[00:03:10] Alex Gladstein: The park started mining the Bitcoin, I think in 2020. And obviously it’s done extremely well for them. So it’s now become like vital infrastructure for the park where all the animals and plants, the biosphere protects and the 5 million people that, that live in the area of the park. So that captured my imagination and I was just, well looking at videos of just like the miners in the middle of the jungle.

[00:03:30] Alex Gladstein: I was like, this is crazy. They’re turning, flowing water into capital. This is awesome. I had an opportunity to get involved with the Africa Bitcoin conference. HRF was a kind of a founding sponsor of the event a couple years ago, and this year’s edition was coming up probably about a year ago. I was talking with my friend Eric Hersman from Gridless, a company that does off-grid mining on mainly hydro and geothermal in in, in East and southern Africa.

[00:04:00] Alex Gladstein: And Eric, I’ve known for a long time. But he, he, he kinda reached out to me several years ago and we reconnected around Bitcoin. Like I’d known him from his previous career doing humanitarian work and social enterprise and basically like information and internet infrastructure in Africa, that that’s what his career was, was in.

[00:04:20] Alex Gladstein: And I knew him from that world. And then all of a sudden, like we realized we were both bitcoiners and that was like an amazing moment. And ever since then, we were like, you know, collaborating and doing stuff. And I thought it’d be super fun for Gridless and HRF to team up to, to maybe visit some of the sites that they had operating in East and Southern Africa.

[00:04:39] Alex Gladstein: Maybe bring some friends of ours from different backgrounds. I won’t be specific, but we’ll just put it this way. Some of these folks are Bitcoin developers. Some of them are entrepreneurs making tools for people to use Bitcoin in Africa and elsewhere. Some of these folks are investors or philanthropists, and then some of these people were like educators or journalists.

[00:04:59] Alex Gladstein: And we put together a nice little group and we went down there and I, I think it, it just so blew my mind. I mean, I, I kind of knew what I was getting into. I knew that it would be very profound. I think that’s the word I was using, I knew it would be very profound, but, but I was not prepared for, I guess, the sinking realizations that you have when you go visit these sites.

[00:05:18] Alex Gladstein: Yeah, and, and in particular we visited two sites. One was a micro hydro project in Malawi, which by the way, it’s a very remote place. Like everybody in Kenya that we were talking to, they were like, you’re gonna Malawi, like, what? Why would you ever go to Malawi? Malawi is very, very remote place. And then we saw geothermal site on the shores of a lake in Kenya.

[00:05:36] Alex Gladstein: And both were very different, but, but equally blew my mind in terms of like what I think this is gonna do to the world. And it helped me kind of understand that in almost all cases, not Bitcoin, mining is a waste of energy. And I think that’s obviously a deep kind of thing to realize.

[00:05:53] Preston Pysh: You almost have to say that again because that is such a profound statement.

[00:05:56] Preston Pysh: I’m serious. That is such a profound statement.

[00:05:59] Alex Gladstein: Yeah. Not Bitcoin mining. Not Bitcoin mining is a waste of energy. Which is the exact opposite of what the, the mainstream media and governments want you to think because they’ve been telling us for a decade plus that what that mining Bitcoin is wasting energy.

[00:06:13] Alex Gladstein: The reality is that almost every single power generation source in the world does not use all of its capacity all the time, and often it cannot sell the excess. In Western countries and in advanced societies, in advanced energy infrastructure places, it usually can sell more of it, right? Because we have grids and energy markets.

[00:06:36] Alex Gladstein: But in a lot of the world in what we would call the global majority, where most people live, there really aren’t like energy markets and grids, like in Africa, for example. Like there is no grid. There’s no grid. So if you’ve got a site on the shores of a lake in Africa. I mean, just picture this in Kenya, where there’s geothermal everywhere.

[00:06:54] Alex Gladstein: I mean, I was talking to the foreman of this geothermal plant and, and this plant was I think like 1.4 or 1.5 or like a two, two megawatt plant. Relatively small, but, but in the region there’s up to a gigawatt of geothermal that’s being harvested in this one area of Kenya. And the guy was telling us that there’s probably 10 gigawatts of, of potential energy there, but just no one’s.

[00:07:17] Alex Gladstein: Built the infrastructure, figured out a way to, yeah, it’s figured out a way to capture it. Yet there’s been no incentive to do so, but you have this beautifully clean, consistent geothermal power, which is basically, they dig a hole in the ground, goes down 2000 feet or so, or, or a little more, and, and the stuff that comes up out of it powers a turbine.

[00:07:35] Alex Gladstein: I mean, this is, you know, very sustainable. It’s gonna deliver the same amount of power for the next 50 years. And the thing is, they build this thing and then a company buys power to run a water pump on the shore of the lake, which takes the water from the lake and moves it to a field to irrigate the field to grow flowers, to sell.

[00:07:52] Alex Gladstein: Kenya is the world’s largest exporter of cut flowers. I’m sure there’s like a tulip joke in there somewhere. But the point is a lot, a lot of those flowers you see in supermarkets in Europe are, are grown in Kenya actually. So this is a big business for Kenya. And you think about the mechanics of it.

[00:08:07] Alex Gladstein: So I’m sitting there at this water pump and I’m thinking like, wow, there must be thousands of these all over this country. Industrial power generation sites similar to this, where they’re powering water irrigation, right? And, and you’re thinking about what’s in front of you. Like you’re sitting at this lake looking around and there’s this beautifully consistent geothermal power coming down to, to power the water pump.

[00:08:30] Alex Gladstein: And it delivers a base load all the time. And then the water pump though, is not consistent. Water pumps using power Sometimes, sometimes it’s off, sometimes it’s on, sometimes it’s pumping, sometimes it’s not. But that doesn’t change the fact that there’s always the same amount of energy of electricity rather being delivered Exactly.

[00:08:47] Alex Gladstein: To, to the pump. So the, the rest is waste. Okay. So there’s this enormous amount of waste that is happening, less so perhaps in western countries, but still like during, at night. Like there’s all kinds of waste even in rich countries, but especially in rural areas and in poorer countries. The amount of electricity waste is so profound.

[00:09:07] Alex Gladstein: It’s so staggering. And then I’m looking to my left. I’m looking at the solution and I’m looking at this gridless hut, which is all custom as the whole thing’s custom designed. All everything’s built by Africans. Everything’s made made in Africa except for the miners themselves. And you’re looking at this hut, it’s got a Starlink on it.

[00:09:23] Alex Gladstein: It’s like totally solar punk. You’re like sitting on this lakeside, and it is the Bitcoin network buying 100% of the electricity that the water pump is not using. So you are using all of the electricity that the earth is creating through geothermal energy. In this one particular instance, this is the Bitcoin network eliminating waste.

[00:09:46] Alex Gladstein: And turning it into capital, and this is extremely powerful. So you’re watching this thing happen, Eric’s showing me on his phone. The actual data in terms of, you know, like what times of day are they getting, you know, a lot of power to run, run their miners, what time of day are, are they not, are they curtailing, et cetera.

[00:10:03] Alex Gladstein: So it’s very dynamic. They write all the software for this. It is 300 seventy-five kilowatt operation. So it’s, it’s basically like they’re basically eating about, let’s call it a third of the base load on average every day, which again, roughly otherwise just would’ve been straight up wasted. But again, it’s not linear.

[00:10:23] Alex Gladstein: It’s like changing dynamically. You have to be clever about how you do this. But basically the, the point is that you’re gonna start seeing Bitcoin miners adorn every kind of possible power generation site almost anywhere. I mean, and the Gridless folks were really great at explaining to me both Eric Hersman, Philip and, and Janet, that like in the near future, if you’re building a variable demand.

[00:10:46] Alex Gladstein: Site like you will build it with a Bitcoin miner because otherwise you’re gonna be losing money and you won’t be competitive. Yeah. This will just be a normal thing that happens with a variable demand power generation site. Like it just, yeah, you will have a Bitcoin miner that goes along with it. It’ll be part of the infrastructure.

[00:11:01] Alex Gladstein: So you start to understand this is gonna just be part of infrastructure for energy everywhere and that, that’s what I didn’t realize before going.

[00:11:07] Preston Pysh: So Gridless has been really leading this charge in Africa more. I haven’t really even heard another name of an entity really building over there.

[00:11:17] Alex Gladstein: There are, there’s actually a Green Africa. Mining. Alliance. So Gamma and Gridless is part of it. And there’s tons, I mean, there’s a lot really, I mean. Yeah. I mean, look, we are, we’re, there’s a lot of interesting things happening in Bitcoin right now. So there’s, there’s, well, the reasons on, on Wall Street, right?

[00:11:31] Alex Gladstein: But there’s like, I mean, there’s big sites coming online. There’s smaller sites coming online. There’s people doing stuff in Ethiopia. There’s stuff happening in Nigeria now that the government over there basically changed the laws so that states inside Nigeria can decide energy policy instead of the federal government.

[00:11:48] Alex Gladstein: So that’s opening some interesting doors. So this is just gonna take time. But basically, yeah, Gridless is leading the charge in terms of, I think showing that you can have a profitable business that is gonna grow and scale all across Africa. I think there’s hopefully gonna be a lot of copycats. They do a really good job.

[00:12:05] Alex Gladstein: They have an incredible team. They’re gonna be hard to beat, but, and they, they’re picky about their sites, things like that. But they are very committed to this, to solving a problem. I mean, yes, they, of course, they want to run a good business and make money. I mean, of course this is not a nonprofit.

[00:12:19] Alex Gladstein: But the problem that eats away at them every day is this problem of 600 million Africans don’t have electricity.

[00:12:25] Preston Pysh: Are there any nonprofits that are competing with Gridless in, in Africa?

[00:12:30] Alex Gladstein: I mean not, not in terms of eliminating wasted energy with Bitcoin mining, to my knowledge, there are, of course, I mean every single, almost every single power facility in rural Africa was done with what’s called concessional financing, which is essentially just like aid right.

[00:12:45] Alex Gladstein: The thing about these projects is that they take a long time. There’s no kind of profit motive, so everything’s slow. Everything’s at the discretion of the donor. It’s a very dependent relationship. It, it creates dependency. Like there’s no sovereignty for the law. I mean, you’re kind of at the whim of the Scottish government or whatever.

[00:13:02] Alex Gladstein: The site we visited, the micro hydro site we visited was originally built in Malawi was originally built by the Scottish government, so it was great. You know, they tend to like, give a certain amount of money. It took eight years for them to build this site. Like Mm-Hmm. Like it started in they finally got power in 2016 in this, in this particular village in Malawi.

[00:13:20] Alex Gladstein: And I think it, the whole thing started in 2008. So it took them so long to actually get this thing up and running. And they don’t provide any capital beyond that for, let’s say, like operational expenses. Any opex, like it’s just any expansion, like that’s just out, so you’re kind of just stuck. And what happens with all these like little grid providers, is that like these micro mini grid providers, is that you know, they, they have a certain amount of money that they earn from their, like initial set of customers and that’s kind of just enough to keep the lights on.

[00:13:50] Alex Gladstein: It’s not enough to like expand or anything like that. Yeah. Yeah. So you end up losing money. And, and remember, like the backdrop is that the fiat currency technology of Africa is a disastrous. So like in theory, we wanna believe that everything gets cheaper in an ideal world, right? The crazy part is, and, and we know in a fiat world that’s not how it works, but especially bad in Africa, like electricity gets more expensive.

[00:14:12] Alex Gladstein: Like not only because the local currency that you earn in is collapsing against the dollar. But we, we were in Malawi weeks after a forty-four percent currency devaluation. Wow. Which thing to think about. So all these people just had 56% less purchasing power, rather, they only had 56% of their purchasing power that they had a few weeks earlier on the global stage from what they had before.

[00:14:33] Alex Gladstein: Yeah. They’re just sitting around, they’re like doing what they do and they’re, they’re 44% poorer. Like just because of an arbitrary decision that was made by the government is crazy. So crime against humanity, in my opinion. And it doesn’t really get talked about like that, but that’s kind of the context is that the currency is very poor quality.

[00:14:49] Alex Gladstein: There’s very little incentive for expanding electricity access, and we’re stuck. And that’s why only 15% of people in Malawi have access to electricity. And this is this big problem that Eric and his team talk about, and they’re like, you can’t even comprehend it. Okay. Imagine a thousand boys and girls without power.

[00:15:08] Alex Gladstein: Okay. Now imagine 10,000. Okay. How about a hundred thousand? Okay. Maybe we, we could start to imagine that a million. And then 600 million, you can’t, it’s impossible to even imagine the scale of this catastrophe. It’s so bad. Yeah. So, and you, we talked with people in this village who lived through not having power and then having power.

[00:15:30] Alex Gladstein: It’s like we, we forget, you know, like everything like medicine like’s charging your phone, like, you know, just micro interesting social stuff. Like the men would all leave to go to the town, next town over to watch football and stuff, and they wouldn’t be with their families at all. And now when they have power, they stay at home and they’re with their family.

[00:15:48] Alex Gladstein: Like there’s all kinds of, I mean, schooling like the, I mean, ’cause the kids, it’s dark most of the time, right? So it’s like they can’t really study. It’s very hard. They have to use like paraffin lamps, which are dangerous. There’s a lot of indoor air pollution that’s incredibly lethal for kids like.

[00:16:03] Alex Gladstein: And when they got electricity, the rate at which the kids at this village got accepted to the more elite sort of national school system really skyrocketed over a period of time. Really? Like once they got, yeah, because now the kids can study at night, like, no problem. I mean, it really makes a difference.

[00:16:18] Alex Gladstein: So you’re talking about this huge human issue that’s more than just African, I mean, obviously it’s a big problem in Africa, but energy, lack of electricity or like lack of constant electricity is, is a problem for billions of people. I mean, think about. Even a country like South Africa where they have electricity, they have load shedding, so, so even the people who have electricity in Malawi when we were there, were dealing with six to eight hours of load shedding per day.

[00:16:44] Alex Gladstein: So even if you were in the capitol with grid electricity, you weren’t getting it. And the craziest part was being out in this little town of Bondo, like in the middle of nowhere, literally. At night, you would see the mini grid come on. So as the sun sets, you see the lights all come on and there’s no load shedding because Bitcoin balances the grid perfectly.

[00:17:04] Alex Gladstein: Jesus, it’s incredible. So you’re like thinking about this and they, they’re, they think Gridless thinks that within 30 years, Bitcoin mining will, will give electricity to close to 100% of people in, in Malawi. And it’s not gonna be the World Bank or the IMF or Bill Gates. I, I hope they do better and I hope they do as good as they can, but like there’s no incentive there to, to get this done. Where Bitcoin provides the incentive, because bitcoins like this thing, it’s like this organism. It’s like this creature that just hunts cheap energy and it just goes to it. It finds, it just relentlessly. Finds cheap energy, wasted energy, stranded energy. No one energy nobody else wants.

[00:17:45] Alex Gladstein: The mascot they use over there is the dung beetle. Grid list is mascot. So the Dung, Beetle turns waste that nobody else wants into value, right? So Bitcoin, the network is like this thing. It’s like this force driving humans to help them find and utilize cheap energy, stranded energy, wasted energy, orphaned energy.

[00:18:04] Alex Gladstein: Turn it into something powerful and, and the crazy part is you get paid in SATs, like right? So you get paid directly in Satoshis, so you don’t get paid in Quacha or in shillings or any of these collapsing currencies, which is, which is really important thing to note because a lot of people might say, well, why wouldn’t you mine?

[00:18:20] Alex Gladstein: Why would you do like AI compute? And I’ll describe why you wouldn’t. But even if you could. You’d have to do like some contract freaking quacha and like you to be like a Forex and there’d be like all these like billing office stuff and it’s like, no people mining Bitcoin on micro grids don’t have to deal with that.

[00:18:36] Alex Gladstein: They just get, they just get paid directly in Bitcoin. It’s credible. But either way, the AI stuff doesn’t make a lot of sense because if you think about what, what AI data farms are like, the chips are very expensive, right? Very expensive. $30,000 plus for a good chip, right? They only have, they only have like a draw of like, I don’t know, something like 1200 watts, like not that much power.

[00:19:00] Alex Gladstein: Compare that to a Bitcoin mine. An ASIC, which is like way cheaper, way, way, way cheaper and, and much more power hungry, like 3,500 watts or something. And maybe it’s 1200 bucks for an ASIC or something. So the point is, what you can see is that in AI compute, the price of electricity is very marginal. It’s not that important.

[00:19:18] Alex Gladstein: So that’s not gonna be a big factor. With Bitcoin, it’s everything, so important. That’s gonna make it a economically wise decision, right. To go and mine Bitcoin in Bondo using this water flow that’s gonna happen anyway. Right. And like literally it’s gonna be like the setting the lowest price of energy.

[00:19:37] Alex Gladstein: Purchasing is gonna be the Bitcoin Bitcoin, everything else will be more expensive. Not even, it doesn’t work the same way.

[00:19:42] Preston Pysh: Yeah. You’re not even getting into the latency of if you were paying that server.

[00:19:46] Alex Gladstein: Yeah, there’s latency and you can’t, it can’t be a grid balancer because it’s, for the most part, AI does not work like Bitcoin where you can just turn it on and off without harming the process.

[00:19:54] Alex Gladstein: Most industrial processes cannot do demand response the same way. Because, well, I mean, what, like, you have like a steel factory, you can just like, turn it off. Like Bitcoin is, is uniquely powerful as a, as an energy buyer in that sense. Obviously it can be anywhere in the world. I mean, it can be anywhere and it can be turned on and off it on whim.

[00:20:09] Alex Gladstein: So it really helps with balancing grids, which is gonna be huge. So it’s not just that it’s gonna help get, it’s not just that a, it’s gonna help eliminate waste everywhere. It’s also that it’s gonna help grow off-grid power, which is important for different reasons, but it’ll also help stabilize big grids.

[00:20:26] Alex Gladstein: So I think they’re, they’re kind of excited about all these things and obviously the Gridless team is in its name telling you what kind of grid it likes best. But like it wants to be these, these off-grid sites. And that’s the really crazy part is you think about it. And without even getting into the financial freedom stuff, like the way that Africa’s gonna help Bitcoin, right?

[00:20:45] Alex Gladstein: Because everybody’s like, oh, well Africans need Bitcoin. And I think Americans need Bitcoin. Africans need Bitcoin. Latin Americans need Bitcoin. Asians need Bitcoin. Everybody needs Bitcoin. But I think you could argue that Africans especially need it ’cause they’re the currency. Technology is so poor.

[00:20:59] Alex Gladstein: But I think that Bitcoin needs Africa too. And a good example is mining. So. And Troy Cross said something pretty profound to me that I put into the essay that I love this quote.

[00:21:09] Preston Pysh: Awesome. Literally have the note right in front of me here.

[00:21:11] Alex Gladstein: Yeah, it’s perfect. And he’s, it’s awesome. Kind of like in the last cycle, access to cheap capital kind of drove Bitcoin mining.

[00:21:17] Alex Gladstein: Like Wall Street would just like fund this stuff, but increasingly he’s thinking in the next cycle that’s gonna be dictated by access to cheap power. And the cheapest power is Wasted power. Stranded power. Power no one else wants. Right. Africa’s got a lot of it right? Like tons of it, like thousands of gigawatts of it.

[00:21:34] Alex Gladstein: So we’ll see. But basically if a higher and higher percentage of the network’s hash rate is being powered by, completely disconnected off-grid, decentralized operations across Africa or the wider, you know, global south or whatever. That’s really good for Bitcoin because what we don’t necessarily want obviously is like all of the mining being done in centralized central point of failure.

[00:22:02] Alex Gladstein: You know, Western setups where governments can come and easily turn it off or confiscate it or hold up a gun and, and try to force folks to censor stuff. Like, so this is gonna be really good for the network. So that’s cool too. Like this is a mu, this is a mutual conversation here.

[00:22:17] Preston Pysh: Isn’t it fascinating? It just seems like, yeah, every time you look at how there could potentially be a vulnerability, it just presents itself in a way that, oh, yeah, no, you, you really can’t do that because 10% of Bitcoin mining is now being done in Africa, in, in a way that has, you know, really incentivized them to do it in a off-grid kind of way.

[00:22:39] Preston Pysh: It’s just, it’s mind-blowing to me. I’m curious, Alex from the vantage point, you know, hearing these stories, you would think that the word would really get out and politically it would start to become very popular. Is that the case? And if it isn’t, what’s, what’s the reason why?

[00:22:56] Alex Gladstein: Look, I think, you know, history rhymes and people take time to learn.

[00:23:00] Alex Gladstein: I mean, at one point we killed whales to get. And oils. Yeah. And, and meanwhile it was all around us in the ground. We didn’t really know. And, and it took time to learn. Right. It took time to learn. And even when the first people started realizing there was stuff in the ground, we were still killing the whales.

[00:23:18] Alex Gladstein: Like, you know, same thing with horse and car and any technological innovation, like there are people get used to stuff and it takes time to, to shift. And I think we’re being. Maybe we’re asking a lot for people in twenty-four months to go from not knowing what Bitcoin is, to realizing that they need to change their energy infrastructure.

[00:23:38] Alex Gladstein: I think that’s gonna be a little more than twenty-four months, right? So a lot of these conversations in Bitcoin started, I mean, obviously everything in Bitcoin was once discussed, like within the first three years on Bitcoin talk. But like Hal, even in the first, in the year, first year was talking about.

[00:23:54] Alex Gladstein: How Bitcoin might help address this issue. But let’s just say a lot of this, a lot of the energy stuff didn’t even really start till 1819, right? I mean, maybe fi, it’s maybe been five years from concept to roll out and we’re seeing roll out. I think the next two, three years are pivotal. And I’m thinking about like governments like Kenya and, and once they realize that there’s this other thing they can do, because think about what a government has to do, like if it needs money, like it can borrow from the IMF with all of its conditions that we’ve discussed.

[00:24:26] Alex Gladstein: Not ideal. It knows it doesn’t want to do that. It can try to sell bonds, like, not like a very appetizing thing right now for global investors. A lot of these countries can’t even like Malawi, that’s bond market is shut. Like it can’t do that anymore. So that’s hard for a lot of these countries. It can reduce fiscal, which is not popular like people don’t want that. It can raise taxes, which is also not popular. So there’s, you know, they’re kind of like stuck and they end up usually doing the easy thing, which is inflating, but there is, there’s of course, eventually can’t do that, like without the people realizing. But the point is, there’s another road here where these governments could basically take one last fiat loan from whomever.

[00:25:10] Alex Gladstein: And just send a team around their country and just figure out, well, how much energy are we wasting at just existing power generation sites? Like, let’s do a three-month survey. Let’s send three dozen people around the country. Let’s figure it out. How many ASICs do we need? How many gridless type sites do we need?

[00:25:28] Alex Gladstein: And let’s do it like, let’s borrow that amount of money and then we will then buy Bitcoin mining infrastructure and build it. And within whatever, two, three years, they’ll have paid back the loan and then they’ll be like earning huge amounts of sovereign currency, which, which I do believe. We will become the next global reserve currency.

[00:25:49] Alex Gladstein: I mean, I don’t know, how long that takes.

[00:25:50] Preston Pysh: But Alex, you are, you’re the master that wrote the book literally on how the IMF will tether, you know, strings attached to the loans and they would never provide a loan if they knew the use of funds be…

[00:26:04] Alex Gladstein: Well, that’s, that’s to this, well, the, and the whole IMF system is tied up in, in the dollar system.

[00:26:08] Alex Gladstein: Like that these countries need to get dollars, therefore they need to try to have this relationship with, with do with Europe or the United States so that they can sell things to us so they can earn dollars, so they can pay back their debt and buy fertilizer and whatever. So this, this is how we get out of that system, right?

[00:26:25] Alex Gladstein: So this is how these countries start to earn on their terms a currency, which today is not a reserve currency, but I do believe that in the next decade or so. That Boeing or whatever will, I think they’ll accept payment in Bitcoin for airplanes. I think you’re gonna start seeing Bitcoin accepted for payment for fertilizer, oil, airplanes, whatever governments need, like, whereas like the local fiat currencies are not accepted today.

[00:26:53] Alex Gladstein: So Kenya cannot use shillings generally speaking. To go to like Lockheed Martin and buy stuff, they’re gonna be like, no, I see you taking shillings.

[00:27:01] Preston Pysh: I see what you’re saying. Yeah.

[00:27:02] Alex Gladstein: So like today, Kenya has to trade, Kenya can’t print dollars. Lockheed Martin only takes dollars, right, or maybe Euros.

[00:27:08] Alex Gladstein: That’s about it. Like they’re not gonna do a contract in like Quacha. So these countries have to basically sell stuff to the United States or Europe in order to earn dollars that they can buy stuff from Lockheed Martin. And that creates dependency because then they have to do what we want. Because if they don’t do what we want, then we won’t do those deals with them anymore.

[00:27:27] Alex Gladstein: And they, in a dollar world, they’ll starve. So basically the idea is let’s change that and let’s have countries be able to create the currency by which international trade is done through their own electricity reserves.

[00:27:39] Preston Pysh: Is the limitation for Gridless to grow or any other for-profit entity over in Africa, like what is their limiting factor for growth right now?

[00:27:48] Preston Pysh: Like is it cap, is it access to capital because it’s very hardware intensive? Is it them, them just finding the right sites that they feel like they can trust? What’s the limiting factor?

[00:27:59] Alex Gladstein: I mean, I think it’s very exciting for them right now, and they’re all fired up and they’re, everything’s wide open and things are happening fast.

[00:28:05] Alex Gladstein: Like I just in the, so I went early December in the time, since they’ve set up two new biofuel plants. This is very interesting too. Okay. ’cause in addition, I mean, all the energy sources we can talk about, like, we just only covered two hydro and geothermal, I mean, wind is interesting to them. I mean, in as much as like if a government does decide to build wind, usually the wind farm just sits there for whatever, however long before they can hook it up.

[00:28:31] Alex Gladstein: The Gridless team I had put this in the essay, but the kind of the founding conversation was many years ago. They were working on a different company, but they were talking about how insane it was that the Kenyan government had built this 40 megawatt wind farm called the Turkana Wind Farm and the government, in order to like get it done, the government had to agree to pay.

[00:28:47] Alex Gladstein: A particular rate for electricity to the people who built the wind farm. And for years the government was paying this rate for nothing. No one was using electricity. And they’re like sitting there being like, this can’t, like how do we solve this? Do we bring up an aluminum mine there? Like do we, do we do we process metal?

[00:29:05] Alex Gladstein: Like, and then they started to realize, well we could just mine Bitcoin. And they, I, you know, you get the sense that they were laughing about it then this was like whatever, 10 years ago or something but finally they realized, no, this is actually a good idea. It just took a long time to quit their jobs.

[00:29:18] Alex Gladstein: Like start a new one, like get people to actually sign on, incorporate, like get expertise on board, like write the software. So I. I think these things just take time, right? So right now this is growing and now they’re doing the biofuel stuff. So the idea is that like any sugar processing facility or any sisal process, a sisal creates something that looks kind of like burlap.

[00:29:41] Alex Gladstein: Not burlap, but more like a, you’d make a, like a strong fiber kind of bag or, or fabric out of it. It’s like pretty rough stuff. It’s, it’s like jute or whatever. The point is that there’s a lot of this happening in that part of the world, and. All these facilities have this waste matter, which is considered actually, I guess like green energy because it, it doesn’t like, it’s like carbon neutral or whatever, right?

[00:30:05] Alex Gladstein: Carbon goes into the plant gets released with the, when it gets burned. Right? But the point is that the sisal or sugar stuff, it gets burned. They burn it. They burn the waste ’cause it’s waste is sitting there. They can burn it and it can obviously heat, water, turn a turbine. Right. Problem is that there’s no grid in Africa.

[00:30:24] Alex Gladstein: So these places are usually pretty remote and there’s usually nobody to buy the electricity. So oftentimes there’s this like energy, there’s megawatts of energy sitting there that are stranded. No one can buy ’em. So it’s like it’s sad. So now Gridless is coming in and they are now buying all that the Bitcoin mine, the Bitcoin network’s buying all of it.

[00:30:43] Alex Gladstein: And what the other interesting thing is there’s a, you know, there are, there are gonna be energy issues in the West, right? Where like. You might have a storm in Texas, right? Or you might have cold weather in Texas or you know, anything that we’ve seen recently like sky skyrocketing energy prices and the people like mining off-grid in Kenya, they don’t care about that at all.

[00:31:04] Alex Gladstein: That’s just totally irrelevant to them. And it may, you may even in some cases, sometimes, you know, we have the difficulty adjustment, but like Yeah. Make more in the interim. Yeah. Like sometimes it’ll be fine for them if the the west has an energy crisis. They might even earn more Bitcoin. Who knows? But we’ll see.

[00:31:21] Alex Gladstein: So it’s crazy to watch. I think that like there is no block. It’s just a matter of how fast can you grow while keeping the quality of your company high in a place where it’s not office work. Like they have to like go out. It’s like they’re hard work site in Zambia that’s like, takes like two days to get to.

[00:31:38] Alex Gladstein: Like it’s not, yeah, it’s not, it’s not like office work. So I think their team’s amazing and I think they’re gonna pave the way, hopefully for a lot more copycats and. Over the next decade, I think you’re gonna start seeing so many of these projects come online. And again, not just in rural, rural Africa.

[00:31:54] Alex Gladstein: There was that tremendous reason video I. It came out a couple months ago, which is a short documentary looking at, starting with a spa in Brooklyn where the owner of the spa realized that instead of using a traditional heater to heat his spa, I mean he just buys grid energy in Brooklyn, but he instead bought Asics and now he uses the grid energy to power the Asics.

[00:32:17] Alex Gladstein: And the externality of that is the heat and the heat heats his spa. And the interesting thing about Asics are they’re very efficient heaters. Very constant. So basically he, he said, I was in a panel discussion with him, with Thomas from Pubkey and a few other people a couple months ago when we, when reason debuted the little mini documentary.

[00:32:37] Alex Gladstein: And he said, told the audience that he’s actually paying less money today to the grid for the energy to heat his spa. And he’s earning Bitcoin. So this is where you start to really realize that this could, this could be helpful everywhere there’s any kind of need for heat. For like, basically an ASIC is a space heater.

[00:32:52] Alex Gladstein: And we, we were discussing this in Africa as well, because like what may make sense in a cold climate, there’ll be different uses for that heat in a warmer one. So for example, in Malawi, in Bondo, what they were, because you, you put your hand out the back of the, microhydro station where the ASICs are and searing blast of heat.

[00:33:08] Alex Gladstein: So what do you do with that? It’s free. It’s an externality, right? Well it, there’s two crops that are really grown there. One is pineapple. So the original idea was to just like dry the pineapple, which obviously is helpful, makes another business. Or the other one is tea, so it’s not a tea plantation. And one of the things you do with tea after you harvest it within the first day or so, is you gotta dry it and you use warm air.

[00:33:29] Alex Gladstein: So they have like a building there that’s like, like literally a tea processing facility that just dries tea leaves and it’s like. That could be the waste there could be eliminated, like the Bitcoin mining can be drying the tea leaves is, is is an idea. So we’ll see. But I mean, I think that I’ve seen stuff, I’ve seen people dry seaweed.

[00:33:48] Alex Gladstein: I’ve seen people dry wood with the externality. Obviously a lot of people heat their homes, their entire cities in certain parts of the world that do this now. I think that eventually as we learn more about this, that will be part of the deal and like it would just be like crazy talk to do any sort of heating or cooling or whatever.

[00:34:05] Alex Gladstein: Using, like, not using ASICs, but basically the guys in Varunga, in the DRC, I met them. I, I just got a chance to catch up with them at the Africa Bitcoin conference in Ghana before I went to Kenya. And they’re telling me by, by March 1st, so like a month from when we’re talking now. They’re gonna have this new setup where basically they convinced, well they were talking with the, the park rangers and the park rangers were gonna buy like $200,000 of industrial heaters to help heat the cocoa, cocoa beans that they process there.

[00:34:35] Alex Gladstein: Because currently it’s crazy, they just like lay them out on the ground in the sun. And it takes a long time and like animals come and eat them and it’s a huge mess. Tons of labor. So instead they’re gonna buy this heater and, and these heaters would, would kind of heat them in batches and be much more efficient.

[00:34:49] Alex Gladstein: And they were like, no, no, no, just buy $200,000 of ASICs and then we will, we will just heat the cocoa with the asics. That’s what’s gonna happen. So this is gonna happen, this is happening. And then the chocolate that they make from the cocoa will be sold and it’ll be like Bitcoin powered chocolate. And I predict it’s gonna do well.

[00:35:07] Alex Gladstein: I just love this, like everything about it is great. Like the externality, the mining will change depending on what part of the world you’re in. Like it’ll depend on what, what your community needs. I just think it’s fascinating.

[00:35:17] Preston Pysh: If a policymaker from Africa was listening to our conversation, what would be your advice to them right now?

[00:35:24] Alex Gladstein: Well, again, just like look, no one wants to cut fiscal raise taxes, inflate, borrow from the IMF. Why don’t you try this like figure out a way to finance this one-time thing and research how much energy your country’s wasting and do it now and start mining. Yeah, and you will have a very powerful recurring source of income that is probably totally disconnected from the world’s power narrative in terms of the price of electricity.

[00:35:53] Alex Gladstein: It’s probably be off grid, it’ll be probably Baseload power. It’ll give you sovereignty. It’ll allow you to hedge against all sorts of things, and one day it’ll allow you to buy anything you need without having to like negotiate with people. You’ll just have whatever the premium currency. I think that that’s very important for people to do in America too, though, like America should be, America should be Bitcoin mining, all of its wasted energy and use that to fund public works.

[00:36:20] Alex Gladstein: I mean, this is why I think it’s like the green, the real green new deal is Bitcoin, right? Like if you want, like Bitcoin is the, this is how the government should be getting the revenue for doing public works, not through debt monetization. So anyway, that’s the idea.

[00:36:37] Preston Pysh: If you were gonna go into one of the towns where these Bitcoin miners and energy hubs are set up and you talk to a hundred people inside the town are, first of all, are they even aware that the Bitcoin mining is taking place?

[00:36:49] Preston Pysh: And if they are, what would be the general consensus that, that they would have in reference to it taking place?

[00:36:54] Alex Gladstein: Yeah, I mean, obviously I have a small sample size, just visited a few sites, but generally speaking, no. The local community doesn’t really know in the case of Bondo. It’s the power company that knows, because the power company in the Bondo case used to subsidize, still Subsidizes the energy so that it’s not like insanely expensive power in Africa is like, can be three to four times the price.

[00:37:17] Alex Gladstein: It is even in, in a place like. California where it’s already expensive. The idea of mainly being like, let’s say you have a generation site that produces, I don’t know, like five megawatts or something like that. That, that’s a lot. But let’s just say for the purposes of this example, but you only have one megawatt of demand.

[00:37:36] Alex Gladstein: Well then really to make yourself whole, you end up having to make that energy five times more expensive than it might otherwise be. Bitcoin mining comes in, buys the other four megawatts, and then the price that everybody pays, that the people who are using the one megawatt pays goes way down, so it makes energy cheaper for people.

[00:37:55] Alex Gladstein: People do not understand this. This is super important.

[00:37:57] Preston Pysh: So when I’m, when I’m hearing that and I’m thinking about Gridless, gridless is, is a huge beneficiary of this. Oh, the community. But, but are they, they’re also, are they giving back in a way that makes it more harmonious for the people as opposed to them just benefiting from that?

[00:38:13] Alex Gladstein: So the power company’s called Mega down there, the Bondo area, and it was really like this guy who’s responsible for the area, the surrounding area. It looks like Yosemite. It’s insane. It’s this incredible mountain range called Moulange and Mount Moulange and the area is just stunning. So I think it’s like the best rock climbing in Africa or something, but it’s very remote.

[00:38:30] Alex Gladstein: Not many people there, and he’s kind of doing everything by himself. So he was subsidizing some of the power for people so that it wasn’t like 90 cents kilowatt-hour or something. He was bringing it way down out of his own pocket. Though it’s not sustainable. So in comes Gridless. Gridless’s miners buy 100% of the hydro power that Bondo does not consume.

[00:38:53] Alex Gladstein: Which of course, even if they design it like perfectly, and like during the daytime, the Bondo folks are eating one close to a hundred percent of the hydro. Well, what happens at night, like the town sleeps, the river doesn’t sleep, right? So you have, you always have extra, and then there’s seasonality, right?

[00:39:10] Alex Gladstein: There’s big storms that come in, big cyclones that come in, dump tons of water. And there’s so much surplus. So Gridless is gonna buy all that and they pay a fee to the power company. And that’s really important revenue for the power company. ’cause that’s power, that’s the revenue it didn’t have before.

[00:39:26] Alex Gladstein: So Gridless wins. Gridless makes money, power company wins. They make more revenue and the people win ’cause their price of energy goes down. And now the power company can afford. To expand it can afford to hook more homes up and actually get the rest of the community online in a, in a way where no other donor was like, you know, that was just wasn’t gonna happen with donations.

[00:39:45] Alex Gladstein: So this is how Bitcoin like brings electricity to people. It’s absolutely beautiful to see.

[00:39:50] Preston Pysh: What are we missing? What else, what else in what else do you want to highlight that you think is important from an overall kind of standpoint that maybe we didn’t cover?

[00:39:59] Alex Gladstein: Well, you’re, you’re talking to folks in these communities and, you know, maybe Bitcoin can help bring them electricity, which is incredible on its own.

[00:40:06] Alex Gladstein: That’s a civilizational challenge to solve, and it’s not an exaggeration to say that Bitcoin fixes this. I mean, that’s the crazy part. Like it really does fix it. It it, it is a technology that allows us to eliminate waste in electricity production. Like, it, it, it allows us to use all of it. And that just has not happened before.

[00:40:30] Alex Gladstein: And again, like why don’t, well, why isn’t everybody doing it? It’s a crazy idea. Like it’s, it’s a really crazy idea that takes time to wrap your mind around. It takes time, time for your people to explain it to you. It takes time. You have to go see it. You literally have to go see it. You have to see it with your own eyes, like even me, who had written about this before and was inspired on it. I didn’t even grasp anywhere close to the full picture until I actually went and started visiting some sites, talking to people, learning about it. So I just think it’s, it’s a long road, but that’s just half of it. Right? The other half is how Bitcoins gonna change the sound money piece.

[00:41:05] Alex Gladstein: Because F civilizations need. They need power and they need sound money. I mean, you need electricity access and, and, and you need, you need sound money. I mean, these are two of the basic ingredients for a successful society, right? So that’s, the other half is like these countries, again, Forty-four percent currency, devaluation of Malawi, crazy total crime.

[00:41:23] Alex Gladstein: And people are gonna be able to escape into a permissionless, open network that allows them to do business anywhere in the world. I mean, I met one, one guy, his name’s Grant, a young guy who, he’s starting the first meetup into the country. The first Bitcoin meetup in Malawi will be like in two weeks.

[00:41:40] Alex Gladstein: It’s like very exciting. I mean, we’re probably talking like 2020 era for El Salvador here, like, you know, small community here that starts small but then becomes a big, big wave later. Right. I totally think that’s gonna happen. And the crazy part is Grant’s like,it’s amazing for me to use Bitcoin because it’s accepted everywhere.

[00:41:59] Alex Gladstein: Like I can stack it, meaning globally online. I can like buy, I like, I can’t use them all my currency anywhere. Right. So it gives them like the English language for money basically is the kind of idea he was getting at. Which, which I think it’ll be even better than that. But the other thing is he’s just, these people are packed with cool ideas and they, they’re starting Bitcoin trains you to start to spot all the waste, right?

[00:42:17] Alex Gladstein: So now he’s like, Hey, there’s this thing the government was gonna set up where like it’s got these terms that has to follow by foreign donors who want us to do more like EVs, right? Even though like we get into all the problems with that, but okay, so there’s gonna be all these EV charging stations powered by solar.

[00:42:32] Alex Gladstein: There’s not gonna be anybody with EVs or expect, like that’s not gonna happen right away. So there’s just gonna be all this wasted solar energy. Yeah. And he’s just like, well, we’re gonna come in and we’re gonna hook up some basics and we’re gonna split a cost with the guy who runs the gas station or whatever, where they’re gonna set up the charter points and we’re gonna make some money.

[00:42:49] Alex Gladstein: And I’m like, I don’t know if that’s gonna work. But it’s an awesome idea and there’s a lot of other awesome ideas that are, that are gonna come about as a result of this. And I think that the other part about kind of Africa helping Bitcoin is the innovations that are happening out there, like Gridless, for example, are, are like just would never happen in, in New York or in London, or Chicago or L.A. We don’t have the same sort of lived experience issues. Like the same problems just don’t really, we don’t have the same problems. And the other big one is lack of access to the internet. Right? So 600 million, some-odd Africans also don’t have access to the internet. A lot more have internet poverty or whatever.

[00:43:25] Alex Gladstein: Like they don’t, they, they rarely have data. So people use feature phones. How do you use Bitcoin? I mean, think about people who are listening. Well, how do you use Bitcoin? Well, we usually either use copy and paste or a QR code to like use Bitcoin. Well, a feature phone can’t do either of those things. So you have all these people who can’t really use Bitcoin.

[00:43:43] Alex Gladstein: So, and then you have all these people who don’t have data or internet. So the question is, well, how do you solve that problem? So this incredible guy named KG or Kogatso who grew up in his township in South Africa, right, like under Apartheid, basically invented this incredible innovation that allows people to use Bitcoin without the internet.

[00:44:04] Alex Gladstein: And this is just so profound. So he’s now got about, I think 12,000 users across seven countries in Africa, and it uses a protocol called USSD, which is similar to SMS. And basically you just like send a message to a number. And it spits out like a decision tree type thing, and you can like buy, sell like you can.

[00:44:23] Alex Gladstein: It’s integrated with Bitrefill. You can like buy all kinds of stuff on the internet. There’s a lot of interactivity with Azteco. So you can go to a store with cash and you can top up your ma, the company’s called MachinCora. You can top up basically your Bitcoin account with cash, like through a voucher system.

[00:44:40] Alex Gladstein: It works with M-PESA. It’s totally integrated and it’s amazing. So people are using Bitcoin without the internet, like at scale. It’s pretty insane. Like I, I’m not sure that Wall Street is prepared for this. Like I don’t think they understand this. And the crazier part is that, well, you know, today it’s a custodial lightning wallet, but that’s not how he wants it to be for various reasons.

[00:45:01] Alex Gladstein: Like, if he goes to Vodafone and says, do you want a partner? They’re gonna be like, well, we don’t wanna hold any funds for our customers, right? Like, so, so the self-custody piece is actually important. Well, how do you do that on a, without a smartphone? Well, they figured out or realized that the SIM card can just be the signing device.

[00:45:16] Alex Gladstein: So you have all these people with dumb phones or feature phones, whatever you wanna call them. No internet. Well, guess what? They can all be self-sovereign Bitcoin users, and they can self-custody. So this is a new feature they just sort of rolled out as a pilot this month, and we’ll see where it goes.

[00:45:31] Alex Gladstein: But I just think that’s incredible. So you can be like a fully self-sovereign. A Bitcoin user with no internet. It’s, it’s wild. So that’s the other piece of it is is the, like power generation and also financial freedom, right? So, and, and the innovations coming out of of Africa are gonna make Bitcoin way stronger.

[00:45:50] Alex Gladstein: I mean, who knows? But in theory you could have many thousands if not millions of people, self-custodying, Bitcoin in Africa. That obviously makes Bitcoin stronger. And again, the power conversation, like just gigawatts of decentralized off-grid power powering the network, like in a world where…

[00:46:08] Preston Pysh: There’s just, there’s just so many self-reinforcing incentives, right.

[00:46:11] Alex Gladstein: It’s weird. It’s weird. But in a world where, like in the west, we might be lazy and privileged and like a lot of centralizing forces right now, right? Like ETFs, like, you know, custodial use of Bitcoin, like it’s easy for us right? But it may be in Africa it’s different. So Yeah. And anyway, it’s like, it was a fascinating thing to do. I’m so fortunate to be able to do it’s, to get out there. It’s amazing. I just, I hoped that the essay could just even show people like one percent of what I saw. If, if it could just do that, then it was successful. If it could just open your eyes, the tiniest bit. To this, then I’m, I’m very happy that, that it was able to do it.

[00:46:43] Preston Pysh: It definitely does that, Alex and the…

[00:46:46] Alex Gladstein: Thank you Preston.

[00:46:47] Preston Pysh: The article is called Stranded, How Bitcoin is Saving Wasted Energy and Expanding Financial Freedom in Africa. This is on Bitcoin Magazine. The website will have a link to this in the show notes. I can’t stress it enough. You need to read this article ’cause the personal accounts and the stories in it are just miraculous and just so ins it’s really inspiring and it gives you hope.

[00:47:08] Preston Pysh: In a clown world backdrop where you just like, you don’t even wanna log into Twitter and read what’s next. Yeah. Right. It’s just so it can be very parasitic to just like read some of the stuff that you’re seeing and this is just a bright light in the backdrop of all of that. And Bravo to you for just always being that light in such a dark world right now.

[00:47:30] Preston Pysh: And we need more, Alex Gladstein’s. We need more people highlighting these, these amazing things that are happening. And I look at it just as an honor to call you a friend and to be on this Bitcoin journey with you. And always thank you for your time. Alex, is there anything else that you wanted to highlight outside of HRF?

[00:47:48] Alex Gladstein: No, I just, the article, I just, yeah, just shout out to Eric and Janet and Phil’s and their team Shout out to KG and Aline and the matching career team. There’s some other stuff we didn’t get into. We can visit it later, but definitely shout out to Marcel and PTC data. I mean the, this woman has a vision of bringing millions of African women on board to be Bitcoiners, which is something most people neglect, which I find so deeply moving and she’s educating people in Africa’s, largest slum.

[00:48:15] Alex Gladstein: It’s incredible, like how fearless she is and. Shout out to Femi from BeatRest Builders, formerly KALA, who is helping address the issue of making sure that hopefully Bitcoin does not become this thing where Africans just consume what the West produces, which is the trap they’ve been in, like, you know.

[00:48:31] Alex Gladstein: Cars are made and cars are made in the west. Africans buy them at a, at a huge up up mark. So they wanna make the Bitcoin stuff in Africa. And to do that, you have to train people how to do it so. His program is training the devs so that they can build and do stuff like, like good listen, KG, like match and current and a good list are good examples of this, but they wanna let a thousand flowers bloom in terms of, you know, African created Bitcoin products that, that are made for Africans doing stuff for Africa.

[00:48:58] Alex Gladstein: So like, one of the things Femi says is that, like in the West, we’re very focused on store of value and that that’s fine. I mean, Bitcoin’s awesome store of value, but we’re, we’re not very focused on Bitcoin as a medium of exchange. But that’s really, really where it shines in Africa for a lot of different ways.

[00:49:11] Alex Gladstein: So those apps are gonna be, they’re gonna advance faster over there. Like he was talking to me about like, even just like pension stuff. Like we have all these sophisticated pension systems here and now most of ’em are scammers because we know, but, but over there, even just basic Bitcoin apps that do pension stuff are gonna be huge in Africa.

[00:49:28] Alex Gladstein: So that’s gonna lead the way in, in many cases. So anyway, shout out to those folks. I really also appreciated my friend Ian Burrell, who’s a well-known journalist in Britain who came with us on the trip. He wrote his own piece much shorter than mine. Obviously, I was in the mainstream media, but, it was un unheard and it was, it was on the same topic, and I was so grateful to Ian for coming and, you know, I just brought him just so he could see. But like he ended up writing a piece that was amazing about the same idea and, and, you know, coming from a more skeptical point of view of like, well, how could Bitcoin possibly help in a humanitarian sense?

[00:50:00] Alex Gladstein: And then he, he, once he saw it, he, he, he understood. I. All it takes is an open mind. Yeah. But once you start to realize how powerful this is and how it’s, it’s really gonna fix a lot of these issues with dependency and with waste, it’s just very, very exciting. So yeah, I’ll be seeing maybe some of your listeners in Madera.

[00:50:18] Alex Gladstein: At Bitcoin Atlantis. I hope some of them come out to Norway for the Oslo Freedom Forum in June, we’ll have a Killer Bitcoin program and yeah, until then, thank you Preston for having me, having me on.

[00:50:29] Preston Pysh: One real quick highlight. There’s a lot of links in the article that, and this is wonderful because you mentioned a ton of things here and I’m, I’m sure a lot of people are gonna want to dig in even more.

[00:50:39] Preston Pysh: So if you don’t see it in the show notes, as far as the links in the article as you go through it, there’s a ton of links to many of these things that Alex mentioned. Just, just additional highlights. So Alex, thank you for coming on the show. This was amazing and just really appreciate your time.

[00:50:54] Preston Pysh: If you guys enjoyed this conversation, be sure to follow the show on whatever podcast application you use. Just search for, We Study Billionaires. The Bitcoin specific shows come out every Wednesday, and I’d love to have you as a regular listener. If you enjoyed the show or you learned something new or you found it valuable, if you can leave a review, we would really appreciate that. And it’s something that helps others find the interview in the search algorithm.

[00:51:15] Preston Pysh: So anything you can do to help out with a review, we would just greatly appreciate. And with that, thanks for listening and I’ll catch you again next week.

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