Bitcoin Unlocked

Good Morning Everyone,I’ve had the phrase “you catch more bees with honey” floating around in my mind for a couple of weeks after listening to a pod with Robert Breedlove on What bitcoin did. As a kid growing up my mum used to say this to me from time to time. It’s a common turn of phrase and is essentially referring to incentives, and the fact that it’s most effective to focus on properly motivating humans toward the ideal outcome as opposed to always reaching for the stick.As humans operating in hierarchical structures we typically default to the carrot and the stick design framework when trying to guide and incentivise decision making and human behaviour. Something to deter you from doing the wrong thing and motivate you toward the preferred option. The thing with this is it’s extremely simplistic, and the implementation often tends to leave a lot to be desired. It’s typical that whoever is higher in the hierarchy tends to operate on more of a “do as i say, not as i do” type model. The fiat model. Because of their position in the hierarchy they have an increased level of influence over the protocol. This is true in shitcoins like ethereum, and it’s true in fiat. Meaning that the quality of the incentive structures are null and void because we will see the people above us operating in opposition to these desired behaviours. This corrupts the system as it’s obvious that the system is essentially disingenuous and trust ceases to exist. It also creates different unintended incentives and thus myriad potential unexpected and unwanted higher order effects as a result of this broken incentive structure.It also on some level tends to corrupt us psychologically in respect to meaning. Specifically how meaningful the work is to us. When we see the system is essentially built on lies, and cease to trust it, the entire business and intention is also corrupted and we struggle to find meaning in the work and performance suffers as you would expect.I feel like this is the state of play for 80-90% of businesses these days. The most basic of tasks can be profoundly important for a community, a country or the world more broadly, and it’s easy to forget the pivotal nature of a given task, job or business when the incentives are broken and we’re distorting reality within markets (which are really just human societies).This in my opinion is really what bitcoin, and moving to a bitcoin standard promises to fundamentally change and hopefully improve dramatically. That’s not to say everything would be perfect on a bitcoin standard, but it seems obvious at this point, that the central banking and fiat standards corrupt our minds and thus human society on the deepest of levels.It’s really a fundamental output of a monetary system - To incentivise and optimise our allocation of finite resources (energy) that supports and facilitates humans to innovate and flourish.We’re never going to optimise for this when our core governance structures around the world (central governments) are predicated on lying and deceiving the public (nodes in the network) given they only need to the slightest margin of a majority to push things in a specific direction. Which is essentially a 51% attack on the network.We can do better. We must do better. The separation of money and state and the adoption of a truly decentralized monetary protocol for the world is a major tool to help us better organise the incentives of our complex modern society and move in a better direction for our kids, and for the future of humanity. Fix the money, fix the world. Hope you have a great day. I’ll talk to you tomorrow.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,With the bitcoin conference currently underway in Miami there has been a ton of announcements and hype around the orange coin and as you would expect a lot of people fixated primarily on price as a result. I feel while number go up, is highly probable over time (as close to certain, without being certain), to focus on the very narrow detail of price truly is to miss the forrest from the trees. What bitcoin is enabling is so much bigger than simply capital appreciation or some kind of an investment. I realise that I could hype-up number go up tech, and it would probably be far more enticing to the average sapien running the now obsolete fiat OS, but that would be completely disingenuous of me, in opposition to my values, and frankly i have no interest in appealing the crowd that support “the current thing”. There are a plethora of hustlers out there that will happily be a vacuum for your attention if all you want is to be told bitcoin is going to one hundred million bazillion.I’m here for the peaceful revolution. I’m here for the installation and major upgrade of a new kind of psychological software - a software package that we call money. A new operating system for us to run on our somewhat primitive hardware. The kind that will completely remove the parasitic and short-circuiting fiat malware from our minds, and install a new kind of system that is and will continue to liberate and empower humans everywhere.With that said, here are a few suggestions from the conference which best capture the potential of such an installation.Hope you all have a phenomenal weekend. I’ll chat to you next week.AK#1 Bitcoin is Freedom: Panel with Alex Gladstein, Yeonmi Park, Farida Nabourema, Fadi ElsalameenProbably the best panel I’ve seen on why bitcoin is so important.#2 Peter Thiel - Bitcoin KeynoteI think he gets a couple things wrong here, specifically when comparing bitcoin and ethereum on the axioms of value and velocity. I would make the case that he’s trying to propagate a narrative around this and it’s simply false. The lightning network and the development that is coming as a result of taproot highlights this very quickly as nonsense. However the part of this that i believe is extremely important is his honesty and clarity around ESG, and it is critically important as many people begin to see this evil trojan horse for what it is.#3 Jack Mallers - The Kings GambitJack is unlocking bitcoin as a medium of exchange using the lighting network and in partnership with Shopify, Blackhawk & NCR enabling someone to pay direct from their bitcoin node over TOR and across almost any major outlet in the US. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,Taro which stands for Taproot Asset Representation Overlay is a brand new bitcoin improvement proposal, or BIP. It is a protocol designed to enable low-fee multi-asset transfers via the bitcoin and lightning network.Lightning Labs have developed this new protocol and have raised $70m in order to help bring Taro to life.I realise most of you are non-technical, so i’ll spare you the complex details. If you want to get a more detailed understanding, i’d direct you to this post from @roasbeef - the developer of the protocol.What i think is most critical to understand here is: 1)This new capability is enabled by the Taproot upgrade. This upgrade only happened in November of last year (14/11/21). Only some four months later we have a major BIP proposal. It’s insane how quickly taproot has been utilised to build on top of bitcoin and this is unlikely to be the last! 2) As a result this has the potential to completely change the game bringing non-custodial assets to bitcoin, while maintaining the inherent security, decentralization and other fundamental properties of the network. This is absolutely massive. The current system does not allow you take custody of almost anything. If you want to hold stocks, bonds etc they need to be held with regulated 3rd parties. Taro has the potential to completely change this model.3) This is completely open-source. Made in the open and for anyone to view, verify or modify to build on top of. I think the wave of open-source development that is being ushered in as a result of bitcoin generally is way under-appreciated. 4) Most people still have no idea about lightning, let alone taproot or Taro. 5) This should help offer some perspective as to how insanely early we still are in the life of this thing as demonstrated by this post from Allen Farrington yesterday from the bitcoin conference which is going on right now in Miami. It’s important to note that this Taro protocol has not been implemented yet. It will undergo somewhat of a peer review process by core devs and as with everything in bitcoin this process will take some time to ensure t’s are crossed and i’s are dotted. We have witnessed the birth of open-source money, a brand new kind of truly neutral money for the world, and now we’re seeing it grow up in real time. It’s impossible to know how things will evolve from here, but you have to just take a moment to sit back and marvel at the significance of what is actually taking place. How often does a new money come into existence? It is truly incredible to be alive to witness this, and even more so when you consider how few people really grasp the significance of it. The asymmetry that exists in respect to bitcoin has simply never been greater in my opinion.Hope you have a great day. I’ll talk to you tomorrow.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,This morning the Lebanese Government has announced the state and the central bank are officially bankrupt. This announcement comes on the anniversary of the US government confiscating gold from their citizens 89 years ago. The Lebanese deputy prime minister had this to say:“The losses will be distributed to the state, the Banque du Liban, banks and depositors, and there is no specific percentage. Unfortunately, the state is bankrupt, as is the Bank of Lebanon, and we want to come out with a result, and the loss occurred due to policies for decades, and if we did nothing, the loss would be much greater.”What an absolutely stunning statement to read.Only a few months ago I’d discussed the hyperinflation within the country and the breakdown within food and energy markets. Now the truth finally comes out. They’re broke.This is a microcosm of the broader world on a fiat standard.If citizens of Lebanon listened to these lunatics and trusted their government, and they continued to hold their money with a bank, it would now be clear that they were lied to and they’re now broke. If they used bitcoin to store their wealth, they will have successfully insulated themselves from some of the madness and at least have some options moving forward.A separate but relevant video has been circulating which includes Stephen Poloz, Former Governor of the Canadian Central Bank being asked about “opting-out” of inflation using bitcoin. The video is extremely enlightening and worth a listen. It’s attached below.He was asked: “Central banks are a key feature of Pierre Pollievre’s campaign and he had a big rally - 1000 people in Ottawa recently - and he said Canada should become the crypto capital of the world because Canadians need to be in charge of their own money supply and he used the phrase ‘through bitcoin you can opt-out of inflation’. How do you interpret what he means by opt-out of inflation by using bitcoin and controlling our own money. What’s your response to that?”The former Governor of the central bank responded as follows:“Well firstly i think Canadians do control their own money through their own central bank in a very transparent process by which it’s administered. But setting that aside, being on a bitcoin standard would be very similar to being on a gold standard except more volatile. A gold standard does limit inflation, so if the price of oil doubled or something like that all the other prices in the economy would need to go down in order to off-set it. That’s the sort of deflation you get during a depression. It’s why we had the big depressions, [and] were during the gold standards years. The Victorian depression and the depression during the 1930’s. Those would not have happened if we’d had a more conscious monetary policy and expanded the money supply to meet the increased supply that came from the industrial revolutions. So i think there is a way around all this which is to say we have an inflation control agreement - That’s how Canadians control their money supply.”He was then asked:“So for the people fascinated with Bitcoin - Can you through anything “opt-out” of inflation?” and responded as follows:“Well, no. Because bitcoin is not a legitimate transactor vehicle. It’s highly variable. So the price of things you would buy would be varying all the time. Digital currencies in a broader concept they’re definitely coming but they’ll probably be official ones, you know the same kind of money we use every day thats in our pocket. But opting out of inflation I just don’t understand that concept. Like when the price of oil doubles, how do you opt out of that?”There is so much to unpack from this short clip, it’s scary. The fact that he thinks sound money is the reason for depressions is completely insane. I do think they are speaking in respect to one kind of inflation, which is price inflation and not in respect to inflation of the money supply. This is muddying the conversation.What seems abundantly clear is that it is the belief of this former central banker, than sound money is bad, and having an elastic monetary system where they can more “consciously” massage the supply of monetary units, and thus confiscating value from you, is good. Not to mention the ability to be able to simply exclude you from the system as we saw with the freezing of citizens bank accounts with the Canadian truckers.These people are not going to save us. Ask anyone in Lebanon now how much they trust the word of the government or central bank, and i’m sure it is decisively less than 12 months ago. They have no interest in learning about or understanding bitcoin, but will force you to adopt their “official” version, that enables all kinds of parasitic capabilities over your money and spending, and essentially gives them an on/off switch whereby they can exclude anyone from the system with the press of a button.These over controlling central planners have not learnt anything from the last 50 years and seem insistent

Good Morning Everyone,The sanctioning of Russian central bank reserves by the G7 marked the end of the Bretton Woods II monetary system (1971-26/2/2022). As a result, the world is going to continue to transition away from the petrodollar and the US T-bill standard and toward a new monetary order as yet unknown.What this new monetary order will be, nobody knows for sure. We can only speculate for now. Something that just struck me when thinking about this transition is that a major symptom of this change, will be for the mainstream crowd to go down the rabbit hole on money.The average person is still unquestioning about the nature of money. Be it the paper, or plastic in Australia’s case, that you can hold it in your hand, or the one’s and zero’s that appear on the screen of your online banking app. Most just unequivocally and unflinchingly utilise the technology like it’s almost invisible and never stop to question it. Which is fine when it works i suppose. Arguably that’s the ideal outcome. That the system is so seamless and so effective, that we need not waste a moments thought on it. Just as the oxygen we breath is invisible and the body autonomously breaths in and out without any need for conscious intervention on our behalf.This would be great. But this is not where we’re at.It seems highly probable that in the short term countries will continue to trust each other less. Much less. Each individually wants to use their own fiat currency more. We have already seen Russia move to selling gas for Rubles, and having already sealed a 30 year deal with China for Gas in euros.The problem with using commodities as money, is that commodities have a very critical utility to humans. Commodities like oil, gas, and coal are the primary hydrocarbons that power grids around the world, and that enable many to heat their homes, run their cars, and cook their food. The use of such items as money will lead to much higher prices, and major shortages. We’re already seeing significant market shocks in energy and food markets. This will be a painful education process for many as to why these items are terrible “money”, but the education process will none the less happen.This breakdown in global trust and cooperation, while being painful and devastating for many, has the very real potential to be a catalyst for a seminal shift in mainstream understanding of money and may infact propel the mainstream down the rabbit hole many of us have been thrust into thanks to bitcoin.Assuming the level of internet censorship does not significantly worsen, which is a big if at this point, there will be no shortage of educational material to help people come to a more informed understanding of the technology we call money. While central banks and governments are likely to continue to try and maintain power as a result of their political currencies, there is no doubt in my mind that as the mainstream descend into the rabbit hole of money, they will inevitably arrive at bitcoin.No one said the road to a neutral monetary protocol would be an easy one, infact, it is likely to get much worse before it gets better unfortunately; but there is no question that it’s made less bad once you understand and embrace what Satoshi gifted the world with.Bitcoin is the mission.Hope you have a great day. I’ll talk to you tomorrow.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,The concept of a truly inelastic and verifiably scarce digital asset is something that i believe remains alien to most humans on the planet at present, despite having existed for some thirteen years already and being completely in the open. It’s a concept that on first glance sounds fairly simple and straight forward, but it’s such a conflicting notion compared with the world of money printing and pricing signal-distortion in which we have become accustomed, leading most to remain ignorant to the gravity of such a characteristic and failing to grasp the profound nature of this innovation we call bitcoin.We are products of a system that is predicated on the basis of infinite growth expectations, despite the obvious reality of living on a planet of finite (albeit it adequately sufficient) resources. This system has distorted our perception of value altogether. We have become deeply confused about what is truly important and fundamental to sustain life, and have strayed along way off the path as a result of a monetary system that gears our time preference, thus our behaviour, to being increasingly short term oriented. I believe our time preference is predominantly to blame for the lack of understanding and appreciation for the characteristic of digital scarcity. And our time preference is a symptom of a broken monetary system. The average person remains fixated on what the latest shitcoin is, or what meme stock is going to make them rich tomorrow (high time preference) - as a result of being increasingly time-poor we are incentivised to seek shorter and shorter term gains - rather than having any interest in deploying any serious cognitive resources toward making sense of the ramifications for this novel innovation. Perhaps it just seems to intangible to zoom so far out for most people? Maybe it is just not practical, and is subconsciously perceived to be unlikely to provide any kind of chemical reward compared with the surge of dopamine attained when their favourite “crypto” surges in price?The fact of the matter is that digital scarcity does now exist. For the very first time in human history we have a verifiably scarce asset. Not only does it exist, the majority of the supply has already been issued. Which in itself is a crazy thing to realise. Bitcoin has only been running for 13 years, and already over 90% of total supply has been issued. I saw this image the other day (thanks to @bitcoinfool) and it beautifully captured the profundity of the this alien concept. Given that we’re so visually dominant, i figured it may hit home with people a little more that the pure numbers.The image shows a circular pie chart split into 21 segments. 19/21 are filled with orange representing the already issued supply. Two segments remain black representing the remaining supply to be issued over the next one hundred and twenty odd years. When you see it like this, the visual representation of bitcoins scarcity leaps right off the page.In thirteen short years 19m bitcoin have been mined. Over the next 120 years the remaining 2m will be issued, at which point the only way to acquire bitcoin will be to incentivise someone to sell you theirs, or by selling goods and/or services for bitcoin. However as previously discussed in the below letter, the reality of bitcoins issuance and the nature of a truly inelastic and verifiably scarce asset is far more confronting. While the issuance continues for the next 120 years, 99% of total supply will have been issued by 2035 with the remaining 1% issued over the following 100 years.We have already entered a new global monetary regime following the end of Bretton Woods II - What Zoltan Pozsar is calling Bretton Woods III - and it is to be a return to scarce resources being at the core of what determines value, this is a return to re-prioritising scarcity as the fundamental property which underpins money within our complex human civilization. If this is the case, it’s going to be wild to see how the world grapples with the fact that the only verifiably scarce digital asset on the planet has almost been entirely issued. Perhaps it is in this moment that the gravity of true verifiable digital scarcity truly hits home?Time will tell.The race is on to accumulate as much as possible of the remaining 9% of bitcoin supply in the next 13 years. No doubt by this time the nature of money will have changed forever and the realities of true scarcity likely begin to sink in.Grateful as ever to be alive to witness history in the making.Wishing you all well. Hope you have a great start to your week. I’ll talk to everyone tomorrow.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

⚡️ Bitcoin For The Weekend ⚡️Article: The Blocksize War Review - Nic CarterPod: What Bitcoin Did w/ CKBook: The Bullish Case For Bitcoin - Vijay BoyapatiGood Morning Everyone,It feels like there is a ton going on in the background right now, whether it be the outright attack on bitcoin via a bogus climate change narrative or the EU parliaments incoming crack down on “unhosted” wallets, which is essentially an attack on an individuals property rights - which is absolutely wild when you think about it - many factions of human society continue to attempt to exercise control over the bitcoin network.Despite all of this my conviction on bitcoin has never been greater and seems to just be deepening with every passing day. The desperate need for the fundamental recalibration of human society which i believe this technology is and will continue to facilitate is on full display.I’ve also come to realise that while it is somewhat counter-intuitive; we actually want these attacks against bitcoin. Which is basically an attack on a set of ideas and principles, or values. It is essential to stress test the network. If bitcoin is going to serve as the primary layer of value settlement for humanity, then it will need to be subjected to every such attack. While it’s critical that the community continues to expose false narratives and vigilantly bring the truth in to the light, these attacks are somewhat of a necessary evil, and each such attack that bitcoin survives will only serve to further highlight the incredible properties of the worlds most sophisticated monetary network and educate greater and greater numbers of human society on these properties and make it increasingly clear how and why the properties that underpin the network are so important.In some respects each attack really serves as a free marketing campaign and as a mechanism that further drives the network effects and user adoption. Which really supports the concept of anti-fragility as the network not only survives any such attack, but actually benefits from the disorder and volatility.This perspective would not be possible for anyone thinking short term. It is only possible when you really lower your time preference and zoom right out. It requires us to think differently, and bitcoin as a tool or technology enables us do to this.Bitcoin really is the antidote. The antivirus software for human society to run, that will cleanse our operating system of the malware that has been installed that is short-circuiting our ability to self-organise in a more constructive and harmonious way.So bring it on. I am choosing to embrace all the attacks, the lies, and the nefarious actors that wish to prevent the unleashing of human potential that this network will usher in because i believe that they are engaged in an unwinable war against truth, and are in opposition to the fundamental laws of nature which will prove to be futile given the fullness of time. The network was designed with these nefarious actors in mind. It was built for the adversarial environment in which it finds itself. It was literally made for this. Block after block will continue to be filled with transactions and blocks mined, while humans struggle to come to terms with the inevitable reality that they cannot control everything and this network will not succumb to their rigid and pathological expectations and world views.Optimism and gratitude really are an unfair advantage in this clown world, and I’m abundant in both.Hope you all have a beautiful weekend. I look forward to speaking to you next week.AKFollow me on Twitter This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,Jack Mallers reminded me of the inspiring Apple marketing campaign from back in the 90’s when he recently shared the ad designed around the slogan “Think Different”.There is also a link here which is actually narrated by Steve Jobs. I wanted to actually read through the text for you, as it resonated with me on a deep level. It is as if it were written about bitcoin, about Satoshi, and every bitcoiner out there that see’s clearly why this mission is as important as we believe it is - and it is as evergreen today as it will be in 100 years from now.Here’s the text from the ad:“Here's to the crazy ones.The misfits.The rebels.The troublemakers.The round pegs in the square holes.The ones who see things differently.They're not fond of rules.And they have no respect for the status quo.You can quote them, disagree with them,glorify or vilify them.About the only thing you can't do is ignore them.Because they change things.They push the human race forward.While some may see them as the crazy ones,we see genius.Because the people who are crazy enough to thinkthey can change the world, are the ones who do.”So powerful.Bitcoin is pushing the world forward and challenging the status quo in a way that is so major, many who cling to certainty may find the change too challenging to bear. The default reaction of these people is to cling to the very system that preys upon them. A system designed to benefit the few at the expense of the many. Bitcoin fundamentally changes this dynamic and redistributes power from the center and back to the edges. From the few, back to the many. These words and the actions of so many within the bitcoin community remind me to remain crazy and be content with my tribe of misfits, rebels and trouble makers. Whether it be Jack Mallers and what he is doing at Strike or Jack Dorsey at Block. The number of rebels who see clearly why the world needs the round peg that is bitcoin, continues to grow. The age of predatory central banking and the nation state’s monopoly on the technology of money is coming to an end. This is the future i’m here for, and i’m inspired to be on this journey with you all.I appreciate you all.Hope you have a great day. I’ll talk to you tomorrow.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,A slew of energy FUD hit the internet this morning courtesy of a greenpeace US twitter account claiming that Bitcoin specifically is driving climate devastation and includes a hashtag “change the code” linked to a marketing campaign advocating bitcoin to adopt a less energy intensive consensus mechanism. They have created a website at the domain cleanupbitcoin.com. The first line of text on the main-page reads “you’ve heard bitcoin fuels the climate crisis” which is so predatory as it is intentionally preying on previously held biases of those that may actually take it seriously, and confirm their previously held concern or bias. They are preying on what is known as confirmation bias. The site highlights four "““facts””” about bitcoin:* “Recent estimates show Bitcoin uses more electricity than all of Sweden.”* “Bitcoin alone could help warm the planet more than 2 degrees.”* “Bitcoin is resurrecting fossil fuels.”* “A software code change could reduce Bitcoin’s energy use by 99.9%.”The marketing campaign, which is exactly that, is funded by Ripple co-founder Chris Larsen who said he provided $5m to fund “the endeavour” and is still being investigated by the SEC in relation to the sale of unregistered securities relating to ripple and XRP.For anyone that is new here i would refer you to the following articles to get you up to speed incase any of the above “facts” have you concerned about whether bitcoin is going to melt the planet. » Bitcoin Needs To Use More Energy» Proof-of-Work Is Not Just Useful - It's Essential» Is Bitcoin Worth The Energy 1/2 & Is Bitcoin Worth The Energy 2/2What i find far more interesting is the incredible individuals within the bitcoin community that are so quick to correct nonsensical and disingenuous claims, and provide verifiable data to the contrary to help level the playing field within the marketplace of information and ideas.For most people that have no understanding of bitcoin, and lack the time, intention or curiosity to investigate further they are psychologically vulnerable to these kinds of marketing campaigns so the critical role the community plays cannot be over-stated and the change in dynamic compared with that of legacy media is also a significant contributing factor.Looking at the comments from Greenpeace’s tweet is a thing of glory. I won’t read through them individually but i will include a few below so you can see for yourself.The thing to remember here, is that bitcoin is not a company with a CEO at the top of a traditional hierarchical power structure. No single entity can actually just decide to change the code, as this marketing scam infers is possible. This only adds to the comedy of it. It could be a precursor however to more combative government measures and to attack the identity, for use of a better word, of bitcoin within the town square of ideas to enable such attacks - and with how easily most people have demonstrated their ability to parrot information mindlessly these days that the news told them is true, it is not difficult to see this happening. In my estimation this is the most likely intent for this campaign, but i can only speculate.The beautiful thing about bitcoin, is that if Chris Larsen and his band of hysterics truly believe their own propaganda, they are more than welcome to fork the bitcoin codebase, and run their own network. Anyone that believes in this vision is welcome to abandon bitcoin and join their new PoS network. This story has already been told in the blocksize wars, but if some exec wants to try again I invite them to try. It would only serve as another powerful demonstration of the beauty of bitcoin and further strengthen the worlds most sophisticated monetary network.My node however will be doing no such thing, and I wish anyone dumb enough to waste $5m on this endeavour all the best for the future.Pomp nailed it with this tweet. Absolutely hilarious!Proof-of-work is one of the core fundamental innovations in bitcoin, and critical in enabling digital scarcity. Without it bitcoin does not exist.As long as people still fail to understand this, it offers an insane edge to the rest of us that do.What a time to be alive.My bitcoin can remain in cold storage longer than Chris Larsen’s marketing scam can remain relevant.Wishing you all well. Hope you have a great day, and i will talk to everyone tomorrow.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,We’re at a fascinating point in human development (or regression depending on how you think about it) where the oozing of hubris is at all time highs and the absurd belief that we can control everything has gone mainstream. We can’t even control ourselves, let alone anything else. We (on a collective societal level) completely discount the incomprehensible complexity of a world we exist as only a small part of and have become numb to our naive interventionism as so many seem to be willing to ignore the destruction caused by this unconscious and pathological behaviour.According to wikipedia a free market is as follows:“In economics, a free market is a system in which the prices for goods and services are self-regulated by buyers and sellers negotiating in an open market without market coercions. In a free market, the laws and forces of supply and demand are free from any intervention by a government or other authority other than those interventions which are made to prohibit market coercions. Examples of such prohibited market coercions include: economic privilege, monopolies, and artificial scarcities.”We are the market. You and me. This is not to say that everything would immediately become some kind of utopia if we were permitted to operate within a purely free-market dynamic. This notion is fantasy. Humans will inevitably be human and we are deeply flawed animals. We are so deeply flawed most of us deceive ourselves from even acknowledging this simple truth. A free market would consist of good actors and bad actors. But this is the case within a regulated market dynamic as well. The difference is that regulation provides a safe haven for bad actors to “game the system” where as a free market would give rise to more competition and presumably weed out these bad actors over time, or at the very least provide the market participants with superior offerings and the ability to choose. Modern day fiat banking is easily one of the best examples of what happens when we try to “fix” things.The issue with us trying to control everything and prevent bad actors is that we naively underestimate complexity and fail to acknowledge the impact of higher order effects. We perceive reality within a very narrow scope of time and a very specific set of circumstances, and often fail to observe higher order effects that take time to manifest and may not manifest in a way that directly effects us making it more likely to not be acknowledged or even noticed.We are psychologically and culturally overly skewed toward hubris and simplistic binary thinking and severely lacking in humility, and a willingness to be open to complexity and the possibility we may be wrong.Regulated markets enable and encourage 1) monopolies and monopolistic dynamics 2) distortion of pricing leading to; 3) lower quality goods & services 4) create unnecessary friction which; 5) excludes certain participants and 6) further amplifies all prior negative externalities KYC (Know Your Customer) & AML (Anti Money Laundering) regulations are prime examples of iatrogenics - which means to help but instead cause harm. This is a classic output of a market that is not allowed to operate freely, and of course the road to crony-capitalism is paved with g00d intentions.Bitcoin fixes this.While a free market is imperfect by nature (as is nature if you are looking at short time horizons) - what it does is fundamentally align incentives. It will not censor anyone per se, but it will disincentivise bad behaviour and incentivise market participants to create or supply the best quality goods and services as the market will naturally be inclined to consume these - rewarding the behaviour/output. Thus indirectly communicating in support of the offering. It allows the complex mechanism of price to be unencumbered which leads to better quality and overall lower prices for consumers. It enables new entrants to more easily enter a market where they perceive an opportunity to create a superior offering as there is less barrier to entry and encourages those already within the market to “sharpen their pencil” as it were. All of this is good for consumers on the buy side of the trade.Ironically, this is a simplistic view, as my daily letter is not a sufficient vehicle to go into a deep thesis, but hopefully you can get a feel for it.The thing that i don’t think most realise, is that we can have this dynamic right now thanks to bitcoin. Bitcoin is a tool to enable freedom. As more and more people accept bitcoin, circular economies will develop, people will naturally begin to denominate in btc as opposed to political monies, and sats will become the standard unit of account.Many people mistake the current environment for capitalism. This is not capitalism. Not even close. Bitcoin is in the process of reintroducing free market dynamics to the world, and the result is going to be glorious.Optimism and gratitude are an unfair advantage in a world of fiat-quality attenti

Good Morning Everyone,Back at it after a week of paragliding! Lets get straight into it.As bitcoin heads toward $47,000 (relative to melting USD shitcoins) i found this video of Russian supreme leader Vladimir Putin of particular interest. The video shows Putin calling a spade a spade, and rightly calling out the end of the USD as a first class reserve asset following the sanctions by the G7 seizing Russian central bank reserves.If you have been paying attention and following along - this is not news to you - but the significance of a pivotal world leader and one of the major energy producing nations calling it out certainly is. The US and others are hiding behind propaganda and Russian smear campaigns to distract the populous from this reality and the potential implications of this. Like him or loath him - What supreme leader Putin is saying here hits straight in the middle of the bullseye. He says (which is subtitled):“Let me reiterate, the whole global economy and trade have suffered a major blow, as did the trust in the US dollar as the main reserve currency. The Illegitimate freezing of some of the currency reserves of the Bank of Russia marks the end of so-called first-class assets. In fact, the US and the EU have defaulted on their obligations to Russia. Now everybody knows that financial reserves can simply be stolen and many countries in the immediate future may begin - I am sure this is what will happen - to convert their paper and digital assets into real reserves of raw materials, land, food, gold and other real assets.”As i said, if you have been following along none of this is news and has been discussed and explored multiple times including here in a previous article titled - “A Clinic On Counter-Party Risk Ensues”What is significant, is confirmation from Putin that he/Russia has received the US memo about counter-party risk, albeit a little late, but will now acknowledge reality and accept that we are entering a new monetary paradigm in which the US dollars reserve status doesn’t count for anything and is not worth the paper it is printed on. I do agree in the short term that it is likely to see most nations pivot to protecting their wealth in quote-un-quote “real assets” as he mentions, however as i discussed last week, this is historically a suboptimal strategy. Hoarding of perishables like raw materials and foodstuff and monetising of suboptimal monetary goods is a knee-jerk reaction to a much more systemic problem. But it is a problem which now has a solution thanks to bitcoin. It is certainly the case that the monetisation process of bitcoin requires more time to deepen liquidity to be able to truly serve as the global monetary reserve asset. In the short term these “real assets” will likely be increasingly used, but over time this will also act as an educational tool for the wider populous what an unsatisfactory monetary good these items actually are.As i said last week:“The problem with this is the same as why it’s problematic to have monetised real estate. By monetising real estate as a store of value, it pushes prices up. This directly and negatively impacts local people because obviously people need somewhere to live. The only reason we have monetised real estate, and may be moving toward a world of commodity backed money, is because we had not previously discovered or invented a superior system. A pristine monetary good. We need a neutral money for the world, that does not need us to trust each other in order to trust the money, or the monetary protocol. With such a monetary good, this ensures we’re not incentivzed to hoard other things people may need, like commodities, in order to store and protect value. We do not want to adopt a money with utility. Quite the opposite. The most superior form of monetary good, is something that purely full-fills the purpose of an optimum money and absolutely nothing else.”Short term it seems likely that naive interventionists will monetize so-called real assets at the expense of many humans on the planet being able to nourish themselves. Long term, the transition to the most pristine monetary good in human history has never been more obvious, and it is this transition that will usher in a new paradigm of energy abundance.Hope you all have a great start to your week. I’ll chat to you tomorrow.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,Hope you have all had a great week. Before i get into a few content suggestions for the weekend, i couldn’t leave you for the week without briefly discussing a recent development between the IMF and the Argentinian Government.The short version is that Argentina are in debt to the IMF, and have had a long and contentious relationship since joining in 1956. In this time Argentina have sought and agreed to 21 emergency financial-support programs, most of them lasting fewer than 24 months.The perspective from inside the country vs outside is very different as Arturo C. Porzecanski explained in a noteworthy article regarding the relationship between the two back in late 2021:“Outside Argentina, that record is evidence of the country’s frequent economic mismanagement. Inside Argentina, it is the rescue programs, rather than the fiscal, monetary and political causes of the country’s financial emergencies, that have come under most criticism, roundly disparaged as ill-conceived, excessively harsh and overall disappointing.”Back in 2018 Argentina borrowed more than $40b from the IMF. These funds were due to be paid back, however Argentina is seeking an extension. In a statement on the IMF website, they outline the agreement to extend repayments:“IMF staff and the Argentine authorities have reached a staff-level agreement on the economic and financial policies to be supported by a 30-month Extended Fund Facility (EFF) Arrangement. The EFF, with requested access of SDR 31.914 billion (equivalent to US$ 45 billion or 1000 percent of quota), aims to provide Argentina with balance of payments and budget support to address the country’s most pressing economic challenges and to enhance the prospects of all Argentines by implementing measures designed to promote growth and protect essential social programs.”As part of the extension included in the letter of intent was a clause to “discourage” the use of crypto-currencies. The exact language was under the heading “strengthening financial resilience” and reads:“While commercial banks remain liquid and well-capitalized, strong bank oversight will continue, especially following the unwinding of pandemic-related regulatory forbearance. To further safeguard financial stability, we are taking important steps to (i) discourage the use of crypto-currencies with a view to preventing money laundering, informality and disintermediation; (ii) further support the current process of digitization of payments to improve the efficiency and costs of payments systems and cash management; and (iii) safeguard financial consumer protection.”Basically in order for the IMF to agree to extending repayment of the loan they have slid in the need for Argentina to “discourage” the use of bitcoin and cryptocurrencies. The IMF are making a strong anti-competitive play here. They are making a play to limit the proliferation of bitcoin, while they attempt to support the proliferation of CBDCs (Read: Centrally-Binding Digital Chains). Bitcoin and crypto adoption is massive in Argentina - according to chainalysis the country is top10 for global adoption. Is it any wonder with 50+% inflation absolutely decimating the people of the country?!The IMF do not want the free market to have any say on money. But this is how money works. They are wanting to prevent the proliferation of a decentralized and open-source alternative to their centralized slave coin. They do not want countries like Argentina to be able to get out from under their heel. They want them to be debt slaves forever.While there is no doubt they can make things more difficult for the people of the country, trying to stop an open permissionless protocol like bitcoin, is no different to trying to ban free speech or ban certain numbers. The notion of it is simply preposterous. But this clearly will not stop them.Thankfully, while there is no doubt they are clearly trying - ultimately they will fail. It seems obvious that they are attempting to prevent another country following El Salvador’s lead and creating a snowball effect within South America which at this point seems inevitable. Once other countries see the profound changes within El Salvador others will rush to implement a similar playbook.Imagine trying to prevent the proliferation of the internet? Well, certain entities and governments tried, in many ways they are still trying to limit its power. But in the exact same way as they failed with the internet, they will fail with bitcoin. I’d anticipate that any action against the citizens ability to interact with this new technology will only act as a further marketing campaign as to why we need bitcoin and will trigger a huge demand for the asset.We may have to demote Justin Trudeau from the role of CMO (Chief Marketing Officer) and appoint the IMF if they keep this up.With all that said, lets get into a few powerful options for the weekend to expand your mind and deepen your knowledge.Hope you have a great weekend. I’m doing

Good Morning Everyone,In listening to an absolutely fascinating conversation between Peter McCorrmack and Nic Carter, Nic explains something that absolutely blew me away in how he thinks about commodity prices and the true connection of these costs to the humans in the world.He explains:“Commodity price charts; they’re not just numbers on a screen. They’re a measure of human flourishing basically. So if a price of a commodity gets cheaper, humans are flourishing more, and if it gets higher humans are in misery basically. So it’s an inverse flourishing index. So as metals and oil and gas get more expensive, life gets worse for human beings on planet earth. And the fact that commodities are in this enormous, monstrous rally no matter where you look, whether it’s food, commodities or metals or energy - that’s a bad sign for humanity.”This is a really interesting way to think about it, and it’s most certainly true. You only have to think as far as food to very quickly realise how significant and far reaching the increased cost of basics like wheat are on individuals, families and society more broadly.When you look at the charts of most commodities this is a pretty deeply concerning dynamic with respect to the “human flourishing index” and it suggests we are likely heading in a direction that leads to extreme pain.The other thing the ‘inverse human flourishing index’ demonstrates is stability (or lack there of) within the world order specific to trust and cooperation and with respect to global trade. In many ways, given the amount of technological innovation over the past 100 years you would expect our ability to source different resources and utilise these resources would have become increasingly efficient and thus drive down costs. And perhaps it has, but the fundamental break down in trust we’re seeing in the world and the way that is disrupting supply flows of specific resources appears to be over-riding any potential benefit that may have existed.It certainly is an absolutely wild time that we find ourselves living through. Perhaps in some respects we need to be more restrained in our consumption of resources - there is certainly an argument to be made for this. However i think the true root cause of this dislocation is a fundamental breakdown of the worlds monetary order. As this system is failing, and instruments and vehicles that were previously considered “safe” storage mechanisms for value no longer appear so. This is leading to a flight to “real assets” such as commodities and others. The problem with this is the same as why it’s problematic to have monetised real estate. By monetising real estate as a store of value, it pushes prices up. This directly and negatively impacts local people because obviously people need somewhere to live. The only reason we have monetised real estate, and may be moving toward a world of commodity backed money, is because we had not previously discovered or invented a superior system. A pristine monetary good. We need a neutral money for the world, that does not need us to trust each other in order to trust the money, or the monetary protocol. With such a monetary good, this ensures we’re not incentivzed to hoard other things people may need, like commodities, in order to store and protect value. We do not want to adopt a money with utility. Quite the opposite. The most superior form of monetary good, is something that purely fullfills the purpose of an optimum money and absolutely nothing else. Those three primary properties are SOV, MOE, UOA. Store of value, Medium of exchange and Unit of account.Either way it seems clear at this point in time, that without global cooperation and us having an ability to maintain constructive and productive relationships where we align on values, we’re heading toward some severe and sustained dislocations that will have major impacts, particularly hurting developing nations the hardest.Hopefully we can course correct, and realise we’re all on team human and work toward getting this index trending back in favour of humans flourishing. I don’t think bitcoin alone fixes this obviously, but there is no question in my mind that the world moving to a neutral monetary protocol is one of the steps we need to take to reinstall this trust, and enable us to align team human toward win/win objectives and ensure that the human flourishing index can begin to trend again in the right direction.Hope this finds you well. I will talk to you tomorrow.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,One of the most fundamental dynamics that has underpin the dominance of the US dollar since defaulting (again) in 1971 and the subsequent removal of the peg to gold, that is the removal of any tether to the physical world, is the creation of the PetroDollar system.Alex Gladstein explains this system and the historical account of its formation in his article - The Hidden Costs Of The Petrodollar. As he explains in the article:“In 1974, they sent new Treasury Secretary William Simon to Saudi Arabia “to find a way to persuade a hostile kingdom to finance America’s widening deficit with its newfound petrodollar wealth.” Simply put, a petrodollar is a U.S. dollar paid to a petroleum exporter in exchange for oil. As a Bloomberg report says, the basic framework was “strikingly simple.” The U.S. would “buy oil from Saudi Arabia and provide the kingdom military aid and equipment. In return, the Saudis would plow billions of their petrodollar revenue back into Treasuries and finance America’s spending.” This was the moment that the U.S. dollar was officially married to oil.”Now following the changing global dynamic, we may be seeing the birth of a new petro-backed monetary chess piece - that of the Chinese Yuan. There was a fascinating article in the Wall Street Journal that i’ve linked below covering this possibility.There are many elements to this I find interesting, but to me the most significant of those is the fact that metcalfes law, ie network effects, goes both ways. The move to trade oil with China in Yuan is potentially the initial etchings of the end of the petrodollars dominance.I don’t think we’re going to see some monumental rise by China tomorrow as a result of this however. Most likely China are just responding to the obvious realisations that they are vulnerable from an energy perspective. But there is certainly the possibility that they wish to attack the US dollar and its stranglehold on them and the global economy by attacking what underpins its dominance. It is also understandable that the Saudi’s will be planning for the potential that the US aims to become more energy independent and reduce their demand for oil.Simon Rabinovitch who writes for The Economist, put together an awesome thread covering some of the complexities. What he is specifically looking at in this thread is not the strategic potentials of this move, but rather “how much Yuan can it absorb and put to work”.He begins to review import/exports and considering the levels to which the Yuan accumulated as a result of such a move could be recycled.The point he arrived at was that while the Saudi’s have some runway to accept Yuan and can expand their FX reserves up to a point, they are ultimately constrained by the fact that China’s markets are still considered too narrow and volatile, and that if they were to increase it further it would risk the original petrodollar arrangement. He gives the example of Russia’s reserves just prior to invading Ukraine.The fundamental issue i see within all of this is the fact that these currencies and the regimes that back them lack neutrality. If the Saudi’s wanted to increase their Yuan FX reserves they are fundamentally constrained because they would be tied to the whims of another global power. This may upset relations with a seperate global power and add further complexity to geo-political relationships. It also means the value of these reserves is tied to this power, their monetary policies and their actions in the world.It would make so much more sense if they were to hold reserves in bitcoin. A completely neutral and censorship resistant bearer instrument which they can custody themselves digitally, and that can be transferred at the speed of light completely agnostic to borders. If this were the case, they would not be constrained by any of these issues and there would be no limit to their trade partnership. This would be a far superior mechanism in my opinion, and would alleviate much of the friction and risks that exist using the Yuan, dollar or any other unbacked piece of paper.It seems clear to me that while this transition may be unlikely to happen immediately, that at some point in time, nation states will wake up to the fact that having a significant portion of the wealth anchored to that of a rival power is suboptimal, and the utilisation of a truly neutral digitally scarce asset is an obvious and far superior choice.In the short term liquidity and the depth of the market is no doubt still a limiting factor, but over the next decade or two I believe this will change and what may seem unlikely now, will then seem obvious.Hope you have a great day. I’ll talk to you tomorrow.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,The EU parliament voted yesterday on a bill titled “Cryptocurrencies in the EU: new rules to boost benefits and curb threats”.Included in this bill was a a rule relating to Proof-Of-Work mining which reads:“ 1. Crypto-assets shall be subject to minimum environmental sustainability standards with respect to their consensus mechanism used for validating transactions, before being issued, offered or admitted to trading in the Union.Crypto-assets that are issued, offered or admitted to trading in the Union before [please insert the date of entry into force of this regulation] shall set up and maintain a phased rollout plan to ensure compliance with such requirements, in accordance with the conditions and criteria referred to in paragraph 3.”Essentially this was a direct attack on PoW mining as an acceptable method of achieving consensus.The notion that a regulatory body can ban PoW is frankly laughable, and demonstrates how far behind these people are, and how deeply they have descended into some kind of clown-world psychosis. The process that we call Proof-of-Work is simply the process of a computer guessing random numbers. That is literally it. So the EU were proposing they could potentially outlaw the use of a computer to guess random numbers? If you’re not familiar with PoW, how it works and why it’s essential - I wrote about it previously here.What is obvious at this point is that the EU can not really ban PoW or force bitcoin to change its consensus mechanism - remember, bitcoin is an inanimate object - rather all they can really do is ban themselves from the bitcoin network.We really are at peak stupidity (in terms of governance) when we have people that have no technical capabilities voting on something, that they 1) clearly do not understand and 2) is as fundamentally absurd as banning guessing numbers.If you want to read more on some of the specifics there is a great thread from Patrick Hansen that covered the situation in some detail.In what is essentially inconsequential for bitcoin, the proposal was voted 30-23 against. Keeping the provision out of a draft of the proposed Markets in Crypto Assets (MiCA) framework. Interestingly, this kind of a proposal if accepted could hurt something like Ethereum which still runs using PoW (despite planning for years to transition to a PoS model) as they have a centralized body of humans (the Ethereum foundation) where regulators could attempt to impose such a change. Bitcoin on the other hand being truly decentralized, does not. Thus any such attempt is futile.The larger theme that stands out to me is that of energy usage. It seems obvious at this point that some nation states are at war with bitcoin, and the energy usage is the battle ground and current attack vector of choice. This is of no major surprise given that bitcoin empowers the individual and disincentives the political rent seeking that many of the pseudo-elites in power have become accustomed to. Ultimately the choice each nation-state will need to make is not whether or not they approve of the consensus mechanism or any other protocol level development, but whether or not they want to ban their citizens from plugging into the most powerful monetary network in human history and disproportionately harm their society as a result. If they were to ban it, not only would they harm their society in the short term, it would most likely be the catalyst for significantly higher prices in whatever local shitcoin currency as a result which would only amplify the problem, as we saw in the US when they banned gold in the 30’s.Ultimately, scarcity drives value and eventually everyone will capitulate. The EU could never really ban PoW mining and infact situations like these just further highlight how far in front bitcoin really is. Open networks win.Hope you have a great start to your week. I’ll talk to you tomorrow.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,I thought i’d keep this theme going on a Friday, and offer a few content suggestions that may be unknown to you and potentially valuable as we go into the weekend or to cue into you playlists for the next week.Instead of recommending three books, articles and pods like i did last week, which seems unlikely you’re going to be able to get through all that, I thought i’d narrow it down a little, and point to one of each which is hopefully a little more digestible - please let me know via the like/comment section if you find this valuable or not.The piece of the week for me, is from Nic Carter titled “America’s Quiet Default”.As the title suggests, it gets into much of what I’ve been discussing and thinking about this week, which is the end of the US Dollar as the global reserve currency. Phenomenal article and i recommend you give it a read.With all that said, Hope you have a great weekend. I’ll talk to on Monday.AKArticle: Nic Carter - "America's Quiet Default"Pod: JP Sears & Robert Breedlove - What Is Money ShowBook: The Fiat Standard - Saifidean AmmousFollow me on Twitter This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,Yesterday I wrote about the thesis from Credit Suisse’s Zoltan Pozsar, who is one of the most listened to and respected macro voices around. His thesis is too complex to rehash in detail again here but essentially he postulated that we could be on the cusp of a transition back to a commodity-backed monetary system essentially backstopped by China. This would be the transition of the world order away from a US dominant - US Dollar backed system - and toward a system where the PBoC become the new cantillionaire [Someone close to the ‘money printer’ that benefits from the Cantillon Effect] on the block.His thesis is essential reading and while i’m open to the possibility of it playing out, I wanted to offer a little more nuance as to my thinking and why i believe the likelihood of us going back in time and adopting a metal based or broader commodity based monetary system is 1) Unlikely 2) would be sub-optimal and would fundamentally be a huge step backwards and ultimately fail; 3) Would mean a reversal in the trend away from the digitisation and adoption of technology that we have been on since the inception of the semi-conductor. Totally possible, but i would avoid temptation to fade this trend, until clear trend reversal were confirmed.It is critical to first differentiate that there are conflicting wants and needs in respect to this. There are the wants and needs of you and I and the “middle class”, and there are the wants and needs of the political pseudo-elites and Geo-Powers. These wants and needs are, in many ways, in opposition to one another and fundamentally out of alignment at present. The conflict here is that one class of people are forced to create value, and the other class of people benefit by confiscating that value (rent-seeking), which disincentivizes the value creation in the first place. As a matter of priority this fundamental lack of alignment should be addressed if we have any hope of course correcting and setting sail in a more mutually beneficial win/win direction.The critical factors driving my view against the idea of a commodity-backed money are 1) trust is required but never possible 2) Supply not verifiably finite + scarcity drives value (ie: we don’t know what the supply cap is) 3) encourages centralization and has already been proven to fail (incentivising cantillion effect) 4) Elasticity - Increased price brings on more supply. This essentially means that supply increases indefinitely. Something with a perceivably infinite increasing supply is a poor monetary good (ex: Fiat).It really is in many ways fundamentally a conversation about monetary properties and the hardness of money. We have seen gold fail as a money through time, be it in the Roman empire or the American empire, but there is an argument to be made that while it failed in isolated instances and periods across time, it has continued to be the default over the fullness of time (so far) - thus while societies based upon it have failed in the short term, the actual metal has persisted to be a primary choice for humans over the long term. This would likely remain true, if it weren’t for the innovation of the semiconductor, and the further innovation of energy-backed true digital scarcity. I believe that where gold has failed, bitcoin will succeed.Obviously I have a very clear bias, however my bias is based upon which system actually has the capability to operate as the superior monetary good, not which one I “want” to be a money. Ultimately while Zoltan’s thesis is conceivably possible, It is my believe that as more nation-state level actors begin to understand what this technology has actually unlocked and how superior it really is, it will be impossible to trust what one geo-power tells another they have in respect to a basket of commodities, especially when you factor in the opaque supply of said commodities; and when you factor in the option of completely transparent and verifiable digital scarcity the notion of this just seems absurd.To go back to a commodity backed monetary system would be akin to getting rid of combustion engines and aircrafts and going back to horse and cart. It’s not that it’s “never” going to happen, but i certainly wouldn’t be betting on it.The only way I could see a system like this being implemented is through force, and even if it were to be implemented the silver lining is that the bitcoin genie cannot be put back in the lamp. The mind virus of bitcoin and superior properties of the bitcoin network are simply too powerful, and as more and more people come to understand how much this empowers them and they begin to take control of this power, even if China wanted to install a global Yuan-CBDC backed by a basket of rocks and shiny metals, there is no doubt in my mind, that the people will choose bitcoin.Bitcoin is freedom money. No one in their right mind would choose to adopt a centralized shitcoin issued by a tyrannical top-down dictatorship over the only truly ver

Good Morning Everyone,As commodities continue to surge in an unprecedented way, Credit Suisse released a paper on Saturday titled Breton Woods III which highlights that we are at a major inflection point as the changes to the world order appear to accelerate.At the heart of this shift is the conflict between Russia and the US, and the actions taken by the US to apply extreme sanctions in response; but it’s important to understand that those events are merely symptoms, and not the cause. The cause is a broken monetary system, which is fundamentally a breakdown of “geo-trust” in the US dollar-backed system.To first give you some perspective on how extreme the moves in commodities are lets look at a couple of charts.Gold - Up 15% in 2022 Oil Up 66% (in 2022)EUR Natural Gas (Dutch Futures) up 220% this year, and over 5700% in the last 2 years. (THIS IS NOT A TYPO!!)Wheat up 74% (in 2022)Nickel - Up almost 200% (in 2022)These are absolutely incredible moves and they demonstrate the wild instability in global commodity markets right now.Now that you have a bit of a feel for how wild the current moves are, lets get into the article from Zoltan Pozsar at Credit Suisse:The article begins as follows:“We are witnessing the birth of Bretton Woods III – a new world (monetary) order centered around commodity-based currencies in the East that will likely weaken the Eurodollar system and also contribute to inflationary forces in the West. A crisis is unfolding. A crisis of commodities. Commodities are collateral, and collateral is money, and this crisis is about the rising allure of outside money over inside money. Bretton Woods II was built on inside money, and its foundations crumbled a week ago when the G7 seized Russia’s FX reserves…”Lawrence Lepard discusses this crumbling of the foundations in the clip below and articulates the situation with clarity and the advertisement for state-less money as he puts it, as a result of the weaponising of the monetary system for political reasons.Pozsar goes on to lay out his thesis - that in prior crisis the US fed has been the backstop, but this is no longer possible given that western nations are the ones imposing the sanctions.“If we are right, and if this is a “crisis of commodities” – a 2008 of sorts thematically, if not in terms of size or severity – who will provide the backstop? We see but only one entity: the PBoC! Western central banks cannot close the gaping “commodities basis” because their respective sovereigns are the ones driving the sanctions. They will have to deal with the inflationary impacts of the “commodities basis” and try to cool them with rate hikes, but they will not be able to provide the outside spreads and won’t be able to provide balance sheet to close “Russia-non-Russia” spreads.”If their thesis plays out, when we look back at history, this is likely to be the inflection that marks the end for the US dollar as the global reserve, and the rise of the new world order born of a Chinese-driven commodity backed monetary standard. Wild.The US is trying to hurt the Russian Government by applying sanctions and freezing assets, but in many ways, this is accelerating a move away from a monetary order dominated by the US. It is sending commodity prices through the roof, disrupting global trade, will force further devaluation of the USD and is likely to significantly accelerate inflation and make it very difficult for the US fed to hike rates - many analysts had priced-in 7-8 hikes in 2022 which now seems unlikely .The article finishes with the following:“The Fed and other central banks will be able to provide liquidity backstops… …but those will be Band-Aid solutions. The true problem here is not liquidity per se. Liquidity is just a manifestation of a larger problem, which is the Russian-non-Russian commodities basis, which only China will be able to close. Do you see what I see? Do you see inflation in the West written all over this like I do? This crisis is not like anything we have seen since President Nixon took the U.S. dollar off gold in 1971 – the end of the era of commodity-based money. When this crisis (and war) is over, the U.S. dollar should be much weaker and, on the flipside, the renminbi much stronger, backed by a basket of commodities. From the Bretton Woods era backed by gold bullion, to Bretton Woods II backed by inside money (Treasuries with un-hedgeable confiscation risks), to Bretton Woods III backed by outside money (gold bullion and other commodities). After this war is over, “money” will never be the same again… …and Bitcoin (if it still exists then) will probably benefit from all this.”This is an absolutely mind blowing piece to read in all honesty. I recommend you take the time to check it out yourself obviously to capture the full detail of his thesis. Many bitcoiners suspected and theorised for years that in the event bitcoins price rises to insane levels, it likely does so along side major problems in the world - which none of us re

Good Morning Everyone,This morning I just wanted to write to say thank you.Today is the three month anniversary since beginning this letter. Since beginning I have written & recorded every day (Monday - Friday) and have written 63 pieces and recorded over 300 minutes of audio spanning a massive range of topics from the nuance relating to the Bitcoin networks energy usage and it’s proof-of-work consensus mechanism to the societal and geo-political implications of the world order - and everything in between. If you haven’t already had a look through the website at past content you may have missed, i’d recommend doing so as much of it will be evergreen.It’s been a massive undertaking beginning this project, and I’ve had many moments where i’ve questioned the time commitment of it, which is sometimes my entire day, but I began doing it because I believe sharing this information and supporting the proliferation of an open, censorship-resistant global monetary standard for the world will change everything - and i believe this now more than ever. I hope you are finding these letters useful and it’s offering perspectives you may not of otherwise been exposed to and encouraging a level of curiosity to challenge former assumptions you may have. Also I’d love to hear your own thoughts and feedback so please utilise the comments section on the site to keep the conversation going!Please share the letters around and encourage others to subscribe if you believe it is of value and to support my work - and if you haven’t become a paid subscriber, please consider doing so. I have structured the cost/content to ensure there is a fundamental asymmetry for you to leverage 💪It’s been an absolute privilege to have you on this journey so far, and i hope the letter can be a spoke in the wheel of learning for many many more people, as the world awakens to the power of the most sophisticated monetary network in human history, and the deep and profound properties that underpin the network.ANIMO ET FIDE 🙏Onward, Hope you have a great day. I’ll talk to everyone tomorrow.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,I want to spend this morning talking about bonds, which are certainly not something i’m not an expert in. Lets begin at the beginning - According to Investopedia:“A bond is a debt or promise to pay investors interest payments along with the return of invested principal in exchange for buying the bond.”Essentially governments issue bonds as a mechanism to raise capital and to support spending and obligations. In exchange they return an interest payment, commonly referred to as a coupon. They are traditionally considered low-risk because the government backs them. This has been true specifically for US Treasury Bills given the US Dollar reserve status, and the dominance of the US as a global power. This varies however depending on their ratings, which are applied by a handful of rating agencies. Traditional portfolio construction was based upon the classic 60/40 split. 60% stocks. 40% bonds. The idea here that 40% of the portfolio was very low risk and would provide a small yield and limit overall portfolio risk while the other portion would seek slightly higher risk/return opportunities. In a historically low interest rate environment, like the one we’re in, this traditional allocation is challenged and essentially means people buying bonds are loosing value in ‘real’ terms meaning when adjusted for inflation.I think the entire notion of a bond is really interesting. While predominantly they’re viewed as a means of earning low-risk yield, it’s not exactly clear what they’re actually backed by. I guess you could say they’re backed by the trust, simply that they will be repaid. They’re also some what of an endorsement of a government when you consider it as simply capital raising. If you believe in a company and their mission you may wish to support them in achieving their goals. While this may not be the lens in which most purchase bonds, it’s difficult to ignore this reality.Back in November of 2021, El Salvador President Nayib Bukele announced his plan to launch Bitcoin-backed bonds often referred to as Volcano bonds due to their plans to mine bitcoin from the geothermal energy provided by many volcanoes in the region. I wrote a little about this back in the beginning of the year which may provide some more colour.The bitcoin bond is an entirely new mechanism for nation state capital raising and one that has some extremely interesting characteristics worth exploring. Typically for smaller nations, their government bonds tend to receive lower ratings, and thus attract less investment capital. This often leads them to have no choice but to accept the predatory loans from the IMF. El Salvador’s Volcano bond could dramatically change this dynamic and give smaller nations a potential way to get out from under the heel of the IMF. It’s essentially a mechanism to crowd-fund outside of the traditional method of borrowing from the IMF where there were previously little other alternatives. Instead of the purchaser needing to trust in the fact the government debt will maintain some arbitrary value, and they will remain solvent and be paid back, they have the backing of bitcoin instead which makes it somewhat of a more trustless and verifiable transaction - if you believe in the long term vision of bitcoin.The capital raised from the initial $1b bond, will support a $500m infrastructure spend including but not limited to the development of a new city, they’re calling ‘Bitcoin City’ and the mining infrastructure to access the geothermal energy and convert this into electricity as well as a $500m purchase of bitcoin.The specifics are outlined in the image below with the headlines being:* $1b of notional value* 10Y Duration (Maturation: 2032)* 6.5% coupon * 5yr lockup on bitcoin allocation* Investments of >$100,000 will quality investors for citizenshipSince announcing this plan, El Salvador have come under fire from the IMF who have tried to warn them away from doing this and attempted to discredit the country and Bukele’s decision making. Rating agency, Moodys, also lowered the rating of the countries debt sighting “deterioration in the quality of policymaking” and the decision to adopt bitcoin as legal tender “as a sign of weak governance”.Obviously the IMF like any bank etc, wants to keep customers, it wants to keep people in debt. In this case countries are the customer, but the basic premise here is no different. So it’s no surprise they have been fairly hostile to the actions Bukele is taking.There is a really major element to this that i think is being completely overlooked.The bitcoin (volcano) bond, is an energy backed bond. It is so powerful, because at the same time as raising this capital, it supports the country in working to achieve energy independence. Perhaps a few months ago if i highlighted how big a deal this was, it may not have hit home with people - but now given the situation with Russia and the energy implications it is exposing globally, this is an absolutely profound featur

Good Morning Everyone,I feel like I’ve unloaded a ton of information on you guys this week, and particularly the last two letters where fairly deep (and long) so I thought I’d keep it short today, and offer you a few links to content that i believe are super valuable.I did want to frame it appropriately before doing so, and offer my perspective on content, but more specifically books, as there is a profound asymmetry that exists that i think few tend to see.I wrote about this in more detail a while ago linked here 2140.blog for anyone that is interested, but i’ll offer a brief explanation.First consider what is distilled into a book. In many cases it can be a life’s work or an accumulation of information over decades. It’s also a filtration process, whereby the author is filtering signal from noise for you, so you don’t have to. Then the book is the transmission mechanism for the information from the author to the reader.The asymmetry is essentially this: Think about what the downside is to reading a book. This could apply to a podcast, or any other content, the only difference is those are often more disposable, and may not have the same signal:noise ratio you’re more likely to get due to the commitment required to write a book.The downside is very low. Worst case scenario is basically that the book sucks, maybe you wasted $20 and few hours of your time. Where as the upside is that the book could completely change your life, the impacts of which are profound and far reaching and potentially changing the lives of those around you and your community which is to change the world.With that said allow me to offer some suggestions for the weekend.Hope you have a great weekend. I’ll chat to you all next week.AKBooks:The Bitcoin Standard - Saifidean AmmousThe Price Of Tomorrow - Jeff BoothThe Sovereign Individual - James Dale DavidsonPods:Russia Ukraine War / Global Macro w/ Luke Gromen & Preston PyshAndreas On Bitcoin NeutralityArticles:Bitcoin Is Time - GigiShelling Out - Nick Szabo / Audio here thanks to Guy Swam - Bitcoin Audible This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,US Fed Chair, Jerome Powell testified to congress yesterday under the title of “Monetary Policy and The State Of The Economy”. In the hearing he made some very interesting comments specific to “cryptocurrency” that i believe are worth a mention. I’m paraphrasing here- but he was asked if Russia “could” use cryptocurrencies to “get around” sanctions.He responded by saying:“I don’t have any private information on the extent to which that is happening [Russia is using cryptocurrencies to evade sanctions], but that is something you read about and hear about and I just think [that] it underscores the need for congressional action on digital finance including cryptocurrencies.We have this burgeoning industry which has many many parts to it, and there isn’t in place the kind of regulatory framework that needs to be there. It was probably no different with rail roads, telephones or the internet and ultimately whats needed is a framework and in particular ways to prevent these un-backed cryptocurrencies from serving as a vehicle for terrorist finance and general criminal behaviour - tax avoidance and the like - So i guess that’s what i would say there, I don’t know the extent to which it’s happening although you do hear that and read about it in the paper.”I find many things about his comments both hilarious and also thought provoking. The first is that the most senior person in the Federal Reserve, of the country managing the worlds reserve currency (for now) is basing his statement off of rhetoric that you “hear about and read in the paper”. You honestly just cannot make this stuff up at this point. He has no data or any kind of evidence of anything, but despite the fact believes they require congressional action to essentially regulate the industry. If you are unclear of whether or not your roof has a leak and there is no evidence like a body of water on the floor of your house, you don’t just automatically decide we should fix the leak. You determine if infact there are any which is normally fairly obvious.Second is his clear view of the need for a “framework” for the crypto industry. The third point and most interesting to me is around the ability to censor entities financially. This is a deeply philosophical point. It highlights to me how comfortable many people have gotten operating within a system that has these capabilities and the desire exists to maintain this capability. That is to maintain a network that is not neutral. Where some nodes in a network have power over another. Whether it be to surveil transactions, freeze assets or completely remove access from the system.This is where what bitcoin enables is just so transformational. It’s a complete system level change and it’s interesting to think about because i think a lot of people are going to feel this way, and to some extent very understandably.I would expect for most people the idea of having a system that can censor and exclude people is with good intentions. An example would be in the case where someone or an entity wishes to inflict harm - which is obvious and completely understandable and reasonable.We have existed within a system of control like this for our entire lives, so it’s natural that most would be accepting of this type of a system.What I think is under appreciated about designing or programming a system that is not neutral, are the higher order effects that are created. Often because we are judging the output of the system over a short time horizon, we fail to realise that this lack of neutrality often leads to the failure of the system.When it comes to money. This is absolutely and verifiably the case. For evidence of this, just look at what is happening around the world in respect to the US dollar. Russia, China, likely India, and others are looking for alternate ways to transact, due to the weaponization of the system. The censorship and the fact that the system does not remain neutral, is this weaponization.Now it’s tricky, because we don’t want to enable evil people to do evil things. I think most of us would completely agree that we do not want that. The thing is that the measures taken do not stop evil people. They may stop some, but they do not fundamentally solve the issues. And they do so at the expense of every single participant in the network and the viability of the network itself. Because in order to do so, every other participant is essentially stripped of their rights, like their privacy, to enable the non-neutral capabilities and this fundamentally weakens the network and from a monetary point of view is the beginning of the end.The slippery slope never stops there due to the incentives of a centralized network, and this is especially true when we’re talking about a centralized monetary network. Individuals closest toward the centre are always going to, over time, use these powers for nefarious purposes and for their own self interest. It’s just the unfortunate reality of human nature. This do

Good Morning Everyone,The world order is changing fast right in front of our eyes. The implications of the war that has begun are far reaching and constantly evolving. The following quote from Vladimir Lenin captures my sense of the situation:“There are decades where nothing happens and there are weeks where decades happen.”- Vladimir LeninThe amount of bad information online has honestly never been higher. I’ve seen videos shared apparently from Ukraine, that was actually from a starwars movie (with storm-troopers in the video!) and that have been shared by mainstream media outlets, as well as propaganda relating to the Ukrainian PM with images of him in full-camo as if he were going into battle that are actually from a year ago. I could go on, but the point is it’s easy to get lead astray right now, and very difficult to separate the signal from the noise.For this reason, i believe it’s more valuable to focus on the larger themes at play as these, just like higher time frames on a chart, imply a higher signal:noise ratio.The big theme as we have discussed is that the world order is in flux. It’s incredible to me to witness the way the attention of the masses is as if it were attached to a string. One day it’s COVID and a fixation toward masks and vaccination status - next it’s war.Now with military conflict breaking out, and all eyes on Ukraine, I’m most curious to see if the situation will escalate, and if it does, how China will respond.Ray Dalio has written a recent piece that i’d like to point you to, which is insanely valuable. I’m constantly amazed at what the internet has enabled, and to be able to access content like this at zero cost is drastically under appreciated.Focussing On External Conflict - The Russia-Ukraine-Nato SituationRay basically outlines his 2 major concerns. That being 1) NATO being drawn into this war triggering an escalation 2) How supportive will China be to Russia.The article captures the broader view with clarity and a laser sharp historical context you’re unlikely to get elsewhere and I urge you take the time to read it.What I wanted to highlight was from the very end of the article where he laid out his Power Principle which is as follows:“Have power, respect power, and use power wisely. Having power is good because power will win out over agreements, rules, and laws all the time. When push comes to shove, those who have the power either to enforce their interpretation of the rules and laws or to overturn them will get what they want. It is important to respect power because it’s not smart to fight a war that will produce more pain than reward; it is preferable to negotiate the best settlement possible (that is unless one wants to be a martyr, which is usually for stupid ego reasons rather than for sensible strategic reasons). It is also important to use power wisely. Using power wisely doesn’t necessarily mean forcing others to give you what you want—i.e., bullying them. It includes the recognition that generosity and compromise are powerful forces for producing win-win relationships, which are fabulously more rewarding than lose-lose relationships. In other words, it is often the case that using one’s “hard powers” is not the best path and that using one’s “soft powers” is preferable.”This lead me to thinking about bitcoin - and money as a system of control more broadly. This system is relevant from the perspective of the individual as well as on a larger scale between nation states as we are seeing play out with this current conflict.It’s important to understand the historical context of economic wars, to appreciate how significant they infact are, and how close it indicates we are from a wild escalation in Kinetic warfare. Ray outlines these in the article, and i’ve touched on these recently but the central point is this:“Shortly before there is a military war there is an economic war that typically includes:* Asset freezes/seizures* Blocking capital markets access* Embargoes/blockades. “We are seeing these first two measures being taken in response to Russia invading Ukraine. So a tit-for-tat escalation is a very real possibility and could ensue much faster than what most may realise. Given this possibility it’s timely to consider how best to insulate oneself, that is to protect what power we do have, even in our own small ways. It is historically difficult to protect ones wealth in times of war as Ray points out in the article, and as i’ve stated many times, that i believe bitcoin is the most transformational tool to empower the individual to protect their’s - which is to protect your economic power in the face of uncertainty relating to the impacts these events may have on individual currencies, different assets and markets as well as how individual governments and/or central banks may change the rules of the game to suit their own means, as we have seen in Ukraine.As Ray states in the article:“Protecting one’s wealth in times of war is difficult because normal econ

Good Morning Everyone,As financial sanctions, bans and the freezing and confiscation of assets become all the rage amongst politicians and legacy media the world over in response to the Russian conflict, and in an attempt to condemn the actions of Vladimir Putin, it’s hard to cite a more significant series of events to demonstrate how Bitcoin truly fixes this.I really am amazed and completely bamboozled quite frankly, by the fact that so much of the world still fails to recognise the level of risk to which they’re actually exposed and specifically to the counter-party risk which is so multifaceted its scary. The legacy system is a system of trust that is not backed by anything, and there is an endless number of examples as to why you would be a fool to trust it. A system that strips you of your rights and ability to custody your own assets. A system that disincentives you from holding bearer assets and is based on taking from the future (debt). A system were the rules can be modified and weaponised against you and enable a 3rd party to censor your access. There is clearly such a giant knowledge gap on the part of bitcoin detractors preventing them from grasping this. It seems at this point that the only thing that is going to help them get the message unfortunately is pain. As Lyle Pratt said below:Naturally every central bank has no choice but to be seeking alternatives right now. Trust is fundamentally asymmetric. It takes a long time to build, but can vanish in a split second. Just like in 2008 when the US demonstrated that they would devalue the currency in a historic way at the expense of all those that were forced to hold massive amounts of USD in FOREX reserves due to being trapped by the petrodollar system, it becomes simply impossible for any node in the legacy system to trust that sanctions and financial attack would not one day come for them.Nic Carter said it perfectly:I cannot imagine still trusting banks or any financial intermediaries for that matter. Certainly not with any significant level of capital. The notion of that is simply insane as far as i’m concerned. If that is how i feel, i can only imagine what Putin would be thinking. What would every central bank be thinking? What would the super wealthy all around the world be thinking? Would they be ok with the level of counter-party risk they’re exposed to?With pressure on all intermediaries including centralized crypto exchanges to censor any Russian accounts Kraken CEO Jesse Powell has been vocal on the critical nature of properly securing your bitcoin keys and taking custody of your wealth which is powerful and demonstrates his principles given the incentives that exist.In a tongue-in-cheek response to the Canadian government condemning he and others from recommending people custody their assets, Jesse said:He also discussed recent calls for more censorship, specifically of Russian accounts, in an excellent thread included below - i urge you to have a read.This is akin to the CEO of a major bank saying “get your money out, it’s not safe!” Pretty incredible.To consciously elect to remain in a system that can literally flick a switch and erase any existence of your wealth is absolute madness. A system that will not allow you to custody your own assets and that enables the freezing and/or seizure of those assets is madness.There really is only one alternative. The greatest risk right now is not bitcoins volatility. It’s storing your wealth in the legacy system where it could vanish over night if your government decided to engage in some kind of war, and steal your money from you to pay for it. This is no longer a fringe idea. Leaders the world over have no choice but to seek alternatives. Do not wait for pain to educate you. Do the work now if you have not already to insulate yourself from counter-party risk and opt-in to the most sophisticated monetary network in human history. There has never been a better mechanism to transport value across time and space, and that enables you to take the power and responsibility to custody it yourself. Grab that opportunity with both hands and opt-in to the peaceful protest that is bitcoin.Ever grateful to the genius of Satoshi in moments like these.Hope you have a great day. I’ll talk to everyone tomorrow.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,As the situation in Europe continues to develop, and world leaders posture and signal to their people about how they intend to act and how righteous they are, rather than allowing our minds to be on the end of the strings of the powerful and our attention to be captured and controlled by the legacy media machine, i want to turn our attention to something far less cortisol inducing being Network effects, or Metcalfe’s Law.Metcalfe’s law named after Robert Metcalfe states that the value of a telecommunications network is proportional to the square of the number of connected users of the system (n2).The network grows exponentially as the number of users of the network increases. As discussed previously, this effect is even more pronounced with monetary networks due to the incentive that exists to join, as well as the disincentive that exists not to join; that is the longer you delay joining the network, the fact that those that joined early benefit disproportionately implies you are comparatively disadvantaged.With all the talk about banning Russia from the SWIFT system, one thing that doesn’t appear to be as well understood about Metcalfe’s law, is that it works both ways.Not only does the network grow exponentially as the number of users increase, so too does it grow smaller as the number of users decrease.By removing any nation from being able to interact with, and as part of the network, it actually harms all participants as it directly impacts the protocols network effect, which is the fundamental underlying property that gives it it’s stability and power.As per the SWIFT website, it states the system is neutral. The system may have been designed to be neutral, but as we know, it is most certainly not the case. It is vulnerable to human influence and the protocol design does not prevent this. We have seen this demonstrated with Iran being sanctioned and thus excluded from the network in 2012. If Russia were to be cut off from the system, given Russia’s size and economic significance in the world, and also the clear alliance that exists between China and Russia as well as the China/US dynamic, this move would be far more significant for the overall health of the network and could see Metcalfe’s law begin to accelerate exponentially to the downside as participants are essentially incentivised to seek an alternate system in the face of the current system being weaponised and entities seeking a truly neutral option that insulates them from the political attack of other nations.Historically speaking, the moment a money becomes a tool that can be used against you and as a means of exerting power over you, it seizes to be a good form of money, and people will naturally seek alternatives. We have already seen a 30-year deal between Russia and China for the supply of gas in Euros and have discussed the trend of de-dollarization multiple times already. I believe it is evident that we are in the throws of a major historical inflection point as countries transition in response to the changing environment leading to the decline of the US Dollar as the worlds reserve currency.In the short term Russia, China and the like could trade in euro’s or we may see China try and push for some kind of Yuan-ification. India has said it is exploring ways to setup an alternative to enable trade with Russia in the face of increasing sanctions.According to one article, government and banking sources said:“India is exploring ways to set up a rupee payment mechanism for trade with Russia to soften the blow on New Delhi of Western sanctions imposed on Russia after its invasion of Ukraine.”Whether that is a move by India to try and gain some power in the global currency wars, i am at this moment unsure and don’t have a strong opinion.What is clear to me is that most are still operating under an old and obsoleted paradigm. Nation states, and the powerful few that represent these want to control these systems as a way of protecting themselves from having the system turned against them, as opposed to the obvious, which is to adopt a system that does not require anyone to control it and thus is truly neutral. This is counter to every system that has come before it. Whether it be China trying to push for the increased use of the Yuan or India doing the same for the Rupee makes little difference. While those alternatives can suffice in the short term, in the long term they would suffer the same fate.In the face of the invasion into Ukraine, there were significant funds transferred via BTC, ETH and USDT to ‘support the people of Ukraine’. This is Metcalfe’s law playing out in real time. While Ukranians had their access restricted to payment service providers by the central bank, people flock to seek an alternative.In response there were many people that had an opinion and that bitcoin shouldn’t be used to “support” war and that the network effectively should censor these transactions. Surprisingly few still seem to get this

Good Morning Everyone,As most are probably aware, Russia invaded Ukraine yesterday. The situation is wildly complex and there are myriad potential implications, responses and higher order effects that could transpire as a result. The situation is far too complex for one person to capture in a short letter. I want to focus on a few of the themes i’m thinking about this morning and that i believe are worth paying attention to. First is that very few people want this. War is brutal, and likely results in a significant loss of life and unimaginable hardship for many. My thoughts go out to everyone that is effected both locally and abroad, and I hope every single citizen and their families are safe. It’s times like this that being on an island a long way away seems like a blessing, and i’m grateful my family and I are fortunate to be living in a place where the thought of another country unloading missles in the middle of the night is not something we have ever been concerned of. However i do believe these times may very well be changing.I will try to do my best and view the events as mechanically as possible. This situation has clearly been percolating for some time, and this looks like being the beginning of a bigger shift. The geopolitical chess pieces had been setup and were posturing, and this is the lead domino.The themes that are top of mind for me this morning are:* China. What will they do if anything? Will they look to strategically leverage this situation and treat it as an opportunity?* How will the US & Allies respond? Will they respond?* Energy costs. Oil and gas particularly and the implications for how this impacts supply, trade and as a result, price. Also higher order societal implications of increased energy costs are major.* US rates. The US rate cycle is the most significant economic driver of much of what we’re seeing in the markets.* Money Printing, DXY and the US Dollar* Bitcoin. People treating it as a risk-on asset are lost in high-time preference thinking.These previous two letters included below offer some relevant things to think about specific to war in relation to monetary reset, and also some potential higher order effects of the US leaning on the SWIFT system as a weapon against Russia.What’s fascinating is that Russia appear to have realised they have an edge over the US in the global chess match. While tension has been extreme between China, they are calling the US’ bluff, and moving to invade Ukraine regardless. And not only that, but they will economically benefit. Russia are a net oil exporter, and they produce nearly 20% of the worlds oil. So while the price of oil rises, they are benefiting while the US is a net importer despite being the worlds largest producer they are negatively impacted. As the price of oil continues to rise this dichotomy grows. So Russia have found a huge asymmetry and are exploiting it. The US’ reliance on the importing of oil also means that the likelihood of them trying to cut off Russia from the SWIFT system is low, as this would send oil prices even higher and harm the US citizens disproportionately. The US focus toward China also provides this edge. If the US did move to support Ukraine in a meaningful way (which i believe is unlikely), that would give China a major edge over the US to move on Taiwan. So the US finds itself in somewhat of a bind.There have been reports of Chinese jets in Taiwan’s airspace this morning. What is China’s position in response to Russia’s move to invade Ukraine? Do they oppose the move (doesn’t look like it) or do they see it as a reasonable global restructuring much like them taking back control of Hong Kong in 2019 and looking to “reunite” with Taiwan as well? It’s valuable to think back to the situation in Hong Kong, as it’s easy to get emotionally triggered by events, and to immediately think worst case scenarios - reflecting on history can help provide clarity. China basically asserted itself on Hong Kong, a major financial hub in the world, and imposed its rule upon the people of Hong Kong. And what did the US or anyone else do? Nothing. Some three years later, and it’s clearly established as part of mainland China and the world has moved on and is distracted by something new. So it’s not hard to see the US and others providing a ton of lip service and talking big, but actually doing very little.I would be shocked if China do not try to leverage this situation. How exactly likely depends on the US response. Do they wait for the US to deploy resources (if they even do) and be ground down a little before some kind of decisive move, or do they move on Taiwan sooner than later, while eyes are focussed on Europe? Make no mistake - all nation officials around the world will be having these conversations and enacting protocols in response. What they are, and when or how they are deployed is yet to be seen. All of this comes while the US is talking hiking rates and a cyclical shift. Whether or not this really happens,

Good Morning Everyone,When nation states have disagreements and to some extent oppose one another, there are a number of typical actions that can be taken in response as a means to try and assert oneself and desires upon the other and achieve some kind of a resolution. The most severe escalation of these actions is of course being out-right kinetic warfare - ie guns and violence - but there are other forms of war that typically precede this, including (but certainly not limited to) informational, geo-political, and economic wars. Economic wars vary in scope from trade wars, as we have seen escalate between the US and China in recent years, to tariffs on specific goods as a means to try and cripple pivotal infrastructure needs or capabilities, or restrictions around the types of goods that are acceptable for import/export. Things can escalate from trade wars to financial sanctioning, and attempts to restrict the flow of capital as a means of more significantly choking and ‘disarming’ a countries ability to operate, and trying to economically suffocate their opponent. Globally this could be by removing access to the SWIFT system or freezing or confiscating locally held assets or accounts.The US as the world reserve currency have had a fundamental asymmetry in this respect as the cost to impose financial sanctions is minimal, but its effect on an opponent is crippling. Leading to this being a much used arrow in the quiver as you can see from the image below - showing some 37 sanctions in the last 18months alone.The problem with financial sanctions is that they provide diminishing returns over time, similar to a sharp sword that becomes blunt the more it’s used and ultimately being rendered useless. The use of such actions incentivises a move away from any system that enables this and in the process removes a major source of power from their opponent. The critical thing to understand here, is that financial sanctions are an act of war. This is not my opinion. This is well documented and continuously demonstrated by history.What we have seen in Canada is the government declaring an economic war upon the countries own citizens, and invoking emergency powers to enable such actions from being implemented free of any legal due process or really any legal restrictions whatsoever. They have attempted to seize assets and freeze accounts of anyone that opposes them in an attempt to economically strangle and suffocate citizens that oppose their political rule. If Financial Sanctions are an act of war, then a run on the banks - that is to custody your own assets - is the appropriate response and the single most effective way citizens can retaliate and project power in the face of such an attack.The following is an indication that this is exactly what is happening.There are 4 charts below, showing outages from four of the major Canadian banks. The outages are from about a week ago, but according to downdetector.ca the outages continue to be significant and wide spread. Obviously these institutions are not open, public networks, so we cannot track outflows on-chain like we can with the bitcoin network, but it’s a safe assumption that the coordinated outages of the major Canadian banks are not just a coincidence and are most likely in response to the initial signs of a run on the banks in progress, and in direct response to the disproportionate actions taken by the Canadian government.I would make the argument that this is the primary reason supreme leader Trudeau has announced they are now revoking the emergencies act, just two days after a vote on it being formally implemented.I’ve attached a clip below where Jordan Peterson even stated that he had been in contact with a reliable source within the Canadian military and he said this:“That if I had any sense I’d take my money out of the Canadian banks, because the situation is far worse than i’ve been informed".”This is an absolutely incredible thing to hear, in amongst a series of fairly incredible events, and at some point the dam has to break.The bitcoin clinic being run by the Canadian government right now to educate their population on the necessity of self custody is, if it weren’t so heinous, something we should almost be pleased about. Obviously it is horrific and I’d not wish this on anyone.The facts are simple.If you do not have custody of it, and you can not project the power to protect it, then it’s not yours.This should serve as a wake up call to everyone that has been idly sitting by and silently complicit as government slowly erode the rights of citizens, to learn from what is happening in Canada and understand and truly, deeply acknowledge, that these kinds of actions are not a matter of if - they are a matter of when. And as discussed previously - Governments and central banks are planning for it.It does not matter how much you think you can trust an entity, or how sophisticated you perceive the society or trust in the rule of law. If the system - and the in

Good Morning Everyone,I can see the initial etchings of an interesting trend that i believe is worth paying attention to. The trend is of intelligent people that did not understand bitcoin and why the world needs it, but are slowly but surely being awoken to its power and necessity and demonstrating the psychological flexibility to change their mind. Which is a competency I have a ton of respect for, but few demonstrate.One of the most notable people recently is David H Hansson who goes under the twitter handle @dhh. David is the creator of Ruby on Rails, an open-source web framework that he created in 2003 which has enabled many of the major platforms you have most likely used or at least know of like airbnb, Twitter, Github and Shopify. He also co-founded a company called base-camp and most recently one called Hey - which is to use his own words, focussed toward “turning email into something you want to use, not something you’re forced to deal with.”DHH is a super interesting character, and given his background and verifiable vision, certainly at minimum specific to technology, the fact he did not see why the world needs bitcoin speaks volumes. He put his thoughts on “paper” in an article called “I was wrong, we need crypto”.While I don’t believe he gets everything right in this (and I actually reached out via email to offer some alternate views), there is no doubt he has seen the light, so to speak, and clearly has a line of sight now to the critical need in the world for bitcoin, much to his surprise.As he says:“I still can't believe that this is the protest that would prove every Bitcoin crank a prophet. And for me to have to slice a piece of humble pie, and admit that I was wrong on crypto's fundamental necessity in Western democracies.”He goes on to outline exactly as we have discussed recently - that tyranny is the ultimate marketing campaign for bitcoin. Nothing promotes censorship-resistant, un-confiscatable money like having your bank accounts frozen and being unable to buy groceries because you donated $25 to a good cause.His specific reasons for the skepticism and inability to have a line of sight to the “why” i think is a very common one amongst individuals in privileged and seemingly well ordered and functioning societies - which is simply that they don’t need it - Yet!He explained as follows:“To say I've been skeptical about Bitcoin and the rest of the crypto universe would be an understatement of epic proportions. Since the early 2010s, some of my most ferocious Twitter battles have been against the HODL army with the laser eyes.There's just so much to oppose: Bitcoin's grotesque energy consumption, the ridiculous transaction fees and low throughput, the incessant pump'n'dump schemes in shitcoins, the wild price swings in the main coins, the obvious fraud that is Tether, the lack of real decentralization in most of the current web3 infrastructure, and on, and on, and on.Beyond all these very real problems and challenges, my bigger beef was actually fueled by a lack of imagination. I could see the fundamental promise of a digital currency free of banks if you were living in a failing state like Venezuela or an overtly authoritarian one like China or Iran, but how was this relevant to the vast number of Bitcoin boosters living in stable Western democracies governed by the rule of law?”The level of confusion that the shitcoin casino and all the bs around “web3” and the noise relating to energy consumption and politically motivated rhetorics has had on the minds of the many, including proven technology visionaries like DHH cannot be over stated. If someone like dhh dismissed it, then it is safe to assume many others have too for similar reasons.He ends the article highlighting a phenomenal twitter thread that I’ve been meaning to write about and share for a few days. Which outlines the critical nature of our ability and freedom to transact, and how everything flows from this.He wrote:“But wherever this leads us next, it's clear to me now that I was too hasty to completely dismiss crypto on the basis of all the things wrong with it at the moment. Instead of appreciating the fundamental freedom to transact that it's currently our best shot at protecting.”The thread is below, I strongly urge you to read it. It is clear that many people have been distracted by rhetoric and personalities and have failed to do the work in understanding the protocol and learning from history. As the global power grab continues to gain steam, we should expect more people to join dhh and begin to rethink and challenge their former assumptions.Sooner or later, everyone is going to understand why they need bitcoin. In the exact same way as they did the internet. It’s the whole reason i began writing this letter! What is obvious to me and many others now, will at some point in the future be obvious to everyone. My hope is simply, that it is not too late.Get educated. Stay open minded. Take custody of your bitcoin. This is

Good Morning Everyone,Power projection is a concept that I have discussed before in depth - but if you are not familiar with it, I suggest reviewing in the letter linked below to have a thorough understanding of the concept and its significance.You can find it here:The concept of power projection was first introduced to me by Jason Lowery who is a member of the US Space Force and is completing his thesis at MIT on Bitcoin. Jason is absolutely brilliant. He has been sharing snippets from his thesis online for feedback and proof reading. He shared one that really caught my attention, and I thought I would share it with you here.Here is the piece from Jason’s Thesis:“5.2 To Test if Someone doesn't Understand Bitcoin, Ask for their Opinion about its Energy UsageI argue it's impossible to fully appreciate the strategic significance of Bitcoin without understanding the fundamental, systemic implications of hashing. People's misunderstanding of hashing and, more generally speaking, the primary value-delivered function of power projection, shows clearly in data. Throughout coding, I repeatedly observed respected technical experts across multiple disciplines illustrate a surprising lack of understanding of the purpose of hashing or how it's designed to solve a very precise systemic security flaw that no other popular protocol has adequately solved. Their ignorance most commonly manifests itself in the form of two arguments: (1) Bitcoin's hashing infrastructure should strive to decrease its energy consumption, (2) Bitcoin's hashing industry should strive to become more efficient.To address the first argument regarding decreasing energy consumption, now that the reader understands the virtue of brute force power competitions, we can understand why encouraging a hashing infrastructure to project less power is functionally equivalent to encouraging a military to project less power. This is a ridiculous proposition that illustrates a gross misunderstanding of the primary value-delivered function of hashing. It should be obvious to the reader why it's not in any user's rational best interest to advocate for weaker military defense at a higher price. Yet, that is precisely what people do when advocating for Bitcoin to lower energy expenditure while simultaneously hoping for a higher valuation (higher valuation directly translates to higher hash defense infrastructure budget due to block subsidies and transaction fees).As anyone who understands power projection protocols like hashing knows, the more energy intensive a blockchain's respective hashing defense industry becomes, the more severe the real-world sunken and opportunity cost is required to systemically exploit its consensus rules. Thus, higher energy expenditure improves security. Users of hash-secured blockchains should therefore encourage it to use more energy and require increasingly more expensive hashing infrastructure - because that is precisely what deters belligerents from attacking. The only rational response from someone who understands Bitcoin's security protocol is "Bitcoin needs to use more energy.”To address the second argument regarding increasing hash rate efficiency, it should first be noted that the more appropriate way to measure the security level of hash-secured blockchains at scale is to measure how much energy and infrastructure backs its hashing apparatus, rather than focusing exclusively on the hash rate itself. One should be concerned about how much real-world power is dedicated to defending the blockchain through its hashing protocol. This is because real-world energy expenditure and sacrifice is what actually deters real-world belligerents from exploiting the blockchain's consensus rules - not hash rate. Said differently, the attacker is afraid of the financial harm that would be caused by the immense sunken and opportunity cost of attacking the network, which is derived from the fixed and marginal costs of the infrastructure and energy behind the hash rate, not the hash rate itself. So why the obsession with hash rate? It's simply an easier proxy metric to quantify the blockchain's real-world power output and infrastructure cost. Everybody knows there's a direct, positive correlation between the two, and it would be extremely difficult to continually keep precise track of the variable cost of energy and infrastructure dedicated to a blockchain's hashing protocol.Satoshi clearly understood that keeping fixed and marginal costs of hashing infrastructure and energy expenditure prohibitively high was the key to deterrence, because Bitcoin has software in place to throttle the difficulty of its hashing competition to ensure that it remains sufficiently cost prohibitive in the real world to perform an attack regardless of the system's combined hash rate. This point cannot be emphasized enough: The protocol is designed to offset increasing hash rate efficiency by hiking the difficulty level of its hashing competition ad infinitum. It intentiona

Good Morning Everyone,As the situation in Canada sadly continued to escalate over the weekend, with the police initiating violence toward peaceful protestors. The police chief was asked about their intentions for filming the protests and if they planned to use the footage they were accumulating to identify people and actively perusing them following the protest.He responded as follows:“The simple answer is yes. If you are involved in this protest, we will actively look to identify you and follow up with financial sanctions and criminal charges, absolutely. This investigation will go on for months to come.”So effectively, the police force has outlawed the rights of the citizens to express themselves, and if they have expressed themselves they will be hunted down and treated as criminals. WowIt’s worth clarifying that under the framework of a democracy, to peacefully protest is indistinguishable from participating in such a framework. Comedian Rob Schneider frames it perfectly:As part of its war against the countries own citizens, the government of Canada have been contacting financial institutions and providing names of private citizens, and entities - essentially a blacklist - instructing these institutions and service providers to freeze their funds, and restrict their access to financial infrastructure.This is analogous to the Chinese credit score system, and we are seeing it installed in the G7 nation of Canada. Where the government deem who can or cannot transact, and what is deemed acceptable or not. While these emergency powers are only supposed to be available for 30 days under the law, it is not obvious given the circumstances in which the powers have been invoked, if that will actually be adhered to, or if the situation will be manufactured to install such powers in a more permanent fashion.While legacy monetary technology enables this, and incentivises these actions - free and open-source software (FOSS) built upon an open protocol is the antidote - and it is literally the only antidote that exists.Nunchuk.io is an open-source multi-sig bitcoin wallet, and was contacted by the Ontario Superior Court of Justice requesting certain actions be taken against specific individuals or entities. Below is there response, and it’s beautiful.You absolutely love to see it. The legacy system is operating under a paradigm that we are in the process of moving away from, but they have not yet realised it, and the power of this system is still unknown to most.This new paradigm is built upon the worlds most secure computing network, and is completely independent of any government or state actor. A truly open and global decentralized system that no one owns or controls. With free and open-source software built on top of this network, that anyone can build and contribute to, from anywhere, and that anyone can install on their device at no cost.The power of what this enables is so major, it seems to elude most people.Closed networks are good for controlling others. Open networks are good for empowering the individual.Get educated and empower yourself. Take control of your keys, and support open-source software development. This is how we win.Wishing you all a powerful start to your week. I’ll chat to everyone tomorrow.AKMonday Meme: This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,There is a powerful meme that tries to capture the cyclical nature of human behaviour over time and the relationship between prosperity and societal regression, destruction and rebirth.The cycle is as follows:* Hard times create strong men* Strong men create good times* Good times create weak men* Weak men create hard times* …and so the cycle repeats… Hard times create strong men…There are plenty of data points that suggest we have lived through one of, if not the most prosperous periods in human history, and an equally large number of data points that suggest it has created an inordinate number of weak men as a result.I’m as much a product of these “good times” as the next person, so i want to clearly state and acknowledge that I try to check myself in this respect to avoid becoming a statistical truth, thus a weak man, but absolutely acknowledge this possibility.If the current trajectory in Canada is anything to go by, we are approaching some very hard times ahead.This tweet from Pomp captured the state of play perfectly.The Canadian government have now begun to cut-off and restrict citizens access to bank accounts and the financial system, both personal and corporate accounts, for essentially wrong think. To attack individuals that are politically opposed to a tyrannical government and rather than respecting, listening and trying to achieve peaceful conciliation, supreme leader Trudeau has demonstrated that if you hold your money in a bank and regulated institution, that ultimately, it’s not your money; and they can restrict how you spend and express value, and restrict your access to the system if you oppose them.Deputy supreme leader Chrystia Freeland said this, in response to whether people donating to gofundme or givesendgo will be targeted:“The names of both individuals and entities as well as crypto wallets have been shared by the RCMP with financial institutions, and accounts have been frozen, and more accounts will be frozen. Crowdfunding platforms and payment service providers have started the registration process with FINTRAC. In terms of the specifics on who’s accounts are being frozen, you now have the regulations, the financial service providers have those regulations as well, and they working with law enforcement will be making the operational decisions.”This is an absolutely chilling statement.It is a historically bad trajectory that the Canadian government seems to be intent on, and offers a glimpse into a future where cash no longer exists and you are forced to use government issued and controlled central bank digital currencies (CDBCs). This is a world where dissenting voices, and those who politically oppose government actions are financially silenced and easily shunned from the economy. These are the hallmarks of a top-down dictatorship, and not values of a civilised western democratic nation.We also saw crowdfunding platform givesendgo get hacked, and all user data relating to the freedom convoy donation campaign being doxed online, which included the names and personal details of over 92,000 people, in what appears to be a very obviously politically motivated attack.The political elite are waging war on the people of Canada, and they are being enabled by a silent majority, that believe their propaganda and lies. With each passing day, i believe the likely-hood of a run on the banks increases, as ever more Canadians are woken up to the way the system is being turned against them, and that the financial infrastructure they have trusted for years is being weaponised as a political tool to control them and keep those that oppose the political elite powerless. This is absolute power corrupting absolutely, in real-time.The silver lining is that hard times create strong men, and strong men create good times. I believe the overwhelming majority of Canadians agree on much more than they disagree on, and that in the fullness of time, most will come to realise it.The values of privacy, self-sovereignty, truth and freedom that bitcoin is built on, have never been more important and essential than they are today, and will continue to be a beacon of hope for many of us in amongst a world gone mad.Truth will win. A future built upon an open, global monetary protocol that dis-incentives bad behavior by a powerful few at the expense of the many will seem so obvious in hindsight. Grateful as ever to be here for that journey with you.Resist the lies. Bitcoin is the mission.Hope you all have a great weekend, and i’ll talk to you on Monday.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,US Congressman Warren Davidson has submitted a bill to Congress to support and protect the right to self-custody your bitcoin and transact peer-to-peer (P2P). This comes in the wake of dictatorial powers being leveraged in Canada against the countries own citizens, and as we witness the ongoing attack on civil liberties in many other countries including Australia and New Zealand all concealed under the disguise of safety.This is an interesting proposal, as ultimately the bitcoin protocol is permissionless, and requires no approval from anyone to be able to custody your keys, however I do still believe there is some value in this act being submitted.Firstly, simply facilitating this kind of nuanced conversation amongst people in government can only be of value in my opinion, as it likely serves as a productive way to educate individuals on the value and power of self-custody, and also the risks and responsibilities associated. It could also cast a light on this concept, and serve to demonstrate that the desire exists to be able to custody your own property in society more broadly, and that is a very powerful meme to inject into the culture.While the document does not appear to have been added to the US Congress website yet, the senator spoke with Bitcoin Magazine about the proposal.He was asked:“This feels timely, especially after the Canadian government has doubled-down on restricting the funding for and bank accounts of the protesters there. In your mind, what’s the relationship between self-custody and free speech?”Congressman Davidson responded:“People are talking about [free speech] with the trucker convoy. If this [protest] happened in America, some would be cheering, some would be upset. My point is that it should be even-handed. We shouldn't use money as a way of controlling people. Of course if there’s criminal activity, you should go after that. But imagine if the same thing were done to a crowdfunded BLM movement. That wouldn’t be okay. It’s not okay with the Freedom Convoy, either.”The fact that it is well recognised amongst politicians that money has been weaponized against the citizens as a means of control, should concern everyone, but it’s incredible how few people seem to understand this. The congressman taking this position however, is obviously a step in the right direction.At the same time, it’s appropriate to be skeptical and cautious, as we have seen many US politicians use bitcoin as a political tool recently, and the true motives of these individuals should be heavily scrutinized, and they should be judged on their actions. Ultimately though, bitcoin doesn’t care.It is an apolitical and completely neutral protocol, that no single entity has any control over. It was built to operate under the adversarial conditions of human nature, and has operated flawlessly for 13 years, and it will continue to do so regardless of what any government or nation state wants.As always, it’s never been more critical to get educated and understand the specifics of self custody, as is being very clearly demonstrated right now in Canada. If you give governments the ability to leverage monetary power over you, they will take it.Suck the oxygen out of the room. Opt-in to the most sophisticated monetary network in history, and take that power into your own hands.Have a great day. I’ll talk to you tomorrow.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,Yesterday Canadian supreme leader Trudeau invoked the ‘emergencies act’, formerly the ‘war measures act’, in the G7, formerly democratic nation of Canada. The war measures act has only been invoked 3 times in the countries history:* During WW1* WW2* 1970 “October Crisis”The Emergencies Act has never been used since being established in 1988, until now. If you want to see the supreme leaders announcement i’ve included it below.I think it’s important to really gain some perspective on the situation in Canada, and to fully appreciate the true nature of the conflict. While many countries around the world have been removing restrictions relating to the pandemic including Denmark, Sweden, Finland and Norway; Canada has continued to force lockdowns and vaccine mandates on its population.As a result of these ongoing and sustained measures the truckers of Canada began to protest, and assemble in large numbers to peacefully demonstrate and express their opposition to the insane covid hysteria, and the ongoing erosion of their rights. It deserves mention, that none of these people likely want to be doing this. Most just want to be working and living their lives, free of government infringing on their ability to do so. They are sacrificing their time, and their ability to earn an income and in the depth of their winter, where temperatures are extreme, and -20’ celsius is not uncommon. These are brutal conditions to be away from home and out in the cold, but it should help to echo how serious these citizens believe the situation is.Now after multiple weeks of sustained protest and resistance, the government have essentially signaled as a result of this emergencies act, that these people do not have the right to protest and are massaging the use of the rule of law, to be able to treat the peaceful citizens effectively as terrorists. Absolutely insane.Deputy PM Chrystia Freeland announced the following measures in response to the Emergencies Act being invoked:“We are announcing the following immediate actions:* We are broadening the scope of Canada’s anti-money laundering and terrorist financing rules, so that they cover crowdfunding platforms and the payment service providers they use. These changes cover all forms of transactions including digital assets, such as cryptocurrencies. The illegal blockades have highlighted the fact that crowdfunding platforms and some of the payment service providers they use, are not fully captured under the ‘proceeds of crime and terrorist financing act’. Our banks and financial institutions are already obligated to report to the financial transactions and reports analysis center of Canada or FINTRAC. As of today, all crowdfunding platforms and the payment service providers they use, must register with FINTRAC and they must report large and suspicious transactions to FINTRAC.”There has never been a more powerful marketing campaign in bitcoins 13 year history, against political money, and in support of a neutral, censorship resistant monetary protocol and the separation of money and state, than what we are seeing in Canada right now.The moment it becomes a crime to send money to a friend, loved one or simply a fellow citizen you wish to support that is peacefully expressing themselves, is the moment that a nation, and much of the world wakes up to what bitcoin is actually solving for and why it is so unbelievably powerful.No government deserves this power over any one of us, nor is any government capable of wielding this power, and as previously discussed over time, absolute power will always corrupt absolutely.While Canada begins to look more like a dictatorship akin to that of soviet Russia, the true value of having an open, global, borderless and censorship resistant monetary network becomes more obvious by the day.If you have not seen the following speech by Brian Peckford, who is a former politician and the last remaining Canadian alive, responsible for the Canadian charter of rights - the very rights that these truckers wish to defend - I recommend you take a look.Although it is hard to see now, out of the darkness comes the brightest light. Bitcoin and the resolve of the powerful and principled Canadians will lead this beautiful nation back toward better days. Wishing all our beautiful Canadian friends and family well in these challenging times.I appreciate you all 🧡Hope you have a good day. I’ll talk to everyone tomorrow.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,Alex Gladstein shared a great thread after visiting a mining facility in Norway. The KryptoVault facility is located in Hønesfoss, which is about an hours drive from Oslo. The facility harnesses the power of running water (hydro) to generate electricity to power the bitcoin miners, and secure the network. Making the electricity generation almost free, beyond the setup and facility maintenance costs of course. According to the companies website:“In Norway, we have 100% renewable energy. In fact, Norway has the greenest and cleanest electricity in the world with 95% hydropower and 5% wind power.”It really is incredible when you consider that these machines are being powered by running water, and the incredible network incentives of this open global protocol have been the invisible force to motivate humans to access this energy, which not only is creating a business of the future and jobs for some locals but it is also powering a completely public, open-source and borderless global monetary network for the entire planet.The other thing that is unique to this mining facility is the way they are trying to integrate and support their local community.One of the largest parts of running a mining facility is heat management and cooling systems. At this facility they have developed a completely novel solution to support the sustainable forestry industry by utilizing the heat generated to dry timber. With the help of bitcoin miners, what often takes 2-3 months in the Norwegian summer sun, takes as little as 4 days.This is just one small, yet significant example, of a new and novel innovation that many of us believe this industry is going to usher in, and as discussed in yesterdays letter, in alignment with the laws of nature, and in a completely decentralized, and bottom-up way.No government or governing body had to create any rules or regulations to force KryptoVault to access this energy, or to leverage it in this way. It is entirely by design. As a direct result of the incentives of the network. They are financially incentivized to do so, and it is to the direct benefit of both their local community and also the bitcoin network.The bitcoin network is in the early stages of ushering in an energy renaissance, and is going to dematerialize energy and support an abundant energy future for human civilization like nothing we have ever seen before, and at the same time supporting the most sophisticated monetary network in human history. This is just the beginning. It’s impossible to be anything other than wildly optimistic about the future with developments like this taking placeHope you have a great day, and i’ll talk to everyone tomorrow.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,There is a powerful metaphor that demonstrates the conundrum we find ourselves in when trying to analyze, assess and gain a clear recognition of a system, from inside of that system.It is that, of a fish in water.“Fish don’t know they’re in water. If you tried to explain it, they’d say, “Water? What’s water?” They’re so surrounded by it that it’s impossible to see. They can’t see it until they jump outside of it.”This metaphor is equally applicable to how we perceive money, and the relationship of money to government or the state.Australia was on a gold standard in alignment with the British until the end of world war one, at which point the British empire was essentially broke, and chose to transition away from a sound monetary standard to a fiat standard, in order to devalue the currency (siphon value from all who hold the currency), by increasing the money supply and enable them to pay their debts to the US. The US famously moved from a gold standard to a fiat standard in 1971. Since this time, which is now over 50 years, essentially the entire world has been on a fiat standard. Obviously we’re not born understanding anything to do with money - infact most never understand it.Much like the fish in water, given we have not had a standard based on sound money since ‘71 in the US, and even earlier elsewhere, it’s unlikely you would have any concept of the change to the monetary system, and how it impacted you, as it’s essentially all you have known. It’s been the water around you for your entire life, which makes it near impossible to view the world outside of that system and imagine the world could have been any other way.But the world has been different prior, and when viewed through a wider historical lens, this period of time is more so the exception to the rule, rather than the rule itself.This is interesting to me, and in many ways explains the difficulty so many have in understanding bitcoin and how it changes absolutely everything. It is a completely foreign system, compared with the current system of ‘water’ which is all they have ever known.The relationship between money and state is at the core of our existing system.I read an incredible article over the weekend by Allen Farrington, which i’ve since re-read about five times, to try and really digest the significance of what it brings to light. I highly recommend you have a read for yourself. It’s short, but profound.Here is a except from the article:“While not a singularly causal factor, it is certainly not a coincidence that the three great empires just cited [Roman, Spanish, Brithish] all collapsed more or less in line with the rate of debasement of their currencies in pursuit of economically destructive militaristic ends.But the fiat era created a dramatic historical anomaly. For the first time in recorded history, the cost of creating new money literally was zero. This has had profound effects on political economy. While money can always buy power, power could now buy money, and without economic calculation. There is no cost too great to seizing power, and next to no incentive not to give it a shot, because any costs can later be paid back, and then some. This, we believe, is the root cause of the cult of toxic bigness now endemic across the developed world,Rather than a naturally homeostatic process of increased size tending to lead to inefficiency, in the fiat era, the bigger you are — either as a business or a government — the more powerful you become, hence, entirely perversely, the more efficient you become. Of course, the less efficient everybody else becomes because they are transparently being stolen from. The more communal capital is consumed, the more energy the capital consumer can direct towards seizing power and paying back himself, but likely nobody else.Bitcoin fixes this. And in a remarkably simple way; it undoes everything just described. It returns a cost to money — a higher one even than gold — and makes toxic bigness unsustainable. Hence, Bitcoin isn’t so much explicitly a pro-localist tool. If anything, the reality is even more profound: localism itself is natural, healthy, sustainable, and right. Bitcoin destroys the historically anomalous countervailing force and, in doing so, will let localism happen without having a particular bias of its own beyond the far more abstract concerns for sustainability, efficiency, accountability, humility, and truth — all natural bedfellows to localism.”So powerful.While money can always buy power, under a fiat standard, power could now buy money. And if history is anything to go by. Power will. Until absolute trust in the system is dissolved, power will continue to buy money at the expense of the population.This is the fiat feedback loop, and we can see this all around us in the world today if you are paying attention. There is a reason the world has become overly politicized, and it is primarily as a result of this feedback loop between money and power.The need to

Good Morning Everyone,One of the common concerns that you hear from people that do not understand bitcoin and the lightning network - or even know about lightning typically, is that it’s too slow, and that it cannot process enough transactions and that’s why the newer shinier xyz shitcoin is more pretty and exciting, and thus going to change the world. When in actual fact, what you tend to find, is that those individuals are just crippled by the effects of the fiat mind virus, and are a product of the fiat system. They are in most cases suffering from a severe case of CDHTPD - Catastrophic and debilitating high time-preference disease.Obviously I just made that name up, and while it is not real in the sense that it’s not a medically recognized disease, the difference between a high time preference and a low time preference is a societal-altering difference. They are polar opposites, and the point of arrival depending on your time preference is a key determent on the way you behave throughout your life as well as how and what you choose to focus on when allocating your time. It determines how you perceive the meaning of value, and how you express value fundamentally and the way in which you orient yourself in the world.For clarity, someone with a high time preference is someone that is extremely sensitive (read: fragile) to time (time = volatility), and is very short sighted and focussed primarily on the shorter-term time horizon. High time Preference is concave.A low time preference would be the opposite. Someone that is focussed on the long term, and prioritizes the future over the present. Low time-preference is convex. Anti-Fragile - meaning one gains from the volatility of time.The classic marsh-mellow test is one well known example that demonstrates the psychology of time preference in children.It is true that bitcoin alone as the base layer, broadcasts transactions roughly every 10 minutes as transactions are confirmed and a block is mined, the block height increases, and the number of transactions per block is limited to the size of the block, which since 2017 was changed to be measured by ‘weight units’.The current average number of transactions per block vary, but for simplicity sake we can say is likely to be somewhere between 5-10 p/second. If you would like a little more detail on this, this link will be clarifying.What is obviously missing from this is Lightning, which is a second layer network built on top of bitcoin. Lightning radically changes the throughput capability of the network. Theoretically, the lightning network can process millions to billions of transactions per second and at almost no cost.The concept and term ‘Lightning Service Provider’, or LSP, was originally coined in an article in 2019 by Roy Sheinfeld. Roy is also co-founder and CEO of Breez - which is an awesome lightning wallet and podcasting 2.0 application, which is well worth checking out if you haven’t already. The idea of an LSP is similar to that of an ISP for the internet.Wikipedia describes an ISP as follows:“An Internet service provider (ISP) is an organization that provides services for accessing, using, or participating in the Internet. Internet service providers can be organized in various forms, such as commercial, community-owned, non-profit, or otherwise privately owned.Internet services typically provided by ISPs can include Internet access, Internet transit, domain name registration, web hosting, Usenet service, and colocation.”Everyone connected to the internet these days, is connected via an ISP. ISP’s were one of the key mechanisms in enabling the internet to scale to the extent it has around the world and allow more users to join the network.In a similar way, bitcoin has established itself as the trust or value protocol layer of the internet, and lightning service providers are going to play a pivotal in supporting the growth and onboarding of users to the bitcoin and lightning network.The lightning network as it is today, is still beyond many ‘mainstream’ users, although for anyone with a tiny bit of interest and curiosity it’s easy enough to get a node running and open up some payment channels, but as i found out recently, if you have any issues it can get pretty technical pretty quick.One of the larger constraints regarding opening and maintaining lightning channels is liquidity. I think this is likely the larger barrier that really drives the need for LSPs over time, as many people that interact with this network won’t have several btc available to be locked-up for use as liquidity by the lightning network.As explained in a great twitter thread, the key functions of an LSP will be:* Provide liquidity to the network* Support nodes with new channels* Routes data and payments* Rebalances channels among users* Drives reliability and redundancyIt’s likely that large holders, exchanges, platforms and service providers built on top of these networks operate as major LSPs with thousands of smaller ones op

Good Morning Everyone,There has been a flood of significant announcements this past 24hrs as bitcoin price relative to the melting USD shitcoin rallies toward $46,000 - an almost 40% increase now from the lows.Perhaps the most significant of them is the Russian Government and Central bank agreeing to recognize bitcoin and crypto as a form of currency. Only last month the Bank of Russia proposed banning crypto mining over concerns it could endanger the countries financial system. Now we’re seeing a full 180.According to Russian publication Kommerstant, that reported on the development:“The government and the Bank of Russia have agreed on a future regime for the circulation of cryptocurrencies in Russia before February 18, they will prepare a draft law on the circulation of digital currencies in the Russian Federation, in which cryptocurrencies are recognized as an analogue of currencies, and not digital financial assets.Their circulation in the legal sector will be possible only with full identification, through the banking system or licensed intermediaries. Operations equivalent to more than 600 thousand rubles. must be declared, transactions outside the legal sector for such amounts will become a criminal offense and an aggravating circumstance under the Criminal Code, fines will be introduced for the illegal acceptance of cryptocurrencies as a means of payment. Mining and related issues of DFA are not affected by the concept within which the project is being prepared.”The big picture of what is going on here in my opinion, is a move away from the US dollar by Russia and others, specifically China, to insulate themselves from financial sanctions from the US, alongside the decline of the US as the world super power.I believe we are seeing the beginning of the end, for the US Dollar as the world’s reserve currency. Years gone by, there was no alternative to the SWIFT system. So financial sanctions were very effective, and if imposed, would completely exclude a country from trading with the world. However the game board has changed in profound ways over the last few years, ways that most still do not realise, and Russia are acting accordingly.We have seen Russia agree to a 30 year contract with China to supply gas via a new pipeline, that is to be settled in euros. A strong US narrative has been baking over the past couple of weeks about a war breaking out between Russia and Ukraine, the validity of which has been hotly debated, and also the US’ intention in fanning this narrative. We recently saw Chinese supreme leader meeting with President Bukele, and most recently the two Russian leaders met face to face with a promise to collaborate more against the west and released a detailed joint statement following the meeting.The statement is long, and demonstrates the position of China and Russia by referring to the two throughout the entire 5000+ word document as “the sides”. The document begins as follows:“Today, the world is going through momentous changes, and humanity is entering a new era of rapid development and profound transformation. It sees the development of such processes and phenomena as multipolarity, economic globalization, the advent of information society, cultural diversity, transformation of the global governance architecture and world order; there is increasing interrelation and interdependence between the States; a trend has emerged towards redistribution of power in the world; and the international community is showing a growing demand for the leadership aiming at peaceful and gradual development. At the same time, as the pandemic of the new coronavirus infection continues, the international and regional security situation is complicating and the number of global challenges and threats is growing from day to day. Some actors representing but the minority on the international scale continue to advocate unilateral approaches to addressing international issues and resort to force; they interfere in the internal affairs of other states, infringing their legitimate rights and interests, and incite contradictions, differences and confrontation, thus hampering the development and progress of mankind, against the opposition from the international community.”The statement goes on to expressly condemn the actions of Australia, the UK and the US:“The sides are seriously concerned about the trilateral security partnership between Australia, the United States, and the United Kingdom (AUKUS), which provides for deeper cooperation between its members in areas involving strategic stability, in particular their decision to initiate cooperation in the field of nuclear-powered submarines. Russia and China believe that such actions are contrary to the objectives of security and sustainable development of the Asia-Pacific region, increase the danger of an arms race in the region, and pose serious risks of nuclear proliferation. The sides strongly condemn such moves and call on AUKUS participants to fulfill their

Good Morning Everyone,The US department of Justice has made its largest financial seizure ever, seizing approximately 94,000 bitcoin in relation the 2016 Bitfinex exchange hack. The original hack resulted in approximately 2000 unauthorized transactions totaling nearly 120,000 bitcoin, worth around $70m US dollars at the time. In a public statement the US DOJ wrote:“Two individuals were arrested this morning in Manhattan for an alleged conspiracy to launder cryptocurrency that was stolen during the 2016 hack of Bitfinex, a virtual currency exchange, presently valued at approximately $4.5 billion. Thus far, law enforcement has seized over $3.6 billion in cryptocurrency linked to that hack.”“Today’s arrests, and the department’s largest financial seizure ever, show that cryptocurrency is not a safe haven for criminals,” said Deputy Attorney General Lisa O. Monaco. “In a futile effort to maintain digital anonymity, the defendants laundered stolen funds through a labyrinth of cryptocurrency transactions. Thanks to the meticulous work of law enforcement, the department once again showed how it can and will follow the money, no matter what form it takes.”The two individuals arrested were married couple Ilya Lichtenstein, 34, and his wife, Heather Morgan, 31. The document goes onto outline some of the specifics leading to the seizure:“According to court documents, Lichtenstein and Morgan allegedly conspired to launder the proceeds of 119,754 bitcoin that were stolen from Bitfinex’s platform after a hacker breached Bitfinex’s systems and initiated more than 2,000 unauthorized transactions. Those unauthorized transactions sent the stolen bitcoin to a digital wallet under Lichtenstein’s control. Over the last five years, approximately 25,000 of those stolen bitcoin were transferred out of Lichtenstein’s wallet via a complicated money laundering process that ended with some of the stolen funds being deposited into financial accounts controlled by Lichtenstein and Morgan. The remainder of the stolen funds, comprising more than 94,000 bitcoin, remained in the wallet used to receive and store the illegal proceeds from the hack. After the execution of court-authorized search warrants of online accounts controlled by Lichtenstein and Morgan, special agents obtained access to files within an online account controlled by Lichtenstein. Those files contained the private keys required to access the digital wallet that directly received the funds stolen from Bitfinex, and allowed special agents to lawfully seize and recover more than 94,000 bitcoin that had been stolen from Bitfinex. The recovered bitcoin was valued at over $3.6 billion at the time of seizure.”There is a ton of debate on bitcoin twitter, as to whether or not this story really checks out, as the notion that someone who stole 120,000 bitcoin from an exchange would store their keys online on a cloud platform like icloud, google or dropbox is difficult to believe. Then when you look a little deeper at some of their online content it gets really weird.As you can see this post from Lichtenstein about security, where he said:Or this one from Heather Morgan:Either way. The seizure has been made, and the US now holds more than 94,000 bitcoin - more than any other country on earth, that we know of. According to bitcointreasuries.net the next largest holding is the Ukraine with some 46,000 btc.Presumably the captured bitcoin will be returned to Bitfinex whom they were stolen from, but this remains to be seen. This should act as a good reminder for us all. Not your keys, not your cheese.Your keys in many sense are your bitcoin. These keys should never been put on a computer. They should definitely never be stored online, and they should not be shared with anyone. Ever.It is only when you hold your bitcoin securely, that it is impossible to confiscate, and over the coming years I believe this property is going to become ever critical. Hope you all have a great day, and i’ll talk to you tomorrow.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,As Bitcoin price ascends back into the mid 40’s (currently $44,074) - up 34% from the lows, KPMG Canada have announced they have added Bitcoin & Ethereum to their balance sheet. It’s unclear as yet how much of each has been acquired and what the actual distribution between the two assets is, but my guess is that it’s a bitcoin-heavy position. KPMG was founded in 1987, and is regarded as one of the major four accounting firms globally. The company employ 236,000 humans, and achieved in excess of $32b in total revenue last year. It’s a massive business, and the fact that they have now joined the likes of Tesla, Square and Microstrategy in adding bitcoin to their balance sheet is huge, and is likely to really send a shockwave around the world and amplify the game theoretic dynamics specific only to bitcoin as a result of its inelastic supply.The Company said in it’s statement:“KPMG in Canada has completed an allocation of cryptoassets to its corporate treasury, the firm's first direct investment in cryptoassets.The allocation includes Bitcoin (BTC) and Ethereum (ETH), as well as carbon offsets to maintain a net-zero carbon transaction to deliver on the firm's stated environmental, social and governance (ESG) commitments.”Also worth noting, while they have not disclosed the amounts it appears they won’t custody the assets themselves, instead giving this responsibility to Gemini.“KPMG in Canada acquired Bitcoin and Ethereum on its balance sheet through Gemini Trust Company LLC's execution and custody services.”This is yet another strong indicator, of the institutionalization of bitcoin the asset, and a demonstration of the institutional interest in other digital assets, and the ecosystem more broadly.While you likely know my views on most of these other “assets”, it’s unlikely this trend is reversing anytime soon, and almost certainly leads to many more people gaining exposure to these networks, and hopefully is a catalyst for the early majority cohort of the distribution, to begin to learn about the critical elements of the bitcoin protocol and specifically, seek to self-custody their holdings.The game theory is playing out before our eyes. More companies will continue to add bitcoin to their balance sheet in 2022, and I believe more nations will adopt it as legal tender following El Salvadors lead.No doubt KPMG aren’t doing any of this for the freedom-go-up (FgU) characteristics of bitcoin, the beautiful thing about the protocol is, that it doesn’t matter. KPMG will offer bitcoin to its customers in Canada initially as a pilot, and then globally. They will expose hundreds of thousands, if not millions of people to this technology and these people will be lured in for number-go-up tech. KPMG is simply helping to wheel the trojan horse into the city.Over time, these people will learn about what this technology truly enables, and they will seek to self-custody their bitcoin and stay for freedom-go-up. It is simply a matter of time. Bitcoin is inevitable.Hope you have a great day, and i’ll talk to everyone tomorrow.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,The wild and rampant censorship train seems to have well and truly left the station and is gaining momentum. There is an incredible level of pressure being applied to Joe Rogan and his podcast, with Spotify caving to political pressure removing 113 episodes of the podcast so far (jremissing.com). Alongside this, is the extraordinary situation in the city of Ottawa. Following Gofundme’s wild financial censorship of over $10m in donations to the #truckersforfreedomconvoy2022, the mayor has now declared a state of emergency labelling it a national insurrection. At the same time, bitcoiners have raised over 6.4btc for the Canadian Truckers Freedom Convoy.You can view the bitcoin raised here, view each transaction and message attached and also contribute on-chain and via lightning.I believe much of what we are seeing in the two scenarios above, and much of what we have seen all over the world over the last 18 months is explained In a recent article by Ray Dalio titled:“The Rising Risk of Civil War: Following in the Footsteps of History”In the article Ray outlines:“the US appears to be on a classic path toward some form of civil war. In this post I’d like to show you both what that path looks like and where the US appears to be on it.”Through his analysis, Ray has identified an archetypal pattern that exists and repeats throughout history and uses this framework to help him interpret what is happening in the present, and may be upcoming in the future.He outlines the cycle as follows:"Stage 1, when the new order begins and the new leadership consolidates power, which leads to . . . . . . Stage 2, when the resource-allocation systems and government bureaucracies are built and refined, which if done well leads to . . . . . . Stage 3, when there is peace and prosperity, which leads to . . . . . . Stage 4, when there are great excesses in spending and debt and the widening of wealth and political gaps, which leads to . . . . . . Stage 5, when there are very bad financial conditions and intense conflict, which leads to . . . . . . Stage 6, when there are civil wars/revolutions, which leads to . . . . . . Stage 1, which leads to Stage 2, etc., with the whole cycle happening over again.”He estimates that the US is in stage 5 of this archetypical cycle, and against the markers and characteristics he outlines, seems disturbingly likely. Some of the forces that bring about big internal conflicts include:* the country and the people in the country being in bad financial shape* large income, wealth and values gaps within that entity* severe negative economic shockAs the US has now surpassed $30T in government debt or more than 130% debt-to-GDP and there is a clear move away from the dollar by countries like China and Russia, the fed is increasingly becoming the (only) buyer of last resort.“A classic marker of being in Stage 5 and a leading indicator of the loss of borrowing and spending power, which is one of the triggers for going into Stage 6, is that the government has large deficits that are creating more debt to be sold than buyers other than the government’s own central bank are willing to buy. That leading indicator is turned on when governments that can’t print money have to raise taxes and cut spending, or when those that can print money print a lot of it and buy a lot of government debt.”Sounds familiar, right?Other indicators identified include:* Decadence* Bureaucracy* Populism and Extremism* Class Warfare* The Loss of Truth in the Public Domain* Rule-Following Fades and Raw Fighting BeginsThis next section really stands out in relation to what we are seeing right now in relation to censorship, polarization, populism and the ability to reach social consensus and agree on a shared reality. That is an ability to agree what is fundamentally true. This is at the very core of the societal fabric.“Out of disorder and discontent come leaders who have strong personalities, are anti-elitist, and claim to fight for the common man. They are called populists. Populism is a political and social phenomenon that appeals to ordinary people who feel that their concerns are not being addressed by the elites. It typically develops when there are wealth and opportunity gaps, perceived cultural threats from those with different values both inside and outside the country, and “establishment elites” in positions of power who are not working effectively for most people. Watch populism and polarization as markers. The more that populism and polarization exist, the further along a nation is in Stage 5, and the closer it is to civil war and revolution. In Stage 5, moderates become the minority. In Stage 6, they cease to exist.”While in the article Ray is speaking specifically within the US, I think these symptoms are being seen in many nations around the world with an observably high level of populist leadership in recent years, and wild polarization of opinions and an inability to reach societal consensus. I’ve certai

Good Morning Everyone,I got reminded recently of a powerful analogy I heard from Michael Pollan originally, that provides a lens to think about the effect of psychedelics on the default mode network of the brain.The default mode network is a region, or network in the brain that is understood to handle many internal tasks when one is not focussed on the outside world.ScienceDirect explain the default mode network as follows:“The DMN is a set of brain regions that exhibits strong low-frequency oscillations coherent during resting state and is thought to be activated when individuals are focused on their internal mental-state processes, such as self-referential processing, interoception, autobiographical memory retrieval, or imagining future.”This is the area of the brain that is operating when you are worrying about something, or when you are being self-critical and judging yourself or ruminating on past events, or imagining about the future.Whats super interesting about this section of the brain is it seems to develop very sticky patterns of operation, and once these patterns are established they can operate in the background of the operating system very unconsciously and in a way many people simply are not aware of. He explains it something like this…If you imagine the default mode network is like a mountain covered in snow, and over time you have ski’d down the mountain over and over many times, and you have established clear tracks from doing so leading you to tend to opt to ski the tracks that are well known and established as opposed to going into unknown territory. He explains the effect of psychedelics on this part of the brain like a dumping of fresh powder covering all the old tracks, and installing a new fresh state on the mountain, that provides the opportunity for you to establish new paths, and form new patterns and modes of internal operation. In a recent conversation with Michael Saylor, Jack Dorsey explains:“If Bitcoin existed before Twitter started, i think we would see completely different business models. I don’t think we would be as dependent on an advertising business model. I think there would be a much healthier balance between multiple business models at once instead of this over dependence on one. I think we’d see a lot less of the issues that advertising systems can bring up in terms of privacy and everything we’re seeing around surveillance capitalism as well. So the fact that the internet didn’t have this mode of transport and didn’t have this protocol and didn’t have this currency forced [it] into very traditional models that became massive at scale and then can become quite dangerous at scale as well so i’m very excited to see the new models that emerge, because we now have bitcoin, and we’re now the closest we’ve ever been to a native currency for the internet. Which to me, changes everything.”“There was a time early in bitcoin's history when there was less of a focus on bitcoin as a currency aspect and just as a transport, and more on the blockchain technology. Blockchain technology is amazing but the network's power is what people do with it and the use cases, and the use case for the internet to have something like is i think as fundamental as tcp/ip or http or smnp, which is a mail protocol. These open protocols create companies, they create projects, they create entirely new cultural and societal shifts that i think ultimately lead to more trust and more transparency as time goes on and and diminishment of all these barriers and boundaries that we've erected”As Jack explains, Bitcoin is likely to facilitate to the internet, what psychedelics do for the default mode network of the brain.I believe Bitcoin is going to usher in a tsunami of new businesses, new models and new ways in which those businesses operate as a result of a fresh coat of powder on the previously well developed and clearly carved out incentive structures of the legacy framework. Just like It was impossible to envision how the internet would fundamentally change society 20 or 30 years later, it’s equally difficult to imagine what impacts this open, decentralized protocol will facilitate in a similar time frame, but i believe Jack has a clear line of sight toward these potential futures, and is absolutely right in saying it leads to more trust and more transparency over time.That’s a future i’m here for, and I’m going to do whatever I can to move us toward it.Onward and Upward!Hope you have a great finish to your week, and I’ll speak to you on Monday.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,The last week has seen incredible scenes in Canada as massive convoys of truckers, have been protesting Trudeau’s government and the ongoing erosion of the rights and freedoms of the citizens of Canada via lockdowns and vaccine mandates.While supreme leader Trudeau and state media channels attempted to discredit the Canadian truckers labelling the estimated 70,000+ people a “a small fringe minority”, the protests have inspired many others globally to do the same including in Germany and Australia, aswell as sparking on the ground protests in Australia’s capital, Canberra.Clearly many in the Canadian community did not agree with the narratives of Trudeau the tyrant, and responded by donating over $10,000,000 to the ‘Truckers For Freedom’ movement, via popular fund raising site, gofundme.In predictable fashion, Ottawa City Council have called for gofundme to censor the transactions of hundreds of thousands of people that donated to the cause, and have been applying political pressure, and said they have also considered applying legal pressure and also asked the PM to do the same, to prevent these funds from being released and passed on to, who they were actually intended. This is blatant financial censorship, and demonstrates how fundamentally broken the legacy model is, and how egregiously it can be pressured and controlled. The entire notion of a private company is being systematically dismantled in real time.As long as parties need to trust an intermediary in the middle of their transaction, the system will always be inherently flawed.It is absolutely mind blowing to see this level of financial censorship in a formerly democratic nation like Canada, but it should serve as a signal to the rest of us that the financial system has been fully weaponized and will be wielded against us. If you express a non-consensus view, particularly one in opposition to a tyrannical regime, you should set your expectations accordingly. The saying “bitcoin fixes this” has never been more accurate, and situations like this while destructive and even effective in the short term, only accelerate the move to a decentralized monetary standard in the long term, as hundreds of thousands of people are awoken to the ways in which the legacy system will be used against them as a method of control.Thankfully we do have bitcoin, and it works. Right now. We do not need to continue to operate in a world where someone else gets to decide whether or not you are allowed to send $20 in support of a cause.You are no longer forced to engage financially in a system that thrives on the capability to apply political and even legal pressure on an entity in the middle, be it Spotify or Gofundme, and have executive level power over the ultimate outcome.The future is already here, and the Canadian truckers and many others are getting a 101 in decentralized systems designed to operate under adversarial conditions.In an inspiring response to gofundme’s censorship, bitcoiners immediately started sending sats in support of the truckers in a completely open and permissionless way demonstrating the power of this censorship resistant protocol with over 298 contributors sending in excess of 22,000,000 sats. What is particularly cool about this, is how open and transparent it actually is. Someone queried the instigator about the specifics:In response he was advised that funds were to be transferred to a multi-sig wallet held by 3 individuals and they would allocate funds at their discretion.Fully verifiable, transparent and in the open, and with no need to trust a bank or any other financial intermediary to do what they say they will do. And best of all, no individual or entity on the planet can exercise power over you and your ability to transact and express value. So powerful. We are only just scratching at the surface of how transformational this innovation can be for human society.While many political actors continue to choose authoritarian measures, they do so at their own peril as they fail to realize they are at the same time incentivizing and facilitating the rise of a new system. This is the power of an apolitical protocol that is truly neutral and censorship resistant. You love to see it!Hope you all have a great day, share these letters around, and i’ll talk to you tomorrow.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,Fidelity Digital Assets have come out with a new research paper entitled:“Bitcoin First: Why investors need to consider bitcoin separately from other digital assets”The paper is well worth a read and i’ve linked it above. Essentially Fidelity very succinctly explain, what many people seem to fail to understand about bitcoin - What it actually is?That bitcoin is the most pristine version of ‘money’ ever realised by human civilization, and is at the same time, the most sophisticated monetary network in history.Hopefully if you’re reading this, then you are already well ahead of the audience this paper seems to be aimed at, but its extremely positive to see this major asset management firm, really get it.Within the papers executive summary, they highlight the following key points:“Bitcoin is best understood as a monetary good, and one of the primary investment theses for bitcoin is as the store of value asset in an increasingly digital world. Bitcoin is fundamentally different from any other digital asset. No other digital asset is likely to improve upon bitcoin as a monetary good because bitcoin is the most (relative to other digital assets) secure, decentralized, sound digital money and any “improvement” will necessarily face tradeoffs.There is not necessarily mutual exclusivity between the success of the Bitcoin network and all other digital asset networks. Rather, the rest of the digital asset ecosystem can fulfill different needs or solve other problems that bitcoin simply does not. Other non-bitcoin projects should be evaluated from a different perspective than bitcoin. Bitcoin should be considered an entry point for traditional allocators looking to gain exposure to digital assets. Investors should hold two distinctly separate frameworks for considering investment in this digital asset ecosystem. The first framework examines the inclusion of bitcoin as an emerging monetary good, and the second considers the addition of other digital assets that exhibit venture capital-like properties.”Bitcoin is both an asset and a monetary network.This single distinction is of major significance. Regardless of whether or not you have any interest in the underlying unit of account as part of the 21m capped issuance - the capability of the network is indisputable at this point and enables the most secure method of information transfer, that is value transfer, between peers in an essentially trustless manner that has previously never been possible digitally.The article goes on to review the properties of money, that scarcity drives value and how the consensus mechanism and design of the protocol essentially ensure the near-zero probability that it could ever change.It’s fascinating to me, the way they refer to bitcoin writing things like:“How bitcoin may position itself against the rest of the digital asset ecosystem”When in actual fact, we’re referring to an inanimate object. Not even a physical object. A code-base, a language, that can be run on a computer anywhere in the world, and by connecting to the internet and joining the network spawning the worlds most sophisticated monetary network of all time. This still blows my mind when you really get to the fundamentals of what we’re actually talking about here.It’s much less a case of bitcoin positioning itself as anything, but rather people actually beginning to understand what it actually is and treating it accordingly.This technology has been operating on tens, then hundreds now thousands of computers on earth for 13 years, producing block after block consistently and without interruption, operating flawlessly, never forcing a single person to use the protocol or to join the network. Simply executing transactions and transmitting information, while humans try to make sense of what it is and form their beliefs about it - and it will continue to do so indefinitely while a consensus exists of its monetary superiority. Pretty incredible!And with each person that does, the network effect grows stronger, and stronger.The article goes on to state that they believe bitcoin has the potential to be the primary monetary good as a result of the power of monetary network effects.“We won’t be so bold as to predict there will only ever be one money, but we do believe that one monetary good will come to dominate the digital asset ecosystem due to the very powerful effects of networks. Many investors are familiar with the power of network effects, where the value of a given network increases exponentially as the number of its users grows. Monetary networks are no different. However, they are even more powerful than other networks because the incentive to choose the right money is much stronger than any other choice of a network, such as a social network, telephone network, etc.”They go on to discuss the reflexivity of the bitcoin network:“There is also a reflexive property to monetary networks. People observe others joining a monetary network, which incentivizes t

Good Morning Everyone,The chorus of authoritarian sociopaths has been increasing over the last couple of weeks in a bizarre attempt to pressure Spotify to cancel Joe Rogan.You know we’re living in a strange time when some cohort of people (read: authoritarian lunatics) think some guy should not be able to express himself and have open conversations on the internet that they do not like, and instead of them simply “changing channels”, said individual should be deleted, de-platformed and silenced altogether. Least of all some old hippie like Neil Young who is famous for writing a song about “rocking in the free world”. Absolutely mental. Joe Rogan released a 9min video in response to the criticism apologizing if he’d “pissed anyone off” and telling a pretty funny and ironic story about working as a security guard when he was 19 at a Neil Young concert. Well worth a listen.The underlying dynamic here is that Joe Rogan’s podcast distribution is exclusively via Spotify’s platform now, and Spotify is a traditional centralized US tech company. The inherent vulnerabilities of centralization are on full display here, and while Spotify seem to have stood their ground reasonably well so far, in my opinion it’s only a matter of time until they lose the fight and are forced to conform whether by political pressure or new laws and regulations.This serves as a perfect advertisement for Podcasting 2.0. A decentralized and permissionless distribution mechanism with censorship resistant payments enabled by the lightning network. The primary difference here is that these centralized platforms are typically advertising machines and advertising, if personalized, entails surveillance. The ability to pay for content you value, in a value-4-value model, via a censorship resistant protocol seems like an obvious way forward.Even though we have not yet seen this kind of pressure on other dominant content platforms like substack, it’s likely that at some point the inevitable happens, whereby platforms like ghost.io and others stand to benefit. It’s still very early and there will continue to be a ton of development in this area, but there is no doubt the need exists and likely continues to become more and more pertinent over time. Apps like Sphinx and Breez are doing a great job of enabling this kind of interaction, and we’re likely to see an explosion of innovation in this space.The future of content, speech, payments and online human interaction is fully decentralized, Peer-to-peer and censorship resistant.I hope you have a great day, and keep on rocking in the free world. I will chat to everyone tomorrow.AK“Freedom is not given, it is taken.” - Subhas Chandra Bose This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,As most of you are probably aware, the ability to custody your bitcoin is at the absolute core of the bitcoin ethos and is as fundamental to bitcoin, as breathing is to life.You have most likely heard the saying:“Not your keys, not your cheese”or“Not your keys, not your coins”The understanding of this is demonstrated by the actions you take, and how you secure your keys. Most people that give custody of their keys to a 3rd party, do so without being aware of the hidden risks, and a true understanding of what they are actually giving up, and in doing so demonstrate a failure to truly understand what this technology enables and how it differs fundamentally from the existing predatory surveillance system.The on-ramps and off-ramps (exchanges & other 3rd parties) are best thought of as a point of control. They are a gate in which regulators will try to force you to go through, and when you do, strip you of your privacy, enable financial surveillance over you and anyone you interact with and remove your ability to operate pseudonymously by linking wallet addresses to your real world identity.It’s worth highlighting for anyone that thinks “oh well, i have nothing to hide”, that this is aside from the point. The point is, that if these measures actually achieved what they purport to be solving, we would have rid the world of pedophiles and child traffickers like Jeffery Epstein - but they do not, and obviously this is not the case. These measures are not in good faith what they are advertised for. They are not only ineffective and dangerous, but are in complete opposition to the the individual freedoms we should all wish to preserve.In recent weeks there have been some major developments that signal the next major battle ground, as governments and a powerful minority of pseudo-elites continue to fight to prevent the redistribution of power from them in the center, back to the edges, and to maintain their power and control by keeping control of the money. This next battle ground is your right and ability to self-custody.Mechanisms like the “Financial Action Task Force" (FATF) Travel Rule and Address Ownership Proof Protocol (AOPP) are likely the first steps of this assault on our right to privately own and hold property. FATF is a bureaucratic intergovernmental entity that was established in 1989 between G7 nations to combat money laundering. ← check the link to see how well that’s working out..Address Ownership Proof Protocol (AOPP) is an automated mechanism to provide confirmation that you own an address you are sending to, when sending from a KYD’d exchange platform.While AOPP seems to be required only by Swiss companies for the time being, it is likely that efforts continue, to link identities to wallet addresses and attempt to remove these rights over time. It has been encouraging to see some pivotal open-source projects including Bluewallet, Sparrow and Trezor reject the implementation of AOPP in response to the communities uproar.Bitcoin OG Marty Bent put it well in his recent piece.“Anyone in the "crypto" industry who is eagerly attempting to comply with FATF guidelines should take a moment to employ some introspection and ask why they are here in the first place. Bitcoin was created to completely obliterate this type of demonic control. Those who tell themselves that they align with the mission of Bitcoin should reject FATF guidelines and engage in civil and corporate disobedience.Enough is enough. No more bending the knee to tyranny."It has never been more critical to educate yourself and get up to speed with what is taking place. Get clarity on why self-custody is fundamental, and take complete and total responsibility - It has never been more important. I hope you have a great start to your week, and i will chat with everyone tomorrow.AKMonday Meme This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,UK Prime Minister Boris Johnson, said recently that the UK are in discussions with the US administration about banning Russia from the SWIFT system, in response to the possibility of Russia invading Ukraine. Russia stated the European countries will not be able to receive gas, oil and metals from Russia in the event they were disconnected from using the SWIFT system.SWIFT stands for ‘Society for Worldwide Interbank Financial Telecommunication’ and acts as an intermediary and executor of financial transactions between banks worldwide. SWIFT is legally a Belgian entity, which was established in 1973. The cooperative is owned by member banks and governed by a 25-member board of directors. The organization is overseen by the G10 central banks which includes:The European Central Bank (ECB), Belgium, Canada, France, Germany, Italy, Japan, the Netherlands, Great Britain, the United States, Switzerland, and Sweden.The entire SWIFT system is run off 3 data centers, located in the US, The Netherlands & Switzerland along with a “command and control” center in Hong Kong, now considered mainland China.So the SWIFT system, is essentially a closed, centralized communications protocol operated by central banks with a democratic like governance structure to enable a cooperative payment network (in an adversarial environment) and (presumably) to prevent the system from being corrupted from any individual having ultimate power over it.What we are seeing however, is the weaponizing of this payments system with threats being made to exclude certain network participants, and demonstrating a lack of neutrality at the SWIFT protocol layer.Given SWIFT is a Belgian company, it complies to Belgian and European law - not that of the US, so the US don’t have any legal power over the company. So far Iran is the only country to have been cut off from the system (that we know of), which happened back in 2012 after they were blacklisted by the European Union and amid pressure from the United States. While the US have no exclusive or over-riding power over SWIFT, they could employ similar tactics like the threat of sanctions against the platform directly, as in the case of Iran, to pressure SWIFT to cut-off Russia’s access.Regardless of the fact, what this highlights to me, is the vulnerabilities of the current system and while best efforts were likely made to prevent the system corrupting, the technology to do so did not yet exist.Even without Russia being cut-off from this global payments standard, the mere threat of such an action would likely motivate any player to seek alternatives. In my opinion this kind of a move is likely to backfire against the US and only further motivate the existing trends - specifically that of de-dollarization.This is a powerful real world example highlighting the vulnerabilities of centralized systems, where network participants must trust a 3rd party, and political power can be wielded to influence the rules of the network.The world of central banks and nation states is an adversarial environment, and in such an environment, a system that requires trust in a centralized entity is always destined to fail in the fullness of time.This makes the SWIFT system inherently flawed as a global standard, and sooner or later we are going to see this system be made obsolete. No country will actively choose a system requiring trust, when they know full well, they are operating in an environment where it cannot exist.One by one, countries will make a move to adopt a protocol that is truly decentralized and requires no trust in any 3rd party intermediary. One that cannot be controlled or influenced by an individual entity. Where no network participant has any power to censor or exclude another. A truly neutral protocol that simply processes transaction after transaction. That is completely a-political and cannot be weaponized to attack a network participant for individual gain at the expense of the network. A system that incentivizes cooperation and humans to play win/win games instead of zero-sum games, despite operating within an adversarial environment. This transition couldn’t come soon enough. I hope you have a great finish to your week, and I will talk to everyone Monday.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,I’ve been looking at the following chart for weeks, and it continues to provoke deep thought and enquiry. The chart shows US federal debt as a percentage of GDP (Gross domestic product), and highlights a fairly obvious trend. That is, that times of relatively high debt to GDP have historically been a catalyst for some kind of war. This trend begins with the American Civil War which began in April 1961, with debt/GDP in the early 1850s bottoming in the low single digits and rising to around 30% at the peak. This was followed by WWI which began in 1914 (one year after the US fed was established) and saw peak debt/GDP only slightly higher than the prior. It only took 25years between WWI and WWII in 1939 with debt/GDP absolutely skyrocketing to almost 125% - orders of magnitude higher than the previous. The Bretton Woods Conference and subsequent monetary reset signaled an end to the second world war in 1944.Since WWII we have had perhaps one of the most peaceful periods in history. However the writing is currently on the wall with debt/GDP printing all-time highs, at the same time while we experience levels of civil unrest in countries all around the world in reaction to government responses to COVID-19.So are we heading for a World War? I have no idea, but the trend here is compelling.It sparks me to wonder:Is war a catalyst for monetary reset? or is it the other way around.. Is monetary reset a catalyst for war?I do not know the answer for sure. But it seems clear to me that of the American Civil War, WWI and WWII, the two have gone hand in hand.We now live in a much more global, interconnected and inter-reliant world than ever before, and this world and the geo-political dynamics are punctuated by nuclear capabilities which somewhat stalemates the nature of power projection, as the result of a nuclear conflict would be catastrophic. Clearly high levels of debt, just like household debt, have higher order effects, and cannot be sustained over time. It’s interesting to think about our current debt based system, and be curious about the relationship between high levels of debt, which create stress and inequality (among other things), and how this trend has compounded over time, and to wonder how things would be different if we adopted a system that prevented these kinds of dislocations and excessive debt bubbles were not possible to inflate. The elasticity of the fiat standard appears to have enabled a lot of progress, and one could make arguments for the efficacy of this. It’s also possible that it’s simply prolonging the inevitable, and by doing so, the eventual outcome be significantly more extreme.All i know, is that we’re living in an upside down world, where debt (liabilities) is treated like assets, and assets like liabilities, and that at some point the trend will revert to the mean. Whenever this happens - Would i prefer to hold a debt based asset or the most pristine collateral that’s ever existed?You already know my answer.This is something that everyone needs to figure out for themselves, but one thing is for sure.. You would rather be a year early than a single day late.Something to think about…Wishing you all well, and I will talk to you on Thursday (Aussie Day tomorrow).AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,Bitcoin is now down 50% from the highs in November, and the class of 2021 are underwater and panicking. As shown by the fear & greed index, printing 11, an “extreme fear” read. To demonstrate our (humans) irrationality, F&G index was at a 95 (Extreme Greed) while price was rallying at the beginning of 2021 and price was around the $37,000 region. Pretty funny how volatile human psychology is. Same price, but bi-polar market sentiment.It is in these time when the tourists really show their hands, and reveal their psychological concavity (fragility).While I would prefer price to be going up, if i had a choice, and the price of Bitcoin relative to melting USD ice cubes to be increasing, that is simply not how markets work and I have been calibrated (painfully) by the market over years to understand and accept this. As humans, we crave certainty. Many people will try to tell you, “fill in the blank” is the reason the market is pumping or dumping, but the truth is, you would have to a completely delusional to think you know the reason millions of people scattered around the world are performing a specific action. This is just a classic case of humans seeking certainty.All we can truly know, is that markets move up and down based on an imbalance between buyers and sellers. We are so psychologically primitive. People naively think they can just buy something and it’s just going to go up in value, and it’s going to be easy. Not so fast..The way I’ve explained it to friends is that markets are like an olympic level event. A global olympics, that anyone can enter without having to pass any tests or having met any prior requirements. Anyone is welcome to participate and compete.If you think you can participate having done zero training, against the best in the world, in an event you know nothing about and have no experience in whatsoever, and you blindly think you can win, you’re completely out of your mind.Bitcoin is no different (for now).I think about times like this as if they were a test.This is how a market tests your conviction. Your thesis. Your position sizing. Your entry. Your time preference. Leverage used etc etc.Below are a few thoughts on how to best handle market draw downs, things to think about and potential actions to take:* Review your thesis, and whether or not anything has changed.* Re-visit fundamentals. What has changed? * Understand your time horizon. Lowering your time preference is a super power.* If your time horizon is years, why are you looking at an hourly chart?* Do you have a line in the sand clearly defined, where you accept you were wrong and take a loss? Think through the actions needed to take, if this were to happen.* Question previous assumptions.* Journalling your thoughts and feelings to better understand your psychology is a game changer. * Treat these times as a time to focus on deepening your knowledge. Re-read a book that had a significant impact on you.In the case of Bitcoin, i believe these times are for accumulating. These are the times where the emotional and immature market participants demonstrate they have not done the work, and bitcoin changes hands between those who keep their btc on exchange, to those that lock it away in cold storage.Most critically, i do not believe the fed can tighten in a meaningful way, sustained over time. The system is such that they will HAVE TO continue to print. The current monetary experiment is built upon an impossible expectation of infinite growth, in a world of finite resources.These are just a few of the things that come to mind when i think about the market at present. I cannot imagine being concerned about short term price, with less than 10% of bitcoin issuance remaining when a single bitcoin is valued at $36,248 USD - for what is an inanimate object; an entry on a shared digital ledger, maintained by a decentralized computing network that no one owns or controls.But it’s not just any digital ledger, and over time, more and more people will come to understand this technology, and the market will price it accordingly. I think Odell put it best:Stay focussed on the long term. Bitcoin is the mission. I hope you have a great start to your week, and I will chat to you tomorrow.AK Final Thought:“My bitcoin can stay in cold storage, longer than the market can stay irrational.” This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,There has been a congressional hearing in the US overnight under the heading “Cleaning Up Cryptocurrency: The Energy Impacts of Blockchains”.Straight out of the gate i simply reject the premise of the title, at least how it relates to Bitcoin, suggesting there is something to be “cleaned up” or as if it is dirty.From what i have listened to so far, many of the critiques made, are items that have been proven false already. There are a couple of fundamental and foundational points that stand out to me, and I think in order to have any meaningful, productive and valuable discourse on a topic like this (which is riddled with misleading terms like blockchains), these items need to be properly addressed and fleshed out by experts that actually understand the technology to avoid the broken record-like behavior of politicians and anti-bitcoin activists that continue to espouse the same false narratives from years gone by. The first is the use of the term cryptocurrency, and the grouping of these as if they were a single entity. As if any of the some 16,000 shitcoins, most of which are out right scams, have anything to do with Bitcoin (Spoiler alert: they don’t). Secondly, and perhaps most importantly is the on-going comparisons between PoW and PoS “blockchains” and the repetitive arguments made against Proof-of-work, specific to the networks energy usage, which ignore the absolute fundamental nature of this consensus mechanism to enabling what Bitcoin is.In an effort to avoid re-hashing many items already discussed specific to energy, let me simply refer you to a couple of earlier letters on the topic.By far the most succinct explanation I have read about Proof-Of-Work comes from Gigi, who has written extensively on the topic.As Gigi accurately states: “a failure to understand proof of work is a failure to understand Bitcoin.”The thing with proof-of-work, is that it’s complex, so it’s not surprising most do not understand it. If i was to try and simplify it I’d simply tell you that to have a truly decentralized system like bitcoin, there is currently no alternative technical solution in existence that actually achieves this outcome. That is the bottom line.However to simplify it misses the beauty of this innovation and fails to capture how incredible PoW actually is. To better explain the complexities let me simply read through Gigi’s thread.Hopefully you found this useful.I hope you have a great day and i’ll chat to you next week.AK This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit unlocked.substack.com

Good Morning Everyone,I shared a chart in a recent letter, that showed the Bitcoin Networks user growth compared with that of the internet. If you missed it, i’ve included it below..The chart below was taken from a post by Willy Woo. It’s a super interesting chart, and i believe the comparison between the growth of the internet, as a network, is very analogous to that of the Bitcoin network. The chart shows that in 1997 the internet (represented by the thin purple line) had around ~120m users. Bitcoin is represented by the thick green line, and shows that as of Jan 2021 there were ~135m network participants, meaning that Bitcoin relative to this specific metric is comparable in adoption to that of the internet in 1997.Back in the early nineties (93/94) when i was 12 or 13 i used an IBM ‘Thinkpad’ laptop at school. This laptop had one of those little pointing devices in the middle of the keyboard, like a little finger joystick to control the mouse. It had a color 7” LCD display, which at the time was still pretty new - Black & white displays were still common. It also had a 4.4kbps PCI modem. Vintage tech.I used to go to the school library at lunch or after school and stand behind the librarians desk. This was the only place in the library that had a telephone point that i could use to connect my modem to. I would connect to the internet and to various mIRC chat rooms, and bulletin boards, speaking with people on the other side of the world.The world wide web (www) was only just getting started. One of the very first web browsers was called Mosaic and it became popular due to its graphic user interface (GUI) and that it enabled images as well as text.Using a computer back in this era as a kid was viewed as strange and was not well understood (at all). It was very fringe and the perception was that you had to be a massive nerd to be interested in this kind of thing. People did not imagine if you fast forward 20 something years that 80% of the worlds population would use a laptop, let alone would carry a computing device (smartphone) with them everywhere - even to the toilet!There was no Google, Facebook, Amazon or Netflix. The use cases in which these businesses were built, were for the most part, not possible yet, and certainly non-obvious to most. I don’t think many people (on earth) realised how big search would actually be, and the implications of it when google was first founded in 1998, let alone in ‘93 or ‘94. If facebook did exist back then, it would have been much less compelling. The user-base may be a few hundred weirdo’s around the world communicating from their basements in plain text. The ability to be broadcasting from wherever you are at almost any moment was not possible. There were no smartphones with cameras, the data transmission was so slow and cost prohibitive to have large data plans, sending things like photos and video was essentially not possible, and certainly not at any kind of scale.It’s important to understand that the network effect is like a self reinforcing feedback loop. Increased user growth, the continued development on top of the underlying protocol, as well as innovations in hardware, infrastructure and data transmission speeds and availability, all mix in, to enable the internet as we know it today.Only with an open global protocol standard is this possible.This open global protocol (TCP/IP) that everything has been built upon, is still the foundation of all the incredible benefits we enjoy from the internet today, and this has completely changed the way humans communicate, interact and transmit information and the speed of that transmission. Back in the 90’s there were a handful of broadcasting networks that had a complete monopoly on the broadcasting of information at scale.Compare that to today, where anyone can create a youtube channel, a twitter account, create a podcast and can transmit information to the world. It is a complete reimagining of information transmission and global human communications.In 1994 Tim Berers-Lee founded the World Wide Web Consortium (W3C), an international community devoted to developing open web standards.It’s incredible to look back at the standards this community developed, especially in comparison to those of Bitcoin.According to the world wide web foundation, these standards were:Decentralisation: No permission is needed from a central authority to post anything on the web, there is no central controlling node, and so no single point of failure … and no “kill switch”! This also implies freedom from indiscriminate censorship and surveillance.Non-discrimination: If I pay to connect to the internet with a certain quality of service, and you pay to connect with that or a greater quality of service, then we can both communicate at the same level. This principle of equity is also known as Net Neutrality.Bottom-up design: Instead of code being written and controlled by a small group of experts, it was developed in full view of everyone, enc