WBD584 Audio Transcription

Finding Bitcoin Signal with Jeff Booth

Release date: Wednesday 23rd November

Note: the following is a transcription of my interview with Jeff Booth. 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.

Jeff Booth is the Author of The Price of Tomorrow and CEO/Chairman of Ego Death Capital. In this interview, we discuss how Bitcoin fundamentals (such as its approach to the blockchain trilemma, centring on truth, and its deflationary effects) run counter to current economic theories, making Bitcoin’s signal harder for some to find.

“Theft in money will divide us all, and that theft in money will take us likely to war and maybe the end of human species… or it will concentrate all control in very few super overlords. And the rest of us, it’ll look like modern day slavery, it’ll look like China’s social credit system on steroids.”

— Jeff Booth

Interview Transcription

Peter McCormack: Jeff, hi, how are you?

Jeff Booth: Great.  Yourself, buddy?

Peter McCormack: Yeah, good, always good to see you.  Always good to see you at a time when I've got things I'm questioning and wondering about.  As Danny said, "What would Jeff do?"!

Danny Knowles: Back for your therapy session!

Jeff Booth: We're not doing that!

Peter McCormack: Basically, the whole show is just a giant therapy session for me; every episode is therapy.  No, it's good to see you, man, and Ego Death Capital, is that the actual correct name?

Jeff Booth: That's the correct name.

Peter McCormack: It's going very well?

Jeff Booth: I can't believe I get to do it.  I can't believe the gratitude I have for getting to be able to invest in what's coming on top of Bitcoin, and the best entrepreneurs in the world building on top of it, it's incredible.

Peter McCormack: I feel exactly the same about running a football club; the best job in the world!

Jeff Booth: Yeah, exactly.

Peter McCormack: Okay, listen, you worked on an article discussing looking for signal outside of noise.  Tell me a bit about the article because there's so much going on at the moment, I've got so many different areas I want to go into with you, but I just want to hear your background to why you worked on this article?

Jeff Booth: I worked on that article because at the highest extraction level, so many people didn't understand what Bitcoin was and what the existing money system was, and very few people typically would want to go down with the sand on a monetary system.  They achieve value built on top of that level, so you achieve your value through products and services that are on top of the monetary system and you very rarely question the plumbing underneath it.  Nobody goes about their life thinking about the plumbing.  And so the plumbing could be rotten and you might not know it, and certainly if they're doing that in the existing system.

Bitcoin, with different plumbing, they don't want to look at the plumbing in Bitcoin either; it's just too hard.  People want to go about their day and life and when they get frustrated about their particular need, they don't typically go deeper, they think it's a surface problem on top of that.  So, I wanted to explain it in a way that people could understand that and write a piece that they could keep on referencing that piece to be able to see what was actually happening at the plumbing level and what that would mean for everything else.

So in the article, that's why I wrote it because for me, I like going all the way down to the sand.  I like to keep on questioning, I like asking why, why, why, until I find the root of something.  And then once I've done that, okay, I can understand the existing system, I can understand why it functions a certain way and what the pros and cons are of that existing system.  And I want to do the exact same thing on the new technology or system that I think might replace that, and I ask why, why, why. 

I think actually, doing that process is actually also what drives the polarisation in what some people understand Bitcoin to be versus some that aren't there yet, and the transition to where we're moving in society and from a system that we're in, in measuring everything in society, and that has profound consequences.  So, in that article, I wrote a pretty simple concept, but one that people take for granted, that all money is is information. 

You can prove that money is information because if it wasn't information, the Venezuelan bolivar would be equal to the US dollar; you would just find them equal.  So, you know it's information, but what it's describing is the thing you want.  And the thing you want is not the money, the dollars; the thing you want is what you think money will buy you.  So, all it is is a ledger describing what you have and what you think you need to get the things you want.  So, that want could be hope for my family; it could be legacy that future generations will think of me a certain way; it could be, if I drive a nice car, people will love me.  It could be a whole bunch of things, but it's describing that.  So, it's just information describing that.

So, if people are looking at money as information in describing their wants and there's manipulation of money, which is just information, then you have to expect as a by-product that everybody in the world is looking through that misinformation.  And as you automate that misinformation through technology, then everyone in the world thinks that they have perfect information and everybody else doesn't have perfect information, and you have all these silos emerging.  So, I wanted to explore what that would look like, and then I wanted to compare and contrast it with what's happening in Bitcoin. 

Through that lens, you can actually  just understand market economics and you can understand what would happen on all cryptos; you could understand what the transition would look like; you could understand the existing system and how inevitably it's going to fail, no matter what, it has a whole bunch of back and forth, but inevitably it cannot work; and what the new system would look like without carrying the baggage of the existing system in.

So I think what I see in Bitcoin largely, or crypto largely, the whole space, is you have a new system emerging and people are carrying the baggage from the old system into the new system, because they can't intuit what the new system will look like and it's almost completely inverse of the existing system.

Peter McCormack: Because those who have looked at Bitcoin, challenged Bitcoin, maybe think it shouldn't exist, think it might fail, whether that's mainstream media or whether it's our friends that we're trying to introduce it to, they're not really comparing apples with apples; they're comparing historically what money's done to them to a system that looks completely different, and they're comparing what it looks like right now.  Whereas, what you're doing, Jeff, you're doing the complete opposite.  You're looking where fiat will head and where it is heading, compared to where Bitcoin will ultimately get us to.  And without people comparing apples with apples, they're actually comparing polarised systems?

Jeff Booth: Completely opposite systems, and they're carrying their perception of what a system looks like in an old world, where we never had the new system, and they're carrying that baggage into the new system.  And by the way, that would be normal.  It's the same normality that you would look at in any monopoly, misunderstanding technology that destroys their value, because they misunderstand the value given to the people furthest away from the monopoly.  And typically, technology is a bottom-up disruption, because the monopoly misunderstands the technology.

So, what would happen if that was in money, and we can explore what that looks like, but let's simplify it even further.  The existing money supply, and I think most people would say that inflation is required, it's a belief.  There is not a physics law that says inflation is required for a productive economy, in fact it's exactly the opposite.  So, it's a belief structure that we believe inflation is required.  And all inflation is, if you ask a deeper question of that, is it's actually theft.  It transfers money from some people, and it transfers it from the middle class and poor to the rich.  And inflation is wage deflation; it's the same action.  It wouldn't work otherwise.  

People get paid less and they believe that this system is making them richer when it's actually making them poorer.  And it's concentrating wealth in some hands and taking it away from other people as a result, so it is actually theft.  So, by saying that you believe in inflation, you're actually saying, "I have a belief that theft is required in money to live in a productive society".  Now, if you believe that theft is required, then you should be able to explain why.  So ask a deeper question, "Why?" and the next why to that.

Somebody might say, "Well, it's required because otherwise the economy would collapse", and that is actually true.  And the why to that is because the economy is built on a credit-based system that has to increase its rate of theft forever to be able to survive.

Peter McCormack: Why, though; why can't a credit-based system be a system where the credit is paid back?

Jeff Booth: Because, and this is what I explored in my book, technology is deflationary.  What that means is prices fall to a level of production.  So, let's say your calculator app.  Your calculator app is free because it's a line of code.  In a free market, if you look on an app store, there'd be 50 calculator apps competing for your attention.  There are not thousands of entrepreneurs that want to create the next calculator app.  You create abundance and it drops to free, so the prices fall to the marginal utility and that becomes free, it becomes abundant.  So that productivity gains.  Productivity gains in a free market reach the free market through price declines as we save time.  And if you capture those by making prices go up, you must concentrate that wealth, that should be flowing to society and saving their time, in very few hands; it is theft.  And that theft has to continue. 

So, what would happen if the emergent, complex behaviour of society, which is all of us, is built on theft?  Wouldn't the natural mirror reflection of the world mean that the people who had the most money would be the best at stealing and might not even know it?  Let's use an example.  Wouldn't charities, or wouldn't non-profits?  Let's add on top of that; where would they get the money to run their charity, to be able to think they're helping?  Wouldn't they go to the same people, who were most benefiting from a system that was based on theft, to help the people?  Those are hard things to realise, because we make that system stronger by thinking we're doing good in that system that is based on theft.

So, even when you see political campaigns, who gets elected, when they're essentially telling you a lie that they can solve it through more theft; who gets elected?  And you can see your entire world through that system and you can see the emergent behaviour of society would get worse and worse, and it be a mirror reflection back to us.  That's what's happening to the world right now in the existing system.

Peter McCormack: Do you think this is reflected by the tension in the world?

Jeff Booth: This is a natural -- we are all connected.  That information connects us all, that information in money.  It's just the trust in money that connects us all, all over the world.  So, if you have theft in it, then we have to be disconnected.  So if you looked at the biggest cities in the world, with trust essentially link together more minds and they create more ideas, and more people move to the city because there's more going on.  And those ideas actually change our world.

Then, if you look at the power loss in the smaller cities and in towns, less ideas in smaller cities, less ideas in smaller towns.  And so, you have these cities emerging; Silicon Valley is a good example.  Mass of talent moving in, mass of change-the-world-type technologies coming out of that area, because all of those minds link together and they form a supercomputer, they're linked together through trust, and those ideas spread and we build upon those ideas.  And we see that one plus that one plus that one, and this person over here; we create something incredible.

Now, look at what happens in giant cities without trust; the supercomputer breaks down.  The linking of that supercomputer is through money, that information exchange.  And if you break that, the supercomputer breaks.  So, what's happening today is that used to happen.  On one level, it used to happen in cities, and those cities needed to have centralised power on a grid system to be able to run those cities.  Those cities need to centralise farming to be able to bring more goods to the cities, and energy and phone lines and technology.  And so it fed back on itself.

What you see today is, now energy through Bitcoin mining can move to the stranded energy anywhere in the world.  You can do a Starlink satellite and you can be connected in the globe anywhere in the world and decentralise yourself from that, and still have the same access to the world.  That's profound changes for that centralisation of structure.  Centralisation of structure, including government, to be able to make sure that whole thing worked and centralised, did provide those cities with enormous growth in their economies. 

But now you're moving into this world where what should be happening is the prices should be declining so fast because of the productivity gains, and they should be flowing to society, but they're not, they're captured.  And that capturing removes the trust and it centralises everything and it keeps on centralising into the existing system and it gets worse and worse and worse.  That means, the existing system, because it's built on theft, has to drive more and more coercion and control into the existing system, and there's no fix, so there's no way out.

There's door one: let the whole thing burn down to the ground, because we assume money is our money, but it's actually a credit note.  So, if you allow deflation to actually happen from that system, everything just fails, including all the banks; everything fails.  And if you drive inflation, if you drive more theft into money, it breaks in a different way.  We just divide apart, because our labour and our purchasing is unified.  Think about your iPhone and where all those parts come from; it's connected to labour all around the world.

Peter McCormack: Okay, so how does an alternate system work if you cannot have theft?  And I'm not saying that as though somebody said, "I think we should have theft", but what is this alternate design system; I know it's based on Bitcoin?

Jeff Booth: And that's where now, if you connect that article, and maybe Danny can pull up that piece; but as Danny pulls up that piece, if you look at from a design perspective, if money has to have theft, how does the whole system work over time?

Bitcoin is the first thing that's decentralised and secure by design.  It's the first time in human history that decentralisation and security happen by design.  So, if you just go look back at human history, it means all of our models going back in human history are based on a flawed design that would repeat throughout time, and we would be looking through the lens of history thinking, "That's the right answer, that's the right answer", but it couldn't be perfect because our money was never perfect; it was never decentralised and secure.

So, what ends up happening through history is you would have money that would be stable for a time and then it would be abused.  And that abuse would take people through the same type of debt cycle, people would drive inflation into currency and you would destroy it and you would go to war.

Peter McCormack: Because centralisation breeds incentives.

Jeff Booth: Because centralisation breeds incentives.  And throughout history, you saw the same thing happening, whether it was on gold because gold had to be centralised and then you'd build a credit system on top of gold.  And that credit system would have incentives in it that the bank that levered gold more would make more money, so other banks would follow and lever gold more.  And people would race into that for leverage because they would make more money on the leverage.  The leverage would unwind and cause a centralising function because the government had to make the banks whole to save the economy.  And so, you just moved the debt up the stack until the debt couldn't be repaid up at the top of the stack, and then you went to global war because that couldn't be repaired.

We're somewhere in that cycle right now in the existing market, and we go to war because our governments convince us it's not our fault, it's those people's fault over there.  And it's really easy to believe there's a person or a group of people that are responsible, rather than a system effect.  So, if you look through that lens of history, the strongest markets, because of that trust, that supercomputer, the strongest markets were always free markets.  We know, through communism, that centralising function can't see all the ideas of a free market, so it must make choices that lower living standards for that control.  That's what centralisation does.  If anybody listening to this has ever worked in a giant company, nothing really gets done.

Peter McCormack: Diseconomies of scale.

Jeff Booth: Exactly.  It centralises and then it turns against itself because you can't see all the ideas through the centralisation.  It's the same thing in an economy.  So free markets worked better, the whole US system was built on a free market that actually worked far better for a long time, and it was encoded in the Bill of Rights Constitution, and the same with the Magna Carta.

Peter McCormack: So, correct me if I'm wrong here, you might not know this, but the kind of laissez-faire economy of post-Soviet Russia did fail and that was more a free market economy.  Why did that fail?

Jeff Booth: So, in this, there are a bunch -- to be able to build that over time takes -- you can't just flick a switch, especially with the global coordination of this.  Essentially, you're globally coordinating labour all over the world for a globally connected world to work, this supercomputer to work.  And that supercomputer could be hacked if you controlled the money; you could hurt other countries so their labour isn't globally connected.  You could impose your pain on other countries.  And so a bunch of these are the game behind the game around money.

Peter McCormack: I'd have to go back and check this and check if I'm right, but I did try to have a look at what happened in post-Soviet Russia, and essentially they encouraged a kind of laissez-faire, free market economy.  But that actually led to concentrations of wealth because people were so poor at the time, it was essentially almost like oligarchs who had lots of money and they were --

Jeff Booth: They picked the people who said, "Here, you can privatise this industry".

Peter McCormack: No, prior to the oligarchs and privatisation of industry, it was essentially the people who just had capital.  People were so poor and hungry, they had to sell everything they had just to be able to feed themselves, and that's just concentrations of money.  Was there a redistribution method?

Jeff Booth: So, let's get here because again, looking through the lens of history without this innovation would lead to a whole bunch of thinking we knew the right answer and everything else, but it wouldn't be the right answer because we never had something that was decentralised and secure.  So, let's just keep going on this.

So, what did societies do to protect their own rights from the state getting too big and centralising; what did they do?  Magna Carta, Constitution, Bill of Rights, a whole bunch of essentially laws enshrined in doctrines that said, "We, the people, control the state", not the other way around.  Where that happened, because now you had more ideas competing, those were the strongest economies and they grew the fastest, because you had more ideas. 

But what ends up happening over time is because money is more powerful than laws, and as you make more money or as you drive more money, then the laws are changed for more money, and if you have inflation built into your system, then the wealthy get wealthier and wealthier instead of prices falling; you actually create this massive monopoly of power that changes laws to favour themselves.  It's not a capitalist system, we don't actually know what a capitalist system is based on that.  The word is misused, because if money has a theft in it, that will happen; and because money is more powerful, the laws get changed for the money.

Peter McCormack: So, if we've never had a capitalist system, are we essentially theorising what a capitalist system will do; and that is another test?

Jeff Booth: All of these naming conventions -- democracy is a naming convention.  So, these are hard things to actually face because they force us down to a layer that we have to break apart what we believed all the time was true. 

Peter McCormack: But this is a good thing to do, Jeff, I always want to do this, I want to question this because I don't want to just sit there and say, "Bitcoin fixes everything, so therefore once we get to hyperbitcoinisation, everything's going to be great".

Jeff Booth: That's why this is important; that's why these are really important questions.  By the way, I believe it does.  But how it does and why I understand that belief would be hard to get to for people is because they're bringing the baggage from their existing system into the new system.

Peter McCormack: But if we can do that, we should drive higher, faster adoption of Bitcoin, which means we should get to the point where these problems are fixed sooner.  So, there's an incentive structure to be able to communicate why this is a better system to people.

Jeff Booth: It's what you do on your show, and many others do, by bringing in different minds and looking at it.  But what I would say is, what's happening is people are taking their view of this new system, which is a fractal pattern, from their view of the existing system and what they want the new system to be, rather than intuiting what this new system will be with different incentives and different behaviour.  And that creates a lot of noise around the new system, especially if you have misinformation expanding at an exponential rate in money and everybody was looking through that misinformation, you'd expect that essentially vortex of people yelling at each other; you'd expect it to get way worse.

Peter McCormack: So, you're saying that you believe it fixes it, whereas I'm in a position where I'm thinking, "I can see a bunch of stuff I think it fixes but I'm a bit unsure on how we get there, how we communicate it, what the path is, what happens during that journey, and we're going to be sacrificing a lot to go on this journey".  It's still a theory; there's no proven model where a decentralised currency makes the world a net better place, we just don't know.  So you're there; how did you get there?

Jeff Booth: What you just asked, in theory, or I think it's fair to say, it presupposes that the existing system will work.  So, I would first say, "What alternative is there; and find me a better alternative?"

Peter McCormack: So, one alternative is carry on as we are, which is clearly very broken, we couldn't have that.

Jeff Booth: We require theft in money.  That theft in money will divide us all and that theft in money will take us likely to war and maybe the end of human species as a result of that theft in money.  That's actually where we are.  Or, it will concentrate all control in very few super-overlords, and the rest of us, it will look like modern-day slavery, it will look like China's social credit system on steroids, and it will just keep going there because you've allowed theft in money to exponentially increase; you're trying to make prices go up forever because of theft in money, when the natural rate of technology should be benefiting all of us, prices should fall and our time should be saved.

Peter McCormack: So, an alternative requires a new money?

Jeff Booth: There is no fix for the existing system; correct?

Peter McCormack: Yes.

Jeff Booth: So, what type of system would be hard enough, would be so violent against that system, that would get harder and harder, that would be outside that system and take away from all of the control functions and all of the vested interest of that system, and not allow any human to change it?

Peter McCormack: You're talking about Dentacoin, aren't you?!  Yeah, okay, yeah.

Jeff Booth: So that's why I wanted to put the Blockchain Trilemma out, I wanted to walk through that.  So, when you understand that decentralised security in a market that, if you look back at information, people are just trying to get out of that system; they know the system's bad, they're trying to make enough money for their own families to be able to get out of that system, to retire, to save enough money, and that system is making them worse and worse and creating more misinformation, and they've been looking through that misinformation, and now you have this Bitcoin, which is the first time in history that you didn't have to trust an institution --

Peter McCormack: It removes the theft?

Jeff Booth: It removes the theft, the decentralisation and security.  If it was true that it was decentralised and secure forever, then it's the first time in history that you didn't have to trust an institution which could get co-opted by money, for trust; you could trust code.  The first time in history, big deal, if that was true.  So, when I went down to the sand, I wanted to test, "Is that true?" and I explain deeper on why that's true.

Out of that, from this system you could predict what market forces would do.  That system, because it's open-source code and it's decentralised and secure, would create a whole bunch of competition, because it monetised from zero to $60,000 and back down to $16,000 today, but it monetised from zero to creating a lot of wealth for a lot of people that were early on this system.  So, what it would naturally do in a system where people were trying to escape a system that was causing pain, and something was growing so fast and creating untold wealth for people, it would create a whole bunch of copycats to try to create the same thing; it would create a whole bunch of noise to be able to do that.

So let's just go through what that that noise would look like.  First, if I could just cut over this same open-source coin and create new coin, Dogecoin, just fork out and create a new one, if I could do that then I could say to a lot of people, "These people made a bunch of money on this.  I can make more money".  Now let's ask the next question.  A copy of the original design would have the exact same utility of the original design with less decentralisation and security, it must.  So it's a shorter chain, it must have less compute power protecting it, it must be less decentralised as a shorter chain, it has no more utility.

Peter McCormack: And its ability to catch up --

Jeff Booth: It can't.  So the network effect of the main chain gets stronger and stronger and, yes, you create short term a bunch of profits if you were the holder of this new coin, by convincing a whole bunch of other people who didn't know the innovation here to go into your thing before it went to zero, but it goes to zero.  So, that's one alternative.

Then, because you can only choose two or three sides of a blockchain, ironically Vitalik came up with the blockchain trilemma to convince people about Ethereum, when he himself missed what it actually meant; the crazy irony.  So, the Blockchain trilemma says you can only solve two sides of a blockchain.  So, Bitcoin solved decentralisation and security forever, first time in history.  And so to be able to compete on it, you couldn't compete for a long time just building a new Bitcoin --

Peter McCormack: Oh, you're basically saying to pick two?

Jeff Booth: Pick two.

Peter McCormack: So, Ethereum picked scalability --

Jeff Booth: Yeah, so let's go through the two.  So Bitcoin, 5 to 7 seconds transaction on base level.  So everybody that talked about Bitcoin, old tech, they couldn't be more secure and decentralised, so they had to sacrifice something else.  Let's say Solana: you sacrifice security.  A blockchain that is insecure inherently has to fail.

Peter McCormack: Yes.

Jeff Booth: Okay, so that has to be pretty easy to most people.  I'm surprised, because there are a whole bunch of blockchains that are completely insecure that people gamble on, but they all go to zero.  But you can see, if people thought this wasn't an innovation as sound as this is and they thought it was just a money-making scheme, a whole bunch of bad actors from this system would race in to make a bunch more money.  So, it has to be, by design, insecure.  Or, I choose scalability and I sacrifice decentralisation, and that's Ethereum and a number of others.

Just by very nature, I can't believe people can't see this.  So, they talk about DeFi on a centralised blockchain!

Peter McCormack: Well, I was having a discussion with people this morning, because when you arrived, I put out a tweet of two years and two months ago where I said, "I trust BlockFi more than smart contracts".  That's an unfortunate tweet, because it managed to piss off everyone, because if you're a bitcoiner, you're pissed off because you don't want to use a centralised service, "Not your keys, not your Bitcoin"; and it pissed off crypto people, because they believe in DeFi.

Jeff Booth: Yeah, but let's use that crypto group for a second.  They're actually saying, "Ethereum is proven completely centralised now, and so are these others".  So, you have a high-cost function that is a blockchain.  Why would you use a centralised blockchain; what economic rationale would you ever use a blockchain for?

Peter McCormack: Because you think it's going to make your more money, it's the only reason.

Jeff Booth: It's the only economic rationale.

Peter McCormack: Nobody's thinking at the levels you're talking about here.  Nobody is thinking about the best money for the world to rebuild the foundations of money, to remove theft from the system, to improve coordination, all these things you've talked about for years; nobody is thinking on that level with Ethereum.  They're thinking of TPS.

Jeff Booth: Yeah, but even so, I'm just saying the economic rationale to use that over long term…  People say, "Web3", they don't know what Web3 means.  They say, "DeFi on top of this", they say, "NFTs on top of this", and here's the problem.  A database is a way more efficient structure for centralisation.  Amazon isn't going to move all its stuff on top of an expensive structure, called Ethereum, to build a Web3, neither is Google.  It's ludicrous because somebody has to pay the more expense, and they have to charge the more expense of the more expensive blockchain.  So, what you understand is, decentralisation or Web3 on top of something that's more expensive and centralised --

Peter McCormack: It's theft.

Jeff Booth: -- it will all go to zero.

Peter McCormack: It's all built on theft, it's built on extraction.

Jeff Booth: Exactly, it's built on extraction.  And it's built on extraction because it's the same model as we have in the fiat system, it's exactly the same model, that the rich get richer inside of that system and they have to centralise more and more.  And as they centralise more and more, they have to cut off certain things from other people.  You have to protect the core and you sacrifice the periphery.  So, that centralisation always produces inferior results over the long term.

But in the short term people think, "Oh, wow, this is growing", and they don't actually understand a network effect.  The definition of a network effect is, "Every additional user makes it better for all users".  Ethereum fails that, because every additional user --

Peter McCormack: Makes it worse.

Jeff Booth: -- makes it weaker for all users.

Peter McCormack: Yeah, because it's more centralised.

Jeff Booth: Because it makes it more centralised.  And over time, that's what ends up happening actually with the US dollar, which experiences really strong network effects for a while; or, it happens with Google, which experiences really strong network effects; or Facebook.  As they get centralised, they have to choose who gets to have voice, who doesn't get to have voice.  And by removing voices as they centralise more and more, their network effect breaks down.

You have something built on Bitcoin that because it's decentralised and secure, the network effect can go on infinity.  Every new user makes the network stronger for all new users.

Peter McCormack: With the blockchain trilemma, how do you layer in additional layers into this?  Because, if you were to say for Ethereum, I say it's certainly gone for scalability, and I can't actually pick what has it sacrificed for that?  Is it decentralisation and security?  I would almost argue both.

Jeff Booth: So, more decentralised, it would be fairly secure.  Now, it gets co-opted by the state because of that centralisation and because it is not --

Peter McCormack: It has a decrease in security.

Danny Knowles: I don't even know if it's achieved scalability.

Peter McCormack: I mean, fair!

Jeff Booth: So, what you would do is you said smart contracts --

Peter McCormack: Sorry, that's what they set out to do.

Jeff Booth: Yeah.  But you said smart contracts and that's a really good example.  By building smart contracts into the base layer, you have to expand the amount of space.  And the amount of space that you have to expand means that as the network expands, the only nodes that can verify the network have to run so high, super-compute, that you couldn't actually have small nodes run the network, so you have to centralise with the most important nodes.  That's why those design choices, around allowing more in the first layer, force centralisation.

Peter McCormack: But so with Bitcoin, it's certainly decentralised, directionally it's the most decentralised blockchain.

Jeff Booth: Yeah, and it's more decentralised today than it was last year; every year, more decentralised, more secure.

Peter McCormack: Yes, it becomes more secure.  But there's an argument it becomes less scalable on the base chain.

Jeff Booth: It is, that is true.

Peter McCormack: So, is this only a blockchain, and because the second layer of the Lightning Network isn't really a blockchain, it's something built on top of the blockchain, it's not part of the blockchain trilemma?

Jeff Booth: This is so important.

Peter McCormack: So for any blockchain to be successful, it has to really focus on decentralisation and security, it has to solve scalability at a high level.  But where I'm going with this is, could it have gone for something else and solved decentralisation at a high level; could it have gone for scalability and decentralisation and solved security at a high level; or does it have to solve decentralisation and security at the base chain?

Jeff Booth: At the base chain, if you want to change money, it has to solve decentralisation and security, otherwise everything relies on institutions that you trust that get co-opted by money, it has to.  That's why it's so unique in time and history because when we read history books, when we read about When Money Dies, when you read all of these, they're flawed because we never had a system that was decentralised and secure at the base.  We always relied on a system that we trusted who was in power and they abused the trust.  The first time in history.

So, if that is true, and people should do their own work whether it is true, but it can't be broken, it cannot be broken.  And I explore deeper why it can't be broken in that article.  Now it looks like instead of what people are comparing it as, they're comparing it as an asset or something like that, or a monetary premium, they're comparing it to gold and other things, and I think it suffices that test, it's a better form of gold; but now, what's happened on top of that, through layers, like the internet is built on layers, you don't know what TCP/IP is.  Nobody thinks about when they're sending their email that the base layer, TCP/IP was invented in the late-1960s by DARPA.  If the base layer failed, everything fails.  We still use that system today and the base layer has to be hardened, it has to be attacked, it has to be all of these things.

So, the base layer of Bitcoin is hardening over time and all of these attacks have crystalised; it's uncompromising.  The uncompromising on Bitcoin is the strength.  So, when people talk about Bitcoin maxis as being uncompromised on five to seven transactions, we will not let block size expand, because it ruins the decentralisation and security.  And to try to change that, it's impossible, because there's a swarm of all these nodes that would never accept a change that would allow that to happen.  And for a long time, that creates an attack vector for all of these other cryptos to say, "It's old tech".

Peter McCormack: But why do you think they don't get it?  Do you think they choose not to get it?

Jeff Booth: Because you can make a lot of money by deceiving people that your thing is new tech.

Peter McCormack: Okay, so the creators of the tech.  But maybe the investors or the buyers of the tech?  I mean, I've seen it today, I see it every day, "You're just a maxi, you're close-minded".  Do you think some people just don't care enough, they don't spend enough time studying money?

Jeff Booth: But again, who wants to every day?

Peter McCormack: That's true.

Jeff Booth: Who wants to think about that every single day.  I'm maybe a little bit crazy!

Peter McCormack: No, but you're right!

Jeff Booth: There are very few people that want to go down to the sand on both different systems.  And then remember, our measurement of a system comes from the system.  So when you say, "It's a theory of a new system", well all growth comes from intuiting what behaviour will look like on something new, and there's no way to measure that; you're predicting it, and you're predicting under different circumstances and different incentives what will change. 

That's what all new businesses do when competing against existing businesses, and I see this all the time in the businesses that I built that created a whole bunch of wealth against an existing system.  When you first go to people and you tell them your idea, they tell you, "Give me the measurement of why your thing will work", because I'm measuring Kodak sales, right.  And you have to predict what people's behavioural change will be on a new system.

Peter McCormack: So, with Bitcoin, we still don't have mass adoption.  We have mass awareness, we have adoption and we have growing adoption.  Do you think the massive growth in adoption will come from educating people of what Bitcoin is and they understand it and make a choice to use it; or, do you think ultimately it will come from the system suddenly growing so fast and everything else failing, they'll be forced into accepting it?

Jeff Booth: Both.

Peter McCormack: Both?  Okay.

Jeff Booth: If you can think about this, many people listen to this show and they go right back into the fiat world for the fiat job and try to make enough money and try to keep that going, and yell at the system.  And they will spend most of the time re-enforcing the system that they hate.

Peter McCormack: It's so funny you should say that, because I am questioning that today.

Jeff Booth: Most of our time -- remember, the existing system we live in, which is just a make-believe world, we allow people to destroy our value, steal our time and we say that's okay, and we make it stronger by voting left or right saying, "This person's going to fix it from the same system [or] this person's going to fix it from the same system"; we make it stronger every day by yelling at it.  If it was working and technology produces abundance everywhere, if it was working then the world would look really different than it does today.  You wouldn't have more and more dictators emerging; you wouldn't have more and more people starving; you wouldn't have the world breaking apart if it was working, by any definition. 

So before, and it's gone way up since I said this, but when you look at the greater system and it's created $185 trillion of debt in 20 years to countereffect what was happening in technology, essentially to try to grow your way out of productivity gains, and not grow your way out, steal from people, because every dollar you created, $1 of GDP gain for every $4 of money that you made up, and it has to get worse and worse.

If the system was producing the right benefit for society you would see it.  It's obviously not and it's getting worse and worse.  So this new system, why people don't see it, the system they live in is four orders of magnitude bigger, not four times bigger, and everything they do is in the existing system.  They spend more and more of their time.  And even on Bedford, you take Bitcoin; I just paid you in Bitcoin.

Peter McCormack: Thank you!

Jeff Booth: But what that says is you're spending more of your time, and even yourself, you're probably spending 25% of your time, into the new system, maybe more for you.  And I'm trying to spend way more of my time and energy building the rails of the new system, funding the entrepreneurs that are building on top of the new system.

Peter McCormack: Well, it's part hedge of the new system.  We have to operate the football club with pounds.  We have to pay our bills in pounds, we have to pay our team in pounds; but I know that everything is changing and I want to own Bitcoin.  So, any Bitcoin we take, we hold that knowing that we've got a foot in the new system.  We can't jump both feet in because it will risk the actual survivability of the club, but we can put a foot in.

Jeff Booth: I've used this example on a couple of podcasts, so sorry for people who've listened to this before, but on a way smaller scale, if you were an executive at Sears from 1995 to 2010 and you were that executive, you would be trying to protect your turf, because stores were the most important and people didn't want to buy online and they wanted to drive to your store.  Because of that, you'd have limited shelf space and you'd have to choose the items that people saw, and you'd think you were right on choosing the items because you never saw what people didn't see because they could only choose on the store.  So, it would feedback on itself and you'd never see what was unseen, and you'd keep on feeding back on that model.  Your world, the same world, would be getting two different views.

Then you were a different executive at Amazon, using technology to solve a problem differently, where you didn't require the store and you could have unlimited shelf space.  And then people could choose actually what they wanted, rather than what was just in the store, and you'd have two different models competing against each other in the same world.  If you were in one system, you saw hope, growth, better future as your business was expanding; and in the other system, you saw getting worse and worse and then failing and filing for bankruptcy. 

That's what's happening today at a way bigger level.  What's happening in Bitcoin is it's early, but people that are in Bitcoin are seeing, and even through the noise of all this crypto crash and everything else, because they're immune from that, completely immune from that; they're in a new system that's building on truth and building hope and abundance for the future, and they're seeing that and they're spending more time in the system, and the more and more people that around them are in that system versus if your frame of reference is the existing world; it's getting worse and worse, and it will get worse.

Peter McCormack: So, it sounds more like you believe we're collapsing into this new system?

Jeff Booth: What's going to happen no matter what, is Bitcoin is going to reprice everything into Bitcoin.  What people are measuring Bitcoin in, and if they are measuring in their own dollars, they're actually using the error code of the manipulated currency to measure the new one; does that make sense?

Peter McCormack: Kind of.

Jeff Booth: So, here's a way to say it.  So, technology should produce falling prices, we know that, and it isn't, or it isn't broadly.  And remember, technology is an energy too.

Peter McCormack: We know it does for TVs.  That's the one I always come back to is TVs.  I just bought the most ridiculous TV in the UK.  We did that interview set, didn't we?  What was it; like 60 inches, high definition, it's 20 times better than the TV I bought four years ago.  It was like £700, or something ridiculous, and the TV I bought two years ago was like £2,000.  I always come back to the TVs.

Jeff Booth: But again, people think that it's only in TVs or electronics.  It's in energy; it's in everything.

Peter McCormack: But we're not seeing it.

Jeff Booth: Why aren't we seeing it?  Because when you have abundance in money, it creates scarcity everywhere.  When you have scarcity in money, it creates abundance everywhere.  And what ends up happening is because you can't print more energy, energy prices just go up in response, where they should be coming down because we find more energy.  We have better ways to explore for energy, we have better fracking in energy, we have more solar in energy.  We find more energy and we have more technology in energy as well, so why aren't energy prices coming down?

Why is a coffee bean 80 times more efficient than it was in 1980, for coffee-growing, distribution of coffee beans, 80 times more efficient?  Why has the price of coffee gone up from 25 cents to what it is now, $4?

Peter McCormack: I mean, I can think of a number of reasons.  Part of the reason we just had with Alex Gladstein discussing the IMF and the World Bank.

Jeff Booth: But that's it, it's because of a system that is designed on theft that has to keep increasing prices, when the natural order thing, nature, us solving problems, and technology is really the wrapper that we're using, we're saying technology is moving fast; but really what we're doing is standing on the shoulders of other people who went before us and solving more problems.  And as we solve the problems, we use the things that better impact our lives, it has to bring down prices.  What's happening is the existing world has to increase prices to keep them going based on that theft. 

So in Bitcoin, it's not Bitcoin price going up.  What it's actually measuring is all prices of everything falling against Bitcoin forever, and it doesn't actually matter how it gets there.  The existing system is going to flail around and some credit is going to be destroyed and they're going to do a massive inflation.  But if you're measuring that system and the noise of the existing system, it's going to feel worse and worse for you and it's going to get really confusing.  And if you're in the new system, you're completely immune from it, you're just building the new future on the new rails.

We didn't really talk about why level 2, layer 3 on protocols, they have to harden.  So Bitcoin on the first layer hardened at the expense of scalability, hardened; and that gave a whole bunch of people an opportunity to create a whole bunch of money by saying their thing was scalable.  And it makes perfect sense in a system that's being manipulated to a whole bunch of grifters, and it's not just grifters, it's other people who actually thought that thing would work and then built businesses, like NFTs, on top of that system of centralisation thinking, "Maybe this will work too", and it confuses more and more people.  But for a while, a bunch of money races there.

Then the money that's racing there, or the exchanges that are racing there, make more money if you have more tokens; they actually get paid more money.  And so the money that they make, they then go and lobby governments to say that Bitcoin and crypto are the same thing.  So, it's coming from a fraud, and more and more race into that because we chase money.  The money comes from the non-profits who say, "Wow, this crypto investor is going to invest in me, that's a really good thing", and they're sponsoring all these -- for a while it looks really strong, until it all unwinds, because it was never decentralised and secure on the base layer.

Well, Lightning comes in on the second layer.  And now, as Lightning comes in on the second layer, now you can transact in this pristine bearer asset on the first layer, global neutral reserve currency on the first layer that nobody can stop, that provides complete trust in that decentralisation and security.  Now you can start transacting on the second layer.  Transacting on the second layer costs a fraction of a penny when you transact and it's limitless.  It means that you can have velocity in money without having debt expansion.  You can have unlimited velocity in the technology, it doesn't have to be backed by anything; it is backed by energy and that security of the network.

Now you can add unlimited velocity and trade between people, which is all money really allows you to do, trade between anybody in a fraction of a second, globally, and transfer value.  And as you're doing that, it builds a really powerful network effect, because the people that are doing it earlier are essentially saving 2.5% credit card fees and other fees, and the people that are spending in that are creating this system which brings more and more people on.  What you're doing by accepting Bitcoin is bringing more and more people on. 

Then another business says, "Wow, that football club doing Bitcoin is actually blowing things away.  I'm going to accept Bitcoin too and I'm going to reduce my fees and increase my profitability.  Then I might even offer an incentive for somebody else to pay in Bitcoin, because I make more money.  We can share that", and the network gets stronger.  And every single person that does that makes the network stronger for every other person.

Then entrepreneurs see that and they say, "I can build something on top of this network that builds a future", and I do understand that if you're not looking at this through this protocol layer, and you're looking at the historic what Bitcoin was, you might not see all of the stuff that's coming, just like I didn't see the iPhone before the iPhone was in my hands.  You might be looking back on the technology revolution that's coming, you might miss that this is a new peer-to-peer internet that's emerging and it changes everything, because you're looking historically at what it was, or what the sideshow of this crypto thing was.

Peter McCormack: So how do you take people from a point of -- you know, I always think, "How do I communicate this to my family, to my friends?"  They all know I've got this Bitcoin podcast, they all know it's one of the biggest there is.  I'd be surprised if any of them listen to more than one episode a year or a couple a year; they don't!  They ask me about Bitcoin, I tell them, they don't care.  It's so hard.  Yet they see I dedicate my life to this, I travel round the world and work on it.  How do we take people from that point and say, "Look, you really need to spend time looking at this, understanding this"?

Jeff Booth: You first ask them why they believe that theft is required in money.  And if they do believe that, first they'll say theft is a strong word.

Peter McCormack: It's come out, hasn't it?  You always ask me this; he asks in a different way, doesn't he?  He asks, "Do you believe coercion is okay?"

Danny Knowles: Like first principles, yeah.

Peter McCormack: First principles, "Do you believe that coercion is fine?"

Danny Knowles: I think getting people to even acknowledge that inflation is theft, even that's a hurdle, I think.

Peter McCormack: You have to explain why it's theft.

Jeff Booth: Or instead of explaining, ask them the question; ask five whys after that.  Ask them a question, "Why is inflation required for a productive economy?" and just listen to their answer.  Their answer will be something like, "Well, velocity in money is required", because that is true, "But why is debt required for velocity of money?"  And as they break down their own belief structure in the first principles, at the bottom of five whys, they'll come to the same conclusion that, "Okay, we have a money based on theft". 

If we have a money based on theft, ask them, "What would the emergent complex behaviour of society look like with money based on theft?  Would it be a mirror image of what we see today; and who would win from that; who would lose from that?  Does a media sitting on top of that win from that or lose from that?  The richest players in the world, why would they be so anti-Bitcoin if you're a beneficiary of the existing system?"  Then you might be able to move them over to understanding, or at least looking at why an alternative is important.

Peter McCormack: Is there any part of this that we look at this through the lens of US monetary policy and US global reserve status and see the absolute abuse of the system, at both an international level and a domestic level?  I would imagine, well I know some guy wrote to me recently and he said, "Norway has a very good functioning society and economy, it is high tax, but it has very good social services, it has very good education, very good health, very good pension support, high standard of living".

Jeff Booth: Did you ask him why?

Peter McCormack: No, just the email came through.  But the email came through in response to one where I'd said previously, "I'm a fan of smaller government.  I believe smaller government, lower tax, more productive society" and he just wanted to counter that and said, "I believe in a higher tax because I believe in a safer, better coordinated society".  I haven't got into the debate with him.

Jeff Booth: Really what his belief structure is based on is Norway's rich in oil, and because they're rich in oil and they're tied into the US reserve system of oil.  So his belief structure is based on a system --

Peter McCormack: Half a story.

Jeff Booth: Half a story.  And I understand why, because he grew up in that belief system and everything else, but that example, he can't see how that system has to steal money from other people, other countries, to keep him in his standard of living.

Peter McCormack: So, that's the added layer based on the discussion we've had with Alex Gladstein today.  Is this going to come out before Alex?

Danny Knowles: Way before, yeah.

Peter McCormack: Okay.  So, we did an interview today with Alex Gladstein.  I'm just going to tell a small amount, but it's looking at how imperialism has essentially become economic imperialism; previously political and territorial imperialism has become economic imperialism.  So, what you're really saying there is that some of the benefits that we've had have come from the fact that we've extracted wealth and resources from poorer countries?

Jeff Booth: Yeah, it has to.

Peter McCormack: Yeah, and again that's a new layer I wouldn't have had until I had that conversation with Alex today, and it changes the picture again.  Okay, so just thinking forward, you've obviously thought about this a lot.

Jeff Booth: A lot.

Peter McCormack: You know one thing I think about is, what is the structure of society, how does society coordinate and operate in these new systems?  I am not somebody who votes democracy because I want to suck on the teat of the government, I believe the government is great; just when I've rationally gone through every form of governance, I've come to the conclusion that there will always be hierarchies.  We have a range of hierarchies now from full dictatorships to western liberal democracies to halfway houses.

I would hate to burn down one system to be replaced by something worse.  I would hate to burn down a western liberal democracy and it evolves into a horrible dictatorship.  I don't know what comes.  Based on what you're imagining, how do you see governance and structure in society coordinate?

Jeff Booth: What I would say is, you step on landmines often because of that and so do many other bitcoiners and many other people because our frameworks for what we call a democracy, what we call capitalism, what we call communism, what we call libertarianism, our frameworks, western liberal democracy, are actually all wrong because we've never had a decentralised, secure --

Peter McCormack: That's fair.  What do you mean by, "Step on landmines?"  Do you mean make mistakes?

Jeff Booth: When I say you'll contribute to conversation that will polarise a different group, because that group is looking at it through their framework and they believe their own framework because something in the past is the right one.

Peter McCormack: Okay, I get it.

Jeff Booth: So it just polarises everyone.  We don't actually have a word for what this will look like yet.

Peter McCormack: By the way, I believe I have a responsibility to stand on landmines all the time.  For every person who says, "He's an idiot", there's a group of people who also say, "I agree with him" or, "I want to have that discussed".  The role of this is that we step on landmines and have these conversations.

Jeff Booth: So I love that, so let's go through some of those.  Let's say a western liberal democracy, you believe in that structure.

Peter McCormack: I believe it's the best we have.

Jeff Booth: Okay, but in a western liberal democracy that inflation is most of government's revenue and you don't have a vote on inflation, do you have a vote that counts?

Peter McCormack: Yes, I believe I do.

Jeff Booth: But explain that; how?

Peter McCormack: I believe I have a shitty vote whereby I cannot change that one thing that you said there, but I have a vote that does drive -- I believe I have a vote that maintains and keeps us away from being a dictatorship.

Jeff Booth: Okay, I disagree with you and here's why I disagree with you.

Peter McCormack: Okay.

Jeff Booth: If that rate of theft has to increase, what ends up happening at the next stage of that is you turn into a dictatorship.  You turn into a dictatorship because people are so hurting from that, they vote to remove their individual rights and freedoms --

Peter McCormack: Yes, which we're seeing.

Jeff Booth: -- with a dictator that tells them it's a different person's fault.

Peter McCormack: But we do have, I can go down to London and I can protest, openly and freely in front of Downing Street, in front of government, in front of Whitehall.

Jeff Booth: You could do that in Germany too, pre the 1930s.

Peter McCormack: Of course, but at the moment I do have that ability.  I don't have that ability in China at the moment; I'd be thrown in jail.  And I do have that ability and if it gets too bad, maybe you can stir up a revolution, maybe you can fight back.  What I'm saying is, I think our democracy is shit, but it's better than a lot of what people around the world have.

Jeff Booth: So all that's happening -- and I don't disagree with all around the world, these authoritarian states that actually are empowered by the way that we connect business, they're empowered by that, because you create this, and Alex would have talked about this, by protecting the core, and you drive destitution and you're robbing other societies.  Then you're actually funnelling money into the dictator to be able to control their societies.  So, when you look around the other parts of the world and you realise it's actually the opposing image of what you believe you have --

Peter McCormack: Yeah, that's fair.

Jeff Booth: Because it's all based on a theft.

Peter McCormack: That's fair, yeah.

Jeff Booth: So now, keep going on that and keep going inside your country, and you realise that 2% theft isn't enough anymore and maybe people didn't notice 2% theft.  It's like somebody walking into your house and stealing 2% of your stuff; you didn't really notice.

Peter McCormack: Well, it's insidious.

Jeff Booth: Yeah, but it happened every year, more and more stuff, and maybe some of the people could escape and they could make more than the 2%.

Peter McCormack: Well, I think we were gaslighted into believing inflation was part of a growing economy.

Jeff Booth: Yeah, but again, based on theft.  And then it can't be 2% anymore, it has to be 3%, then it has to be 4%, then it has to be 10%.  Then at 10% or 15%, you start noticing, "A lot of my stuff is missing out of my house; what happened?" and you vote for somebody who will say, "I'm going to fix the system".  What they do is typically they tell you they're going to fix the system from the same system, and they take more control, they take away your individual rights and freedoms, like you saw in Nazi Germany, like you see in any system that's based on theft, it has to get worse and worse.

So, the mirage of the liberal democracy is something that, and I even hate saying this, but it was based on a time window where it didn't look as bad as it looks, and that time window gets worse and worse.  And so, when you say, "I believe in something", it was based on a time window of less theft when we benefited from it.  It still had massive repercussions for other nations in the world, but when we benefited from it.  And now it has more and more theft, all you're doing is mistaken where it goes.  You're not looking at the change in human nature and how we all will vote away our individual rights and freedoms.

Even if you look at Trump versus Biden and the Capitol Hill, what happened on 6 January.  If Trump stayed in, do you think laws would have changed to protect him?

Peter McCormack: Of course.

Jeff Booth: Of course.  Do you think people would have voted to allow those laws to change?

Peter McCormack: Of course.

Jeff Booth: Of course.  So, we're susceptible in people telling us that they can fix it and removing our rights and freedoms as a result.  And if you have a system based on that, then the money and the power of the system make us more susceptible and many people will race to that system and see themselves as avenging the right path at the expense of all the other people that are bad, and that's where these things break down.  So, the words we have to describe what this will look like are based on structures that couldn't actually function properly, couldn't allow the abundance gained from technology to be able to flow to people all over the world.

Peter McCormack: Jeff, this is probably the fourth time we've done this, fifth time, and previously you and I have made shows, the first one I think was just based on your book on deflation and why deflation's bad, and gradually layered in more Bitcoin and more money.  I don't think we've ever covered the political layer to this extent.  Is this something you've connected the dots with recently?

Jeff Booth: No, always.

Peter McCormack: It was always there?

Jeff Booth: Yeah.

Peter McCormack: Yeah, because I think in some ways, I've fought the battles of trying to defend democracy, or being a statist cuck, all that stuff over and over again.  But I don't know about you, Danny, but this is the best explanation I've had?

Danny Knowles: It's very good, yeah.

Peter McCormack: Yeah, it's the most compelling argument I've had of why --

Danny Knowles: Why your vote doesn't matter.

Peter McCormack: -- your vote doesn't matter.  And I kind of know it does and it doesn't matter.  But ultimately, it doesn't matter.  It's the best argument I've heard so far.  So, what now?  Are we voting orange?

Jeff Booth: So, this new framework, we're making -- so again, you have two systems.  One is based on a lie and one is based on truth.  We know that's true and anybody could audit this system, run their own node and see that this one's based on truth, and anybody could; I do, you do.  Running your own node is actually seeing that and it's open-source and anybody could see it's based on truth, and everybody can see this one's based on a lie.

What would the emergent society look like if you had something based on truth versus something based on a lie?  What you'll see is this one's early, it's really early, but why it's so hopeful is because the people that are seeing that are building on top of it.

Peter McCormack: And they're building together collaboratively; we're not enemies.

Jeff Booth: We're building together, we're connected.  Every person all over the world is connected and they are connected through a base layer of truth.  What would society look like?  It's incredible.  Then that path produces constant falling prices, but government gets smaller as a result, because the only government that actually succeeds tells you the truth instead of a lie.

Peter McCormack: And also, if you or I travel to anywhere in the world, literally anywhere in the world, and any major city, you put out on Twitter, "I'm in such-and-such a bar tonight, any bitcoiners want to hang out?" and 10, 15 people come down.  Even if outside of Bitcoin you have a complete different personality, you know that you can sit there and talk all night and you will be on the same page, on the same goal, on the same mission. 

I don't think shitcoiners really have that.  I don't imagine ETH people say, "Any Ether's here?" or PulseChain or Dentacoin people get together and they're all on that same page; I think they just hang out.  But there is that kind of unifying mission where you know, even if you don't 100% agree on certain Bitcoin issues, you're kind of 85% there with each other.

Jeff Booth: And when you're in that, again, when you have a framework around a bunch of people that feel like that and they're hopeful in building the future of the world, and then more and more people are -- because it's hard to understand at the base level.  Remember, we experience the base level through abstraction levels of products designed on top.  So, our houses on top of the existing fiat system, we think they're going up in price and we want to buy more houses to protect ourselves from money, when actually it's the currency going down.

But we experience the value on top of there and it's so early, and what's happening is products are built on top of Bitcoin because it had to harden first, and this comes in layers.  So, the value that's coming to society through the products and the type of technology that is going to bring immense value to society, they won't think about Bitcoin at the core, they won't need to learn everything that we're talking about at the base layer.  They'll just be experiencing value on things that give them tons of value on something based on truth.  It will seem similar to what ended up in…

If you were in 1985 and you looked at the technology today, you would actually consider the technology today magic.  There's no way you could comprehend what we have today, what we take for granted today.  In 1985, you would consider it magic.  If somebody said what we just take for granted today, it's just natural, you'd sit and think, "What are they on?"

Now playout what's happening on Bitcoin.  If people actually understood what's coming on this, it's going to be magic.  That transition is going to be, because people are going to be in the system and they're going to have a frame of reference of this system and everything in this system.  Then the longer they live in this system and spend all their time in this system, they're going to be yelling at the clouds, they're going to be marching, there's going to be proxy wars, it's going to get really ugly over this system.

Peter McCormack: It already is.

Jeff Booth: Yeah, but it gets a lot worse.  I wish it didn't, but it gets a lot worse.  And in the new system, it's based on truth, it gets a lot better; it's really exciting.

Peter McCormack: I think this is like, I don't want to be hyperbolic, but one of the most important conversations I've had in a long time, because the frame of reference for this, you've just put it in a way that nobody's ever done for me in the past.  It's almost like I've had all the different clues and had different conversations, but to wrap this in, especially after doing the Alex Gladstein interview, there's a lot to think about with this.

Jeff Booth: It connects some of the things I didn't know when I talked to Alex lots on this.  But if you actually connect just what naturally happens, now you have decentralisation, you have energy decentralisation, satellite communication where you could be anywhere in the world and you can plug into a global network of mines building the future of the world from anywhere.  That could be an island nation, that could be El Salvador, that could be anywhere in the world and it's moving faster and faster.  What will happen with labour?  If I could hire somebody in Nigeria and I could pay them in Bitcoin, and I could pay them in Bitcoin for one-tenth of what I paid here and they were better, wouldn't I do that?

Peter McCormack: Of course.

Jeff Booth: And they're connected.  So, what ends up happening is their labour rates go up because of the competition in force.

Peter McCormack: So, it's going to be a leveller.

Jeff Booth: It's going to be a leveller all over the world.  So, it's just in that transition from one system to another.  I think where people get stuck on this is they want their thing to win right now and they think of it as a light switch, and it's a transition, it's a bridge to the other side.  It's creating a bridge and yes, if you're early in it, if you're early in Bitcoin, you'll create more of the wealth in Bitcoin, but it gives you no more power in this system.  And as you spend your Bitcoin, you'll distribute your Bitcoin.

There's one thing I often hear, which is interesting.  So, if wages are sticky, then wages being sticky is the thing that allows inflation to work, because people don't ask for wage increases as fast as inflation is going up and it means they're getting paid less in real terms.  That's a well-known economic fact throughout time.  So, if wages are sticky and you had the exact inverse of the model you had today and prices declined, we know wages are sticky, that means the middle class and poor are getting wealthier, because wages aren't going down as fast as technology is creating that abundance.  So, you have the exact inverse of what's happening today in the world healing the world.  And that transition from one system to another system is super-powerful.

Peter McCormack: Healing the world.  I need to go have a think about this one, Danny.  Yeah, Jeff, it's amazing, it always is when I talk to you.  That's two really important interviews in one day, on an important day where other weird stuff's been going on that make me just go and ponder about a few things.  Is there anything we've not covered?

Jeff Booth: I don't think so, this is great.  But if we haven't, we can do it again!

Peter McCormack: Well, we're planning a Canada trip, we're planning our first Canada trip.

Danny Knowles: Yeah, next year.

Peter McCormack: Yeah, so we will let you know about that.  Have you ever been to Canada?

Danny Knowles: Not since I was a kid, so I don't really remember it.

Peter McCormack: Yeah, it's great.  All right, anywhere you want us to send people?  Ego Death?

Jeff Booth: Ego Death, if you're a venture company or if you're a company building on top of Lightning or in the Bitcoin space, we want to hear from you.

Peter McCormack: All right, okay, we'll put that in the show notes.  Jeff, honestly, always a pleasure and a lot to think about with this.  Thank you.

Jeff Booth: Thank you.