Overview: This week, our special guest Shane Ulrich attempts to distill years of bitcoin knowledge into one short, informational interview. This episode is packed with perspective that will help everyone understand bitcoin a little bit better. Find and contact Shane at his bitcoin consulting business: https://www.beginningwithbtc.com/
Submit your questions and suggestions for us here!
Contact us at yondercast@gmail.com
Episode Agenda with Time Stamps:
Credits:
Overview: This week, our special guest Shane Ulrich attempts to distill years of bitcoin knowledge into one short, informational interview. This episode is packed with perspective that will help everyone understand bitcoin a little bit better. Find and contact Shane at his bitcoin consulting business: https://www.beginningwithbtc.com/
Submit your questions and suggestions for us here!
Contact us at yondercast@gmail.com
Episode Agenda with Time Stamps:
Credits:
Ep.11 - Bitcoin with Shane Ulrich
[00:00:00] Ian: I
remember my band director in high school, he had a Baton
and it was
broken. It was like split
down the
[00:00:05] Patrick: middle.
[00:00:05] Ian: So it was like in two pieces.
Anytime he would wave it around, he would like, they would, you know, they would flap and you would like, see
it.
And it was really confusing.
[00:00:13] Shane: cuts
[00:00:15] Ian: Yeah
[00:00:16] Shane: can't afford.
A new Baton.
[00:00:18] Patrick: That would make a pretty interesting
[00:00:23] Josh: What
[00:00:24] Patrick: Yeah
[00:00:24] Shane: be enough.
[00:00:27] Patrick: Like, what are they mad at of Plastic.
[00:00:29] Ian: I
think
they're
plastic.
[00:00:30] Shane: Then
how does one split
[00:00:32] Ian: I don't know
Maybe it's
not,
maybe it's like ivory or some Fancy.
thing. I don't know.
[00:00:37] Patrick: down on. poaching for batons.
[00:00:41] Shane: They're made
from
an
entire tusk Oh,
it does
ground down
to
one tiny
little
sliver.
But
that's
why it's
worth.
so
[00:00:49] Ian: I think it's time for yonder cast. Welcome everyone today. We're going to discuss the blooming business of Bitcoin and what everyone should know about cryptocurrency. But first let me introduce today's cast. Today I am joined by he who must be named the master
of
tactics, the bringer of thunder.
Patrick
[00:01:08] Patrick: Leitch Whoa I was actually expecting Josh for that one.
but thank you.
[00:01:13] Ian: I'm
also joined by.
The wrath of the chipmunk, the spirit of the wet noodle. Josh
[00:01:18] Josh: Baltzell the wet noodle.
[00:01:21] Patrick: I would say that one was probably more me.
[00:01:24] Ian: And today we have a very special guest today. We are welcoming onto the show, the pride of the jungle.
Mr. Shane Ulrich.
[00:01:31] Shane: Oh, I was
Expecting someone else to
[00:01:33] Ian: walk
[00:01:34] Shane: I didn't realize okay. Got it.
Hello.
Well
thank you.
I am super glad to be here.
[00:01:41] Ian: So
Shane is a teacher at the same school that Josh and Patrick and I all teach at. And he is a.
very knowledgeable individual in the realm of cryptocurrency. So we invite him on the show today to give us and the whole yonder squad.
an introduction to what
cryptocurrency is and Bitcoin and why people should be paying attention to it. And at least know a little bit about it. But before we get into that,
Yes.
we always banter a little bit at the beginning of the episode. So Shane, tell us a little bit about yourself.
and something that has been
Occupying your time
lately.
[00:02:15] Shane: Let's see, occupying my time. It's teaching children. Trying to,
Be a
good father realizing all the ways that
I am a total
failure.
and
trying
to make up
for
the many.
Failures.
that I
I perceive That I have on.
a daily basis.
Looking forward to the summer and all the fun stuff that I'm going to be doing.
And yeah.
[00:02:39] Ian: Yeah.
So timeline wise, I don't know exactly when this episode is going to end up being published, but we are recording.
Right.
at the end of our
school year. So all of us are in a pretty good mood. We are right about to enter. Our summer
vacation.
And and that's a good time.
Josh what's
been going on in your life.
[00:02:56] Josh: No,
man.
I
had to go
second.
That's unfortunate.
I you gave me a full 48 hours to figure out what I've been doing with my life.
That came up with nothing. Gap basically the same machine I'm
just
wrapping up grading. living my best life. Excited for summer.
Finished writing a paper, which that was good.
But like that's, that's. That's like it, my whole life recently has been writing
papers.
program.
Yeah.
unfortunate.
[00:03:26] Patrick: Yeah.
[00:03:26] Ian: Well, I don't,
mean to, I don't mean to pry, but there have been other developments developments in your life that are pertinent to this show. Specifically that I think need to be added to the.
the tome of
the under cast lore that we've
discussed in the
[00:03:39] Patrick: past.
[00:03:41] Ian: There's a, there's a.
a yonder gauntlet. That now has some additional. Slots that have been
filled.
[00:03:51] Josh: What
did I do?
[00:03:53] Ian: You
got kidney
stones.
Did you not?
[00:03:57] Josh: sitting there like
what happened?
oh my
gosh we haven't recorded since my kidney
[00:04:02] Ian: stones.
We have not.
[00:04:03] Josh: So yeah, you guys haven't had the opportunity to make fun
[00:04:05] Patrick: of me.
Yep We're waiting
[00:04:07] Josh: Oh man.
Yeah, no,
I have a new found respect for Ian.
Because we made fun of him hard over those kidney stones.
And then I had the same pleasure of having kidney stones. And let me tell you, I thought I was dying.
I have never felt
pain like that.
in my entire life.
I called the nurse's hotline at
like
four o'clock in the morning. It was like, I haven't been able to sleep and I think
I'm dying.
and it feels like I got stabbed. And she was like,
[00:04:34] Patrick: yeah,
that sounds
[00:04:35] Josh: kidney
stones.
I was like,
okay, what do I do?
And she was like, go to the hospital.
[00:04:39] Ian: Yeah.
Yeah.
So.
So. after having
the experience yourself, do I, do you feel like I did it.
do you feel like I over-exaggerated as you guys. Suggested in the past.
[00:04:50] Shane: is this is Ian's coming
to terms Yeah.
[00:04:53] Josh: Quite the
opposite you
under exaggerated
it.
because you were like, yeah.
no, they were pretty bad.
No, I'm here to tell you that I cried.
all night.
It was 24 hours of crying. No, that was misery.
Yeah. So
I have a newfound respect for you I already. I already somewhat respected
you beforehand.
Now
I fully respect you.
because
you
survived that anyone that's ever had kidney stones, you need to understand. Or hasn't had kidney stones. You need to understand.
[00:05:20] Patrick: I'm kind of scared for
that.
Cause.
It's going through the line here.
Hey you Josh you have any I'm logically
[00:05:26] Shane: I'm glad we're sitting
[00:05:27] Patrick: in this
[00:05:27] Shane: order.
That makes me last.
[00:05:30] Patrick: Clockwise is not good.
Yeah.
So when
are the
best friend forever necklaces coming with it Crusted Gemstones,
if
you
will
[00:05:39] Josh: have mine.
I put it in a
Ziploc
[00:05:40] Ian: back Oh, I had to give mine back
[00:05:42] Patrick: to the
lab.
[00:05:43] Ian: I actually.
I don't know
if I told you guys, I don't know if I said this on the show.
but when I had to like, turn it into the lab for it to get tested or whatever. I asked the nurse. I was like, so when do I get this back?
And I
was trying to like lighten the mood, but
she just
[00:05:58] Patrick: look
[00:05:58] Ian: at me. Like
I can't
tell
if you're serious.
or not.
And I was kind of like,
I don't know if I'm serious or
not.
Like, I kind
of want it
back.
[00:06:07] Patrick: Got to give it the
Viking funeral.
Send it.
On
the
Pyre Burnet
and send it to see
[00:06:10] Ian: It's a significant.
I don't know, it's a significant event. I mean, it's like
[00:06:13] Josh: The most embarrassing part of this is that they told me that mine were too small to test.
Like the pain that I went through and the guy was like, oh yeah, that's the smallest that they usually get. And you can feel it. And I was like, no, you're wrong.
That
thing is not tiny.
[00:06:31] Patrick: Well you had multiple
right.
[00:06:32] Josh: I
have, I have two still inside me.
Yeah
[00:06:35] Shane: just
waiting for you Like a
ticking time bomb.
[00:06:38] Josh: And apparently one of them is just sitting right at the top of
the ureter and is just
Waiting for either. I'm going to get
punched
one day Or like, I'm going to bump my hip
and then it's going to start making its way.
[00:06:50] Patrick: We can take
care of that right now.
[00:06:51] Josh: I'd rather not.
[00:06:54] Ian: Well, I'm sorry.
that you had to go through that, Josh.
Oh, thank
you. But I'm glad that we can bond
over that.
We can
laugh in retrospect.
[00:07:02] Patrick: That's a
good call back It's been a while since the kidney
stones came up I like that.
[00:07:07] Ian: I know.
It's It's
amazing
that it's like,
It's not just one of
us.
Yeah There's only,
there's only three
of
us main
[00:07:13] Patrick: hosts.
Yeah,
you
can't see it but I'm sweating right now.
in anticipation. Like I'm scared.
[00:07:19] Josh: We
were
only like six months apart, too.
Yeah.
Wow
Back-to-back
[00:07:25] Ian: I mean,
I think that we are
like,
the
Statistical likelihood curve.
Peaks right around our age.
So we
are
definitely in the window of most likely to get kidney stones. So
[00:07:37] Shane: as
a
male,
can you get past the window?
[00:07:39] Patrick: Yeah,
[00:07:39] Ian: it does It does decrease.
I
think
[00:07:42] Shane: Okay Nice.
looking forward to
old age
[00:07:48] Ian: There's always exceptions.
[00:07:49] Shane: Yeah.
[00:07:50] Ian: Patrick what's been going
[00:07:51] Shane: for running it.
[00:07:53] Patrick: Well, I have not had a kidney stone, which is good.
Uh Mainly just moving.
So
we're moving.
About a mile Yeah.
We're pumped.
So we have.
To move with two little ones. So that'll be interesting. Kind of sad to leave the house behind. This is actually the last weekend in that house.
So we've been a little on
the emotional side, but
no it's been great. So we're going to move next week. Other than that, just, got some anticipation of some video games coming out.
just to lighten it up with all the.
The dark kidney stone doc.
[00:08:23] Shane: Isn't
there a kidney stone shooting.
game like some kind of laser.
[00:08:27] Ian: yeah.
Asterisk That game asteroid.
[00:08:29] Patrick: That's
straight
[00:08:30] Ian: an intern That's
that's
occurring inside the human body.
[00:08:35] Patrick: Minimally invasive surgery, just taking care of
kidney stones.
That's so good.
Yeah No,
I think Diablo two, remasters coming out soon in September. So I'm pretty pumped for that one.
I know I've been trying to
get you guys to play
that.
As much as I
can,
So.
that. Just trying to relax.
Shane was talking about.
just trying to not make mistakes. All the
[00:08:57] Shane: time
[00:08:57] Patrick: and realize them as
this teaching
year,
and parenting has gone.
but it's been good.
Surviving.
[00:09:04] Ian: Yeah, it's
interesting to
hear you all talking
because I feel like.
I
feel like, like the last month of the school year, it's kind of like, For teachers.
Throughout the
rest of the year, you kind of balance your personal life and your teaching life. And then like the last month.
of the year, You don't really
like do a lot in your personal life. You're just kind of like teaching and wrapping things up. and figuring out how to, you know, get all these kids past the finish line and everything like that.
And then
you're just kind of waiting for summer to like renew your, your personal life. So.
We're all.
we're all
kind
of like, haven't been doing much.
And that's.
The same for me. I've actually been reading a little bit, which is something that I don't do enough of. But I've been reading this series called red rising.
Oh, have you guys heard of
red
[00:09:46] Patrick: riser heard of it but never.
gotten any details about it.
[00:09:50] Ian: It's good. I want it to bring it to the show because I think that you guys would like it. It's a science fiction
series.
There's it's a
trilogy.
but then there's a
second kind of
followup trilogy.
So there's quite a few books out there. but the first book, which is just red, rising kind of gives me like a hunger game vibes.
But it's Hunger games for adults. It's definitely like not.
to me, it doesn't strike me as a young
adult.
Kind of level.
Book and then books too. And I'm currently in book three. They're star wars.
for Adults are kind of like star wars, game of Thrones. There's like a lot going on. Really epic.
kind of.
Battling factions and conquest and just tons of action and intrigue. So it's a good summertime book. I feel.
like I've been listening to some of it on audio book and reading some of it. And it's just like, Very very engaging. So if you're into books on tape or books in general,
Red rising. I think. Is a worthwhile one.
And they just came out with a, a.
With a
board game for red rising. And you guys know how big
[00:10:51] Patrick: it is
[00:10:51] Ian: a, Board game fan. I am. And and it's, I think it's good. I
think it's really good.
[00:10:56] Josh: Which
came first, the board game or the book.
For you
[00:10:59] Ian: Yeah.
So
my
dad recommended
that I read red
rising.
like two years ago and it's been on my to read
list
[00:11:06] Patrick: for
a
long time.
[00:11:07] Ian: And then they announced that they were bringing out this board game more of a card game.
And
I was like, well, now I have to finally read it. Yeah.
So kind of the, the impending release of the game. Motivated me to read the books,
but
[00:11:20] Josh: yeah, that sounds great.
Yeah.
I was picturing, like
you got
the game.
and then thought, well, now I have to read the book.
[00:11:26] Ian: It's
been kind of fun though, because I.
had read the first book
and like a
quarter
when I got the game.
And so I've
like played it a few
times with my wife, like at different stages of reading the books.
and
I like recognize more.
characters every time I play it. It's kind of fun.
Yeah, but.
The biggest thing going on with me is that I.
am going to be a dad.
in a few months.
in October.
Um
My wife
is pregnant
and is going to be delivering at the end of October. And
so there's going
to be we're going to have to buy a new microphone. because There's going to be a new.
member of the yonder cast.
And
that's been,
that's been just super exciting
for us.
So a lot of my time and
energy too has been just
like,
thinking about that and
Making plans and
trying
to figure out what we need to make plans for and,
you know,
[00:12:09] Josh: there's going to
be a younger cast spinoff
called
younger
[00:12:12] Patrick: Yes.
[00:12:17] Ian: Very
cool. Very cool. Well,
I want to talk about Bitcoin.
but first I do want to take a really quick break to just thank our listeners and reviewers, because several people, since our last recording have added. Five star reviews to our apple podcasts.
Page and,
Can't
tell you how much we appreciate that.
I mean, those,
those reviews
are
the
best way. To support the show, honestly, it, it not only makes us feel good and lets us know what we're doing right. And what we're doing wrong, but it also is our way of kind of building. Legitimacy as a podcast and building our audience.
[00:12:51] Shane: Building an empire.
The yonder
empire.
[00:12:55] Ian: I especially
want to think.
User origami Yoda.
two, three, five, two, five.
So
apparently origami Yoda
was a popular username, because I guess there were
23,524 of
them before this. Before this user,
[00:13:09] Patrick: A lot of folding.
[00:13:10] Ian: But
Origami Yoda says. Quote, this podcast is literally magical.
Apart from hearing
the perspectives of three high school teachers from Oregon It also has a great flow to each episode, a little slice of
life gaming.
and science. Keep rocking
[00:13:25] Patrick: dudes.
[00:13:26] Ian: Very nice. Thank
you. Origami Yoda.
And
now.
The main event, the main attraction.
Shane, let's talk a little bit about Bitcoin.
So,
first of all, what is your,
what is
your involvement in Bitcoin?
Like how long
ago did you get interested in this
what do you do in the world
of Bitcoin?
[00:13:46] Shane: So I've been involved with Bitcoin since 2017. Started with it kind of in two ways, one just investing. Like personal funds and retirement funds.
But
then also I have a friend.
Who I met in college. Who's been
doing. Like YouTube chose about Bitcoin since like 2015.
And so I've been talking.
I was talking to him, listening to his shows, also
got,
Financially invested. And that's how
I started
in 2017.
And since then I've gone
down the Bitcoin rabbit hole, which involves a lot of learning and understanding such topics as. Macro economics and history of money and Just a lot of things that go into why Bitcoin actually has value and how Bitcoin works.
[00:14:31] Ian: Awesome.
You actually have started a business.
[00:14:35] Shane: I have yes I have started a business.
Nice
Yikes
[00:14:38] Ian: It is.
[00:14:39] Patrick: the new biz coin.
[00:14:41] Shane: That's like the new age business.
It's like the
next level
of business.
It's
like a yonder business.
That's what I think.
Yeah, I've started a consulting business where I am just teaching clients that are interested in learning.
Either how Bitcoin works or how to accept Bitcoin through their businesses or how to.
Invest retirement money or just personal funds into Bitcoin. How to custody Bitcoin.
Because
there's a lot to learn and there's a lot of misinformation.
And
I am It's a it's important to
kind
of learn the right way of being
[00:15:15] Ian: Fantastic.
And so that's called a beginning with
[00:15:19] Shane: beginning with BTC
btc.com
Yeah.
[00:15:23] Ian: And that, And that link will
be In the show notes.
So any listeners who want to check out Shane's business can find that.
LinkedIn. The show notes.
When we're on whatever platform you're using.
And we'll say
it again at
the end of the
podcast.
as well, but you have a lot of knowledge and information. And so I want to, I want to bring some of that
to our listeners. So
first of all
In talking to. People that I've talked to about Bitcoin and cryptocurrency.
The first question is always
like, what
is it? Because
it kind of.
seems fake. Like
it kind.
of
Seems
[00:15:50] Shane: like.
For sure Video games It is totally fake
Yeah
[00:15:54] Ian: so so what is Bitcoin?
[00:15:58] Patrick: I'm not
going to lie One time
I had
a friend this.
I was like, I'll honestly want
to say like 2009,
2010. I went to high school with this individual.
Which is
probably about, I don't know when it started, you'll probably cover that. But he was talking about this new thing called digital currency. Yeah. And we legit thought he was crazy. Like 100%.
He's.
He's like I'm investing in this thing. It's not even a real currency. It's the currency of the future. And we're like,
dude.
What are you on?
I'm not even kidding.
But I think he still has it.
Which is like,
I honestly want to say I was like the first time I've ever heard of it was a long time ago. And we literally were like, do this.
Can't be real.
There's no way.
Yeah I thought that was like,
it's crazy how it's.
changed
over time.
[00:16:38] Shane: Yeah for sure.
Yeah The
the ecosystem has grown a lot and just trust in the network has grown a lot. For sure.
[00:16:45] Ian: That
was
I mean,
2009.
Isn't that when
[00:16:48] Shane: January of 2009 was when the Bitcoin core protocol first started being run
by.
[00:16:54] Patrick: on.
Not saying it is, but it sounded like a conspiracy theory.
yeah,
He was literally talking In
a way. I was
like,
He had like the codes to
something.
that I didn't
know about
like,
He had this tinfoil
hat on and he's speaking all of this jargon. I'm like dude.
You
need to calm
down a second.
because he's just
talking about like, I don't want to say he was like trying to get me involved in it in any way. We're just kind of catching up and he was talking about things. I was like, oh, okay.
Now
I'm
looking like the
[00:17:19] Shane: idiot.
[00:17:22] Ian: So,
what
[00:17:22] Shane: is
it So so I'll
talk most
about Bitcoin.
That's
kind of
where
my
focus is, where I believe the value is.
A couple of different ways. You can think of it. You can think of it as a network that has two main components, which is the asset called Bitcoin, which is there's 21 million Bitcoin.
They are divisible and.
and. so uh no one can really create more than a 21 million that's prescribed by the protocol.
And then.
So there's the asset Bitcoin, which is kind of like an uh you.
know, think of it like a, an accounting, but not. And then there's the Bitcoin network, which allows for transfer of the Bitcoin in a decentralized way, which means there's no third party, no intermediaries that can. Control the movement or stop or seize. Transactions of Bitcoin between wallets and between individuals.
And so.
It started out right in 2009 with no value. Like it really was like video game money, just like
you
guys play video games. So I'm sure that you play video games where there are.
economies within the
video games right And
and and that's kind of and then That's kind of how, like
how Bitcoin started was just you know,
Think
of it as like a digital collectible.
On
a network
that allowed for the transfer of,
Of that asset.
and over time. As.
There's like, you know, the dollar Fiat currencies and whatnot that that are all controlled by central government is going to be printed by central governments.
That's leading to inflation, that's leading to a lot of income inequality and how newly created money is distributed, which is not distributed evenly to populations. But Bitcoin.
Just the way the protocol is set up is there's
like,
again, there's no way for people to make more.
No one can control it. No one can stop it. And so over time, since 2009, trust has grown in the value of the asset.
and its ability
to not
be debased or controlled or seized And so with that trust just
The willingness of participants to pay money for the Bitcoin.
has increased. So it started out I just as a digital collectible, with no value.
And then it was a penny.
and it was two pennies.
And it was a dollar.
And
it was a thousand dollars. That was $30.
It's gone up a lot and it's gone down a lot and currently. That price today is people are willing to pay $37,000 per Bitcoin
[00:19:37] Patrick: Yeah.
[00:19:38] Josh: I got exponentially
more
interested.
This sounds like a social justice issue
almost.
[00:19:43] Shane: So
actually,
that's why,
that's why I'm in.
That's like the main reason why I'm involved in Bitcoin. And that's kind of why I started my business, was to try and teach people about how it works.
And there's a lot of work
going on and maybe. I don't know if we'll talk about it in this podcast, but the first country just adopted Bitcoin as it's a legal tender, El Salvador.
And one of the reasons that they did that is because they previously didn't have their own currency. They.
Just after years of civil war and whatnot, they had dollarized, which is what it's called.
They
had just taken a dollar as their Country's currency. But because they do not have any control over the issuance of the dollar or creation of the dollar, then basically as a country, And as a people, they are basically subject to whatever inflation and monetary policy the us decides to do with, with its currency.
And
so, you know, people talk about inflation and like, oh, it should be, this should be this, but really what inflation is, in my opinion is a Central bank government creating.
you know, in a way legally counterfeiting money.
which then decreases the value of all the money that we have.
Which for us.
in the us doesn't seem like a big deal, but for people in other countries in El Salvador who are working hard and storing their value in that currency, and then to have that currency, debased and devalued Is unfair. And so one of the reasons El Salvador has adopted Bitcoin as legal tender is because no one can create more of it.
And so it's a way for them to protect their value.
[00:21:13] Ian: Because.
by the nature of
Bitcoin. It's, It's
not centrally
controlled by anyone.
It is
[00:21:19] Shane: There's no central authorities Totally decentralized network.
[00:21:23] Patrick: And
I
think that's what, when he was talking to me about it so long ago.
I mean, I was young. I
didn't
know A lot about like big banks and all that sort of
stuff.
big corporations And
so the way he was talking about it was like, that just doesn't seem like it could happen.
Yeah.
It doesn't seem like the reach of.
I guess the banking system and
the government is
so big that how could you just put something out there that isn't governed by that?
Like it just doesn't make
any sense of how
that would work. But
I
mean, It totally
[00:21:51] Shane: does.
Yeah I mean,
so it was interesting. like All of us alive. Like we, we have basically.
we were born into and have grown up into an age of what is called Fiat currencies, which is currencies that have no interest in intrinsic value. There only have value because our governments say they do.
But that hasn't always been the case.
You know, before the
dollar, for example, there was the gold standard and there had even been times in us history when the dollar
was backed
by a certain amount of gold, meaning that the government had gold.
And
then they issued
dollars as an easier way to transact because it's hard to carry around gold bars.
And then you could take your dollars to the bank And tr And switch it out for gold, if you so wanted. So that's called a gold standard.
But if you think about it, as far as like a government not being in control of a currency, that's kind of what gold is. Gold is a currency.
Whatever
you want to call it. Currency asset. That's been around for thousands of years.
well it's been around
forever.
but it's been used as money for thousands of years.
but there's no central authority that issues more gold, right?
It says gold miners that do the work to create more gold. And
then, you know, Gold's value is based on what people are willing to, to trade it for and
So,
yeah.
I think
it's think of it as gold. It's like a decentralized currency as well. And Bitcoin is just a new digital
form
of decentralized currency. Like gold
Digital Yeah Yeah
[00:23:09] Patrick: No.
[00:23:09] Ian: Well, and that's,
that's the
best way to think about Bitcoin, right? Like.
To like, explain it to someone is that it's basically digital
gold because a lot of the same kind
of principles.
With regards to like
Holding value in like people understand you can go buy gold.
and That's a way that
you can hold value or you can like buy something that will increase in value or at least
store the value.
of your purchase.
And like Bitcoin is just that.
but
digital.
[00:23:34] Shane: Yeah. And, and just got several uh like improvements over gold.
right?
Some people that are real big goldbugs.
That's what they call themselves that. really love gold. They would say like,
Bitcoin
has no value because.
Bitcoin kind of.
infringes on.
you know, Gold's place in society.
and as an
asset class. But but a lot of people feel like.
So Bitcoin does kind of replace in some ways gold as a store of value, but with some.
Really important improvements, which is like transferability.
I can send Bitcoin from me to someone across the world and in no time.
[00:24:07] Patrick: Right.
Can send
one to me right now.
[00:24:09] Shane: I could, if you,
Yeah, just uh I
don't know if I'd be willing
to send you a whole Bitcoin But,
Yeah, I was
[00:24:15] Patrick: using.
Adam of Bitcoin gold
AC
Oh
[00:24:19] Shane: Just like
a dollar has a hundred cents.
Each
Bitcoin has a hundred thousand What are called Satoshis or units. And currently once a Toshi is about 0.00 zero three pennies But but
yeah.
so you can you can transfer it quickly, easily.
There's no one that can confiscate it from you. Which has been a problem in Gold's history.
If you know, very much about like in 1933, there was an
order.
put out by the us government,
called
the order
61 oh two, where the government just decided to confiscate everyone's gold And,
And that can't really happen with Bitcoin. If you self custody yet And
so
yeah,
there's there's,
It's
like, you can think of
it like gold,
but it's
easily transferable over the internet. And. non
[00:24:56] Ian: So
a lot of the questions I
have for you are like questions that I have asked
you in the past.
about Bitcoin or questions that. My wife has asked me or the other people have asked
cause I think that one of the things
that like
immediately makes people wary
of Bitcoin
is
Whereas gold does not make people where he is because like gold
is a physical
thing,
you know?
like if you own gold, you can hold onto it. And like, I mean, unless someone robs you.
It's yours.
right And
we hear all the time about like
hackers, you know,
And like
taking people's information
and taking people's identities
and taking them and stealing people's money digitally. And Bitcoin's a digital asset. So one.
common. Concern is like can't. Bitcoin.
Be hacked and stolen by a hacker or can't, you know, couldn't there be a crash or a power outage that would suddenly lose all the Bitcoin data. Like, is that a thing.
[00:25:46] Shane: Um So there were a couple of different things you said first.
The first
question you had was like,
was you mentioned like the question of like, why does Bitcoin have value? Right.
And so I'll try and connect it to something that you guys.
frequently talk about which is video
games.
So what if you were playing a video game? like worldwide? and let's say it was some kind of, I don't know, Harry Potter type, magical game or whatnot. And and then they came out with a wand.
And there was only a couple of that one maybe two or three of that one. But within that game that was played worldwide.
There
was, it was limited. There's only two or three of these ones. And this ones gave you special powers beyond those special powers. Other people in the game.
The elder wand Exactly. Yeah.
[00:26:28] Ian: We can give it a name. Yeah.
[00:26:29] Shane: Yeah, the elder one.
Like, would, would people be willing to pay
[00:26:33] Ian: Like
[00:26:34] Shane: don't pay pay dollars Would people pay dollars,
[00:26:37] Ian: So people would pay a
lot of dollars.
[00:26:38] Patrick: Yeah.
[00:26:39] Shane: Or like, yes.
Yeah.
, but, but one
of the reasons why maybe the whole world
wouldn't start
to store their value
right. In these elder ones. It's because really there's a central authority,
which is the video game maker, which could just
change some code and
create.
more elder ones right?
So Bitcoin though is the first is the first way that actual, the idea of digital scarcity was created.
Without
any kind of central authority that can create more. So think of it like a video game.
which
is the world financial markets. and they made it, they made 21 elder ones.
or 21 million elder wands And they're divisible.
but no one can ever create more of them.
Right And,
And
what these elder ones give you the power of is they give you the power of storing your wealth.
and because no one else will ever make more of them.
Then.
they'll
just store their wealth because of digital scarcity.
And
so Bitcoin is kind of like the elder one of the world financial markets, because unlike gold.
definitely unlike Fiat currencies.
There's only going to be 21 million Bitcoin.
and there's no. Third party, no central authority that can create more of them or even take them. And so that's why more and more people are willing to store their wealth. You know, at first, no one trusted it. No one trusted the network. It was brand
new.
As in,
as in your your
[00:28:02] Patrick: here
[00:28:03] Shane: right But,
But with time,
The Bitcoin network has earned
trust because
of its characteristics have never faltered.
right? Like it's it's uncomfort Skateable. It is, decentralized.
Totally digital transferable, all those things. So, so that's kinda like
why
it started to have value and why it continues to have more and more value.
And then your second question was with regard to like hacks and whatnot.
And so to think about people having Bitcoin stolen. Think about if, like, if you had gold.
And you stored your gold at a
bank and then.
People came to the bank and broke into the bank and stole the gold.
Is that a problem with gold or is that a problem with the bank?
That's the bank, right?
So,
So no one would question gold. For example, if someone stole some gold people, wouldn't say like, oh, there's a problem with the goal That's a problem with the security structures of the bank, the people that
were
holding the
gold So.
Throughout Bitcoin's history, because it's such a new asset, a digital asset there have been different like market participants that have used Bitcoin in different ways.
And
through trial and error have learned some of the dues and not and don't dues of storing Bitcoin, particularly for other
people.
So,
it's not as common now, but throughout. Bitcoin's history. There've been a number of exchange hacks.
One of the biggest and largest was
one called Mount Gox I think that was around 2012 or 13, which
was a a website and exchange.
In Japan.
And so these online exchanges, you can think of them as banks with websites, where people can go in and just kind of trade Bitcoin back and forth.
Like they can sell Bitcoin, they can buy Bitcoin.
And then if they want to, they can move Bitcoin off in self custody them.
So Bitcoin, as an asset, you can self custody, which means it's no longer the private keys that have access to it are no longer stored by like an exchange or a bank. But if you leave your Bitcoin at an exchange, then basically what you're doing is you're trusting that exchange
to
use proper security measures, to keep people from accessing the Bitcoin and taking the Bitcoin.
And throughout time that has historically
Proven to, to not work very well for a lot of people, because with this.
You know Growing
asset and like people learning more about it. Like.
People are learning again, like how to safely store it. And a lot of exchanges have been hacked and people have stolen Bitcoin.
And so that's why if you get into Bitcoin, it's important to learn how to self custody yet Which is something that I promote and try and teach people about.
[00:30:37] Patrick: So, I
guess one question I always have is they always talk about Bitcoin mining.
Yeah.
Since
We're
talking about gold.
You can mine gold
and make more gold.
maybe you fuse two atoms and make gold or break apart
one bigger one and make gold why and how can you mind Bitcoin, if there's only a certain amount.
How can you mind something and potentially get more of it.
And
then
why is
that driving graphic graphics cards prices. So freaking high that I can't get a good. one.
Like I want a 30, 80.
I'm not
going to pay $12,000
[00:31:03] Josh: it.
There's an
ulterior motive to this question.
[00:31:05] Shane: Yeah.
[00:31:06] Patrick: I'm
not bitter.
Yeah.
Any way about Bitcoin.
But
[00:31:11] Ian: it's
not Bitcoin.
[00:31:13] Patrick: My
currency is.
[00:31:15] Shane: The
yonder coin.
[00:31:17] Ian: Hey
[00:31:18] Josh: Yeah.
[00:31:20] Shane: So so Satoshi Nakamoto was the anonymous creator of Bitcoin, which
Was
the
person that basically kind of put together work that.
had
den done
different parts of a code that had been previously worked on.
on other attempts at digital
money.
None of which
had really taken off or had failed for different reasons, but Satoshi Nakamoto in 2008, 2009 put the different parts together and created the right incentive structure to.
To make Bitcoin work.
and
how it's set
up is there's only ever going to
be 21 million written the code.
But those 21 million were not all released or available.
right at the
Beginning.
So one of
the ways that the Bitcoin
the Bitcoin network kind of sustains itself is
Is there
are minors right? Like obviously not pick and shovel miners. Right.
But,
They
named a minors to
make, make the connection to gold a little bit easier and the understanding. And
what they do is they run,
Computer
algorithms to solve, try and solve a mathematical puzzle. And while at the same time, they are kind of scooping up Bitcoin transactions and into a block, and then adding that block of transactions to the end of the blockchain. So if you hear about a
blockchain.
What that
is is every 10 minutes. The Bitcoin network adds a block to the blockchain. And that is all the transactions that were scooped up and utilized in that 10 minutes. after
that 10 minutes, there's another 10 minutes of they scooped the NEC transactions and then it just, at each 10 minutes, there's a block of transactions added to the blockchain.
And then minors for contributing to the network.
It's a way of like, Secure.
like security for the network.
they are contributing hash power, computer power to solve this puzzle and validate the transactions. And then there is one computer that finds the. Finds the answer to to a computerized puzzle at the end of every 10 minutes. And that computer is rewarded with. What's called the Bitcoin block reward.
which is a certain amount of Bitcoin that they get.
just for validating the network for that 10 minutes.
And when.
Bitcoin started from technically from like early 2009 to 2012, it's on a four, basically it's on a four year cycle.
very close to four years. It's the number of blocks, but it's, you're Approximate it as four years.
Every 10 minutes, there were 50 Bitcoin. That were released every 10 minutes.
And but that which sounds like a lot
now, but at
that point, I mean, in 2009.
Bitcoin had no value. So people were just contributing hash power, computer power to the network. And then gaining these Bitcoin as rewards, but they were worthless. They were just kind of like a collectible token. And then in 2012, the block reward halves. So every four years, Bitcoin has something called a having and every four years that that reward gets cut in half. So it went from 50 Bitcoin, every 10 minutes to 25 Bitcoin From
2012 to 2016.
2016,
there was, the second having a, and it went from 25 Bitcoin to 12 and a half Bitcoin every 10 minutes.
And then just last year in
2020 was the third Bitcoin having. And so the Bitcoin block reward went
from 12 and a half
to
6.2 five Bitcoin, every 10 minutes.
So right now around the
world, every 10 minutes.
There are miners using their computers, right. All over the world.
Contributing to the network and every 10 minutes another block is added to the blockchain of transactions and a miner is rewarded with 6.25 Bitcoin And so every four years that number halves so it goes from 6.25 to 3.1, two, five blah blah You know, like a half, half half half And,
It's estimated right now that
around the year 2140.
is
when the last of the 21 million Bitcoin will have been released.
Right now it's about 18.9 million Bitcoin had been released So most Bitcoin had been released because it started out with 50 every 10 minutes and then 25 traumas So, and obviously the number is getting smaller.
[00:35:02] Patrick: So that's when I should expect my graphics card.
[00:35:05] Shane: I know
because then
because they, they also get not only the Bitcoin block reward, but they also get transaction fees.
from the transaction. So at that point, miners will.
still be incentivized to. The network. But instead of getting block rewards, they will.
just be getting transaction fees. So basically you're screwed.
[00:35:23] Patrick: Yeah.
So
this brings up a follow-up. So
it doesn't.
Is
that creating incoming quality, any quality for within Bitcoin? Like does that mean the miners will almost get more overtime.
If they keep somebody or is
[00:35:36] Shane: So it's a
free market So anyone that wants to run.
Bitcoin core and validate.
transactions and add blocks of the block are, is able to. And so
Miners
all over the world, they have capital requirements,
which is buying these
Asics miners Which
as you know,
using graphic cards are very
expensive. And then in addition,
they have to pay for the electricity.
So
80
to 90% of their
of their overhead of their costs is just the electricity that they use. And so
So they, if you know, if they were making a ton of money,
Over what they put into
then that would just incentivize more people
to contribute to the network. And so over time, what happens like they're not really.
I
mean they have minors mapped and mostly sell their Bitcoin just to pay for their operating costs. They were kind of like a business. And if they make too much money, then that just means that'll incentivize more people, more businesses to go in.
But but every
four years at the having
their, their block reward, basically what they get is suddenly cut in half.
Which actually means for a certain amount of time.
Miners that are either using old machines are inefficient or paying too high of electricity costs kind of go out of business.
And
so it's kind of like every four years, it's a bit of a flushing. And an improvement in the efficiency of, of minors, just based on the
block reward.
having
[00:36:50] Ian: So,
okay. So every 10 minutes. Bitcoin gets given to someone.
[00:36:55] Shane: Yep.
A minor
[00:36:56] Ian: and,
and it can be, it can be anyone who
is like, kind of logged into the Bitcoin.
Core.
[00:37:03] Shane: So.
yeah, they
they're running Bitcoin core
software and but the amount of computing
hash
power that they contribute to the network is
basically
you.
know,
the Big
ups, their probability of winning.
that reward.
[00:37:16] Ian: I could run it on this
[00:37:17] Shane: You could run it
on that
Laptop.
Well actually technically now you
couldn't get this AC,
but you could run
it on like a gaming machine.
But
the probability
of you actually
winning Bitcoin.
would
be Like so small.
because the actual amount of computing power you're contributing to that work is tiny in comparison.
to what everyone
[00:37:33] Ian: else
So the More computing power.
You contribute,
the more likely you are
to be that
lucky one
[00:37:38] Shane: Yes Yeah Yeah It's all based on what you're contributing to the network
[00:37:42] Ian: Now
you mentioned that the.
Biggest cost.
to Bitcoin miners is
electricity.
And that's something that I've seen like in the news a lot.
It seems like people are
talking a lot about.
The electrical usage of Bitcoin and Bitcoin.
mining
and In a
very Negative way.
like
The
press right now around
Bitcoin. There's a lot of like, Bitcoin
is really
environmentally unfriendly. It's bad For the
environment. It uses
too much electricity. It's not, it's not an ethical thing for us to
do.
And in fact,
I think.
one
of the recent
like
dips in Bitcoin value was.
kind of
partly.
you
can correct me if I'm wrong, but.
Elon Musk.
did some tweets.
about Kind of this topic and said we shouldn't be using Bitcoin and like,
people were.
I don't know. So.
[00:38:24] Josh: big words from a guy that owns all of the
[00:38:26] Patrick: money.
[00:38:27] Shane: Yeah
[00:38:28] Ian: So
[00:38:28] Patrick: then
goes on SNL and promotes
his own
[00:38:31] Ian: is
there some truth to that?
I mean, is there some truth to Bitcoin not being environmentally friendly or using too much electricity?
And Is that something we should
be worried about?
or think about?
[00:38:41] Shane: So
the first thing that has to be like, decided on would be like, does Bitcoin actually.
contribute value?
Like it, like is. Does Bitcoin contribute any value to society? Right. And, and if,
if
your answer to that is no, like me personally, I don't believe that that's true. I believe Bitcoin contributes a lot of value, particularly in, places where people do not have a monetary sovereignty and they're kind of.
Living at the whim of their own central governments and what their central governments want to do with their monetary policy. Anyway.
One has to decide
if one thinks that Bitcoin has any value.
and
if Bitcoin,
if one thinks that Bitcoin has no
value then there is
no amount of electricity that that would be okay. That one would
think is okay to contribute to Bitcoin.
Right.
So.
So I think that some, I think that the first question people have to ask is.
like, is Bitcoin contributing to the world?
And,
I think like my personal belief is, is when you, once you do research on it and how people are using Bitcoin and how Bitcoin can protect people from
like monetary inflation and authoritarianism in governments around the world. I think Bitcoin provides a great value to society.
So
once we have decided that Bitcoin like contributes value to society, which I believe then the question is like, okay, so it requires electricity. So let's talk about like, what is what is the electrical electricity makeup that goes into supporting Bitcoin? And Bitcoin miners.
Like I said, they're about 80 to 90% of their costs.
Electricity
alone. So, so basically.
The one thing that they are looking at, as far as the business model goes is their price of electricity.
And a lot of people don't really understand how the electrical grid works. They see it as like, maybe there's just one.
central place
that electricity
is generated.
And as science teachers, you
[00:40:37] Patrick: guys
all the electrons are in one
spot
[00:40:40] Shane: spot right And
then they're distributed to everyone equally, but if someone over here uses more electrons, then that means someone over here doesn't have access to electronics And
that's not
how the energy grid works at all. Electricity can't really be. Can't really be transferred over more than
500 miles is about the maximum. And so energy generation has to be. Somewhat decentralized.
and then all energy obviously is not created the same, but also the cost of all energy is not the same. And so Bitcoin miners have to target.
Really inexpensive
and cheap.
Electricity.
That's the only
way
they can stay in business Yep. For their own benefit.
and the really cheap.
Electricity happens to be electricity that would otherwise be wasted.
or electricity. That is what is called stranded. And so some examples of stranded electricity or,
Energy that otherwise be wasted.
Is
there several companies in the U S now that
What they are doing is they are working with oil companies.
and oil companies. whenever they have like little oil rig thing or whatever.
that pumps oil out of the ground. They also bring out natural gas.
but the cost
of
natural
gas doesn't
Doesn't justify.
The cost of natural
gas being low means
that it doesn't really
justify them building
the infrastructure to then capture that
natural gas and bring
it to market. And so what a lot of oil producers do all over the world, not just in the us.
Or
Canada, but
as they
flare the natural
gas, so they just
kind of burn it off
and they usually burn it off very inefficiently with produces tons of methane and other greenhouse gases.
And and that's just energy that is wasted. And so like one example
of how Bitcoin miners are using as wasted energy.
as they can bring.
Even as something as small as like a rig let's like, think of it like a, like a railroad rig, like railroad car or whatever the cargo box or whatever those are called, but it could be even small enough to fit on the back of a truck.
They can literally just park it right next to an oil rig.
It has a, like an EPA approved burner or whatever. So it can burn the natural gas, like very efficiently, and then use that electricity.
To, to run Bitcoin mining machines and earn Bitcoin. And so in that way so that's one way where that's energy that would otherwise be wasted.
That's
also some pretty negative greenhouse gases, like methane and whatnot that comes from incomplete combustion that these Bitcoin miners are then able to come in capture that otherwise wasted energy.
Reducing
the
emissions that would contribute to greenhouse gases.
While at the same time producing Bitcoin.
Able to sell that in the market and producing
money another recent one is, that people just
started
They're
talking about in the last week was El Salvador, which is the company.
the.
country that
just
adopted Bitcoin as their legal tender.
They
have geothermal energy and so they are going to
They are going to bring Bitcoin miners To use their geothermal energy. And that will, they're a country that has.
after years and years of civil war and infrastructure problems, they don't really have a lot of infrastructure to capture some of their,
Some of their resources that that would otherwise help too.
Just improve the infrastructure of , their country. And so they're going to start using their geothermal energy to, to mine, Bitcoin.
Thus you know, using an energy source that has no emissions.
And and producing.
you know, money for the country.
Another really common way or place for Bitcoin miners to get energy is from hydroelectric dams.
Which oftentimes
Energy infrastructure. It usually has to be built before industry and populations can move in.
So so places will build hydroelectric dams, but then they don't necessarily have the industry or, or, populations to, to sell the electricity to. And so Bitcoin miners can move in.
They can help pay for the hydroelectric dam in the first place. Make it more of a, of a like
like,
just help their business model to justify building the dam. And and then they're using again, zero emissions, electricity and a lot of times actually dams will just kind of like let water through without generating any electricity Because. they don't have the market to sell it to. And so in that case, that's like an example of energy that would otherwise be wasted.
Like water
just kind of being led through the dam, but now they're using it to generate electricity too to mine Bitcoin that then helps pay for the capital of the dam in the first place and helps helps the business model.
[00:44:57] Ian: It sounds like a really.
a positive situation in that.
There is incentive.
For Bitcoin miners to
not just
Build a Bitcoin mine in the middle of a city and draw from the Power grid.
But specifically.
to go to
these places where
there's Unused
energy.
and tap
that.
not
just out
of
concern for the environment or the cost of
it,
but
for their own.
So
the.
financial incentives and the
environmental incentives
are aligned in this
case Yeah.
[00:45:24] Shane: Yeah.
yeah.
you won't find Bitcoin miners in the middle of a city or town because that's the most.
Expensive electricity.
So
they're seeking out other electricity.
that would otherwise be wasted or stranded.
[00:45:36] Patrick: I'm interested to see if that like fusion,
Reactor technology.
coming out soon.
who knows.
As I said it's
been going to come out.
in the next five years for the last 50 or
whatever But if
that's a completely, almost renewable resource. That could
change
the game. I think a lot for something like Bitcoin I don't know,
probably again, putting my tinfoil hat on here, but
I
would feel like the government would want.
it Bitcoin, not to be efficient because people need to buy a resource. Right. So if you're using something like oil or anything else that makes a lot of money for the government, which increases the dollar amount.
you don't want Someone else not.
to use the dollar.
Right You want someone to use our money? Yeah.
Because then
we can.
create that big gap in wealth inequality For
sure. So it's one of those
He hit something.
[00:46:20] Shane: You've been, you've
been mining Bitcoin
on there?
You just started right
Yeah.
and It overheated.
probably
[00:46:26] Patrick: the government's
on us now.
They shut us down
[00:46:29] Ian: And we are recording we're
back.
Sorry, everybody. There was a quick interruption the computer we were
using just just went black shut down turned off, but all of our recordings that looked like were saved. So so we are back and we're going to finish up this episode. And in the meantime Shane has put a, a graph in front of us.
And
He's asked us it's going to be hard to describe on on the podcast, but
he's asked us
to imagine what the rest of this graph would look like. It's like the covers half the page.
[00:46:59] Shane: And I can tell you more about it after, after after you guys do your little exercise.
[00:47:04] Ian: I think we should all submit our, our
[00:47:06] Shane: drawings to Shane
[00:47:08] Ian: and he can, he can grade us live on
the show.
[00:47:10] Patrick: I can,
[00:47:11] Shane: I can explain to you what the graphs are,
So along the bottom, that is, so you were, what you were looking at is you're looking at a graph of Bitcoin's price history on a logarithmic scale. So a logarithmic scale is like a Richter scale. Hmm, in that as science teachers, you guys were familiar with this, that like right, like going from like a five earthquake to a six earthquake to a seven earthquake is those are, those are actually orders of magnitude of 10, right?
Where like a six is like 10 times bigger than a five and that type of thing. So this graph is the same thing. You can't really look at, Bitcoin's
[00:47:45] Patrick: graph on a linear scale.
[00:47:46] Shane: You have to look at it on a logarithmic scale and then along the bottom I already stole Ian's here, but you guys can see here as you can see.
There's the time. So the furthest left is about 2010, which is around when Bitcoin started having monetary value. So the bottom is the bottom line is 1 cent per Bitcoin, and then you can see it's 10 cents. And then a dollar $10, a hundred dollars. One K is obviously 1,010 K. And so I'm looking at Ian's graph here and just based on what Ian thinks.
So here is a hundred thousand. So Ian has predicted that Bitcoin will reach a hundred thousand dollars by 2022. He has predicted that it'll reach a million dollars by about 20, 25. And $10 million per Bitcoin by about
[00:48:41] Patrick: 2020.
[00:48:42] Josh: I'm not going to say you're wrong, but I think you're going to need to retake the class
[00:48:48] Shane: Josh has not predicted.
A a 100,000
Bitcoin until 2025.
[00:48:55] Josh: Okay.
[00:48:56] Shane: And Patrick, where are you at Patrick
[00:48:59] Patrick: Whoa, he should be,
he should be
named
[00:49:02] Shane: He, who should be named thinks that Bitcoin will never actually reach a hundred thousand dollars. So it looks like you're, this is probably around like 70 to 80.
So it looks like
[00:49:13] Patrick: that's what I was thinking.
[00:49:14] Shane: thinks that Bitcoin tops out at about 70 or 80,000. Interesting. Even through the year 2030,
[00:49:19] Ian: all of our grants.
[00:49:20] Patrick: looked kind of similar,
[00:49:22] Ian: but
I didn't expect the logarithmic scale thing.
[00:49:26] Patrick: They're
actually very different.
[00:49:28] Josh: Who was the most right.
[00:49:29] Shane: We'll have to do a second yonder cast in a couple of years.
[00:49:34] Ian: Is it okay to ask what you would draw
[00:49:36] Patrick: on this graph? Like what
[00:49:38] Shane: yeah, for sure. Um, I uh, I think that just based on Bitcoin's price history I think that we'll hit close to a hundred thousand dollars by the end of 2021. And then somewhere between 150,000, around 150,000 in 2022, and then we'll have a pull back in a bear market into the next having, which is in 2024 which will pull back in my opinion to around 30 to $50,000.
And then by 20 26, 20 28,
[00:50:05] Patrick: I think
[00:50:06] Shane: that Bitcoin will be around somewhere between 300 to $500,000 per Bitcoin
[00:50:10] Ian: per Bitcoin.
[00:50:12] Patrick: Wow.
So
[00:50:13] Ian: that's astronomical. I mean, cause it's, it's only
[00:50:16] Patrick: at
[00:50:17] Ian: 30 some thousand dollars right now,
[00:50:19] Shane: so, but that's why it's important to look at it and think about it on a logarithmic scale because in 2019, Bitcoin was $3,000.
And so now it's at $37,000. So in only two years, it has more than 10 times. Right. And so if it just does another. 10 times, like what it's done. And then before it was $3,000, right? A couple years before that it was $300 and a hundred, you know? So if you look at it on a percentage basis while the, the jump from 30,000 to 300,000 sounds really, really big, it's pretty much in line with what Bitcoin has done since its inception it's on average, Bitcoin's growth has been on average about 200% per year. So, and obviously there are years where it goes up much more. And there, there have been a couple of years where it pulls back over the course of a year.
But
[00:51:10] Ian: so, I mean, based on those numbers, it kind of feels like, well, gosh, everybody
should
get some Bitcoin because I mean, you don't see those kinds of growth numbers out
[00:51:19] Patrick: of
like
[00:51:20] Ian: A mutual fund or something like, you know, another potential
[00:51:23] Patrick: investment
[00:51:24] Ian: possibility.
[00:51:24] Shane: Unless you're invested in a, in a Bitcoin ETF, which is a lot of people are right.
[00:51:30] Ian: but like There's still, I think a lot
of hesitancy
to like getting invested
[00:51:35] Patrick: in Bitcoin.
[00:51:36] Ian: And, one of the hesitancies is what you were just talking about about
the volatility, You know,
[00:51:40] Shane: for sure.
[00:51:41] Ian: It's going to go up to
150,000, and then it's going to pull back to
50,000 that really freaks people out, you know, like
[00:51:46] Patrick: 100%
how can, especially
when we're
talking about something that is a currency
[00:51:51] Ian: you're supposed
to.
be able to
spend to like buy things
[00:51:54] Patrick: and, you know,
[00:51:55] Ian: you know, get services and things like that. You know, why
would you,
first of all, why would you ever spend something that's going to just keep logarithmically increasing in value and also you know, how do you know when to spend it? Because it's just going to, like, it could, it could go way
up in value
the next day.
It could go way down. Like it's just a super volatile thing. So
what's,
What's the wisdom behind the volatility of Bitcoin.
Is that
something that is going to even out over time?
[00:52:21] Shane: So over time Bitcoin's volatility is decreasing. So while the numbers feel like they are going up, like, you know, it was a couple months ago, two months ago, it was at 65,000. Now it's at like 37,000.
And that sounds like a really big number, but actually over time, Bitcoin's volatility is decreasing. So on a percentage basis it's still kind of following what are called four year cycles based on the having and whatnot. And so there've been several, several drops in Bitcoin's history of like 75, 80% regularly during bull runs, especially there's drops of 30 to 40%.
And that's that's, that's not that wild. Feels like a lot, like it's not that uncommon for an asset. That's undergoing price discovery. So for example, Amazon stock, you know, since the nineties has had several 80% drops, it's had many, I don't know the number off the top of my head, but many things.
30 to 50% drops. But a lot of people would argue that Amazon stock is a good, it's a good asset to have owned. And, and those drops represent people. Taking profits. People may be losing faith in its ability to continue to store value changes in narrative, which are all things that Bitcoin is subject to as well.
But over time, trust and adoption are great. So if if the volatility is difficult for people to that are invested in it, then the argument would be like, you shouldn't have a lot invested in it. You know, a lot of there's a lot of macro economists and managers that recommend like 5%, 10% of your investible allocation to Bitcoin, so that the volatility isn't as difficult to deal with.
[00:54:00] Patrick: that would make me nervous.
I feel like, especially with a lot of cryptocurrency, the ability for someone to. Influence the market seems pretty high. Like in video game economy, someone could just buy out all this stuff and then reprice it at a specific level and almost manipulate the economy there. Obviously, that probably can't happen in this instance, but I just feel like when there's people out there who can like tweet or say something or do something and then make that drop or go up in very drastic ways would make me nervous.
And yeah,
[00:54:28] Shane: look, I look forward to the day when when Bitcoin has a much higher market cap and and individual people kind of stop influencing
the price.
[00:54:38] Patrick: I guess another criticism I've seen of it. Yeah. Is people have talked a little bit about it being like a MLM sort of thing. Like a multi-level marketing. Like if you can get people into it, it helps create wealth for you.
But again, what you've talked about doesn't necessarily seem like that lines up. Like, just in terms of like, like the free market sort of stuff you can go in without anyone ever. Introducing it to you, I guess it would be very difficult, but you could do your own research and start your own. Yeah. So yeah.
[00:55:04] Shane: I mean some people that have arguments against Bitcoin, they're talking about the multi-level marketing or something, we'll call it the greater fool theory. Like it only has value. If you can find someone who's a greater fool to P to pay, to buy it off you at a higher price.
But you using that, rationale, like every asset in the world fits that criteria. People that buy gold, their hope and expectation is that at some point they can sell it for more later on when you buy stocks. Like your goal is to at some point later on.
You know, for a higher value and the only things that wouldn't fit that are things that have like intrinsic value as in a house, like a primary residence, but even like, you know, rental, you know, and, and and investing real estate, you know, still kinda, you're hoping that someone will buy it more later, but you know, food bullets and house.
Are pretty much like the only things that actually have like intrinsic value that that you could like invest in and then actually use to your own benefit without the hope of someday selling it for more, but anything other than that gold stocks, bonds you know, unless they yield something which a lot of, a lot of assets don't yield very much anymore, but Yeah.
I mean it's yeah. And some people choose not to invest in Bitcoin because they don't have trust and interfaith in it. And don't, and that's totally, yeah,
[00:56:24] Patrick: and that's great.
[00:56:24] Josh: Or just knowledge. Cause that's been my problem. This is the, this is all, everything that we've
[00:56:28] Shane: talked about. This
[00:56:29] Josh: all that I know about Bitcoin right now. Like I only,
[00:56:33] Shane: know. It's going for awhile. Yeah. They were the same thing. Yeah. Yeah. And the reason that I started my consulting business, cause I like, I very much feel like well as a teacher, like one of the reasons I became a teacher is because I want to help kids. I want to make the world a better place through the skills that I have, which is teaching.
But I also believe very strongly that Bitcoin will make the world a better place through ending ending central government's ability to. Control and influence populations through their manipulation of the monetary system. And so that's one of the reasons why I'm so behind Bitcoin and why I'm dedicating myself more and more to trying to teach people about it.
[00:57:10] Ian: Awesome. You mentioned doge
[00:57:13] Shane: coin. I think, I think
[00:57:14] Ian: last question
that I have written down for you has to do with
All of the other
cryptocurrencies,
because
[00:57:20] Patrick: Bitcoin is the first
[00:57:22] Shane: and
[00:57:22] Ian: biggest, it's
the one that has the biggest, you know, market presence,
But there's like a new cryptocurrency every week.
[00:57:28] Shane: there is right now there's around five to 6,000 different cryptocurrencies. Yep.
[00:57:32] Ian: heard, of, we've heard all, all about doge coin and like, there's been like
T-zone and light coin,
And I know
Ethereum has like, made a lot
[00:57:39] Shane: of
[00:57:40] Ian: news because a lot of like, like the NFT stuff, right. Is built around the Ethereum blockchain.
[00:57:45] Shane: can build.
It
[00:57:46] Ian: and so there seems like, so I guess my, my question
is something else that people I've, I've heard
concern about with regards to Bitcoin, is, is it going to get replaced by something better?
You know, is someone going to
come out with a better cryptocurrency and suddenly Bitcoin.
is going to be.
It's gonna be obsolete.
[00:58:01] Patrick: Silver, silver to the gold.
[00:58:03] Ian: Yeah. Yeah.
Like it's, it's something
[00:58:04] Patrick: come
up? That's
[00:58:05] Ian: that's even more energy efficient, you know, or, or that's more
secure
[00:58:10] Shane: or,
[00:58:10] Ian: you know, for some reason is better, like it.
is there any possibility of that happening?
[00:58:15] Shane: So Let's see, there's, there's a lot of different points of that first, just to talk about like other cryptocurrencies.
What I would say is if you're going to invest your money in something, do you want to invest your money in something that either one person or a small group of people could just one day decide to turn off for sure. And the answer to that was probably no like that. That's not something that you would trust with a significant portion of your of your net worth.
And so a lot of crypto coin cryptocurrencies claim, like they, they're all based either loosely or closely on Bitcoin's core code. Cause it's just open source software. And so there are a lot of small groups that have you know, taken that code, like change the code, made different currencies. What not.
[00:58:54] Patrick: but
[00:58:55] Shane: they all retain some semblance of control over that cryptocurrency, either complete control where they can just shut it off and then turn it back on. To fund whatever it is they're doing. And at the end of the day, Bitcoin is a totally decentralized, can't be shut off. It has a huge network of people all over the world, whether it's minors, node, operators, anything that are maintaining the network.
And in my opinion, There really isn't any, any, any claims for improvements made on Bitcoin come at other costs. So for example the Bitcoin
a base layer transactions could be, could be considered slow for if, if you think about like 10 minute blocks. And so there are a lot of coins to say like, oh, we're faster than Bitcoin, but when they to increase speed, the reason, the reason they're able to do that is by, is by decreasing.
Decentralization, meaning that rather than transactions being verified by nodes all over the world, they have like one or just a few. Central authorities that are monitoring the transactions. And and, and then you get into the question of like, well, if there's only one or a few people that are basically maintaining the network, then those people have this, have the ability to stop transactions.
They have the ability to change the incentive incentive structure of how coins were issued. And and you just get into, you know, oversight issues and, and whatnot.
[01:00:17] Patrick: you're basically saying like the more, the people that are there, the more secure it is. Right?
[01:00:21] Shane: Yeah. Yeah,
[01:00:22] Patrick: if like the, if a decentralized system has more nodes or more people, the more secure that will eventually be.
So the more people that buy into Bitcoin, the more. Solidified it is into it security
[01:00:35] Shane: and it's not even necessarily buy into it. Cause when you buy into you
actually aren't contributing to the network. But like so you can run a node which helps validate transactions and keeps a copy of the Bitcoin core, the blockchain which I run at my house. And then there's minors also in but but yeah, I mean, I guess you think of the network.
[01:00:51] Patrick: as
[01:00:52] Shane: Also, I guess also people that, that buy into Bitcoin, then they're now like proponents
of
Bitcoin. Right. Cause they're like financially incentivized to, to maintain it. But yeah, I would, I would, I would I would say that pretty much every other cryptocurrency while they claim to have improvements on things that they see as, as faults with Bitcoin, all of those come at costs that at least up to this point,
[01:01:14] Patrick: point
[01:01:15] Shane: Have not have not proven to be more valued by the market than Bitcoin.
So it's, it's all, it's all free market supply and demand. And Bitcoin is traded 24 hours a day, seven days a week, 365 days a year, all over the world. And and, and so far, the market has proven that that people trust Bitcoin more than any of the other
[01:01:34] Patrick: cryptocurrencies.
[01:01:35] Ian: Awesome. think that's a good thought to end on.
Is there anything else
that we forgot to ask that is like, vital Kind of intro Bitcoin
knowledge? obviously
people can follow up with
you?
[01:01:47] Shane: I would just always I, I think that there's a lot of narratives around Bitcoin that I think I believe are based on lazy reporting or just misinformation that that either.
Reporters or other people have just like continued throughout the years. And also, you know, mainstream media is incentivized to to kind of feed us stories about fear that make us afraid of things or wary of things that we don't necessarily understand. And I, regarding Bitcoin, I would just urge people to question. Anything question everything that you hear, even from me, like, if something I'm saying you're like, wait, that doesn't sound right. Question. It verify it, validate, try and do research on your own to learn about it.
[01:02:32] Patrick: it.
[01:02:33] Ian: Awesome.
Do you guys
have any more questions or any more thoughts?
[01:02:36] Josh: No.
This was one of the coolest topics ever. I loved this. I was not expecting to be as interested in this as I
[01:02:43] Patrick: was.
[01:02:45] Ian: Yeah,
that was really fascinating.
Thank you so
much, Shane
[01:02:47] Shane: for
the show.
[01:02:49] Patrick: Yeah, it's nice to have like a personal explanation. Like I've read through it a bunch on like Reddit or out that sort of stuff. Like I see people's responses, but it never, like you can't ask a follow-up or have a nice little analogy for it. So it was, that was nice.
[01:03:01] Shane: And that's why I started my business.
[01:03:03] Ian: Speaking of
which this is beginning with btc@beginningwithbtc.com. That's
where you
can find
Shane and, get involved with that and reach out to him.
that way.
And that is going to be
[01:03:15] Ian: for this episode of yonder cast. So thank you all so much for listening and if you haven't done so
[01:03:20] Patrick: yet,
please
[01:03:21] Ian: to our show.
And if you have a few seconds to spare, we would really appreciate if you
would rate and review us on apple podcasts or Spotify
or wherever else you listen
[01:03:30] Shane: to
[01:03:30] Ian: our show
[01:03:31] Shane: If
[01:03:31] Ian: have any suggestions on what we
can discuss in the future, you
[01:03:34] Shane: can fill out
[01:03:34] Ian: form,
LinkedIn, our show notes, and you'll find
[01:03:36] Patrick: the
link to
[01:03:37] Ian: Shane's business there as well.
And if you've
ever liked to contact us, just send us an
[01:03:41] Patrick: email at yondercast@gmail.com.
[01:03:44] Ian: Take
careeverybody
[01:03:45] Patrick: ah.
[01:03:45] Shane: bye.