Practice English Speaking&Listening with: This week in Bitcoin- 8-3-2018- Lightning network, institutions, SOV, Bakkt hype

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Hello everyone this is adam meister the bitcoinmeister the disrupt meister

welcome to this week in bitcoin today is August the 3rd 2018 strong hand deferral

of gratification uncopyable all right I am offended by selling bitcoin I hope

all of you had a strong hand this week I'm coming from Boise Idaho now and we

have three guests who've never been on the show before but you all know them

because I talk about them I linked to their tweets always check out the links

below I link to all these guys below today to please um they are Gary Batsuit

and rod mah mood of and Nick Bhatia and you're gonna hear from them in one

second but I want to first read a tweet because these dudes are experts in a lot

of different things but first we got a we got a hit on the current events right

now and here's a tweet from FinTech Frank

he says a year ago executives that the major stock exchanges would describe

crypto as a fad dangerous and nothing they were taught taking seriously today

ice which is the intercontinental exchange which is I guess owns New York

Stock Exchange announced a project with Microsoft and Starbucks to create a

digital asset ecosystem sounds like a buzz word the term change has been

massive and they're calling it bat now a lot of people are saying this is huge

news obviously it's involves some traditional

institutions that we're all familiar with

we'll start with more on what what do you think about all this what is this an

important earth-shattering thing like some people are saying

well even though the whole thing does seem kind of mercenary versus sort of

the more missionary ethos of cryptocurrencies and sort of

decentralized systems in general I think like in the long run like this is like

generally bullish for Bitcoin and like the Starbucks integration with their 15

million user mobile pay community in theory like this can have similar

implications of an ETF and together in conjunction with NYSC serving

essentially as the lycra warehouse or a custodian it should get like a very big

distribution effect in the long run as well and also it would maintain to be

much greater divisibility versus some of the like recently proposed ETFs which

have like much bigger minimums for investment and it's also like physically

settled versus cash I generally think like these things are pretty bullish

that being said despite how in my view relatively bullish these announcements

are the fact that mark that essentially barely moved upwards on this news

confirms my bearish in the short term and like don't get me wrong like you

will not find a more intense long-term Bitcoin Bowl but I think in the short

term we might see some lower levels in the next couple of weeks and months when

I see an announcement like this I mean obviously I it's got some big names in

it but then it's something to me it almost seems like one big buzzword when

they start chatting about digital asset ecosystem what do they even mean by

digital asset ecosystem do you think rod um I guess it seems like they are it's a

very ambitious project and they want to do a little bit of everything but as

I've said in general I think these kinds of traditional financial institutions

getting involved is very very bullish for ecosystem as a whole and just like

the tweet said as early as a year two years ago they were laughing at

cryptocurrencies and Bitcoin but now they're essentially like diving head in

at first and so I think we will see more and more our institutions exchanges

financial intermediaries slowly dip their toes into crypto more and more and

this will facilitate sort of my longer ongoing thesis I think like Bitcoin will

become will become a store of value for Millennials 8 + 2 I think in the coming

years high net worth and ultra high net worth individuals will be putting from

anywhere from zero point two to five percent of their net worth into baskets

of blue chip cryptocurrencies and I think these kinds of announcements are

facilitating this I love to hear that and we are going to be talking about

your evolution of Bitcoin the financial evolution of Bitcoin a little later on

you've just given everybody a preview but everybody should already be familiar

with it because I have linked to his chart in the links below in past videos

found that like button if you like me connecting all this stuff together okay

now we got Gary here what do you what do you think about this in NASA you are

from a traditional finance background is this it's just bigger than the EGF I

mean how do you interpret all this well from a training perspective I think it's

it's a pretty big deal like right now the technology behind all these

exchanges is kind of a joke from like a professional training standpoint so

having somebody with like a strong tech infrastructure like ice come in and

provide a platform is gonna gonna bring a lot of liquidity to the table I also

think like in terms one of the problems with the ETF is they're concerned about

lack of surveillance lack of a regulated spot exchange this I mean this will

basically solve that so to the extent that any TF gets approved I bet it would

be something it would only come after something like this actually gets off

the ground nice timing the yeah I like that Nick what do you what do you think

about all this I think that any large institution that's coming in with any

sort of custodial angle is a big deal and important for the ecosystem to

evolve so I wouldn't put too much weight on any

one announcement it's more the fact that you have an why is he involved ice CME

and CBOE are both involved now Northern Trust just announced that they're going

to be offering custodian type services we're not exactly sure what they're

announcing Citigroup recently announced that they're gonna get involved they

used the word crypto but the details were pretty thin there you have Goldman

Sachs starting a trading desk so they're going to be involved in the trafficking

I don't know about the custodianship as much but they're going to be involved in

the trafficking so you see institution after institution

announced their involvement to what degree are they going to be involved to

what degree are they going to be using real Bitcoin versus futures or other

financial instrument derivatives some of the ETFs are going to be using physical

Bitcoin where they're gonna store it in a trust and others are going to be using

futures contracts only so we don't know to what degree all these institutions

are going to touch real Bitcoin but the bottom line is that the adoption is

happening one step at a time well you know you guys have maybe a

little bit more happier about this announcement I was thinking it was more

of this the buzzword you know click Beatty type of thing and this is

substance behind this this could this could you know I guess the markets III

think you said that the MU rod said that you know the markets weren't reacting

this you know the markets are made up of a lot of like nineteen year old kids

though you know that just want to like train like coin and Bitcoin aetherium

back and forth so I think it just shows that they're just not paying much

attention who knows okay let's move on to your everybody's breadbasket here but

everybody likes to talk about each of these guys have you know I I like

certain things they've tweeted about and one thing that Gary you said at one

point because you you again coming from a background where you've dealt with a

lot of traditional assets bitcoins biggest selling point to institutions

Bitcoin returns are not very correlated with

other asset classes and I like that a lot if you could elaborate on that if

you want to talk a little bit more about that also going back to the ETF if you

have any uh any thoughts on the progress of that and what what your trip your

friends in the traditional markets in finance or think about that so I guess

two different things there sure yeah I mean most of my time has been spent on

trading but I know that about like what asset alligators look at and I mean this

kind of reminds me of of the when commodities kind of became a thing and

came into their own as an asset class and everyone was kind of talking about

their diversification properties like you know why buy silver well it moves

differently than all the other stuff in our portfolio and so that makes the

Sharpe go up sometimes so it's the same with Bitcoin and I think it's also you

know people call it perhaps like a gold replacement and it's interesting because

so far it's been behaving pretty differently from gold like cold seems to

be kind of like a risk-on risk-off hedge so like when people are kind of

panicking a lot of money can go into gold and Treasuries Bitcoin moves a

little bit weird it almost seems like it's kind of like a like a hedge against

like specific countries having instability or capital controls coming

on and off so it's like a new type of exposure that that you can get access to

so I think once it matures a bit more you know traditional asset allocators

will be interested in putting of you know maybe half a percent to two percent

of their portfolio into Bitcoin and maybe a few other big coins I have a

little bit I guess the question kind of it goes off of this in terms of Bitcoin

maturing and attracting interest of all sorts of people do you see it as a store

of value yet and if you don't do it when do you see that being more accepted in

the traditional ones well I think it's a store of value for us that I think

bitcoins awesome and the next big thing I think for most people like when I

asked my friends were a little bit you know they think it's worthless and

doesn't have any inherent value and therefore he's like a very forced work

value so I think a lot of that just comes with time so give it another five

or ten years have it the unregulated exchanges have significant liquidity and

volume on those exchanges and then it you know eventually it becomes obvious

that it's it's not gonna go to zero and it's not worthless and yeah over time it

becomes seen as a store of value okay we're gonna we're gonna get to moon rod

in a second was he's gonna have a lot to say about that the progress of the

financial maturity of Bitcoin but I want to get a UH I want to go to Nick first

here what what do you feel about the store value aspect of Bitcoin at this

point in time and also go any any thoughts on it being an uncorrelated

asset sure I'll start with the correlation first now I think that we

can we can measure correlation on different time horizons so we can look

at you know an annual basis what did a few assets return versus each other we

can look at daily returns so I do think that bitcoin is not very correlated to

other asset classes on longer term time horizons but I do stare at intraday

price action of different markets on a daily basis and the one thing I see with

Bitcoin is that it does not tick with the other markets so you can see on any

given day certain currencies US Treasuries stock

markets and oil for example all trade tick for tick together in one direction

now that doesn't always happen all the time every day but there are times you

know quite often where these asset classes are actually trading on top of

each other because they're all controlled by or they're dominated by

algorithmic programming program programmable trading and Bitcoin does

not seem to move on a tick by tick basis with these other asset classes that

tells me that bitcoin is an independent asset class it's separate from the

financial system and the liquidity in the direction the

market is moving is completely independent of all these other markets

so I really think that that is interesting about Bitcoin from you know

the very short-term correlation perspective now I do also agree that it

is an uncorrelated asset because it you know Bitcoin has gone up so much and you

look at every other asset class and they don't have those type of boom and bust

cycles as often as Bitcoin does Bitcoin seems to you know skyrocket in the crash

and skyrocket and crash and other markets like stocks or bonds are not

moving and you know anywhere close of that kind of volatility all right

they're very good and the store value aspect of a Bitcoin you know we're

combining two different things here store value I mean I think store value

is you know a relative subjective type of thing you know to those of us who

understand what bitcoin is and value its digital scarce properties and it's

amazing protocol and improving protocol yeah it's gonna be a store value to

those people because they have a longer term time horizon and they know what

Bitcoin can become in the future and to others that don't necessarily understand

bitcoins properties they're not gonna see it as a store value so that you know

it is subjective I'm leading up to Mourad for this I'm bringing up these

things because broad you wrote monetary evolution of Bitcoin and on your chart

Bitcoin has in its monetary evolution it hasn't hit the store value stage yet and

I hope I'm not misinterpreting anything can can you give us a little insight on

into your monetary evolution of Bitcoin theory and how it pertains the store

value and and everything else I'm not retarded yet for sure I would describe

Bitcoin at this stage as a scarce digital collectible with with a with a

very promising chance of becoming a store of value or in other words I think

investing in Bitcoin today is making a bad

that three four five years from now it will be a store of value so and Vijay

boy a potty safety no moose nick szabo tangentially and and some others have

written about this extensively but essentially there are many theories of

cryptocurrency value accrual most of them I think are wrong I subscribe to

this theory that bitcoin is undergoing monetization and it's moving in in these

stages from a collectible to a store of value to eventually a medium of exchange

as it gets bigger and the disincentives to spend get reduced and eventually as

it gets even more stable it it will and it has a chance to become a unit of

account but really stability will be achieved closer to full adoption it's

it's it's quite it's quite binary but for pure stability and not versus fiat

versus actual goods and services you need very very extensive adoption but

versus Fiat Bitcoin will stay volatile for a while and you actually want it to

be volatile you want Bitcoin to be volatile preferably upwards you want it

to signal to the world that fear is weakening relative to the dollar and the

Fiat leak is occurring and I strongly believe that Bitcoin will become a store

of value because and I don't even somewhat controversially I don't think

that money is a collective fiction I think it's actually I think bitcoin is

an objectively better store of value especially if you take a longer-term

view just like people say the future is already here it's just not distributed

enough yet and to me it's not collected fiction but rather it's social consensus

coupled with market and now quickly convert towards the best but due to

self-interest and due to self-preservation and I think this will

happen alright Gary and Nick which what do you do you guys have something to say

about what was just said their commentary of any of any sort that was a

deep stop there for all the 20 percenters in straw

handers out there this show is is definitely for you guys all the

long-term thinkers well I love the evolution of money of framework that

Marauder is putting forth it really does have to take this evolution into later

stages of maturity and right now it is still is a collectible I mean it it's

moving towards a store of value because more and more people are recognizing it

as that but but still for us bitcoiners we're just trying to get our hands on

this much Bitcoin as possible because we understand that it's limited in supply

and that's kind of what is driving you know the adoption for it and it will

move that direction through time one Bitcoin equals one

Bitcoin people try to get more don't worry about the dollar value of it Gary

any thoughts um nothing much dad I mean I agree with with Nick and Mourad I

think it's going to take time and I think there's some fundamental

properties about the way the system works that make it more attractive than

fiat currency in the long run but there's going to be a lot of volatility

in between so they get exciting have a strong hand indeed excitement but strong

hand people all right now before we go we move on to Nick who is going to talk

about the Lightning Network in all its glory

I didn't have one little final question from you rod you said eighty in one of

your tweets I found it very interesting 85% of VCS are no better than I CEOs

that was kind of tongue-in-cheek but I didn't think that safe for a tiny

minority of VCS they're actually know what's going on and how this thing works

most of them are really flowing into horrible investments horrible tokens

horrible I SEOs I actually think most of them know that what they are following

in is essentially utter trash but they're just taking advantage of their

pre presale discounts and then dumping on retail upon the liquidity points and

like I'm just saying obvious things we all know what's happening

I do consider it at least slightly unethical but this is just the way

things go and is it being going on before long

before crypto but yeah I think most VCS don't really understand cryptocurrencies

they don't really understand monetary economics a lot of them still think of

the of it blockchains as software platforms or blog chains as equity but

really first and foremost block chains are money

and block chains are monetary systems we're not trying to reinvent Amazon Web

Services here we're not trying to reinvent PayPal we're trying to get rid

of central banking and we're trying to build a robust fixed monetary system and

really both that has the highest potential for return the highest total

addressable market and also the highest potential for socio-economic change and

I think it will happen in our lifetime and I think it will be beautiful

well-said talent like button people make do you have any thoughts on the the VC's

view of crypto I don't have much knowledge of that world and I also don't

even follow the ico whole space at all because it's not it's not part of what

I'm interested in I'm interested in building a Bitcoin so I really I

couldn't even name you like a nei SEOs or anything like that so awesome that is

awesome I wish everyone was like that unfortunately uh the newer the people

are to the space the more they seem to like to ask me about AI CEOs and you

know actually more I'd you said well everybody knows you know you said that

everybody knows that what the I SEOs were about oh no no the 80 percenters

out there they think this stuff is real they think they don't know that 90% of

that's why they keep buying all that stuff anyway well let's talk about what

the people want to hear about and that is the Lightning Network and that is the

Bitcoin risk spectrum lightning networks arrival

finally allows us to sign time value to Bitcoin and can begin building bitcoins

capital market from first principles alright Nick take it away I mean if

traditional finance they're going to is they're gonna want interest rates on

on Bitcoin and everything and you think litecoins gonna help I'm not like kung

fu lightning networks gonna help out with all this so tell us all about this

III think it's so unique and with this other other guests have tried to

interpret what you've said in your articles and everything but now we want

it straight from the horse's mouth thank you yeah I think that a bitcoins

layered approach that it's taking is the perfect approach and that's because I

think about gold as an analogy gold in its raw form is you know nuggets out of

the ground and the protocol is that it is a element on the periodic table now

that is what makes gold consensus it's what atom it is on the periodic table

tres mayor talks a lot about it following chemical law so you know

that's that's the foundation of Bitcoin now when gold is turned into coins and

bars that's another layer of the protocol and the protocol has consensus

around what the weights and measures should be and then after that you starts

to get into counterparty risk and we're talking about gold certificates where

banks and vaults can take deposit of gold and issue certificates and those

can act as money but it's not real gold it's another layer of gold and bitcoin

is following this approach and lightning network is the first it's the first

example of a second layer that is going to be have mass adoption or it's it's

having adoption as we speak and it makes Bitcoin usable on a layer above the base

chain the base chain is meant to be slow and clunky for a reason it's not

intended to be fast confirming because that's not part of the security of

Bitcoin bitcoin is final settlement digital scarcity and that takes time and

proof of work and that is you know slow clunky and expensive as the criticisms

of Bitcoin you know are but they're not criticisms I mean they're not false

they are features of the base layer and lightning Network is beautiful because

it allows us to use Bitcoin instantly in this very unique payment channel type of

way and we don't have to use the base layer until we need to to

take final settlement and part of lightning Network now is being able to

assess time value so you can make fees from the Bitcoin that you stake to

lightning payment channels these fees are income the payment channels the the

Bitcoin that you put in the payment channels is your capital and it takes

you time to earn those fees these are the three components of interest and we

can start to calculate an interest rate now if you don't want to call it an

interest rate that's fine you can call it fees and not interest I'm also okay

with that but the bottom line here is that we have principal income and time

and that is a framework for interest rates and it just opens up the Pandora's

Pandora's box of the entire capital market Wow

that that is a beautiful stuff hey I want to say before we move on with this

James in the super chat thank you very much clearly bitcoin is where the big

boys play we're talking about some big boy subjects right now Gary do you have

any thoughts on what Nick just said and he anything's to add on to that I mean

not really I totally agree I think I think the decision to to layer it has

been well thought out and seems to be leading a good results I know people

have been criticizing lightning for for appearing decentralized

rather centralized but that doesn't seem to be the case when you dig into the

details in terms of like channel capacity and and how many channels

actually are open for someone for a lot of these nodes so I think over time

you're gonna see it need just as decentralized if not more so than the

base layer with a lot of nice properties attached to it

Murat haven't you I think the pod around lightning Network and lightning hubs

being centralized is extremely overhyped first of all as the great stop and

decrypt recently pointed out in his latest medium piece the there really

isn't going on right now but even if there is mild centralization of hubs on

sec there I think it's completely fine just

like Nick described the idea is for the base layer to be hyper secure and hyper

decentralized and slow now as you move to higher and higher layers you can

start sort of toggling the the trade-offs and you can be faster but a

bit more centralized and a bit more sort of a bit less secure and that's

completely fine because like we're not going to be like putting our entire

savings into lightning payment shop and all probably smaller amounts especially

for the time being and also the lighting hubs from what it seems are going and

like various lightning service providers are going to be extremely competitive

and it will be relatively easy impossible to like to move from one hub

to another they will come they will be competing based on reputation and trust

and I think that like if one of the major lightning hubs for example abuses

its centralization people like that information will like quickly leak and

people will simply switch to other participants and other players so I

think that even if there is mild centralization on like layers above the

base layer I think that's completely fine and workable perhaps even desirable

all right Nick you might have some follow-up to that there yeah that was

great you know the thing about lightning

network is that you don't have to use it right you can keep your Bitcoin on the

base layer in your own private keys you don't have to release that liquidity if

you don't want to but you can and you are taking some risks right I talked

about how I don't feel feel that there's a direct counterparty default risk but

there is risk of security there is risk that it's in a hot wallet there is risk

that you can miss manage your payment channels and lose your Bitcoin if you

don't you know if you don't follow the rules and you know you can you can lose

your Bitcoin if you're not careful and so that risk should come with a

reward those rewards are going to be in the form of routing fees and maybe other

services that can be provided via lightning network but I'm focused on the

routing aspect because it's a observable right

now and you know with this income that you're making we can start to assess

that type of interest that you're rewarded now I'm so glad that you

differentiated between the type of risks that are involved because in your

original article you specifically said there's no I don't know counterparty

default risk here now that really is the case I mean that just seems amazing what

do you think that a lot of big players are going to want to get into this very

soon and put on a put a lot of money down in these chat a lot of big point

down in some of these payment channels and do you expect this to happen soon or

is it just is it too clunky the network now is is still just almost in beta

version so that it would be too risky to do this yes what do you think about that

well I think it's great because I believe it's going to be a free market

because the only thing you need to compete in the Lightning Network is the

software and the Bitcoin now anybody can have those two things it's not it's

there no Barry there's no real barrier to entry here into the Lightning Network

so if some centralization ends up happening then that's part of the market

and then if people don't want that they will browse around that centralized hub

and it's gonna be very interesting to see how it falls I don't know the degree

to which you know big players are gonna come in they're not gonna view this as

no counterparty risk so it's safe and I'm just gonna do it because it takes

technical know-how you know I don't have a coding background so I'm not I don't

have a lightning note up and running because I don't think that I could

properly do it now I took months and months to learn

private key storage so that I could do so myself right and that was part of my

process of learning about Bitcoin but I don't think I'm ready for the Lightning

Network because it there's gonna be technical no it's just gonna be above my

capabilities currently with the current tools now hopefully that will change

quickly and I can get involved and learn you know the little bit of code here

there that I need to customize my note but

right now I don't so I don't know what you know big players are gonna come in

with what type of money but it will be a free market and it's going to be very

interesting yeah there is there's a lot of technical know-how before you're

gonna be become confident in doing this and know that you're actually doing the

right thing and unfortunately I just thought of a horrible scenario in my

head how as the net lighting Network becomes more and more publicized they're

going to be like scammers creating like businesses saying hey we'll invest your

money into our Lightning Network node and you'll return this interest to you

and then they'll just they won't have a Lightning Network note at all and

they'll just steal it I just did this all popped into my mind future scans of

cryptocurrency don't pound that like button for that all right uh we're gonna

move on from Lightning Network to uh garrier more I'll you have anything else

to say about Lightning Network or Nick anything conclusionary remarks about

Leighton Network actually I wanted to throw out that the payment channels like

enable a lot of cool stuff it's not just about you know back and like the simple

back and forth game at use case there's there's a lot of potential for building

things like derivatives or kind of like uncollateralized or off chain

collateralized payment channels that will show up over the next year or two

that could lead the totally different applications that we haven't seen yet

yeah I mean who knows you know that kind of it is in the internet you never you

never would have predicted social media know what kind of sicko we're gonna put

the social media on top we do not know what is gonna be created that's some of

the most exciting aspects of it that in ten years we'll look back on this and be

like oh my god they were so naive of what this was going to bring to the

world so I'm serious about it obviously and I'm very happy to always have

guessed that know so much about it and yeah that interest aspect of it is you

know we hear about all the technical aspects of it but you know nick has

brought it down to a very financial based his articles are the very

financial base concerning the Lightning Network and more and more people gonna

start talking about that so Gary I want to hear I wanna hear more about what

you're doing out there because again you're

nikka you got the trading you got you know a lot about the traditional stuff

just to tell us tell us some stuff that's going on I guess it's pretty

broad question there I'm giving you an open topic time here

sure well at the moment I'm I'm kind of serving surveying the landscape so I'm

interested in how the markets work how drivet azar gonna work

lending stable coins insurance I think ideally if I see the right opportunity

I'd like to build the business I think I mean I think we're all kind of an

agreement that a big point is where it's at that's where a lot of the value is

going to accrue so being able to build a business that's that's gonna take

advantage of that kind of like a lever and exposure to Bitcoin becoming you

know much much wider adoption as a store of value is what I'm interested in

different ways of trading it hedging the risk moving it around etc you know you

mentioned stable coins um you think that's really gonna become a thing I

mean there's a lot of hype behind it and I think a lot of it is is almost

buzzwords I mean you see you see a real place for them in the future

a successful stable one well I guess one one caveat is I'm I am advising a stable

fine project so and I'm probably a little bit biased oh yeah I think yes I

think there will be a place for them I think the question that everyone's

asking is is it going to be more than just a tether replacement I think people

want to know if if stable coins are gonna leap out of the crypto world and

become maybe potentially a major entry point in a crypto adoption worldwide I

think it's very possible but obviously there's risk with risks attached to it

some some of these stable point approaches appear to be pretty

susceptible to collapse so that's another thing that that we're kind of

worried about is there's all these stable plane projects coming out some of

them might get big and then fail fail spectacularly and that would be a very

bad look for the crypto world so I'm kind of worried about enabling that yeah

it would be very I mean if there's centralization aspect of them too

oh yeah I can I can speak quite extensively on stable coins go ahead hi

I am an investor and a bunch of stable current projects but to be completely on

it I think they are a temporary solution at best I think for the time in the

short term medium term if they work they will be used as sort of a beast like the

medium of exchange of a decentralized world but eventually bitcoin is superior

to stable coins because it's a better store of value and eventually Bitcoin

will be used as a medium of exchange because if Bitcoin goes to like ten

fifteen trillion or bigger and people see that other people are valuing

Bitcoin as something which is valuable then they will demand it as they will

demand it as payment for their goods services and labor and so like for the

time being like something like a stable coin can be useful especially in like

countries which like have like hyperinflation or really high rates of

inflation while bitcoin is still sort of undergoing this slow monetization but

like it's stable coins are quite difficult like especially the like the

non collateralized ones it's hard to be stable without the milk without a

military and without a monopoly on money and without lenders of last resort and

without like state decrees and legal tenders and debt extinguishing laws

maintain my Teaneck stability is going to be incredibly difficult now I am

generally optimistic but still like Bitcoin is king because bitcoin is fixed

supply and so fixed supply is the best monetary policy imaginable it's sound

money which is the most important thing and I think at the end like once Bitcoin

gets big it becomes a stable coin and once Bitcoin gets big all stable coins

will collapse yes I see that world awesome that world in the future another

reason to get into Bitcoin now but wait Gary

replied what he just said and and also talk about it Gary you had some tweets

about decentralized exchanges also so I guess reply to Murad and then talk about

too centralized exchanges is that you tweeted about that I believe yeah I'm

inclined to agree with more admin but I think that the short run can be very

long I mean it could be 20-plus years before bitcoins at the point where it's

you know at the same level of stability as something like the US dollar so I

think it's very possible to get there but yeah you can definitely do a lot of

good in the next 20 years with a stable point right the short room can be very

long that's very is very true it's very true

but things do change Gary any ended that you're decentralized

exchanges tweets that you had out there you have knowledge about many interest

in them yeah yeah especially given kind of my trading background I'm interested

in how the details of how these markets are functioning and Dex's are pretty

cool right because you you eliminate a lot of a lot of issues with centralized

because custodial risk and maybe some privacy so I'm an optimistic that

they'll turn out to be functional and useful in the future although at the

moment that seems to be not really the case unfortunately you know some of it

is is a technological problem and that'll that'll take a few years to

solve but a lot of it is kind of I see it being like institutional and legal

issues as well like I think that the regulators need to find a way to deal

with these kinds of structures without stifling innovation but also like

preventing some of the bigger problems that can occur with money laundering at

scale so I mean right now the problem is that the main liquidity providers and

traditional exchanges kind of like high-frequency trading firms like the

one I own I think can't really participate on a decks for some of these

reasons and so that gets solved I think you're gonna have a hard time

getting much trading done on them alright Nick I didn't mean to leave you

out or anything any thoughts on these decentralize exchanges or these stable

coin things are these just not your thing now I just agree with the the

fixapply aspect of it you know the stable coin is you know by definition

going to have a centralized Authority and a flexible monetary policy that you

know we're not really sure what it is and I'm in Bitcoin for the stable

monetary policy and you know don't really have an opinion about the stable

coins outside of that okay excellent I'm not a big stable coin guy either but

hey I'm glad these we finally had some Jews that did get to talk about we

haven't had anyone on the show really talk about it yet so found that like

button everybody if you like I'm bringing you all sorts of information

today all right well we're getting we're getting close to the end here but I did

one um I don't want to get people to more excited out there because I know

there's some altcoin freaks out there murad you had a viewer to tweet and I

I'm just doing it for memory here you like you had like a rat not a ranking

but you listed like five coins that you thought were legitimate obviously the

top one was Bitcoin but then you mentioned some others too I think you

mentioned Z cash and you actually mentioned store a value do you remember

this tweet that I'm talking about yeah for sure in one of the tweets I listed

the top five coins in my view and in another tweet I listed the most

important right for achieving story value so yeah Gober book but remember

people this is not an endorsement of those coins but he can continue yes

honestly them the longer I spend time in the cryptocurrency space I realized that

as of right now everything other than Bitcoin is essentially trash and I kind

of like privacy coins the two known scammed privacy coins manera NC cash I

think if I were to choose among sort of the quote unquote premium out points I

would add some minor proposer to narrow and z crash just because privacy

probably Gator against Bitcoin but I do think the privacy will continuously and

slowly improve on Bitcoin as well I included etherium and D cred in that top

five list just to rounded out to five but honestly I'm pretty bearish on

though in terms of a store of value I would say that the most important things

are security disinflationary monetary policy and the credibility of monetary

policy and sort of the link the effect associated with those three things at

the end of the day the purpose of money is an anxiety it's to reduce anxiety

about an uncertain future and you want a protocol that is reliable you want a

protocol that is robust and you want a protocol that makes you think that it's

safe and when I think about the cryptocurrency space Bitcoin is clearly

the best along those criteria so I think it's it's much riskier to park millions

of dollars of wealth and out points other than a speculative bet if I have

to chief I have to go to coma for three years obviously I would put money in

Bitcoin first and foremost so that that all right guys he said D Craig by the

way all the deep red freaks go crazy when anyone says that on the show I'm

just pointing that out a boob I'll see some view to the comment section hey

we've got a question from the audience for mention McDowell thank you for the

$10 to perch at mention I don't know if any of you guys can answer this but

here's the question how soon till we see decentralized labor apps like TaskRabbit

that will allow a diesel mechanic like myself to pick up mechanic work

anonymously and outside of the conventional financial system anyone

have an answer to that question that was a pretty targeted question there how

soon till we see a decentralized decentralized labor acts like TaskRabbit

that will allow a diesel mechanic like myself to pick up mechanic work

anonymously outside of the conventional financial system I think it

depends on the jurisdiction to be honest with you so I don't it's impossible to

say when but I think it also depends on the degree of labor law freedom and you

know accessibility to technology so I don't know when or where but I think it

will come down to you know different countries will adopt that type of thing

at different speeds all right country specific stuff there well and any other

thoughts on that anyone out there prevention I know it's very specific

thing hey man tah in terms of time I'd say it's a it's a little while hey just

because people are working on so many I mean maybe we still gotta get user

interface down with like Bitcoin okay you're talking about something really

specific they're decentralized labor hats man I mean for the average dude I

don't I don't know when those things are gonna be available I mean let's get a

big Bitcoin user interface easier first let's get lightning Network

you know the main second layer a solution that everybody knows first

there's that I mean that was just a discussion I was having an ending

tonight there is so much work to be done we're so early on in all this I mean

it's like 1994 and internet terms still and we just we just know how some guys

like that you know how complex this can get eventually we're just I mean we're

far off from there right now all right let's uh let's get to everybody's

conclusionary thoughts here we'll start with Gary was there anything left out

anything you wanted to talk about any any replies you wanted to say or

anything you want to promote talk about your what you're doing your business

again his Twitter is linked to below taking away Gary the floor is yours I

think just in general I want to share my enthusiasm with with how the Bitcoin

community is developing and I am generally of the belief that big point

is where it's at and the amount of infrastructure being built on it it's

just early days so it's really exciting to see it all come

together yeah myself all right Murad what do you what do you get thank

you Gary for be on the show your first time on this show it's it's awesome to

have you want to meet you Murad you - your first time here great

to have you you guys are just bringing different perspectives on everything but

any conclusionary thoughts anything that was left out you want to say I think if

you want to accelerate the adoption of Bitcoin and make it go faster I think

you need to turn as many high net-worth individuals and institutions into hard

layers of last resort or at least make them make them understand the investment

theses and the fact that bitcoin is objectively a higher quality and a

stronger harder sounder money than what we have right now you need to paint a

picture that bitcoins victory is inevitable and have them start

allocating even small pieces towards it I like it you know when I want to go

back to Gary on that real quick I got you know as a trader I mean what do you

think about how blurs of last resort with your table and good for them I mean

I think it's a good idea yeah I think I think just like you know buying stocks

the correct move is to buy and hold but people need to trade for all kinds of

reasons so functional markets are good for everybody

yes yes strong hand people you know where I where I lay on that line people

you know trading it's risky 95% of people lose all right let's let's go to

Nick the lightning Network master in my well in terms of finance dude what what

are the things you have to share what other knowledge you want to drop on us

before we are you guys go out to dinner and have fun in the west coast or

wherever everybody is today anything that was left out anything he was saying

dick thank you for being on today by the way it's great to finally meet ya and

thank you for having me yeah what I'm working on now is called

the lightning Network reference rate it's an idea that I had where you know

we can observe reference we can observe interest rates for

individual lightning notes if we can come together and decide on a consensus

method on how to calculate these interest rates and publish it to each

other whether in a trust list or a trusted way we can start to build a

capital market on top of that so the foundation of every capital market and

every financial transaction has two components it has time value and it has

risk premium and in lightning Network we can observe both of these things and so

we can just start to develop the tools to have Bitcoin denominated financial

markets and it's really exciting to me I'm thrilled to be a part of the Bitcoin

community and engaging with a lot of people so thank you to everybody that's

reached out and look forward to continued writing and developing this

idea in an open source transparent way also all their links are below their

twitter links you can follow on Twitter see all their awesome articles and

tweaks or tweets remember Andrew Rogers dropped off by accent there one or

Bitcoin equals one Bitcoin and devalue your relative Bitcoin value your wealth

and Bitcoin I think that is the direction that Nick is is taking us in

which is awesome okay everybody that's it for this week in Bitcoin pound that

light bond of course we do this show every Friday The Times very you know how

it is just tuned in every Friday every Saturday is the is the beyond Bitcoin

show I don't know what time that'll be on tomorrow and then every other day is

the one Bitcoin show I posted a new show here every day check out the links

section below everybody get your treasurer ledger net or your t-shirts

and remember I'm speaking here on Wednesday in Boise then a Los Angeles

I'll be on what the 11th and the 18th to Philadelphia all of that is linked to

below thanks a lot everybody have a great night have a great time thank you

guests again pound that like let's see everybody later bye

The Description of This week in Bitcoin- 8-3-2018- Lightning network, institutions, SOV, Bakkt hype