It seems there are patterns within patterns here Liquid is not all that liquid, people might even want it more when main chain fees are so high and people want to stack, save and not spend. There might end up being different prices for bitcoin. New layer twos are all the rage and we are going to need a while universe of options in this next bull market.
Bitcoiners have learnt the power of money, yet often in their daily lives they struggle to accumulate fiat. It could be ironic or reasoned, I don't know, but a good friend who is into bitcoin but also still holds on to what he himself will call "shitcoins" discussed this topic at some depth.
Money still sadly provides some signal in the fiat world, though this is degraded and distorted and often leading to destruction it is still useful for bitcoin maxi's to see these things during the transition. We can take the good parts out, use the bad currents to the advantage of the good and accelerate what we are trying to create. It is confusing as hell and that is why for many it is best to just phase out altcoins and fiat all together, but never fear! we will dive in.
It can be hard to create value in bitcoin only, not many people want to give you their bitcoin honestly, because they know what it is truely worth. So many of us need to earn fiat so that we can accumulate bitcoin.
One prime example of fiat money making is in the cryptocurrency scene. Often from a bitcoiners perspective it is completely subsumed to the forces of fiat. My friend (who has some crypto) explained that their meetups are more popular at the moment. This is even during the start of an exciting bull market where bitcoin has already outperformed riskier altcoins. Their meetups attract 10x the audience. So we want to figure out why? It seems it could be more than flashy marketing and promises of great returns.
As "decentralisation maximalists" and "bitcoin maximalists" the key differences in the behaviour of crypto and etherium type groups and to the "bitcoin only" type groups that we saw were:
1. Short term profits and saying YES to yield
2. Young people attending and today love
3. External focus, to much introspection creates division in a group
4. Starting with an open mind, all crypto is good crypto
So in the interest of promoting "bitcoin only" experiences let go through it point by point.
1. Time preference has a limit, being to longterm focused can scare off many people, it can also prevent action and we need action to have long term benefits. So where crypto groups encourage action with the promise of gains, championing yields, bitcoin groups have encouraged stacking and care, demonising yield in most forms and this has been at the cost of action. If there is nothing to do but wait, why even come to a meetup, its a security risk. I propose that ACTION can be the new bitcoin YEILD. Where our actions, though they may not turn to bitcoin immediately, will create value able intangible infrastructure and trust, and we should work on this with pace and intensity.
2. Having a positive mental outlook on life is important, bitcoiners often like to wax on about doomsday scenarios and how kids these days don't know how to live, music is not what it used to be. Nobody wants to be around people continuously whining, Instead I propose we focus on our achievements, how good we have it since finding bitcoin and how optimistic the future is for us with all the cool things that we do. The youth are great bitcoiners with potential to be the greatest and today and everyday we have is an honour live through. We have sacrificed, and we will continue to have temperance but at the same time we need to live our lives to the fullest now, leading by example and embracing our youth. We are all younger than our oppressors and isn't that fun, we are winning so well.
3. The ponzi nature of cryptocurrencies forces an external focus. This is because you need to find new people to feed the beast, exisiting people often find out what is going on, don't like it and then are of no value, even negative value, they are often ignored ghosted. Conversely in bitcoin circle introspection is common, all the way down, you can spend a lot of time doing this and it is valuable, we are kind of doing it here, but there is a limit. It comes at the cost of other things. Further to this loss of time we can't be perfect and can always find little issues with each-other, these things are often pointless and isolating. Too much introspection ends up making us worse.
Analysing ourselves, each others and different companies and groups bitcoin purity levels comes from a good place of "don't trust verify" but makes new relationships hard to establish. To grow the group we need to trust that new members will be good and will be made good just by being with us. If we have the right foundation the more people we bring in the better and they will find their way naturally without lecturing. Evidence suggests that bitcoin makes people naturally introspect to a level that creates good outcomes and that we just need to bring people to the school.
4. In bitcoin maximalism its easy to get clear on what is good and bad and then let people know, it's called getting toxic. It is a great feeling because it is so decisive and provides a clear course of action. At the same time we are innovating so need to embrace the unknown and the new. Having an open mind exposes you to scams, which is dangerous, it exposes your stack, but at the same time as a group it exposes you to new information and ideas.
Even if these ideas are misdirected they provide insight into how people are thinking. This is important if you are growing a group. A lot of people have been burnt by scams, but now, we are not as vulnerable to ideas as we may think. As cypto people start coming back to bitcoin and new people start looking at crypto and experimenting with things we know are hazardous we can have an open mind. Many people take that path and learn the hard way and for some that may be the only way they can get to bitcoin maximalism. So it's ok we can't protect them. We can learn a lot from this and we can help them by prioritising growth of the group.
More people will benefit in then end and our group will get bigger, which in the end is more valuable than one small toxic lesson. We can learn something from shitcoiners, they have built large groups. If we can learn how to negotiate these four factors well it will help bitcoiners who have fallen all the way into the bitcoin maxi rabbit hole. With larger groups bitcoin only people will have the infrastructure to make fiat money, which so it turns out at the moment, ironically makes better bitcoiners, because they will stack more!
In the name of action and at the risk of ostracism I'm listening for fiat signals now.
We have to push back against the political wordsmiths. Using the term inflation to describe this money phenomenon is a sham that favours the money printers. in the past people have used the words strengthening and dilution and I think this is much better.
Inflation implies that what goes in (the money printing) is not material and that the surface is what is of importance. I don't think that this balloon analogy relates to reality. You could say in this image the surface was the market of prices, but the market is influenced of the whole of the money supply.
Deflation also, is such a deflating word, no wonder they picked it, they want it to make you feel sad. The terms have been chosen to maximise the money printers disguise and reduce it's psychological footprint in the publics mind.
In truth, during what we call "deflation" the pool of money becomes more potent. The metaphor of the pool which is a good description, is broken down when the balloon inflation is included. This creates a convenient confusion for the state. The term "Dilution" is more accurate. The pool of money gets bigger and its potency reduces. All of the sudden your brain doesn't hurt so much.
In the pool metaphor inflation money is added to the pool and in doing this the strength of the money is diluted, something that you don't want happening. You can see easily that this disadvantages savers. I think its much clearer, or is it just a boozy metaphor? Let me know
To me the word is dilution not inflation
Despite our resentment as bitcoin purist's we can't deny that there has been a lot of development on Ethereum over the years. We call it a scam and it is pretty scammy, dishonest at the core (see my previous article). Though it has been a major distraction, we can learn a lot from what has happened and how it has fallen. Bitcoin gets stronger from attacks and this is no different, but we can learn a lot from the choices that were made in etherium and how they have slow led to its decay and fall from grace.
There have been so many well-funded projects, programmers even amateur devs maybe, have been getting rich. It is not (or it wasn't) uncommon to find a relatively unknown project with an ERC20 token that has a billion-dollar market cap. That market cap means that if the developers are taking 10% they have more than enough money to work on the project for life. It means we have seen a lot of fast development in the Ethereum ecosystem.
This wild funding has been used to wrap bitcoin, to exchange bitcoin and to do all sorts of things, NFT's and finance rip-offs. Lots of bitcoin has been moved around here and it has created value for bitcoiners wanting to get spendable money out or wanting to exchange their forks and altcoins. It has had the highest bitcoin volume of all the sidechains, I like to think of it like this, yes it's a shitcoin, but this has had the biggest objective utility for bitcoiners for many years. It was never going to replace bitcoin (even though they said they used to say they would), but it did have a use, though many of these are only experimental we bitcoiners get to learn about many things before they can affect the mainchain.
With etherium for me at first it all seemed too good to be true and it turns out it was. The altcoin development ecosystem sits on shaky foundations. It stands at odds to honour and prudence. Despite the potential security flaws and deception, we have to admit that the methods have coloured our vision for what could be our future and stand as contrast so we can define bitcoin in the best way. I wonder if the anarchy that creates them and allows them may be necessary.
With the rise of Liquid, RSK, RGB, Taproot Assets, Lightning, nostr, BRC20 and layer 3 how long will it stay on top. We might need to reorganise coin market cap, with the demise of etherium and all its decendents and offshoots. I hope that bitcoin can learn from it's rebellious but prosperous, now foolish and forgotten son Etherium. BItcoins son that let its own sons (the grandchildren) free and then succumbed to fear and changed his mind for the worst to hold onto power.
With the blockstream green wallet, breeze and sphinx the power of VLS is coming to everyone. Validating Lightning Signers allow you to have control over spending your bitcoin on lightning without having to control the full stack, preventing hacks and physical vulnerabilities.
Its a nifty gadget but its stronger than it may seem!
The cult classic coined by Knut Svanholm is great. so much there. Possibilities wtih bitcoin are infinite and only limited by our own creativity... So what if we just this whole thing is backwards, but it's interesting if we divide 21 million bitcoin by the everyone (8 billion people)
The answer is 0.002625 btc or 262,500 sats thats $8.97 in today's
price.
1 BTC = $30,000 usd
10 BTC = $300,000
100 BTC = $3,000,000
1,000 BTC = $30,000,000
The fiat numbers seem somehow attainable where the bitcoin numbers impossibly high. They are however just different expressions of the current exchange rate. As you go up 10x in the number of bitcoins it seems exponentially harder to see yourself saving to those numbers. The fiat numbers however seem like at some stage in your long life, given a little luck you could get there. How can it be when the numbers are the same, at this moment the equivalent value, they could feel so different?
Fiat has an insidious way of bringing shallow goals falsely within reach. Attaining a number as we know means very little, It is what you do with it that counts. I think this subconsciously makes many people feel more positive about their progress than they should. The number move closer over time but the real goal continues to be distant.
When the numbers are small it is not so noticeable, but the larger they are the more we feel the dynamic. where 3 million dollars might come to you with a successful business and some good property investments, 100 btc will require a lifetime of diligent savings and then if the price goes up to fast could easily escape even your most diligent grasp. 1000 btc seems near impossible as it would require you getting 30 million dollars now and then buying bitcoin before it likely skyrockets given the copy cat demand that you could expect to see. In 50 years time however, maybe a fancy house is worth 30 million dollars.
The current price is the truth, in a sense a summation of possibilities and current human understanding however for the individual this can be very different. Each person has there own truth and for me, I know that in trying to somehow get 1000 bitcoin, even if I had the dollars, the price of the bitcoin itself, due to its limited supply would go up now to a point where the amount of fiat dollars required would be impossibly high. If everyone should try this then it would become impossible. The opposite is not true for fiat, to me they can and probably will print it till we all become broken millionaires. In this way the ambitions bitcoin goals or OG stacks of yesteryear really are further away than the fiat numbers, because we look at them with a future mindset.
The future value of dollars is already discounted in our heads. This is imprinted in our subconscious and it might take a generation or two to change this. When looking at the current value of something we should include future expected values and if you're confident in bitcoin it means it is very undervalued currently. It's no wonder it's hard to get people to spend their bitcoin, the real current value in our minds is higher than the spot market price. This psychology also holds the bitcoin price back, people can't stop thinking that somehow it can't go up for ever.
A permanent transaction record has different psychological impact in a deflationary bitcoin moon environment. In fiat it's rare to look at old bank statements or review your transactions back further than the last couple of month, maybe a year if your doing annual accounts. It's a boring thing that you have to do and generally there is not a lot of information or emotion there.
When you look at your bitcoin wallet it is different than your bank statement. Not only are your main chain transactions permanently on the blockchain, but they are easily accessible and naturally sorted by use case for each wallet. Often you have many bitcoin wallets, trying out the latest new thing and keeping your UTXO's separated in accordance to how you want to spend or save the bitcoin. On your phone you end up seeing past bitcoin amounts and often a fiat number to go with it and it can casually spark your curiosity.
The fiat numbers linked to the bitcoin transactions sometimes display what was the fiat amount at the time, but since this would require someone to hold extra information, often they just show a conversion of that bitcoin amount at the what is the current conversion rate. This option makes the current value of your transactions very apparent.
In bitcoin old transactions for beers, dinners or gifts to friends can increase in value in a surprising way. The pizza effect is real, the $20 dollars worth of bitcoin you gave your friend long ago suddenly buys them a big TV. Even if your friend should spend their bitcoin, as long as they keep there wallet, which they probably will, because they will have change, they will be able to see their transactions. You might see it and call them up and ask them if they feel the orange glow yet. It is something that regularly reminds us of the current value of our old decisions. This should empower us to make better long term decisions.
In the old fiat world, inflations mean that numbers on old fiat transactions fade into insignificance. That feeling of insignificance comes from the inflation. Banks don't even keep digital records in a way that is available to the customer for longer than 7 years. Your old statements if you get them are never looked at and only kept in the off chance that you need some legal evidence sometime n the unknown future. It all piles up in a worthless clutter.
In bitcoin history is permanent. This posses privacy challenges, which we wont delve into here, but this applies more importance to your behaviour. Importantly it allows self reflection and improvement. It's easily accessible and seamlessly archived. It helps you to be conscious of the impacts of your spending in your life.
Bank statements will never feel the same. Worthless paper displaying the record of worthless paper. Bitcoin wallets friendly reminders for self improvement and the virtues of balanced fun and frugality.
An new place for most online things, also it’s bitcoin friendly. Words can not describe and definitely this drawing is understated.
Here is an essay to describe what I call fuzzy logic and its effects everywhere. The question, which I must form in words is "what is a word?" So what is it already?
Well I would say... It is a metaphor that attempts to define something.
Is that enough? Words are made of metaphors? Considering this is a bitcoin blog and you may well be a coder, lets do an analysis from this perspective. Computers work in binary so we can be mathematic about it and this is a useful to show the contrast from reality.
If I where to define a word in code I would look up its definition in the dictionary, there would say ten lines of text there, and to accurately describe this I would need, lets say, 100 lines of code (we are assuming that we can have a perfect code that exists before words are defined which we can't and it's circular but hey, we can ignore that detail). I would also look at the thesaurus which would give us links to the definitions of other words and we come into yet another recursive problem. Having defined words using words not yet properly defined, we have a thesaurus of undefined words which we use to add detail to our definitions, and now our words relly on the meaning of other words, which relly on the meaning of other words and when you call the word the computer ends up churning through code endlessly. However to solve I that just cap our word calling function at 1000 lines of code. There is little option but to accept that the starting point is not exact, that there are bandwidth limitations within the definition process itself and in accessing the meaning of a word even in a artificially limited context.
Compromise is cool so I end up with words defined with 1000 lines of code each and it seems reasonable that we could build a dictionary of code which works and of which inaccuracies seem ok (kinda like chat gpt). A quick search tells me there are 170 thousands words and 47 thousand obsolete words in the english language. So the math comes out to a database of approximately 21Gb. Not too bad, might fit on a small computer.
However definitions are changing! I have to maintain this database and when one word changes, it effects the meaning of other words linked so I have to check all these. Less updates per second than your average internet connection, but I can see that this is enough work to occupy more than what one very productive person could be expected to achieve with all their efforts. I am going to need some team work here.
So looking at words like this we can have this decentralised evolving database of which we contribute to and which we can not comprehend, but can understand the extent of. People could even influence the consensus on definitions over time in some areas of their experience or expertise.
Knowing now that the definitions are not absolute and given that this metaphorical metaphorical database is in consensus we can know that given people understand the technical limitations the resulted communication should be as good as it gets. It seems like it might work ok if we had heaps of human workers to manage this database and maybe some kind of digital neural link. Yet at the same time it is scary to give away the attribution of meaning to this machine. To me it's scary because a machine will act absolutely to the code, in a binary way and at the same time I know that the word database is only an attempt at accuracy.
Now lets detail how word meanings are applicable and effective dependent on perspective. To go to first principles words are different depending on context and context can be described by time and space. It's all very important as the accuracy of data transfer relates directly to the amount of information transfer that we can transmit between people, the quality of communication.
The definition of a word twenty years ago in the database is not identical to the word today or what it might be in the future. That's one aspect of time, ie; we time stamp the definitions that we pull in our code. There is also another aspect of time which I need to bring in an example of a defined word a database item.
So this item is a "horse", you might think "a horse is a horse of course of course" but what about over time? When in it's evolution did a horse become a horse from a a pre-horse creature? This is code so we need to define the exact date. Also we can look at the horse over the time that is spanned by its individual life, at what time in pregnancy does the horse become a horse and at what moment of its death and decomposition does it cease to be a horse? Yikes!
What about our database entry for a "horse" in space. What shape and form can the horse be? Where does the Venn diagram overlap with a pony a donkey a mule. What aspects associated with the horse comprise of the horse, the hair in its main, the hair that falls off? The smell of the horse, the horses hooves, it's shoes? It is actually very hard to define in code how to draw a line around a horse in space.
So we need to add to the thousand lines of code to each entry to specifically address time and space in a way that is appropriate for each entry and these need to be kept up to date in a way that is more customised to your particular context, a perspective script. SO our database is 42Gb in total now, still less than the bitcoin blockchain, but with half of it quite dynamic. Far more information than I can comprehend and this comparison ends quickly as you don't at all need to perceive the movements of the bitcoin blockchain in your mind to live and communicate effectively. Words are how we structure our thoughts and interface with other humans, so fundamental.
Language is the database through which we communicate. The better each participant knows it and is in a synchronised consensus the better the communication. The better the communication the better almost everything. The less chance of miscommunications, relationship breaks downs, misinterpretations, the more accurate the thought process the less chance of bugs in a program and the faster the information transfer, the better and more inclusive our consensus is on the definitions.
So hopefully the words establish how errors appear through time and space within our definitions with context. Apologies that so many meanings can come from that sentence, but hopefully less in the context of this essay. Actually i'm not sure the volume of words provides more meaning, just by itself. I think quality is important and sometimes less is more.
Bringing it back to society, let's consider that we create laws with these words that we have created. The more words we use the more exponentially complex maintaining them and abiding to them accurately becomes. If you are not very clever, and if you are not comprehensive of the dynamics I attempt to articulate here, the law easily becomes fuzzy as you extend it. It becomes less comprehensive and defined as you add words to it. That is why we need people, juries and judges to interpret them and that is one areas where I am confident less words can be better than more. I am sure we should all be able to read the law fully in the early parts of our lifetimes. To read this effectively you probably want to know about the fuzziness we have described here and have a good grasp on definitions of the words within the law.
So now here, we have a lot of words about words. Hopefully the information transfer in the text is not corrupted and it can give clarity. I think this understanding of the wide spread persistence of fuzzy logic, not only as a mathematic concept, but as a linguistic one is important and I wish I had been taught this. To me fuzziness is an important foundation of accurate thought, a first principle of first principles and a basis for building really good relationships.
I don't try too hard to orange pill people anymore and I think this is proving to be my most successful method. I meet the person where they are and try to really listen to them and be in their ideal friend conversation mode. In other words, I am just relaxed and tell them, if they are interested, about the good things that have happened in my life because of bitcoin.
I think it's valuable for bitcoiners, who for good reason are passionate and excited about telling people and teaching people about bitcoin. Sometimes I think less is more when trying to win over people who can be quite sceptics. Here is my example orange pill dialogue.
To keep it simple it often starts off with the financial aspect. A new person you meet often asks
>"what do you do?"
I say "well I kind of semi-retired when I was 37 a few years ago and now I work on small projects that excite me to do with bitcoin and the lightning network."
>"Oh man that's cool, my job is such a grind."
They might ask and continue the conversation on bitcoin or your work, or not, but it doesn't matter because you have planted a powerful seed. The financial benefits seed.
You can say (responsively to what they said and if they want to talk about the subject) "yeah I know how you feel, my job used to be like that, I still like to work hard though."
Let them talk, and leave space, there is no pressure or urgency to explain to them all the beautiful things about bitcoin, it would be too much at once anyway.
I might say " my main thing at the moment is .... it's pretty cool, you should check it out."
Shilling your stuff to newbs however, I think is a personal thing and might not be the best for bitcoin overall. Most importantly you have planted a financial seed ( could be your retirement plan) and the most important is that you stay friends with this person.
Next, you can have a drink (non-alcoholic of course) and so you can really become friends. At a bar, if they want, you can pay them for half of a round with Bitcoin, a good time to introduce the lightning network. This payment use is the second step.
Getting people to experience what bitcoin is, might take years, but people generally need to see how bitcoin works.
>"its that easy?"
"yeah anyone can get into it, you can go really deep though."
Once they have seen an app and seen the price movement, hopefully up, they can build a basic understanding and this has the power to break a lot of built-up scepticism. The material experience can do things an abstract conversation often can't.
You might have to wait till the third date or after the dating stage to tell them about all the other great bitcoin things. I know you wan't to talk about the huge wide-ranging positive effects on people, to their minds and their health, about the great liberating political implications and peaceful but potent killing off of parasite corporations, the dirty banks and the F** federal reserve, but you can't. If it comes before building new friendships you might not end up getting anywhere and might struggle to tread water yourself.
I say stack friends and orangepill gently.
A trend is a direction that you can decifer in a chart at the stage, when you zoom out, where you can see INFORMATION in the chart just by looking at it.
Different people see information in different charts at different resolution depending on their level of knowledge and connectedness.
For instance. If you look at an NSD100 you can see history depicted in the chart .com bubble, recessions pandemic, at that stage most people can see the trend.
If you are an oil trader or someone who follows say bitcoin very closely then you have more granular knowledge of the environment and can see other events materialise on the charts at closer resolution you can see the trend.
@hughhendry podcast "the Master of all bear markets"
Follow me on Etoro https://etoro.tw/3I4qtYu
You can learn about it on this great podcast, very in right now. https://fountain.fm/show/W8pjfavWchv8diXjikgC
You can also check it out the website here https://ordinals.com/
Etherium maxis and bored apes must be flipping in their digital yacht club right now, especially with the smart contract stuff coming up, simplicity and RGB on lightning etc. Rocks are selling for more on the everlasting blockchain.
On a recent battle with the terminal I have been trying to recover a lightning node which I ran on using some rare beta software and which I hastily thought i could simply recover with a seed phrase and a channel.db file. Its is not always the case, at the moment none of the funds are recovered. Somewhat luckily there where only small amounts on it and most of the channels are to known counterparties. Now if find my self digging into the darkest corners of the web to find out how to modifying commitment transations so that I can close channels with my self in favour of nodes that still work. Dangerous knowledge indeed, but I think I can call myself a lightning wizard should I pull it off.
Bitcoins next biggest problem durring global financial crisis may be that bitcoiners make too much money too fast.
Given a strong flow to sound money, the obvious advantages of bitcoin over gold and silver and the small current market cap of bitcoin.
If people get wealthy to quickly without any work other people get jealous and feel justified in taking the supposedly ill gotten gains away. Bitcoiners need to make sure they are deserving.
