your balance sheet, for speed and we can transfer -- we've done some investments, or we've had investments, or we've done market investments and trades, and they have to be done on weekends and evenings.  The normal banking system, nothing.

If you have this on your balance sheet (1) you can avoid the government taking penalties on their own, and (2) you can operate outside of this legacy financial system.  I mean, that's the whole thesis of my business, the Humla Ventures, the XBTO Humla Ventures, our venture capital, is that we have already entered market transformation.  So, there's a market transformation happening, and everything's going to change. 

But the core of it, you saw the Big Short, which is an epic movie, and that movie's actually really interesting, because that's the beginning, that's the moment that inspired Satoshi to launch his -- maybe he knew that was coming, because he worked on it for some time, but that's when he launched Bitcoin.  And now we see all these legacy banks with millions of lines of COBOL code, and running by 70-year-old guys that have no incentive to change their company.

Meanwhile, there needs to be thousands of companies to exist for our vision of Bitcoin.  And I think we said earlier, if Bitcoin is going to be the people's money, then Layer 0, or these other coins like Cardano and Solana and Ethereum, those are like Layer 0; that's like the application layer.  Then below that, you have all the shitcoins, and that's essentially what my idea is that --

Peter McCormack: Well, we'll come back to the thesis, because I just want to --

Greg Carson: I have to say, this is the people of Silicon Valley!

Peter McCormack: People are going to be triggered by Cardano.

Greg Carson: Okay, yeah.  True, yeah.

Peter McCormack: We can put that in the shitcoin category.  The point I just want to come back to is, when you talked earlier about the Samurais that once discovered gunpowder, they're the ones that took over, all the Samurais.

Greg Carson: No, it was one Samurai.  One Samurai clan got gunpowder first, and then they just went out and kicked arse all through Japan.

Peter McCormack: Well, if you look at the banks, the banks have it cushty.

Greg Carson: Yeah, they have a chance.

Peter McCormack: The first bank that discovers and allows the ability to have a Bitcoin account next to your bank account, with the ability to store your private keys if you need to, but also allows for stablecoins and moves into this real world, they will be the winner.  But what's going to happen is, I don't think it's going to be one of these legacy -- I think it's going to be a Strike.

Greg Carson: Or some hybrid maybe.

Peter McCormack: Yeah, some hybrid, or I think there'll be some consolidation.

Greg Carson: I think Fidelity's been really aggressive in picking it up soon. 

Peter McCormack: That's true.

Greg Carson: I mean, it's going to be slowly, then suddenly.

Peter McCormack: Yeah, but they're avoiding the reality.  Whereas, you can see someone like Bukele in El Salvador getting criticised by economists and mainstream media.

Greg Carson: What else can they say?

Peter McCormack: What else can they say?  But he is most likely going to be proven correct.  In three months, he has released an application.  Whether or not you agree that it's centralised, the point is he's released an app that banks everyone in the country who hasn't got a bank.  They can download the Chivo app and they can accept dollars and Bitcoin and they can move between them, and they can get their own wallets and move off.

Greg Carson: He just gave every in the country a bank account, their own bank account.

Peter McCormack: Yeah, and a country where 70% of the population do not have a bank account.

Greg Carson: But now they do.

Peter McCormack: Now they do.  But they can increase their trade.  You've got local businesses, like shops and pupuserias, but maybe someone there in El Salvador is producing a good that can be exported, and they've got that facility now.  He's put 50 Chivo machines in the US where there are densities of Salvadoreans who can send money straight back.

Greg Carson: Genius.

Peter McCormack: Yeah, routing around Western Union.  Western Union admitted they're going to lose $400 million of business.

Greg Carson: Just from El Salvador?

Peter McCormack: Just from El Salvador.  He's encouraged Bitcoin companies who all want to invest there.  All the bitcoiners are taking holidays there.

Greg Carson: Everyone I know is talking about buying a house in El Salvador, not to move the markets or anything, but seriously.

Peter McCormack: But he's foreseen this.  So, I know there's discussions at the moment whether or not he's a dictator, a benevolent dictator, or whatever, to be seen; but he has moved the needle forward for that country.  He's recognised this market transformation.

Greg Carson: Doesn't he have a 97% approval rating?

Peter McCormack: Something like that.

Greg Carson: Something crazy, right.

Peter McCormack: But that makes it easy to do things that might prove to be a mistake in the future, to be seen, but the point is, outside of that, he has moved the needle forward, he has recognised this transformation.  Having Article 7 in the Bitcoin Law, I spoke to him about this and he said, "I did this, because I've got five banks here; they're all billion dollar banks".  He said, "If I don't put this in the law, they don't accept Bitcoin, because they're banks.  Now, every one of them has to provide every service to be paid for in Bitcoin; they have to do it".  And that's on top of Starbucks and McDonald's.

Greg Carson: It was awesome to see the McDonald's.  I saw on Twitter, someone showed the McDonald's bill; they have to accept it.

Peter McCormack: Dude, it's on the screen.  You know the screens where you order?  I thought you would go to the till, they'd give you a QR code, which you can; but you can actually pay on the screen.  It pops up an open node and you can scan a QR code.  If they can do that there on that screen, that software's global.  So, he's got global companies now accepting Bitcoin; Walmart, and they did it in three months.  They did it quicker than the exchanges have accepted Lightning.

Greg Carson: That's true, yeah.  A little bit more power there.

Peter McCormack: Well, yeah, but you can move quick, it's possible to do it, and he's transformed a whole country in three months to be a Bitcoin nation.  Whatever you think of him or whatever, it's fucking impressive, and he's stepped ahead of them all.

Greg Carson: If they can see some serious traction; not traction, but benefits to the people, I think for the world there needs to be a second country.

Peter McCormack: Yeah, I agree.

Greg Carson: I mean, there's a really neat thing on leadership, and I do some lecturing at the University on Negotiation of Leadership and stuff, and it's the follower that defines a leader.  We need someone to follow him in this way.  So, it would be good that he makes enough traction that will really pull another emerging market leader into that.  That would be important, yeah.

Peter McCormack: Well, Cuba and Ukraine have both -- they've not made it legal tender, but they've legalised the ownership of the asset.  There's a guy in Paraguay who's gunning, he's running for President; he says he'll make it legal tender if he is.

Greg Carson: Oh, really, as a platform?

Peter McCormack: As a platform.

Greg Carson: Oh, that would be interesting if it's like a leadership platform in some countries.

Peter McCormack: Well, what do you think, I mean it's what Ted Cruz is doing, right?

Greg Carson: Is he saying that?

Peter McCormack: I don't think he's saying it to become President.  What I'm saying is I think he's recognised --

Greg Carson: He definitely came out as pro-crypto.

Peter McCormack: Yeah, and I think he did it because he recognised it's a very Texas idea and it's good for votes.  I don't believe that he was just suddenly orange pilled overnight.

Greg Carson: It's good for money too, and there's a lot of people with significant balance sheets that want Bitcoin to succeed.

Peter McCormack: But if that's the route to orange pilling, then that's great.  And then, I think it's in Costa Rica, there's a presidential candidate they're trying to orange pill at the moment.  It feels like the second domino isn't too far away; it feels like it.

Greg Carson: Maybe.  I mean, there's dark forces though.  You have major countries and major governmental organisations which are coming out against that, and they have a lot of power.  I mean, we've seen Americans' power and IMF's power, all these.  They may or may not accept it or like it, etc, and they're really run by people that don't fully understand the implications yet.

Peter McCormack: Or maybe they do, that's why they're powerful forces.

Greg Carson: Maybe they do, yeah.  Could be that they do.

Peter McCormack: I think us bitcoiners are a powerful force.

Greg Carson: Well you know, it's very interesting, because if you believe in Bitcoin as a money, or you believe in Bitcoin as the internet of money, it's like a gun in the gunpowder revolution, just to take it full circle.  The gun is not a political instrument; it's just a tool that you use or not.  So, they may hate it now, but they may realise in a month or a year or ten years that, "Oh, I should be using this tool, or this weapon, to make me stronger".

Peter McCormack: Well, the interesting thing about the US as well, my guess is that has one of the highest densities of Bitcoin ownership.  Got a lot of companies here, a lot of investment, they're ahead of everyone else, and by over-regulating, they're going to push the money and the companies into other jurisdictions.

Greg Carson: Could be.  I mean, this is a critical point.  If you look at the last 12 months of Bitcoin and even further crypto involvement, you've seen, especially Bitcoin, you've seen Wall Street really start to accept it; XBTO, we've invested in an international bank.  We have seen Ray Dalio, Stan Druckenmiller, MassMutual, MicroStrategy, Tesla, Dan Tapiero's raised a fund just investing in Bitcoin companies, or crypto companies.  I mean, Wall Street has really started to accept this, and that's where this transformation is going to start.

That means a lot, because that means that there's so much bought into the power base, the money power base, that that can basically influence both people and governments in a different way than it did before those last 24 months.

Peter McCormack: We should do your crypto thesis that I interrupted you on.

Greg Carson: Yeah, could do, my crypto thesis.  Come on, let's talk about it.

Peter McCormack: Well, it's interesting, because you were telling us that beforehand, but it's an interesting time where me and Danny this week, this is the first time we've hung out together.  We've worked together for three years and we've talked a lot.

Greg Carson: So, is he getting a promotion now?

Peter McCormack: He's just had one; this is it! 

Greg Carson: Good job, Danny!

Peter McCormack: But we were talking a lot about Bitcoin, crypto, Bitcoin versus crypto.

Greg Carson: Right, what does it mean?

Peter McCormack: Well, what does it mean, and not only what does it mean, what is the best way to approach it to help people understand Bitcoin and move forward to the future.  I'm a bitcoiner, I only hold Bitcoin.  I can think of scenarios where I'd maybe own Monero and perhaps need the use of a stablecoin, but really I just use Bitcoin for now.

Greg Carson: Stablecoins are important.

Peter McCormack: I get that they're important, but I just haven't had a need for them.

Greg Carson: I see them as a bridge.

Peter McCormack: Fine.  And I can see a definite use for someone in Argentina wanting to hold some dollar stablecoins.

Greg Carson: Sure, it's this whole bank account thing, it's another reason, yeah.  And that goes deep into deep finance, so there's a lot of things in the financial world which are changing on lending and industry support.

Peter McCormack: I was talking to Kevin O'Leary about it the other day.  But just to get to where I was saying, I've been very much a bitcoiner, I'm on the spectrum of maximalist to toxist.

Greg Carson: We've noticed!

Peter McCormack: Well, no, but I've been fully toxic, yelling at shitcoiners, calling everything a shitcoin.

Greg Carson: Yeah, that's great!

Peter McCormack: It gets tiring, and having travelled, spent time with people talking through it, I actually sometimes think, what is the net result?  If the net result of yelling at people, criticising shitcoins, does not stop them investing in altcoins, but pushes them away from Bitcoin, is the net result worse? 

Greg Carson: But do they really push?  I mean, they're already away.

Peter McCormack: But do you bring them back by having created this narrative that Bitcoin is -- Bitcoin wins anyway.  I think all roads lead to Bitcoin.  But for your own mental health, career and trying to help support Bitcoin, are you better --

Greg Carson: Well Bitcoin, it needs, like Michael Saylor's comment I make, saying it needs those cyber hornets, it needs those people.  And they act just like Amazon's thousand employees that just do everything for Amazon, or Google's thousand employees that did that early on, because there's no employees in Bitcoin, right; there's all these people that support it.  And Bitcoin is the strongest network.

There was a really neat post by Jameson Lopp the other day where he -- oh, no, it was Paolo from Tether, I think it was.  They said that -- no, at Bitfinex, where they were testing all the different nodes, and Bitcoin's the only one they never have to touch.  The other ones, they have to reset every month or two.  So, it does have some history as being the strongest, and if you're like me or like you, we believe that it could become international money, or international central bank money; or, could be one of those things.  I believe it will, but there's a lot of things that can change in life, and I learned that personally.

But then you need innovation also.

Peter McCormack: But is the Bitcoin node the best, because Bitcoin has amazing Core developers working on it who are well-funded; or, is it because of cyber hornets holding people to account?

Greg Carson: No, I think it's the purpose and the mentality.  So, when we just did a visioning session at XBTO and we were working on core purposes and what's our values of the company, what do we believe in as people, and then we move quickly into what's our goal for three years, five years, seven years, whatever.  I think the definition of Bitcoin, its thesis is, "Move glacially slow and design for inevitability".  That's the Bitcoin thesis.

Then you have everything else is Silicon Valley method which is, "Design hyper-fast, break that shit, make it work, work on the financing, work on new ideas", which is useful; because what happens is you have these Layer 0s that we called, and I won't mention the one that you didn't want to be mentioned.

Peter McCormack: You can say Cardano!

Greg Carson: You can bleep that out!

Peter McCormack: No, you can say Cardano.  I understand, I'm not going to pick a winner when you say this conversation.

Greg Carson: But I don't know the winner.  I mean, none of us know what's going to win or not.  I think we feel that -- I mean, I think that thesis makes Bitcoin hard to beat.  There's a famous saying, "It's hard to beat someone that never gives up", and Bitcoin's never going to give up.  Then these other things are innovation clusters for applications, because Bitcoin's not designed to have applications on top of its Layer 1.  You need Blockstream's Liquid, or you need Lightning Network, or you need a couple of other things, and now we have Taproot, which is allowing smart contracts, so it's getting closer.  But why did that happen?  Because, the Bitcoin Core realised that Ethereum and all these other Layer 2s were gaining a lot of traction by having all the smart contracts already there.

So, to repeat the thesis, which is that Bitcoin is the people's future money, or even the bank's money.  It's the global potential solid asset and people's money, we would say; and then the Layer 1s are the people's application layer, decentralised or, don't want to get into that argument.

Peter McCormack: Permissionless?

Greg Carson: Yeah, permissionless application layers, which is amazing.  But Bitcoin is a permissionless application, or the internet of money, I would say.  So, Bitcoin is the internet of money, the people's internet of money.  Next is the permissionless application layer.  Then, the shitcoins are the people's Silicon Valley, the people's innovation system, where anyone permissionlessly, is that a word?

Peter McCormack: Without permission?

Greg Carson: Without permission.  Permissionlessly.  Can we make up a word?

Peter McCormack: We can make up a word.

Greg Carson: We'll call it a make-up word.  So, people can permissionlessly, without permission, raise a bunch of capital, have a bunch of people working.  If it's a great idea or has a lot of support, have more people working on it, test ideas.  I mean, there needs to be regulation, there needs to be -- our firm is very much a pro-regulation, pro-do-it-the-right-way type of firm; we're an institutional player.  But in the VC fund that I run, and the new one that I'm raising, we're looking for people to break things also, because that's where good ideas germinate.

Peter McCormack: Well, that's pause that.  Why pro-regulation, because obviously there's people in the Bitcoin world who hate regulation?  They're going to be, "Fuck this guy.  He's pro-regulation".

Greg Carson: Yeah, "Anarcho-capitalist!"

Peter McCormack: Yeah.  What does it mean to be pro-regulation?

Greg Carson: I'm pro-rules, let's put it that way.  Let's say you were on the pitch for football, soccer for the Americans; I've lived in Europe now for 12 years, so I can say football with a straight face.

Peter McCormack: I knew exactly what you meant.  I wasn't thinking of the egg!

Greg Carson: Exactly.  Everyone in the room is British, so they're getting used to my --

Peter McCormack: No, he's a yank.

Greg Carson: Okay, yeah.  We have the upgraded language accent!  So, imagine a football pitch, but instead of having rules, you just said, "Okay, go and play".  You can't play.  You can't play a game without rules.  So, it's not that I want lots of regulation; it's that I want governments to make a claim, "Okay, you're going to be a government, you want to have Bitcoin, you want to have rules around Bitcoin, let's hear them; make a list.  Okay, then this is not the country for me, I'll go to this country" or, "This is not the place where I should domicile my business, I'll go to this country".

I mean, the game is up.  Basically, we're at this moment of transformation in transformational markets.  Like, our fund is international.  We have investments in Unicorn in India, RelayPay in Australia, we're about to make a Nigerian investment this month, South America, Europe, Northern Europe, Bermuda, United States, Silicon Valley, New York City.  We're totally agnostic with location, and the gig is up.

Peter McCormack: Has COVID accelerated the transformation, because companies have realised they do not need to have an office?

Greg Carson: I think for sure with other -- I mean, we were already on that thesis.  Day one, we've been a fairly remote -- I mean, we do have offices, so you need to be around people, but our planning was, the day that COVID lockdown happened, we had zero break in our trading systems in our firm, our weekly meetings, all these things.  Nothing changed, because we were ready for that.  That's how we already operate.

But I think that the world is at the cusp of this transformation, which is markets are getting permissionless, and it's a bunch of new technology, and which government is more ready and less ready.  They've got to get their shit together and they've got to make rules, which is why I say pro-regulation.  And I think US has been quite good, actually.  I mean, maybe some people disagree.

Peter McCormack: Way better than Europe.

Greg Carson: Yeah.  Europe is a disaster right now in their understanding of Bitcoin and crypto and what to do next and the innovation system, yeah.  They need help.

Peter McCormack: But back to the thesis --

Greg Carson: I like Europe, for the European powers.

Peter McCormack: Yeah, me too.

Greg Carson: I like it there, I have a passport there.  It's a good place, and I want to help them invest more.

Peter McCormack: Look, we can compare and contrast Europe and the US, because there are certain differences.  But just back on the thesis, the thing I like about the thesis, what you were saying, is that sometimes where things happen in the crypto world and they don't happen in Bitcoin, and then they come to Bitcoin and people suddenly like it, you go to my YouTube comments and people are like, "Oh, now it's on Bitcoin, you like it".

I think this idea that the crypto world is this place to test innovation, you figure out what works and what doesn't, and then it comes to Bitcoin, is kind of interesting.

Greg Carson: It could be.

Peter McCormack: Yeah.

Greg Carson: We're talking about an almost $3 trillion market now and one-third of that is Bitcoin, right.

Peter McCormack: But the idea that, for example, you've got the security tokens starting to appear on Liquid now, you've got NFTs starting to appear on Liquid, the idea that these things can appear on Lightning.  I think the idea isn't so much about, "Oh, it's on Bitcoin, I like it.  It's on Ethereum, I hate it".  It's more like my implicit trust in the Bitcoin basechain.

Greg Carson: How trustworthy is the chain?

Peter McCormack: Yeah, and the longevity.  So, let me just, sorry, for example, we've seen something like Uniswap be hugely successful.  I foresee it's more likely that we get a version of people trading real stocks; the companies that would invest in them perhaps would trust it built on a Bitcoin layer a bit more than they would trust build on a smart contract platform, because perhaps for the longevity.

Greg Carson: Maybe, yeah.  Taproot is a smart contract platform, right?

Peter McCormack: True.

Greg Carson: Liquid has that as well.

Peter McCormack: Well, the uptime and longevity.  So, we've had the uptime failures of Solana and Ethereum and recently, I just think perhaps if it can be done in a more robust way on Bitcoin, people would trust it more.

Greg Carson: So, I think you're in the bubble too.  We're in the Bitcoin -- we were at the party this weekend and we're going to mainnet, and last week we were down in Miami, and we're going to Bitcoin Magazine's event in March, you know, all these things.  So, we're in it.  How many people actually know that Solana went down?  That's this core group of people.

I think you're right, which is it's going to move to the most trustworthy.  Things will move to the most trustworthy place, and Bitcoin can keep that theme, to move glacially slow and design for inevitability, they're going to get a lot of that stuff.  But meanwhile, there's a thousand companies that have to exist outside that.  And if you look at stablecoins as a good example, start an Omni on Bitcoin's Network, because that was where it was created when Phil Potter invented it when he was at Bitfinex and Tether. 

Then they realised that this stablecoin doesn't care what platform it's on.  Stablecoin can be on any platform.  So, Tether's on Ethereum, and then it was on Tron, and then it was on everything and Tether became its own entity, literally separated from the layer.  So, why wouldn't NFTs become that?  You have your EtherRocks; do they actually have to sit on Ether?  Can you have NFT platforms be floating and pop between whatever's the most trustworthy layer?  I don't know.  I did meet the CEO of OpenSea this weekend and fantastic guy, amazing visionary. 

Peter McCormack: I'm thinking he needs a better HR policy!

Greg Carson: Yeah, maybe!

Peter McCormack: The front-runner, the guy, you saw about that?

Greg Carson: I didn't see the news.  I heard there was something.  Sorry, I'm bad at news, because I don't watch the news so much.

Peter McCormack: Well, this one, you couldn't miss on Twitter.  I can't remember which employee, who was it, Danny?  He was one of the guys in the company was front-running trades and he kept his job, because they didn't have a policy saying you can't front-run.

Danny: He's now resigned.

Peter McCormack: Oh, he's now resigned?  Yeah, so he didn't lose his job, because they didn't have a policy.  I was like, well what if he gets caught jerking off in the toilets and they don't have a policy that you can't jerk off in the toilets; does he keep his job?

Greg Carson: Do you have a policy in your firm for that?

Peter McCormack: Yeah, I do.  No jerking off in the toilets.  It's just not allowed.

Greg Carson: Okay, just so you guys know.  There is a policy.  McCormack Enterprises!

Peter McCormack: Yeah.  But the point being, it seemed like such a pathetic thing to say.  You front-run your customers.

Greg Carson: Yeah, but that's an employee, that's not the firm.  They'll learn from this, I'm guessing, and I don't want to -- I think entrepreneurs and CEOs are an important breed, especially in our space.  I don't know anything about this situation, right, and I do know that that's probably overblown.  If I look at most Dilbert situations, companies are inept in general.  So, you've got to be able to fix.  One of my core theses as a human is that people that can change their mind are the highest form of human.

Peter McCormack: People don't like it when you change your mind.

Greg Carson: Yeah, people hate that.  That's how you know that it's not AI, because it thinks logically.  People are not logical, right.  And the other thing is to give entities or organisations a chance to correct.  You don't want to get into this cancel culture for everything?  Okay.  There was a mess up there.  Last year, no one even knew NFTs were anything, so front-running, I don't know what policies I would put in, but now it went from zero to a bezillion in no time!  So, as a CEO, how can we know all the policies to put in place?

Peter McCormack: But what I mean is, it was major news; I think he should have been fired.  Perhaps it's some HR thing, "Because we don't have a policy, therefore I can't fire him".

Greg Carson: Definitely in some European countries, that would definitely have been the case.

Peter McCormack: Yeah, it's a lot harder to fire someone in Europe, especially if they've had a job for two years.

Greg Carson: Yeah, you can't do anything.

Peter McCormack: You literally can't do anything.

Greg Carson: "You totally suck, but we're going to keep you on for another two years of sucking for no reason"!

Peter McCormack: Yeah, and if you work for the government, you get to stay for another 40 years and get full pension.

Greg Carson: I want to remember, because we were talking before, market transformation stuff, and I have a key metaphor that I want to say; just to go backwards.  It's that, we talk about Silicon Valley, this kind of concept, and I just wanted to mention, I was an investment banker at UBS and I was doing fintech in Europe.  I was like, "This is bollocks", excuse my British; how did I do?!

Peter McCormack: That's pretty good!

Greg Carson: So, "This is bollocks, because it's boring".  You're going to do fintech and it's payments.  That's what fintech was; you're paying people.  I was like, "I want to do something that's meaningful and maybe should be a life science, or…"  And then I went to Sweden and I did venture capital for a while, before I did venture capital with Humla and XBTO, and that was exciting times.  But now, Bitcoin changes.  So now, the internet of money is a human transformation concept, so we're investing in these cool things.

But here's the analogy.  If you were in venture capital in the 1990s and 2000s, we can all agree that that would have been a great time to be a venture capitalist.

Peter McCormack: Very good.

Greg Carson: You made a lot of money.  If you were an LP in Madrona and they found the first investment for Amazon, that was a good fund to be in.  Or, you were in XL when they found Facebook and Google, etc.  Those were amazing times.  And if you think about Amazon and Netflix; Netflix took Blockbuster out, Amazon took out first Barnes and Noble and then everything in consumers.

Peter McCormack: Everything else!

Greg Carson: Everything else, yeah, everything!  And, Google took out a new concept called -- they took out Yahoo and then, they made search --

Peter McCormack: AltaVista?

Greg Carson: AltaVista.

Peter McCormack: Yeah, remember that?

Greg Carson: And essentially, TV advertising is now miniscule, because most people will get their advertising via Google or the internet some way.  That was a $1.5 trillion market that got transformed in this venture capital era of the 1990s and 2000s; $1.5 trillion.  I say, "Okay, now we're done, venture capital's done.  Why would we be in that business?  That's my business, my whole day-to-day life".  And then we fast-forward and say, "What about financial markets?"

If you think about asset management, investment products, contract and trade payments, banking, wealth management, this whole financial markets thing, that's a $22.5 trillion market that's about to get the same decimation that happened in the consumer markets.  And, what are the VCs that are targeting that space?  I mean, there's 5 of us, or 15 of us.  Now, there's a lot of new VCs coming up, but do they have ability for the liquidity and network and the relationships that we have already?  So, there's a lot of "me toos" aswell.

But this is in order of magnitude bigger opportunity in venture capital and for us, as a community of people having fun and with good relationships.

Peter McCormack: What is the transformation?  Is it 24/7/365 markets; is it final settlement of assets?

Greg Carson: Yeah, finality.  I mean, that's what we said when we were talking about it.  What's happening?  Is it the transformation of markets?  Transformation of markets is critical to our thesis with internet money, Bitcoin, blockchain, AI communications.  These three things are going to transform markets, identity, all that kind of stuff.  So, that's a huge opportunity.  People say, "Why don't you just do coins and that kind of stuff?"  Well, there's a lot of companies that have to exist, just like in the gold rush, you had Levis and Wells Fargo, and those are the companies you remember from the gold rush.  You don't remember the mining company that went up there in Lake Tahoe and started pulling the gold out.

So, this is the first step, but that financial transformation is going to change everything in society, because what happens when we have permissionless -- NFTs, I don't understand them completely, but you can own a thing besides Bitcoin, or another, that is sitting outside of any jurisdiction.

Peter McCormack: A share certificate.

Greg Carson: Yeah, it's a share certificate, essentially, of an asset.

Peter McCormack: What happens with the legal enforcement of share certificates in those scenarios?

Greg Carson: Do you mean NFTs?

Peter McCormack: Yeah.  So, if your share certificate was an NFT and you were holding it on your ledger.

Greg Carson: That's cool.

Peter McCormack: It's cool, it's an interesting idea.  I mean, I like the idea of --

Greg Carson: If you're an entrepreneur doing that, send me your pitch!

Peter McCormack: But imagine we were having dinner and you were, "You should invest --"

Greg Carson: That would be a good dinner; steaks.

Peter McCormack: It would be a good dinner.  And you were, "Do you want to invest in XBTO?" and I was, "Yeah", and you're, "Well, I can sell you $10,000 of my shares" and I send you $10,000 of Bitcoin and you send me the NFT of the share in that moment.

Greg Carson: Right, yeah!

Peter McCormack: What I'm saying is that, the fact that we can do that, peer-to-peer, and I have --

Greg Carson: It's to the next level.

Peter McCormack: Yeah, and I have that asset.

Greg Carson: You have the cap table and you can hit a particular button and then you get all these…  But those aren't NFTs really; they're more fungible, semi-fungible; asset NFTs in Bitcoin terms.

Peter McCormack: But how's that legally enforced; where does the legal enforcement of that come from? 

Greg Carson: Well, in any contract, you choose your jurisdiction.  You either choose, or you're here by default.  If we make a personal agreement right now, a verbal agreement, it's legally enforceable in the United States.  And we're in the United States, so it would be the default jurisdiction, I'm guessing; I'm not a lawyer.  Or we can say, "Let's agree that our agreement is in some jurisdiction".  You can't have a non-jurisdictional enforceable contract, unless it's a smart contract, because then it's having a computer do it, which is really cool.

Peter McCormack: What's the role of the SEC in all of this, because sometimes I feel like they would claim they bring order to markets; sometimes I feel like they hold markets back, certainly on the ETF side of things at the moment, they seem to be holding the US back.

Greg Carson: Well, we want that to go.  We invested in Valkyrie, so we're really excited, and those guys, Leah and Steve, are amazing entrepreneurs.

Peter McCormack: Amazing.

Greg Carson: Yeah, I saw Steve was on here, right?

Peter McCormack: I love both of them.  Yeah, well I came with Steve to your place.  I haven't seen Leah for a while, but I think they're great.

Greg Carson: Pure team, and we're actively supporting that.  So, I'd like to see them do it.  So, what was the question?

Peter McCormack: What's the role of the SEC in this?

Greg Carson: What's the problem with the SEC, or what is their role?

Peter McCormack: Well, in this transformation of markets and hyperbitcoinised world, does the SEC become delegitimised, or is it important to have?

Greg Carson: That's a good question.

Peter McCormack: Is it important to have, because you also then say you like rules?

Greg Carson: Well, I don't say I like rules, I say we need rules to play a game.  I'm the last person to say I like the rules, I'm just saying that I need to know what the rules are in order to win the game.

Peter McCormack: But do we want rules centralised by someone like the SEC?

Greg Carson: Well, if it's in the transformation.  I think we have horizons.  There's the one- and two-year horizon, there's the ten-year horizon, and then there's the 20-infinity horizon.  It's easy to predict things maybe in a five to ten horizon, but it's really hard infinity and it's hard in the one, right.  Maybe some people say it's easy in the one.

What's SEC's role?  That's a really good question.  The SEC's role is clearly out for the consumer, and I think that's their actual -- they believe that and they want that to be the case.  Now, if they had the internal tool sets and the incentive systems to do that properly…  I think the biggest problem in most society in most people is incentive systems.  A lot of people in politics, I won't say which side, just lack the understanding that incentives drive humans.  If you put the wrong incentives in, you get the wrong results, period.

It doesn't matter if you want this to be the case because it's good for the ESG reason, or the financial reason, or the social reason, the incentives drive human behaviour.  If I give you a cookie, you're going to do something to get that cookie.  If I give you poison, you're going to do something to avoid that poison.

Peter McCormack: I'd definitely want the cookie!

Greg Carson: I didn't bring any cookies.

Peter McCormack: You brought bloody liver!

Greg Carson: I did, actually!

Peter McCormack: You've got liver, but no cookies!

Greg Carson: It's the carnivore -- it's very healthy.  It's the most nutritious food on the planet.

Peter McCormack: I mean, I don't think I'm ever going to walk around with beef liver!

Greg Carson: I think we're going to get to the transformation of everything, the health hacking.

Peter McCormack: Well, we should, but I did like that point whereby you were saying previously about --

Greg Carson: Don't judge me because I eat liver!

Peter McCormack: It's like you were talking about proof of work, basically, and that's the great thing about Bitcoin.

Greg Carson: Yeah, I love proof of work.

Peter McCormack: The great thing about Bitcoin is the incentive system.

Greg Carson: Yeah, that's the most well-thought-out incentive system of all time.

Peter McCormack: Because, rather than having a room of ten people creating complex rules that try and make everything balance for hundreds of millions of people, what you've got is a small system with two or three very important rules, that everyone else has to adapt to.

Greg Carson: It's like parenting.  You can't give your kids 100 rules.  There are three or four, stick with those --

Peter McCormack: Figure everything else out.

Greg Carson: -- everything else, you have to figure out.  Good judgement had better be one of them.

Peter McCormack: But listen, transformation of everything, there's so many things I'm into.  The two ones I'm primarily interested in is transformation of governance; I've talked a lot about it on the show, I'm not an anarcho-capitalist.

Greg Carson: Yeah, I saw.  I forget the guy's name; what was his name?

Peter McCormack: I've said it so many times.  And the other thing is the transformation of media.  For me, the mainstream media --

Greg Carson: It needs to happen.

Peter McCormack: Yeah, it needs to happen.  It's an absolute fucking shitshow right now.

Greg Carson: Will it self-correct, or does it need something, a catalyst?

Peter McCormack: I think the economics change, because the advertising model's changing.

Greg Carson: Well, the economics for them totally has gone upside down.  They only get their money from pharmaceutical companies.

Peter McCormack: Well, I think people realise they're being lied to more and more, and there's other sources they can trust.  But there is also a war between the mainstream media and the independents.  Joe Rogan does something, the mainstream media attacks him.

Greg Carson: Oh, yeah.

Peter McCormack: So, it's an interesting war at the moment.

Greg Carson: It's all the independents.  And that's why I like the Twittersphere so much, even Srinivas, he's a VC guy that does deep research.  He ends up being a better journalist than any actual journalist.

Peter McCormack: Yeah, which is great, and we've got a lot of people like that.  But it's just, I think a lot of the poor discourse in society, we've attributed some to social media.  I think we have to actually attribute it to the media companies.

Greg Carson: Corporate media.

Peter McCormack: Corporate media, which is pretty much the majority of media.

Greg Carson: Well, in the old days, there was a big guy that owned the media, and then he sold it to the corporations.  Now, it's essentially middle management and their incentives.  Their incentives are profit and appeasing their boss.  There's no incentives to help them do good media.

Peter McCormack: With lower margins.  There's some stuff I like in the FT that I think's okay, but they've covered Bitcoin badly.

Greg Carson: I think they have a couple of different tracks on Bitcoin, yeah.

Peter McCormack: Yeah.  There are some things I think that Reuter and Associated Press do that I trust more than other sources, but also some of the more independent stuff seems to be less independent.  It's very hard to pick a source.

Greg Carson: But I mean, I don't know if I'm going to answer the question the way you want me to; I don't have any answer to this.  I think it's a huge problem.  I think most of corporate media's a poison, not that it's wrong or right, it just has bad incentive systems and it's impossible to give any sort of knowledge in seven minutes.  I mean, that's the biggest problem; it's just not a medium that works.

But in The Innovator's Dilemma, which is Clay Christensen's great work from decades ago, I mean that was my consulting before I became a banker, is that the innovator is almost never the incumbent; it just doesn't happen, right, and the incentives don't work.  If you were making $1 billion on this product, you're not going to invent the product that puts that $1 billion revenue source out of business.  And I think we're at that moment where there are a lot of people trying to do new media.

The obvious one is your business.  Peter McCormack, you and Joe Rogan and all these others, I don't know which ones you like or don't like, but the podcasting world is platform-independent and has become a new media source, which is fantastic.  This long format, it's probably the most viable part of media I can imagine, this long-format podcasting.  It's the most viable thing that society has right now.

Peter McCormack: Well, it scales.

Greg Carson: It scales; it's there forever; it's good financially for you, perfect incentives; it's good for us, the people that are blessed to have the invitation from you; it's good for the viewer.  Long format has a whole -- you get through all the stuff the PR firms tells you to say in the first five minutes, so you have to get to the real stuff.  If someone's not accepting long-format interview in politics or media or whatever, you have to be questioning why; what are they scared of; what is the reason that we're not going deep?

Peter McCormack: And I think trying to watch two people wrestle through a difficult subject is something that I think a lot of people can relate to.  There's a lot of complicated problems in society right now.  COVID is hugely complicated, how to manage COVID, how to manage hospitals; vaccines, do they work, don't they work, what age they work, are they damaging for some people, not damaging for others?  There's a lot of complexity.

Greg Carson: Yeah, and there's no actual answer to any of those.  That's the thing that everyone's missing, is that one media source may say there's an answer, and are they actually right?

Peter McCormack: Well so, I'm not going to discuss the topic now, but an interesting one recently, and I've received a lot of emails recently asking me to discuss it --

Greg Carson: He did say, "But"!

Peter McCormack: No, I'm not going to debate it, but the topic of abortion has come up again recently, because of the Heartbeat Law in Texas, and I've had maybe 15 emails saying, "Pete, will you touch on this topic?"  I haven't, and I think there's no answer, because you either believe you are trying to control a woman's body, or you're murdering a baby, and you're basically one or the other.

Greg Carson: Yeah, hot potato subject.

Peter McCormack: And it's unwinnable.

Greg Carson: And, what do you know, what do we know?

Peter McCormack: What do we know?  You can't understand everything a woman's going through, you can't understand every scenario of an abortion, it's too much to understand.  And, if you take a position, then you're going to piss someone off.  But at least if you're wrestling with these subjects and you go through the complexities, you're doing an infinitely better job than the media and the politicians and the social media grifters, who weaponise these arguments.

Greg Carson: They weaponise a statement.  I think that's what's great.  If you can get two really smart people that know about that subject --

Peter McCormack: Well, a smart one and a moron; we'll take a smart one and a moron.

Greg Carson: Or maybe two people that aren't us that actually understand that topic that you just brought up!  Like, I'm so far out of my wheelhouse talking about those things.  Of course, we have opinions, but I think that the right people to talk about those are two experts, probably two women experts!

Peter McCormack: Yeah, probably.  But my point being is, there are so many complex problems.

Greg Carson: But on both sides, because there's women on both sides of all those issues.  It's not us saying that.  And for people to realise that there's huge cultures and huge countries that have completely different opinions.

Peter McCormack: But the long form allows you to watch two people wrestle with that.  And you can watch one and you can find out if you like someone, you think they're authentic or they're not, and you skip them in the future.  Like I say, I mentioned earlier, I've got Jack Murphy later on today.  He was just on Tim Pool's show, and they were talking about vaccines for the kids, and he doesn't want to have his kid vaccinated.  But if he doesn't get vaccinated, he can't play varsity sports, and he's wrestling with it.

Tim was like, "Stand up for this!" and he was like, "Yeah, but this is my kid".  It was so authentic to see him wrestling with that, rather than going on Twitter and just having a weaponised binary statement.

Greg Carson: It makes me super emotional, thinking about things that we're pressuring our kids to do that I just don't have the answer to.  Do you know if it's going to be good for them long term or short term?  For me, I can make a decision.  I'm like, "Okay, for me, I want to travel, so maybe I'll do it.  Or, maybe I think it's going to save my health", I make my own decision.  But if we have a minor kid, I really don't want to do anything that's going to harm him long term.  So, I can understand his wrestling.

Peter McCormack: Well, there's going to be some parents out there who don't vaccinate their children and they get COVID, a very tiny, tiny amount, but they're going to have problems from contracting COVID, a very small number.

Greg Carson: From…?

Peter McCormack: From COVID.  And equally, there are going to be some parents who are going to vaccinate their children, and a very small number are going to have a problem.

Greg Carson: With the vaccination.

Peter McCormack: Neither are zero risk. 

Greg Carson: Well actually, both of them are really close to zero actually.  The statement is opposite.

Peter McCormack: It's a rounding error.

Greg Carson: It's a rounding error whether they're going to be riskier with COVID or without, from what I've read, at least.

Peter McCormack: But the examples become weaponised, depending on which side of the argument you are.  So, you'll see about a 4-year-old girl getting COVID and dying, and you'll see about a 12-year-old having a vaccine and being crippled, having a heart issue.

Greg Carson: Yeah, having a heart issue, or something like that.  And the NHS just said that they're doing some sort of research on effects of women's reproduction.

Peter McCormack: Yeah, there's lots of things.

Greg Carson: Yeah, there's a lot of unknowns.

Peter McCormack: And when we have biases and people are trying to weaponise it, rather than going for nuance, that's really complicated, and I don't think there are enough people out there saying, "Hey, I don't fucking know.  This is really hard".  But there's a lot of people out there going, "This is definitely wrong".

Greg Carson: Yeah, I think you can discount anyone that says definite.

Peter McCormack: Yeah.

Greg Carson: I think you get into this whole science question, because the whole definition of science is questioning assumption, questioning the known.  There's no scientific revolution in the history of man that wasn't some guy, one single person, not a consensus, a single person that went against the norm of the science of the moment, Copernicus, Einstein, Galileo, all these history of scientists, mostly Nobel Prize winners, at one point in their career, were critiqued for even saying different from the consensus.  So, the whole concept of science is to question the existing thing.

So, if you have a good scientist, it's not necessarily automatically agreeing with everybody to get funding, it's the one that's going against you.  So, we need to incentivise that somehow.

Peter McCormack: And everything's changing.

Greg Carson: Everything's changing, and I think that we're having a moment in time where things are changing so rapidly, like the internet time of the 1990s and the 2000s, I was doing start-ups then; compared to now, it's slow.  Our sector, Bitcoin and internet of money and crypto, it's all moving so fast.  And that's, in turn, forcing the hand of all these politicians and CEOs of big companies that don't know anything that we're talking about.  They're watching a zero market to $3 trillion market in less than a decade, and that's for 3 out of 22 at $0.5 billion, $1 trillion already, and we haven't even gotten going yet.

That's going to affect the banks, that's going to affect the politicians, the politicians are going to affect the people, the government structures, like we talked about.  I mean, government structures are at risk, because people are not sure how these…  I mean, there's always the intended technological risk, there's a secondary risk.

Peter McCormack: Effect.

Greg Carson: Secondary effect, and then the tertiary effects.  The internet was invented to share files, but it ended up being used for email first, and then eventually for the web.  The internet was not invented to have web or email, it was invented to share files.  And now we've seen that our whole life has changed from the tertiary effect, not the primary. 

So, internet of money, I think it's what we're talking about, that Bitcoin has sparked a series of changes, which include all the shitcoins; all the shitcoins are part of the Bitcoin revolution that Satoshi Nakamoto initiated, and it's just snapping down society, all the way to El Salvador.  A person in a small town, in a village, is affected by it already, and we haven't even gotten started.

Peter McCormack: Got to get you down there, man.

Greg Carson: Yeah, got to go, for sure.

Peter McCormack: You need to go down there.

Greg Carson: We haven't even started.  And it goes full circle to, how can we make change; what's important to do?  I actually find my job, running the fund, investing, is important, because we're investing in companies, in good people, that are making change for the future, which half the world's unbanked, and we need all these tools for the potential new rules that will be created. 

But what everyone can do is really focus on their personal responsibility.  Go down and look inside and say, "How can I be a better person?  How can I manage my health?  How can I manage my own, everyday --", I like the word responsibility; what are you doing for yourself?  Not for -- there's also the people around you, but that's why I like this biohacking, I'm my own body; and mental hacking. 

I spend a lot of time thinking about ethics and the principles of Eastern Buddhism, or something like that.  That's the origin of making the right choices.  And I feel as if there's not enough people, especially in government, that I feel like, who's wise?  The big question I have is, where is society getting wisdom from right now? 

In the old days, you'd have this whole set of older generation, which you think have collected wisdom and they've gone through hardship or not, and they've collected wisdom, and you could turn to them.  Do we look at our baby boomer generation that's running, and which one would you say is our guru or our wisdom?  I do see some wisdom in this next generation, maybe the Xers, there's some people I can identify.

Peter McCormack: Ron Paul?

Greg Carson: Maybe?  I don't watch enough of the soundbites from those guys.  But I do think that wisdom is the most valuable currency that we have.

Peter McCormack: I mean, I struggle to think of a single politician --

Greg Carson: Isn't that scary?

Peter McCormack: -- who is anything beyond some kind of virtue-signalling, rent-seeker.

Greg Carson: Sycophant, like Clegg.

Peter McCormack: I mean, AOC, Met Gala, "Tax the Rich" dress.  It's just the most obvious statement of bullshit that you will ever see.  Whereas, before I've seen her give quite impassioned speeches about protecting the poor and immigrants.  Whether you're a leftie or not, it felt authentic, and it's just lost; the message is now dead.  She's politically dead to me.  She might keep some of her political capital, but she's politically dead to me.

There's people I've met in the Bitcoin world.  I like them because of Bitcoin.  I like Cynthis Lummis and I like Warren Davidson, and hopefully I'll meet Ted Cruz and maybe I'll think he's all right; but there are very few.  There were things about Mitt Romney I kind of liked at one time.

Greg Carson: Yeah, maybe.

Peter McCormack: But you can name any one person and there's going to be someone listening going, "Yeah, but he did this".

Greg Carson: Well, that's just another element that humans are fallible.  You're not going to find someone that's the Buddha, everything they do is perfect.  You're going to find people that have good things and bad things.  I just want to find some wisdom in our leadership.

Peter McCormack: Ron Paul is the one person who I consistently, every time I've watched him speak and debate, I'm like, "You are principled in the right way". 

Greg Carson: Yeah, I think I could agree with that, maybe.

Peter McCormack: But there's very little else.  Then people will be, "Well, Pete, why the fuck are you a statist?"  It's just, yeah, it's terrible in the UK; we have nobody.

Greg Carson: I think it is definitely a deep philosophical question about our leadership and our own personal leadership, because you don't -- actually, there's a really interesting quote; who's it by?  I think it was Einstein would said, "You don't get wisdom unless you seek it".  You have to be constantly seeking it and then you become wise.  It's not something like, "Oh, okay"; maybe there's one or two people that get it that way.

Peter McCormack: But there's no incentive for the smartest and wisest people to go into politics, to have their lives exposed, to be trashed.  There's an incentive for people who can't really operate in the private world to go in.

Greg Carson: It's hard to imagine it.  I mean, politics is a new job.  I mean, the state, you talk about the state; the state is a new -- you read Sovereign Individual and there's other books, and we should talk about my book list.  But the state is a new concept.  Before the United States, there really wasn't states, right?  We had monarchies and we had the church.  Before that, we had empires and kings.  So, it's a new concept, and I think the jury's still out on how well the states work.

Maybe, Bitcoin -- maybe if you pull money away from the government, states can actually work better.  That's a potential concept.  I think if you read Mises' Human Action, or you read Rothbard's What Did Government Do with our Money? epic; I mean, no one's going to read Human Action, that book is ridiculous.  But the other book is readable.  But Mises had a good interview where he said, "The states are never going to give up money.  It's got to be ripped out of them", you know, ripped out of their hands.  And if that's happening now, maybe states work better, with a really solid, hard money that exists outside of the state system.  That could be interesting.

Peter McCormack: Do you know of any?

Greg Carson: I've never heard of any, I don't know.  Maybe; there's a candidate out there!  But that's why it's really hard to talk about the state of the world, because there's a lot of suffering and I have a lot of empathy for all these problems: COVID, there's a lot of oppression, there's authoritarianism, there's a lot of pain and disease and stuff like that.  But it's also a moment of massive change, and change is usually good for us.

So, things are changing, so it's entertaining in some way, with the empathy at the same time, because we are kind of in the know.  I feel like Bitcoin and the additional permissionless networks and decentralised systems mean that we're participating in the change, instead of just getting hit in the head by it, and it's coming in a big way.  I mean, it's already coming, it's already there, right?

Peter McCormack: Well, we're going full circle back to the start, because it's the shift in money, which is required, because Bitcoin fixes things.  But that also causes that shift in people.  I feel a lot of alignment with a lot of the people I get to hang around in the Bitcoin world, they've had a shift in values.  Not everyone's the same, but there are some similarities and this desire to have a better world with a lower time preference.

Greg Carson: Yeah, time preference is great.

Peter McCormack: Yeah, and that shift.

Greg Carson: Well, I like the metaphor, and I'm working on some writing and stuff like this around this, which is the concept of investing.  You think of me as a venture capitalist; okay, I'm investing in these things.  But if you think of it much broader, if you invest in yourself or your spirituality or your health, investment is a super valuable word.  It's a time preference word.  It's not spend. 

You're going to invest in your health when you go to the gym, or if I choose to eat my beef liver, I'm choosing a very high vitamin-rich source at the moment, versus a Twinkie that I got; or, I invest in my son.  I really, really love my son and I want to spend time with him and I want the best for him, and my friends and my colleagues.  I'm super blessed to work with the people I work with at XBTO.

If you think of every minute of your life and every dollar or Bitcoin that you spend -- in my mind Bitcoin is my unit of account -- as an investment, then you always think of that time preference return.  And if you don't spend any time today on teaching your kid wisdom, or espousing wisdom, then that's wasted; you didn't invest in that.  Or, if you didn't spend any time today working on your health, then you didn't invest in that; your time preference is negative.  So, you're compromising your future every moment, if you're not completely present with your inner investments.  For me, it's a really powerful thing to think about.

Peter McCormack: Well listen, man, it was great to have you here.

Greg Carson: Yeah, it was awesome, it was a lot of fun.

Peter McCormack: I knew it would be great.  All these times, those few times I've had the pleasure of sitting down with you and having a drink, like having tacos and just talking, and I've been bugging you for a few months now to say, "Come on".

Greg Carson: It's epic, man, we've got to do this again.

Peter McCormack: I know.

Greg Carson: It's just so good!

Peter McCormack: Hopefully with David Beckham!

Greg Carson: Yeah.  At least we'll look at one handsome guy in the room!

Peter McCormack: If we can fit him in.  But dude, love you, thank you, appreciate you coming on and I'm glad you're a friend, I'm glad I've got to know you and we will do this again, because it was such a pleasure.

Greg Carson: Yeah, and your team is amazing.

Peter McCormack: They really are; I'm very fortunate.

Greg Carson: He's actually travelling with them in one hotel room and there's four people in this room.  So, I don't know how that works, but amazing people!

Peter McCormack: Well, I'm very fortunate to be surrounded by such amazing people.

Greg Carson: No, I'm so grateful for you and for this opportunity and really, just as some cred to you beyond inviting me, that's really nice, but I think you do a really important thing for Bitcoin and everyone in the decentralised space, because you are an entry point.

Peter McCormack: Thank you.

Greg Carson: And even though you're my friend, even before we met, when I meet somebody and they say they want to learn about this space, your podcasts are the starting point, because you approach it in such an open way.  I mean, you're very skilled at this, so some compliments to you; I'm grateful.

Peter McCormack: Thank you, man, appreciate it.

Greg Carson: Cheers!

Peter McCormack: All right, listen, tell people where they can find you.  What's your Twitter?

Greg Carson: My Twitter is @proph3ttt and then you can go to our two websites: one is just xbto.com, and then the fund is xbtohumla.vc.  If you are an entrepreneur with a great idea and you are a good person, send us your pitch.  If you're an LP and you want to invest into the ecosystem alongside some really amazing, fun people like us, then reach out; we'd love to work with you guys.  It's great.

Peter McCormack: Awesome, man.  Well, listen, we need to go see Inter Miami play.

Greg Carson: We're going to go to a game for sure; you've got to come down.

Peter McCormack: For sure, man, and yeah, see you soon and all the best with everything.

Greg Carson: Thanks, my friend. Cheers.