Preston Pysh (00:05:20):

It shows you at that level, how these guys are thinking. I turn on the game, I played baseball as a kid up until like high school. This is just unbelievable to hear that type of thinking and being able to throw a ball and be able to direct it in that kind of way is just mind boggling to me.

CJ Wilson (00:05:40):

We’ve all shot rifles before, I assume?

Preston Pysh (00:05:43):

Yeah, yeah.

CJ Wilson (00:05:44):

It’s very similar. If you have a very small target and you’re focused only on that, the world melts away. And so when you’re in the middle of a huge stadium and there’s a lot of energy and it’s rocking and it’s warm weather or whatever, you have to be able to zone everything in to just the target. And on a glove, you’re looking at like a little tiny, like the crotch on the glove way deep in the pocket, there might be like a W or an R or a little cow or something, and you’re trying to use like x-ray vision to zoom all the way in. So I always had really good vision, I have 20/10 vision in my right eye and 20/15 minus two, which is like a 20/10 minus two, which is like 20/12 basically, because I would miss one or two questions on the 20/10 vision.

CJ Wilson (00:06:24):

I would zoom in and I would just be locked in. And so when you would see, let’s say a Tom Glavine or somebody with Greg Madduxback in the day when I was a kid, those guys, when they would throw, their whole body would rotate, but their head would stay right on. And now you see these like whipping their heads. And so they’re obviously using more of a max effort delivery, but the players that can keep their eyes level throughout the plane of their delivery going towards the catcher, those are the ones that are able to really direct traffic in a very finite thing, the way you’re able to say, “Oh, it’s windy,” and then you just need to move your cursor a little bit here, you’ve got to move your chevron just a little tick over.

CJ Wilson (00:07:00):

So I would say it’s very similar to that mentally, but keeping that going while you’re doing something very physical, it’s a learned skill and you have to use a lot of training in order to be able to stay in that aggressive adrenaline level, but below cave man mentality where you tend to lose it if that makes sense.

Preston Pysh (00:07:19):

I just can’t imagine what that looks like with 50,000 fans or however big the stadiums are.

CJ Wilson (00:07:25):

Yeah. It’s a lot of action. There’s a lot of stuff going on behind the target. There’s the umpire, there’s the hitter over here, you got babes sitting back here. You know what I mean? You got fat guy eating the popcorn. There’s a lot of action. There’s no such thing as blocking anything out, but you just tune in what you’re focusing on, and then you can make it a tiny little thing. Because if you’re shooting at something that’s like the size of a golf ball as a target or a little bit smaller, you’re 60 feet away, so it’s pretty close. Like I’m looking across the office right now, you find like the monitor, like the corner of a monitor, and you’re just looking for that.

CJ Wilson (00:07:59):

And when I would pitch, if I’m full screen, now you would try to throw pitches up in one quadrant in a very narrow… You only want to use about like this size of the strike zone. You don’t want ever be in the middle. There’s a whole basketball in the middle of the strike zone you just never want to throw the ball there. You want to live on the periphery and kind of flirt with that out there because then the hitter’s having to go side to side. But if the hitter’s able to keep you in a narrow range, then they can mentally adjust, just like a boxer is going to say he keeps going jab, jab, hook, so jab, jab, ready for it, whack, and that’s the way I would say the strategy works live in action.

Preston Pysh (00:08:38):

Amazing. And it has to feel just unreal when you strike a guy out and the stands just go wild. I just can’t imagine what that-

CJ Wilson (00:08:45):

Yeah, it’s the best, the best. But my best Houston highlight, I have two really good Houston highlights since they’re playing in Houston tonight. My first Major League hit was a triple and I hit it to dead center field.

Preston Pysh (00:08:56):

Really?

CJ Wilson (00:08:57):

Yeah, when they were still National League.

Preston Pysh (00:08:59):

Pitchers don’t hit the ball.

CJ Wilson (00:09:01):

Well, I played center field in college, so I was an athlete? So yeah, I hit the ball, and I just remember thinking… I hit it and I was like, “I’ve got to run.” You know what I mean? So it was pretty good. I was excited.

Jimmy Song (00:09:14):

You still made it to third base though, that’s awesome.

CJ Wilson (00:09:18):

It would’ve been a home run, like a lot of other places if I would’ve just hit it to the right a little bit or the left. And then another game a couple years later, or maybe the next year or two years later, I actually threw the fastest knuckle ball in a game. I threw like an 84-mile-an-hour knuckle ball, which was like some thing, just for fun. We were beating the Astros so bad, I was like, “I’m going to throw a knuckleball and see what happens.” I was like, “Weee!” It’s just sometimes the best games, the most fun games are the ones where you really never even have to get out of second or third gear, you’re just going to cruise it. It’s just easy the whole way. You’re never really grinding in that regard.

Preston Pysh (00:09:50):

Who’s going to win World Series?

CJ Wilson (00:09:53):

The Braves. I think the Braves do. And I’m saying that because they have a healthier team right now, even though Morton’s hurt, I think they have a better bullpen. I think their starting pitching just overall is a little bit more complete. And I think they have the least amount of distractions on the team. I think Astros have a lot of distractions right now, some of their best players are going to be free agents this off season. So I think that that always hangs over the head a little bit, having been in that position.

Preston Pysh (00:10:20):

Wow, I never would’ve thought about that.

CJ Wilson (00:10:22):

Yeah, because you have guys that basically, they have an out, they’re like, “Ah, yeah, if we lose, I’m still going to get $100 million next year.” I think Korea for the Astros is in that position. So there’s some things like that are going on behind the scenes that are a little bit very inside stuff. You know what I mean? But the Astros starting pitching is like they’re Swiss cheese right now, they haven’t been able to do anything, they haven’t been able to hold it. They can’t hold anything right now. So I think that’s the case.

Preston Pysh (00:10:48):

Wow. That was fun. And I know people want to hear us talk about Bitcoin, but that was me being a little selfish. CJ, you were up in DC this last week and you’ve got some lobbying efforts, Jimmy yourself and Alex Gladstein is part of this as well. Talk to us about like, what was the impetus for standing this up?

CJ Wilson (00:11:09):

I would say Alex, to clarify, he has the human rights foundation, so he’s there independently, we just happen to be aligned on this particular thing, which is educate as many people in Washington DC as possible. As we’ve seen this infrastructure debate or the SEC or CFTC or stable coin, so there’s a lot of noise right now coming from the DC machine. Jimmy and a couple of us, we banded together and we decided, “Hey, maybe all we have to do is just give these people like a workbook, give these people the little Bitcoin book, give these people This Machine Greens, give these people a couple of your interviews or something like that. And maybe if they take that in, they can absorb some of this, and then come from a position where… ”

CJ Wilson (00:11:49):

They’re going to regulate and do whatever they’re going to do, we understand that. Bitcoin is going to do whatever it’s going to do, which is just tick, tock, next block. But the people that are holding Bitcoin are obviously attack vectors for Janet Yellen with unrealized capital gains and things like that. So we just want to educate as many people as possible, maybe get some of them to buy some Bitcoin along the way, align those incentives like Parker Lewis always talks about, get those incentives to match up. And I think we had a lot of reception with that. I think Senator Lummis and Senator Sinema started The Financial Innovation Caucus.

CJ Wilson (00:12:18):

So they did a lunch and learn, which was Alex and myself. Alex is such a more eloquent speaker than I think just about anybody in the space. He’s done so many things in the space, but he’s like a double black belt octopus with his life on the line. He’s just able to just weave all these things around and people are like, “I’m going to back up and just watch this.” And he just lays it all out so cleanly and with so much compassion. It really is one of the most artistic and fantastic things I’ve ever seen in person, and I was very happy to share the table with him.

CJ Wilson (00:12:50):

But of course, as a small business owner and a retiree in a way, my concern personally, I give it a little bit of my story and it’s like, your career earnings as baseball player drop and then go from there. But obviously Jimmy’s been a big inspiration of mine and somebody that I’ve spent a lot of time talking to between Clubhouse and Twitter and podcasting and stuff like that. And as I’ve spent more time in Austin, we wouldn’t be able to have a group like without a core developer, without somebody who’s got as much stuff under his belt as Jimmy does. He brings a lot of contacts and things like that and knowledge that I don’t have anywhere near that.

Preston Pysh (00:13:25):

It’s just crazy what Jimmy can jive on. He can get as granular as you want. Look at him up there, he’s all embarrassed.

CJ Wilson (00:13:31):

So shy.

Preston Pysh (00:13:34):

Jimmy, what are your thoughts on standing this up?

Jimmy Song (00:13:38):

I really appreciate this opportunity because we do need to focus a little more on education. And as CJ said, Bitcoin’s going to do whatever, it’s going to survive, but there are people that are vulnerable because of the actions of the US government. And should they seek to do something like unrealized capital gains or taxing minors or something like that, it’s going to make our lives pretty difficult. So that’s what CJ and I and some other people are focused on, is in helping people understand, especially on Capitol Hill, what Bitcoin is, what we want, and it’s a significant number of people. So they’re starting to realize, “Okay, this is a big constituency.”

Jimmy Song (00:14:20):

A lot of senators got an insane number of phone calls after the infrastructure bill, and they were like, “Okay, who are these people? And why are they calling?”

Preston Pysh (00:14:29):

Why is there so many of them?

Jimmy Song (00:14:30):

Right. And I forget who put out the report, but something like 46 million people in the country owns some form of crypto, that makes me shutter a little bit when I have to say that word. But I imagine a large number of that are Bitcoiners. So there’s certainly an appetite amongst the people that own it to protect themselves a little bit and get their voice heard by talking to a lot of these people in DC. That’s what we’re trying to do. And we’ve set up a 501(c)(4), which is based on education. And we want to provide material to senators and their staff and Congressmen and their staff, and even the Executive branch, if they want, and just give them some idea of what this is.

Jimmy Song (00:15:21):

Because for most of them, they just have no clue, they don’t know anything. And we’re trying to help them out and provide some value for them and for are the community as well.

CJ Wilson (00:15:32):

The thing is, the curiosity is very high, but the knowledge is low, so it’s a good combination because you have effectively so much material that’s out there already. There’s so many books, there’s so many podcasts, there’s so many videos. Not all of them are high quality, that’s the problem. So what we’re trying to do right now is sift through that and give us an all-star cast of people that are in the space and great takes on a roundabout between mining, transactions, block size, all these things that have happened, the history of who these people are, who the developers have been, how GitHub works.

CJ Wilson (00:16:06):

I was having a conversation with somebody the other day. I was like, “Yeah, so in order to change the protocol… ” And they’re like, “Wait a second, hang on. They’ve changed the protocol?” I said, “I don’t know what number improvements they’re on right now, but it’s version like 27 or something. They’ve done a lot of stuff over the years.” And they’re like, “Oh, okay.” And they start writing it down.

Preston Pysh (00:16:26):

I’m out. I’m out.

CJ Wilson (00:16:28):

It was funny because it’s like you have, like I said, this curiosity. When we were at Bit Block Boom, Parker said something that was great. He said, “Listen, don’t try to force people that aren’t curious, you can’t be like a Seventh Day Adventist and just hit somebody over the head when they open the door. You have to hold events, you have to invite people in. And if they show up, then they’re fair game for the conversation because they’re there for it.” But if someone’s not really receptive, you can’t be like a used car salesman and just try to just like pitch them on it.”

CJ Wilson (00:16:57):

And in the same way that you would want your family or your friends to just know what it is, I think there’s a lot of value to taking this to people. But the funny thing that I had no idea about really until I started engaging with Senator Lummis’s office, each Senator has like 20 to 80 staff. They’ve got lot of people working for them because that’s the only way they’re able to digest these 2,400-page bills.

Preston Pysh (00:17:18):

And they’re usually pretty young. So was the staff pretty receptive to Bitcoin or did you find that some of them were… I don’t know. In general, what was the sentiment?

CJ Wilson (00:17:29):

Yeah. There’s a lot of like 20-somethings in there, and I had individual with some of them in between the other large meetings and stuff. And one of them was like, “Hey, I’m only doing this until this guy’s done and I’m thinking he’s going to retire after this session, and I want to go work for a crypto company.” She’s got some legal experience, whatever, I was like, “You should go talk to Hailey Lennon, she’s got CryptoConnect or something like that, which is this deal for people that want to join the industry for women and stuff. So I think it’s interesting to see how their certain roles get pawned off. You’re going to have like an energy person in the office, or a wildlife person in the office, or BLM or whatever.

CJ Wilson (00:18:08):

So if here you go with the crypto thing. And a lot of the people that we met with were from the House Finance Committee or the Senate Finance Committee in their offices. They’re basically taking reports. So Jimmy and a couple of the other people today, I think yesterday were working on this, like a leave behind PDF to say, “Okay, here you go. Here’s my follow up email. Here’s some links. Here’s some explanation. Reach out to us if any questions.” But extremely, extremely curious, very interested. And I think as this event goes further, Senator Lummis’s office provided some Chick-fil-A, some people showed up, it was great.

Preston Pysh (00:18:40):

You can never go wrong with that one.

CJ Wilson (00:18:45):

You got waffle fries and protein, people are in for it. It’s great.

Preston Pysh (00:18:50):

What were some of the questions, just the more common ones that you were getting from them?

CJ Wilson (00:18:54):

It’s the same questions you and I are going to get on a daily basis when we’re meeting with somebody that’s, let’s say at any authoritative position. So I met with a particular congressman, and his question was, “What if bad actors adopt Bitcoin, what do they do?” And I literally pulled up my laptop. I’m like, “Here’s blockchain.com. Here’s the explorer. You can see the transactions as they go. So you can see every Bitcoin and every Bitcoin when it was transacted.” And he was like, “Okay, hang on a second.” I said, “Literally, every transaction is like a tattoo on the Bitcoin itself. So even if they split it into tenths or hundreds or thousands or whatever, you can see where that Satoshi initiated and you can see it was mined by F2 pool in 2014 or something like that.”

CJ Wilson (00:19:32):

It was awesome. It was awesome. And I think now that they’re starting to see that, and this is somebody who I would think has a say in how these things are going to go because of the committees they’re on, it’s interesting. But the weirdest part about it is, I got home and I talked to my wife. I said, “Do you know how when you go to New York City there’s just all these people who’re like, ‘Yo, what are you doing? How are you doing?’ It’s like this kind of vibe like everybody wants to meet everybody?” DC is like that exact same thing, but it’s like a different type of interaction.

CJ Wilson (00:19:59):

You don’t have that sort of animal chemistry when you see somebody and you’re single and you’re like, “Hey, you want to go on a date? You want to go out?” To everyone, it’s like, “Hey, who do you work for? Maybe can get on a committee together.” And it’s kind of strange.

Preston Pysh (00:20:12):

So, you’re sniffing each other’s rear ends?

CJ Wilson (00:20:14):

Yes. 100%. It’s a little bit weird, but if you’re in for a penny, you’re in for a pound at this point.

Preston Pysh (00:20:22):

Interesting. Jimmy, do you have any other points that you want to talk about?

Jimmy Song (00:20:27):

I’m being as entertained as you listen to CJ talk about the actual culture of DC, but I have experienced some very similar things. I did spend some time with Senator Lummis’s his staff down in Miami. And what they told me was absolutely shocking. The staffs of these senators, they’re generally in their late 20s, early 30s. That’s young, and these are the people writing the bills. They’re like, “Yeah. But that’s not nearly as bad as the House.” I’m like, “Well, what’s going on in the House?” The House staff members are early 20s out of college.

Preston Pysh (00:21:01):

Right out of Georgetown. Yeah.

Jimmy Song (00:21:04):

And those are the people writing the bills there and it’s more of a jungle over there. So there’s a lot that I think we have to learn about DC culture and how things get done that frankly CJ and I are just starting to learn, like, “Okay, this is how it works. You get the staff on board and then you get them to go talk to their principal,” and their principal is the senator or the congressman or somebody like that. And you get them to advocate for it, because really that’s the ultimate decision maker within that office or whatever. But there’s a lot of subtle things in DC that I had no idea about.

Jimmy Song (00:21:44):

And I’m just starting to understand, oh, so these people do this and then these other people do this, and this is how you get influence. And if you’re a lobbying group of some kind, you’re not just going to get in the door just flashing money, that’s not how it works. There’s a whole culture and process and value added and ultimately, you have to do something that benefits the candidate or the person in office or they’re not going to really listen to you. So that’s what we’re having to navigate, and we do have some people on our team that know a lot more about that stuff and know how to navigate it. It’s a very strange world, I’ll tell you that

Preston Pysh (00:22:30):

CJ, were they asking much about stable coins.

CJ Wilson (00:22:33):

A little bit. Very early in the conversation, Alex and I tried to steer it to Bitcoin, just because we’re both maxis and that’s frankly why I was there was just really to talk about Bitcoin. But I think it’s been apparent from the conversation that’s being had openly now and reports coming out on Twitter and stuff like that the SEC is really looking at stable coins as an attack factor and the treasury is very interested because they feel and have felt for a very long time with the stuff with Tether and stuff like that, that it’s an attack on the dollar.

CJ Wilson (00:23:04):

And if you have people being able to transact USDC or USDT, then it might diminish their need for the dollar, and America really does thrive in a lot of ways off international countries using dollars in trade, whether it’s the petrol situation or whether it’s some dollar-backed euros, because the euro in a lot of ways is underpinned by its bridge to dollar, the pound in the same way. So when I was, I guess about 10 years ago, I was actually a forex trader. So I used to trade forex and it was really big on macro stuff. So that’s when I was really aggressive with day trading, so with gold, silver and Forex.

CJ Wilson (00:23:47):

This is pre-Bitcoin for me, but this was like 2008, ’09, ’10, ’11, that’s when I was heavy into that stuff. And then I decided I was going to be a car dealer. But the conversation in a lot of places is there are these boxes and rules and people are afraid in some senses to step out of it. And I think in that regard, a lot of these younger staffers, they’re not really sure what the rule is about them holding Bitcoin. And so we’re just like, just touch it, hold it, see why it works. And so what we have to do for the people that have never been a Bitcoiner before is I have two phones, so I go out there and I do a lightning transaction from one wallet to another wallet. And they were like, “Whoa, wait, it moves that fast? What did it cost you?”

CJ Wilson (00:24:29):

And I’m like, “Oh, just like four cents because of strike or something.” So because there’s American companies that are doing these things, I showed them the Fold app. I showed one of the House members we were at lunch, because this is funny, I’m not going to say who it is, but he won’t meet in his office because people read the logs of who goes in and out of the building because you have to sign in to say, “CJ’s going to go visit this office.” And you’ve got people on the other side that will blur it out there, they’re like, “Oh, why is this guy talking to this guy?”

CJ Wilson (00:24:59):

There’s a level there of the social engineering that like Jimmy said, it’s navigating like a haunted house in a lot of ways. We don’t know if we’re reaching into that bowl, it feels like brains is it like ramen? What is that? You know what I mean? It’s dark. It’s very dark and we don’t know. So we’re very cautious about how we’re doing this. And one of the things is behind closed doors feedings have to stay behind closed doors because we’re feeling each other out. And like Jimmy said, we have to provide value. And I think some of these states, very clearly Wyoming, very clearly Texas, very clearly Florida, have been very pro cryptocurrencies and we’re trying to filter that into being pro-Bitcoin obviously.

CJ Wilson (00:25:39):

Texas is very pro-Bitcoin, Abbott is very pro-Bitcoin, Cruz has come out as very pro-Bitcoin. I met with Conan’s office, he’s figuring it out as well. Wyoming, obviously with Cynthia Lummis who’s absolutely the swinging this massive bill club against inflation and stuff like that. Her staff with the Yellen meeting the other day was fantastic. But her office totally gets it, A to Z, everybody in her office, orange field, everybody gets it, and they’re trying to sell me a ranch. They’re like, “You should come up to Wyoming, it’s great. We’ll ride horses, we’ll go fishing.” And I’m getting that a little bit from Will Cole from Unchained.

CJ Wilson (00:26:13):

He’s like, ‘Man, go fly fishing, it’s awesome.”

Preston Pysh (00:26:15):

That sound awesome, CJ? I have to admit, it does sound pretty awesome.

CJ Wilson (00:26:20):

We can do it. We can do it. Eventually my idea, you have these individual states that are really campaigning for their own rights in the same way as small country like El Salvador is. They’re trying to push their own agenda, which they totally should. If you’re a governor or a senator or a congressman from any other state, you should be pushing the agenda for your constituents, that’s literally your job. You should be looking to make… I’m going to say his name, Gavin Newsom, he should be trying to make California the best place to live in the country. Suarez is trying to make Miami the best place to live. Scott Conger in Tennessee is trying to make his place the best to live, Abbott in Texas, and all these people.

CJ Wilson (00:26:56):

So they’re all trying to fight for that, which is great, it’s fantastic because then you have this organic competition that it gets everybody better. And I think that’s what we need to look at. My theory is that if you water the lead horses, the lead horses, they’re dragging everybody else along, you let the innovators run. And if they get it, you just give them the capital, you give them the freedom and let them run forward. Otherwise, if you try to keep pushing from the back, you’re going to get people smashed in the middle and it doesn’t really work. It’s better to train people off of the best examples.

CJ Wilson (00:27:28):

And right now the SPDI Bank Charter in Wyoming and the energy situation in Texas really are two of the key differentiators in that regard for attractiveness as a Bitcoin or Bitcoin company, why you’d want to locate there.

Preston Pysh (00:27:42):

Even your analogies that you’re using are Wyoming analogies it seems like. So you’re set. Hey, let’s go in a little bit of different direction, there was a couple questions relating to just how the core developers work. You guys were talking a little bit about GitHub, but there was a person in there that was just the governance of Bitcoin, the software. How does this work? Because I think for a lot of outsiders, I know myself included when I was first looking in this space years ago, I was like, “Well, who actually gets to decide as to what… Like we’re rolling out Taproot, that’s a perfect example maybe for you to use Jimmy on just how that entire process works from the very beginning to people developing that code to the full implementation that’s about to happen.

Jimmy Song (00:28:33):

Yeah. It’s a complicated process and it takes consensus essentially to get in, but basically, somebody has something that they want to include into their Bitcoin. And right now, I think there’s like 400 different poll requests on Bitcoin. So there’s constantly a lot of things that people want to bring into Bitcoin. Taproot was one of those things. I think it was first conceit by Greg Maxwell back in, I want to say 2018. And then the next day he came out with, “I got something or it’s called Graftroot.” And people were like, “All right, well, Taproot’s pretty good. Let’s work on that first.”

Jimmy Song (00:29:10):

There were additional things within the Taproot soft fork and including Schnorr signatures and a bunch of other improvements. But that that’s what Taproot was. It was a bunch of things that were rolled up into one because this whole process of getting consensus is rather difficult than there’s some argument to be made that if we do it all at once, then we can test everything the same way, and we can do a lot of this stuff a little better. And there’s a whole discussion around that, which Michael Folson started on the mailing list. But basically, somebody comes up with an idea, it has to get refined.

Jimmy Song (00:29:50):

Usually, if it’s just an idea and Taproot was a really cool concept, but no one had coded anything and there were certain things within it that needed clarification and refinement and stuff. So it goes to something like a design phase where just developers are going back and forth with each other, “Oh, that’s a cool idea. What are you going to do in this particular case?” And then you have a lot of advert serial thinking at this stage where people are trying to poke holes at it and say, “Okay, well, if you do it this way, then that leaves it open to this kind of vulnerability. Is that a tradeoff that we’re comfortable with,” and all that.

Jimmy Song (00:30:29):

And eventually, come up with some spec and usually that’s in a bit, or a Bitcoin improvement proposal. You don’t necessarily need to do it, but that’s a good way to have a document that people can be like, “Okay, well, if you really do it this way, then something is going to go wrong or whatever,” and they get refined and their status has changed. And that’s been a process that’s been in place since, I want to say 2011 or something like that. So there’s a whole Bitcoin improvement proposal process, and that design document, again, goes through some iteration, lots of eyeballs looking at it and stuff.

Jimmy Song (00:31:12):

And then the code actually gets written. And usually that’s the shortest part. Coders code, to code something isn’t is difficult as you might think. It’s the actual design process and making sure that it all works, that’s the hard part. So the code will be written and then there will be a poll request on GitHub. And a poll request is like, “Here are the things that I want to change.” And if it’s a consensus change like Taproot is, a lot of different eyes will look at it. Usually at least a dozen people, in this case, probably over 100 people, they actually had little seminars for the developers to explain different parts of the code, just so they would have like better anchors on, “Okay. All right. So this is what Taproot is.”

Jimmy Song (00:32:03):

And they invited a bunch of people and they had four cohorts of 50 people each and they were just explaining it over Zoom and things like that saying, “Oh, okay. Is that what that is?” And explaining it that way so that people could understand, “Okay, that’s the functionality that we have.” And then you get into a lot of the testing and stuff like that. And people try to break it, try to figure out, “Okay, can we do something that wouldn’t work?” There’s also a lot of room for disagreement along all of this. At any time people can say, “Well, I don’t think this is a good idea because of this, this, and this.”

Jimmy Song (00:32:42):

And the reasons that they give, if they don’t get addressed, a lot of times, the pull request doesn’t make it. That’s why we have 399 pull requests on GitHub. There are tons of people waiting to put in their feature. They’ve done a lot of work, but there are concerns about different things like OP CTV is a good example. Jeremy Rubin’s been working on that for three years. And he has this idea where this new hop code, check template, verify. And if you have it, then you can get covenants and Eltoo and all this other stuff.

Jimmy Song (00:33:20):

He’s made the argument for it, but there are people that are like, “Well, if we are going to do covenants, then these are some of the concerns that I have about your particular proposal and so on. So it could die at any of those points, but if you get consensus, Taproot did where a lot of people looked at it, tested it, objected to certain things which got changed or they were satisfied some other way by another explanation or something like that, then it gets merged in, and then the next major release of core, I think in this case was 21, they include it in the code.

Jimmy Song (00:33:57):

And the person that merges it has more of a janitorial role. Those are the people that we call core maintainers. Jonas Schnelli, recently left as a core maintainer, but there’s several of them, Pieter Wuille is I believe one of them, Falke, Michael Ford is another one.

Preston Pysh (00:34:19):

How does a person become one of these?

Jimmy Song (00:34:22):

It takes a lot of time and effort. You get nominated by people in the community. And there’s only about 50 to 70 core devs that are pretty actively involved. But if you have a good reputation, if you’ve been contributing for years and stuff like that, then people consider you a pretty good… can sort of handle, has the right personality, because you have to be the person that says no. There’s still these objections outstanding, they’re the referee in that way. You need to address them before they go in. Oh, Wladimir van der Laan is another maintainer. But there’s like a four or five of them, and then Marco Falke is the other one.

Jimmy Song (00:35:06):

Those five people have the ability to merge, commits into core. And they only do it if there’s consensus. And once there’s consensus, then it goes in. At that point it gets tested, reviewed again and everything else. And when it goes out, when it’s released, they have released candidates, and then it gets released, and then people download it and run it.

Preston Pysh (00:35:31):

That’s the ultimate piece is, like the Taproot. I have to choose, I personally have to choose to run that on my full node.

Jimmy Song (00:35:39):

If users want this feature, then they have to upgrade, but they don’t have to, they don’t have to use this feature. Everything is backwards compatible. There’s also a courtesy thing for miners, which is this idea, “We want to make sure we don’t fork the network accidentally or something like that.” So you can signal whether or not you’re ready for this soft fork by flipping the service bid and the block header. And miners are encouraged to do that. And unfortunately in 2017, they used that as a power play saying, “Oh, we give you permission or something like that.” And we had this whole drama with the Blocksize War and you can read all about it in that book, but basically at the end of the day, they realized, “Okay, the users control this thing.”

Jimmy Song (00:36:29):

There’s a bunch of them that are going to do a user-activated soft fork, and they’re going to run a software that they want regardless of what we think, which users absolutely have the right to do. That was used in a nasty way in 2017. So a lot of core devs have been traumatized by that. This time was a different kind of trauma because there was a lot of conflict over whether or not to use BIP8 or BIP9 and that’s time base versus block base, and they’re very subtle, weird attacks that you can do on either one. So it ended up being a very weird controversy, but it did get resolved because we tried something called a speedy trial where miners had three months to signal and they did.

Jimmy Song (00:37:16):

And we were all watching with the blocks, turning red or green. And that’s really just the service bit being set on the header. But that ultimately meant that it’s going to get activated in about two and a half weeks, November 15th, if I’m not mistaken, right around there. And at that point, we will have Taproot on the network and you’ll be able to pay to Taproot addresses, which I believe are back 32. So it’ll start with BC1Q instead of BC1P, so that’s how you’ll know.

Preston Pysh (00:37:48):

CJ, I suspect you were having that exact conversation with all the people up in DC?

CJ Wilson (00:37:54):

Truly what I try to explain is using real world examples. They’re be like, “What’s a blockchain?” Imagine Jenga, but you put it together in reverse. And then once the magic, last little piece is found, the block is complete and it’s published and that’s it. And they’re like, “Oh, okay.” And I’m like, “I better not have to dig any deeper than that.” But I try to explain this like, “Okay, each little transaction is like a little block of Jenga, but instead of that magic block coming out, and then the whole thing falls down, it’s the reverse. The thing is really wobbly and you put that one block in and then it’s solid, then it’s gone. And that’s what everyone’s fighting for with the ASIC and stuff like that.” And they’re like, “Oh, okay.”

CJ Wilson (00:38:36):

I hope Jimmy doesn’t roast me on this one because he’s as close as it gets. But I think of it in the same sense, where we have the executive branch, the legislative branch, the judicial branch of the government, then there’s checks and balances. So you have the miners, you have a BIP, which is effectively like a mini white paper, Jimmy, I guess you can say that where somebody has an idea and they’re putting it out there. Before that idea comes out, they’re going to have done some work and some theorizing, and they’re going to probably do some behind the scenes conversations with their buddies, because during this process, everybody gets to know each other.

CJ Wilson (00:39:07):

And I think that’s one of the things that’s most essential is that even the people that are pseudonyms on the internet, they still have an opinion and they have a personality that you can deal with, just like Twitter. And that’s something that as a thing, we’re like, “Hey, you guys should just put a full note in Congress and then we’ll just keep updating and be with us.” You know what I mean? So it’s interesting to see how this is going to go, but I think ultimately, there are senators and congressmen that are very interested. Some of them are more technical than others, some of them are like, “What’s a PDF?” So it’s a little bit challenging.

CJ Wilson (00:39:42):

It’s like, “Okay, we’ll just print that for you, we’ll give you a tangible thing there. We’ll give you a stack of papers, and you can type those links out yourself or books.” I think the technical aspect of it is very easy to say that you have a certain level of training for, but at the same time, there’s people like Jimmy that break it down. There’s a whole wave of people that are interested in this, I call it the sport, the sport of improving these types of things. And there’s no reason why we can’t draw more people into that and just explain it in plain text ways.

CJ Wilson (00:40:13):

Because we have the people like Jimmy that are eventually going to go talk or maybe even, sorry, Jimmy, have to testify in front of people on CSPAN because we have to explain to these people what it is they’re trying to regulate. Otherwise, they don’t really have the tools. And if they read all the way through this stuff and they really get it and they lock it and it takes them a little bit of time, like it took all of us, then they’re going to make the best decision at that point with the most ammunition and the most education possible. We don’t think that they’re going to make the best decision for Bitcoiners 10 times out of 10, but at least if we stall a little bit any negative rollouts, then that’s a victory because Bitcoin’s going to do its thing and NGU’s going to just bury everything.

Preston Pysh (00:40:51):

I think so many just totally miss this whole idea of blockchain. They just want to slap the label blockchain on anything and just be like, “Oh yeah, well, we got this blockchain over here that’s doing this.” And I’m thinking the whole idea of a blockchain is about decentralization and removing any central point of failure. And when you look at all these other protocols that are “using blockchains,” I think there’s just a massive terminology gap there that’s just been thrown around for years, for years and years. And I think if I was going to guess as to what’s causing it, I think people are able to engage in a conversation, throw out that buzzword, and feel like they’re with it or that they’re up to speed on this new technology because they’re using that buzzword blockchain, but really truly don’t understand anything about what they’re actually saying.

CJ Wilson (00:41:51):

Unless you’re actually writing a dApp, what does a blockchain to do? What are you doing with a blockchain? You’re buying it on some exchange, whatever that token is, you’re buying it just to buy it because you think the number’s going to go up. That’s all there is to it. Don’t tell me you’re here for the technology, you’re here because it’s a gamble. You’re gambling on a PUPPY PooCoin and your deal. Let’s be honest about that. I have an employee, he’s like, “Dude, come on man. Should I buy some?” And I’m like, “I will not tell you how to live your life, I will tell you that I’m not doing that, and that’s it.”

CJ Wilson (00:42:29):

I run a Signal chat for like a couple of my friends that are trying to learn more about this stuff. And then one guy starts talking about, “Oh, I did this and that, and then I flipped it into Bitcoin,” or whatever. And he’s like, “It’s a great way to make money.” I said, “Hey, listen, you can make your own shit coin if you’re that desperate to make money.” I said, “At some point it comes down to integrity. And at the end of the day, the Bitcoin process is arduous, you have to fight really hard up and down to make things happen, and it’s a lot of pressure on both sides.”

CJ Wilson (00:42:58):

And I think in a lot of ways, what happens, to use to use a comparison. People see DC as this massive, slow, glacial situation, but it’s better that way because you can’t just have one person going and pulling the lever and then God knows what’s going to happen next. We don’t want proof of Italic anymore than we want proof of Janet. We don’t need Janet being the sole source and sole authority of money printer. So it’s good to have those checks and balances in the system in terms of the governance. And Bitcoin has that through the bit process and through all these users that can effectively run a full node for nothing.

CJ Wilson (00:43:38):

And that’s the biggest difference. Dude, you don’t need any money to run a node, you need like a couple hundred dollars worth of equipment and like a modem where you can download the thing. NVK is trying to do like ham radio transactions and stuff like that. He’s like, “We should be buying FM stations and broadcasting over FM.” And I’m like, “This is a whole another technique that now we have to get a radio guy.” We’ll figure this out eventually. But yeah, I agree with you, Preston. I think that a lot of times people talk about technology the same way they talk about music or art, which is they look at something which is clearly over of their heads and they rationalize it.

CJ Wilson (00:44:16):

And then that rationality allows them to like identify and then put a badge, like one of those Latin American dictators that’s got like 87 badges on it, all the way down there. I don’t even know, what’s the point? What is the point of these blockchain companies? Because they’re creating a mythology that doesn’t need to exist.

Preston Pysh (00:44:41):

A marketing pitch.

CJ Wilson (00:44:41):

It’s all marketing, and that’s the conversation. I say it’s very simple. Every other cryptocurrency was started by a CEO and a marketing team, and that’s who you’re hearing stuff from. That’s why that stuff’s out there. And they’re like, “But who’s Satoshi?” And I’m like, “Well.” And then, “Okay, no, but who is he?” And I’m like, “No, really, the guy has been transacted in 10 years or surfaced, so he’s whatever.” Those two questions, which is like, how do you prevent bad actors, and who is Satoshi? You get that from every single person that we talk to. And so you just have to have this candid response for that in prep for it.

Preston Pysh (00:45:14):

The irony of the Shiba Inu coin outpacing and taking a higher market cap over Dogecoin today, for me was just a classic example of everything that you are just describing. This was my big beef, and people saw Mark Cuban and I going at it. But that was my big beef with Mark, is just, “Hey man, you have, you have seven million, eight million people or whatever it is that follow your account, they really look up to you. And they’re looking to you as a billionaire for financial guidance and just relying on you to steer them the right way, and here you are out here pumping this meme coin that literally has no application value to it whatsoever. And now we have a competitor to this meme coin that just passed it in market cap.”

Preston Pysh (00:46:02):

You have so much liquidity in the system because of all of the actions that Bitcoin is attempting to solve here, and you’ve got all this liquidity in the system and it’s just chasing the most random and insane ideas for people to get rich quick.

Jimmy Song (00:46:19):

I would say that it’s more than that. I wrote an article, The Triumph of Post-Modern Investing. It’s this idea that people can make something go up because of their collective will. This is a very post-modern idea that they create their own reality. And investing has definitely gone in that direction. It used to be what Preston preaches all the time, which is, “Okay, you need to look at like all these investments as a money making machine. How much money is it producing per year?” And that’s how it used to be. But it’s gotten so far away from fundamental value and the underlying productive capacity to something like, “Okay, if we can make the number on this go up through a pumping of various things, then that’s it, we’re going to make that happen.”

Jimmy Song (00:47:08):

And we’ve seen this happen with not just in alt coins or whatever, but also like Hertz and AMC and GameStop and all these meme stocks, where it’s a collective will to make something go up. And it happens because there are enough people that are willing to try to create their own reality. But for me, that ultimately ends up with capital going towards stuff that’s completely useless. The reason why investors are supposed to invest in things with good fundamentals is so that you could build up civilization. Those companies that make good products are adding goods and services to civilization.

Jimmy Song (00:47:51):

Something like Dogecoin or SHIBU, absolutely not. It does nothing for civilization. And if capital sinks into those things, you have civilization decline. And that that’s what really gets me.

Preston Pysh (00:48:03):

I see it totally as a trap that they’re literally walking themselves into the cage, they’re shutting the cage door, and then they’re getting ready to lock themselves in the cage. And what I think that locking event will be is when the market finally comes to the realization that, “Hey, maybe the CPI gauge isn’t going to cool off. Maybe these supply chains are absolutely wrecked, and maybe they’re not getting better anytime soon.” And if the 10 year treasury and all these long term debt is at 1% in a negative real basis globally for all $300 trillion of it, or $300 trillion worth of buying power is in this negative yield state, when that dam breaks and where all that buying power goes, it’s going to pop.

Preston Pysh (00:48:53):

All of these little nit-noid, meme coin pet projects that are being run by marketers, by people who literally didn’t have to do anything other than stand the protocol up and then market it, and then are selling their bags and likely buying Bitcoin with the receipts of the sales. Meanwhile, all the people that are following Mark Cuban are getting locked in their cage. That’s my beef, that’s pretty much it.

CJ Wilson (00:49:20):

Well, I guess the question is, Preston, in this case, like Jimmy said, post-modern investing, is post modern investing self-selecting? Meaning, people, like you said, they’re marching themselves into their own cage. I put a thing out a couple weeks ago on Twitter, sometimes I’ll be like holding my son up 1:00 in the morning, I’ll just grind on something and then I’ll do like a tweet storm, like 10D. Nobody sees it because it’s like 1:00 in the morning or something, so I have to DM it to people. But I said, “Listen, Bitcoin is the ark, and Noah built one ark and that’s all.” If you looked at the ark and said, “I don’t want to get on that because I’m worried about smart float or like I need a faster boat or something like that because I’m worried about getting from point A to point B while the entire world is flooding, you’re not going to make it.”

CJ Wilson (00:50:12):

And that’s okay because in a way, the friction and pain of evolution is what makes the strong survive. Jimmy talked to Al about that article, about the liquidity, transfer the fake liquidity on DeFi. To me, I was thinking about it, because I was like, This is great because it’s actually an expose.” And him and Alan Fenton were like, “Debunk us. Go ahead, read this, debunk us. We would totally love for someone in the space to explain how you can cross collateralize an asset seven times, and it’s not fractional reserve lending and where the liquidity is, and everyone’s claiming that they have this liquidity locked up or whatever, but it’s really not anywhere near the amount that they claim because it’s all based off an entry that’s like three or four steps back and all those things after that are all cross collateralized.”

CJ Wilson (00:51:02):

So when I was listening to that and reading Alan’s article a little bit, I was just like, “Oh my gosh, this is so articulate. It’s great how they’re putting this point.” Someone like me always says like, “Hey, DeFi’s a scam. Look at all these rug pulls, these flash loan attacks and all this other stuff, that’s a problem.” You don’t see that happening at Bitcoin, you see occasionally people making mistakes with their Bitcoin, losing their keys, stuff like that. Being your own bank is tough, it is. It’s something that we need to learn how to do, and we will evolve in that way. The people that are capable of a that way and the services, like Jimmy said, that are capable of evolving that way will see the money and the trust build up because they’re providing value.

CJ Wilson (00:51:40):

And I think the hardest thing is, when you’re looking at all these investment choices, if you have $1 to spend, you can only put that $1 in a bucket. And so these people are basically coming up with these carnival games with your dollar to say, “Oh, if you put $1 in, you can turn it into like $6 because you get these other free coins as a result of staking it on this one protocol.” And that is such a big problem because it’s not an honest game, and it’s not something that protect itself. That’s the thing, those protocols are sloppy and loose, and you have chains like Solana, basically getting rewound or paused for 10 hours at a time or something like that.

CJ Wilson (00:52:18):

That’s not a safe place to put your money. That sucks. And that’s the problem with new things that are the VC model of move fast and break stuff. It not how you want to invest your 401(k) or your retirement plan because you can’t come back from that once you lose it.

Preston Pysh (00:52:35):

The root of all of this, CJ, is you’re going from a centralized model that is breaking down and trust is becoming completely eroded, and you’re getting ready to transition to a decentralized model that requires absolute trust in it working. And so which one of those are going to win as the one fully unwinds itself and transmutes itself over to the other? And I think we all three agree. You said the word rug pull, and just this past week, you absolutely murdered a trade that we did not talk about on Binance. So describe what happened here because I shot you a DM when I saw your post in the morning. It was like a meme of people just standing up and clapping because, boy, oh boy, what a trade.

CJ Wilson (00:53:24):

Yeah. Listen, I didn’t have a buy bid at 9,000, so let me just clarify with that. I’ve been on Binance US since it first opened. I remember when Binance US wouldn’t even have like a million dollars of liquidity or trading volume on like Bitcoin dollar trades. This is a couple years ago when I first really started like power trading. And that’s one of the reasons why I got into Bitcoin, was because this is a 24/7 market. So I felt like, “Oh wow, if I can nail some of these trades, I can grow my stack. I can get a lot of money.” This is when I was a little more Fiat based. And then eventually, what happened is something locked in and I stopped trading all the alts.

CJ Wilson (00:53:59):

Because I think a lot of people do this where they get into the Bitcoin game and they’re like, “Oh, this is cool.” And then they’re like, “Ooh, what’s over there.” And then, “Ooh, a buffet.” And they’re like, “Oh, smoked salmon and crotons, all this bacon. This is great.” But you’re at the Brazilian steakhouse for the steak. You can stack up as many tomatoes and spinach as you want, it’s not a steak. And that’s what I try to explain to people about Bitcoin versus these other alts. And a lot of us fill up on these things as we’re learning and then you make a mistake or you get wrecked or whatever. I got to an ethical thing where I was like, “These things don’t even have any liquidity. Who am I trading against? What’s the game here?”

CJ Wilson (00:54:34):

There’s like $67,000 of LINK trading daily on this exchange, I’m like, “This isn’t real.” I could just go boop, and just shoot the whole thing up myself. And I’m like, “I just don’t like that. I don’t want to think that I’m the only guy in there and there’s somebody, effectively like a casino card player at the table against me, like a house player.” That’s something that I’ve always been very suspicious of in general on exchanges, is, who’s the house player at the table? Is there somebody or is the house itself running a bot against us and trying to scoop up things, to dump things?

CJ Wilson (00:55:07):

Because most exchanges have a two-layer protocol, they have the market limit purchases that are happening and then they have the OTC desk. But in order to have an OTC desk, they have to have Bitcoin. So are they sourcing it from the sale? Are they some of those bids, or whatever? Anyways, so I always leave super out of the market limit orders in. So like if Bitcoin’s at, let’s say 40 grand, I’ll have limit orders down to like 27, 28, because you look at the chart, you see it’s bounced around and it could do 30% in a week. That’s not really out of the realm of what we’ve seen in the last three years.

CJ Wilson (00:55:42):

So I had some bids because recently Bitcoin was down at 32, 33, so I had bids down that low. What happened was somebody I think put in a sell order as a sell wall at 82,000 in their head, they thought that they were putting like a 300 Bitcoin or whatever it was sell wall at 82,000 because they thought that the Bitcoin price was going to hit that, and then that would be an insurmountable wall. So they could either accumulate more on the way up and buy it as the fish are trying to nibble through the wall, they’re going to try to like buy the bids and try to run it up. Or they were just saying, “Hey, this is an exit because we bought at 41 and we’re getting out at 82,” because you can see hedge funds making that kind of a play.

CJ Wilson (00:56:22):

So anyways, I’m traveling out to Austin to go to BitDevs and the [Beefsteak 00:56:27] and all this other stuff. And then I’m getting all these notifications for Binance, “Limit order, limit order, limit order filled.” And I’m like, “How are these things filled? I’m nowhere near the price. Bitcoin is 67,000 and my bids are like 40 and 34 and stuff like that.” And then I look and I see this just red candle going straight down in a one minute thing. So what happens is, are filling out on Binance or Gemini or Coinbase Pro, they have a very complex page. But my theory is that this was somebody using an API that they were plugged into multiple exchanges at the same time.

Preston Pysh (00:57:00):

Yeah. And I heard that’s what it was. Yeah.

CJ Wilson (00:57:01):

And they basically said, “Oh, they’re going to set a limit order at 82,000, but they forgot the zero and hit enter really quick or something. It was early in the morning, maybe they hadn’t had their espresso yet, I don’t know. But they got wrecked because they sold Bitcoin like so low. It showed a spike down to 8,200. I don’t know how many people were filled, but if you go through the order book on some of these exchanges, they have people that have like one, two, three, four Bitcoin buy orders down that low because they’re just like, whatever, completely out of it. So like D++, and some of the other people that I saw Beefsteak were like, “You got so much cheap corn.”

CJ Wilson (00:57:38):

And I’m like, “Hey, anybody can take the risk.” I didn’t have that much. I would say that I got less than half a Bitcoin in it, but more than a quarter? So it was a good amount of money, but it was relatively cheap and I was not upset about it at all.

Preston Pysh (00:57:52):

It was a fun little post to see. Real fast. Jimmy, CoinJoins. Talk to us about this.

Jimmy Song (00:57:58):

CoinJoins are a way to anonymize your coin. There’s a lot of different providers that have different things. Samourai has this Whirlpool product, Wasabi has their own CoinJoin. I think now with their 2.0 CoinJoin, you can have different amounts as long as they either add up to or are multiples of certain amounts. So I think they’ll take anything binary or multiples of five or something like that. They make it so that you can’t tell what the output is because you get combinatorial blow up. It could have been any combination of these inputs and it could have been many different combinations. So it gets too difficult to try to trace that and so on.

Jimmy Song (00:58:42):

That’s how their thing works. My only grief about it is that it does take a while and there are multiple rounds that you’re usually having to go through and it is somewhat expensive. What I’m really looking forward to is this ability to do cross input signature aggregation, which would incentivize CoinJoins. And what that is, as part of Taproot, we get something called Schnorr signatures. With Schnorr, what you can do is aggregate signatures and aggregate pub keys. So right now, if you have two of three multisig, what you have to do is show two signatures and three pub keys.

Jimmy Song (00:59:23):

With Schnorr signature, instead of showing two signatures, you can combine the two signatures and prove that you have one signature from it. That’s cool. And you could do that at the input level. So could have 100 of 100, and that could work. And with Taproot, you could have a really deep one and you can have of many different combinations and so on. What cross input does is then it says, “Okay, well, if we can aggregate signatures, why don’t we aggregate them across different inputs?” So if you have five inputs and there are all Schnorr signatures, you cant combine them all and check just one signature instead of checking five separate ones.

Jimmy Song (01:00:06):

And that would incentivize it because the size of the transaction gets smaller because you have one signature for five inputs. And if you have it for six inputs, then you pay a little less on a per-byte basis. So you end up incentivizing CoinJoin because you’re paying ultimately less in fees. So that’s a possible soft fork after Taproot. That’s something that a lot of people have been talking about.

Preston Pysh (01:00:32):

Do you find the miners might push back on that a little bit?

Jimmy Song (01:00:35):

I don’t think they would because block-space wise, they would still get a ton of business. And as it is, a lot of blocks are empty in which case, or not completely empty, but there’s empty space in a lot of these because the men pool clears them and so on.

Preston Pysh (01:00:54):

We need bigger blocks. I’m sorry, I had to. Keep going, I’m sorry.

Jimmy Song (01:01:00):

The idea is we’re going to have a lot more lightning channel opens and closes and there’s stuff that they’re doing with state chains and lots of different potential stuff. There’s this ion project, decentralized identifiers and things like that. There’s always going to be demand for block space. So I don’t think miners need to worry. It’ll be really interesting because depending on how people figure out how to do these like cross input joints, once that’s available, essentially every block will be like one giant transaction and it’ll be one giant CoinJoin. So whatever block you’re in, no one can tell who you paid or what you did or whatever because it’s all joined together and everyone pays one fee that’s divided by everything.

Jimmy Song (01:01:50):

It’ll be very interesting to watch how it all works, but I think that’s the future of CoinJoin where you’ll get privacy by default almost.

CJ Wilson (01:02:02):

Jimmy, do you see that as like a 2023, 2024 thing where people start to integrate it in the sense that, you’re talking about Taproot, where it was originally proposed in 1819? What I’m saying, it takes people years to not only agree to it, but then actually to institute it in as a practice. That’s what’s really interesting for me is to see this ideation and then practical like rollout where there’s use, because that’s where it gets into the timing thing again, because as we get closer to the halving, which is also the same year as the presidential election, it’s like you seeing all this stuff converge on like 2024 being this incredible year for so many reasons.

Jimmy Song (01:02:48):

There’s definitely a lot of that. And there’s still a lot of research that needs to go into something like cross-input signature aggregation because there’s a lot of attack factors that we have to consider, “Okay, well, can people do something nasty to you if we allow that, and would that cause some sort of bug or something?” We want to make sure that the incentives are all aligned, that everything else. So it’s going to take some period of research. I think any prev out is a little bit ahead of that anyway right now. I think Jeremy’s been pushing for Check Template Verify.

Jimmy Song (01:03:26):

There’s like four or five different soft forks that are possible for the next one. Cross-input signature aggregation is probably one of the more exciting ones, but from a practical perspective, it probably requires the most engineering and a lot of design review and figuring out whether or not it’s actually going to be safe.

Preston Pysh (01:03:48):

What kind of timeline do you guys see the next four years? How do you guys see this thing playing out? The fun stuff. This is the fun chat.

CJ Wilson (01:03:58):

As COVID has taught us, we don’t all need to work in an office. Look, the three of us right now, we’re in three different states from what I understand. I’m not going to doxy Preston, but obviously, we’re not the same spot. I know where Jimmy is. Jimmy’s obviously, he’s in Bitcoin land as we can see. So if you think about that, now we have incentive for people to shop their jurisdictions. And the first time I had heard this, I heard Tim Draper talk about it, there we go.

Preston Pysh (01:04:33):

Jimmy just changes background.

CJ Wilson (01:04:33):

I heard Tim Draper talk about this in 2019 at one of the conferences I went to. And he goes, “No, by all means, there’s going to be countries and cities and states that are fighting for the brain power that wants you to live in their jurisdiction, because they want the highest quality of people and they’re going to make it the best place to be a Bitcoin or something like that.” And I’m writing notes and I’m like, “Crazy eyebrows guy has got it figured out. That’s a great idea.” And I think for Bitcoin as the price goes up and it gives the buying power of the users, even on a small level, more leverage, they have the opportunity to pick up and go sometimes.

CJ Wilson (01:05:06):

And if you’re an office worker or a core dev, or a digital nomad of some sort, you’re going to really go where you think is best for you and your family, or you and your loved ones, or you and your small puppy or something like that. And I think that in a couple years, as we see the adoption curve go up, you’re going to see more people innovating, people like me that are brick and mortar people going like, “How can I bring Bitcoin into my business and how can I become more of a Bitcoin business? Can I get in more into mining? Can I figure out payroll? Can we do lightning channels instead of like paying with credit cards, which saves us swipe fees?”

CJ Wilson (01:05:39):

There’s all these different elements that are going to spin up. And in the next, well, I would say three years as the halving gets closer and the pressure to get ASICs and all that type of stuff increases, if the number goes above a certain level, during that period of time, you’re going to see this crazy FOMO thing happen and it’s going to show people’s true colors, a lot of ways, because there’s going to be a lot of jealousy and a lot of haters that didn’t jump in when Bitcoin was at 30,000 or 18,000 or whatever, when we all had opportunities to buy more.

CJ Wilson (01:06:11):

I think that’s going to be really interesting as you’re seeing the leadership, meaning like senators and governors and stuff like that figured out, then as more people figure it out, the DCA army is going to be like little fish just nibbling at whatever Satoshis are dropping in the surface and become available.

Preston Pysh (01:06:30):

I really like that last point because that’s becoming a habit that you see more and more people who have been exposed to the space for a year more and have outsized returns, and they’re saying, “I just need to keep chipping away at this thing. Let me just set up an auto DC. I’m not trying to trade it, I’m busy. I don’t have time to be trying to do those things. So I’m just going to set up an auto buy of whatever amount twice a month, four times a month, whatever it is.” It’s like these little feeder fish that just keep on nibbling away at it. You’re exactly right, CJ.

CJ Wilson (01:07:03):

Yeah. It’s got to come from somewhere. So the Bitcoin has to become available. So people have to decide to sell their Bitcoin exchanges, have to sell their Bitcoin because you have bidders, you have bidders at all these different levels as we’ve seen. And whether it’s Swan, Strike, Cash App, a lot of the exchanges now, you can set up a daily buy of $10, a weekly buy or whatever. And you can afford that. I recently signed up a Strike. I talked to Jack Mallers this weekend actually and I was like, “Dude, pay it in Bitcoin, I’m doing it.”

CJ Wilson (01:07:34):

I got my first Bitcoin thing. And you have Fold, you have Lolli, these things that people are using like traditional programs to obtain Bitcoin in a way that’s a little bit off the beaten path. It’s not as hardcore as like gambling for Bitcoin or something like that. You don’t have to be good as a day trader to get Bitcoin, you just have to have 20 bucks and you can just keep getting it. And a lot of people are going to do better DCA-ing than they were trading, most people. You have to be a very good trader to play the taxes against the gains in the Bitcoin versus the dollars and whatever else, whatever levers there are.

CJ Wilson (01:08:09):

So I think we’re in for a much more conservative approach to Bitcoin than we saw maybe in 2017 when people were just gas pedaled down thinking, “This is it, it’s going to go to 100,000 or whatever it is.” I don’t think we’re going to see that same type of increase because I think people are, on the hedge fund side, they’re they might be DCA-ing out of positions because they’re still so fiat minded. That’s going to be hard for them to hurdle. It’s hard to hurdle, it’s not easy.

Preston Pysh (01:08:34):

They’re managing their risk exposure.

CJ Wilson (01:08:37):

Yeah. Exactly.

Preston Pysh (01:08:39):

It’s such a winner I have to sell some.

CJ Wilson (01:08:42):

And I think that’s a bad mentality. I follow a lot of Wall Street people and stuff like that on Twitter. There’s people like Jim Rickards, he’s a gold guy. I’ve been following for a really long time as a gold guy from 12, 13 years ago. There’s Keith McCullough from Hedgeye and there’s Zero Hedge. There’s all are the people that are tweeting these things out there all the time about Bitcoin or Bitcoin adjacent or the economy. And it’s so funny when you see like a Steve Hanke, you know what I mean? Just constantly being wrong, and then you two guys or anybody else just ripping him apart. It’s like, “How are these people not reading their replies and just getting massively ratioed and not taking any humble pie?”

Preston Pysh (01:09:25):

Even Jack Dorsey was jumping on Hanke. I think that’s when you know it’s getting brutal, is whenever Jack Dorsey’s taking time to reply to Hanke.

CJ Wilson (01:09:35):

Yeah. And that’s something that I’m really lo looking forward to is like the discrediting of a lot of these is like fiat economists, fiat people, the people that control things right now. I think what we’re seeing with Bitcoin is individuals taking a lot of the power back. It starts with Bitcoin, but it doesn’t end there. A lot of people after they start DCA-ing and stuff and starting to learn about sound money and all this other stuff, they start questioning a lot of things, including, “What’s going on with this whole area of my life because I always thought it was this way?” And they start seeing things in a more rational way.

CJ Wilson (01:10:17):

So I see the next four years as like a big red pill moment for society or orange pill moment, I don’t know, where people will come into a much better realization of what reality actually is and how things actually work. And hopefully, we’ll have a part to do that, all of us here, will be educating the people and trying to help them see what’s going on at least with their money. And I think ultimately, that means a more educated electorate and electorate that understands tradeoffs and this idea that you can’t just get stuff for free all the time, which unfortunately Americans are addicted to.

CJ Wilson (01:11:02):

But as we do a little bit more of this education, maybe they’ll understand, maybe they’ll recognize, “Well it’s being stolen away from me, do this, this and this.” That’s what I’m hoping will happen, I’m not saying it will, but we’re going to try, we’re going to try to make that happen and help people understand. And it’s already 20, 30 million people in the US that probably have some Bitcoin. We want to make that number go up, educate all those people and get them to call their member of Congress or senator and get them to-

Preston Pysh (01:11:38):

You want people to own it because it’s a fair system. It’s using a fair unit of account. It’s something that fixes the cost of capital around the globe. Hey, people listening to this, you couldn’t find two better spokes people to represent the community than CJ and Jimmy here. I’m sure you guys have a website or something for people to provide donations to your efforts on the hill. Is that something that you guys are doing or is this just funded internally? Talk to us about your fundraising campaign.

CJ Wilson (01:12:11):

It’s still very new. So we’re putting it all together right now. We’re going to launch the website in the next couple days so we’re working on the Donate Now button, so we’ll have something up there for that. We are a Wyoming corporation because we wanted to give the nod that Wyoming is the leader in the space in a lot of ways. And so we’re setting up a bank account in Wyoming and all that stuff, which I don’t live in Wyoming, so there’s some extra compliance stuff that we had to go through, but you never know, like Chris and Tyler from Cynthia’s office were like, “Man, we’ll get you a cowboy hat. It’ll be a whole thing. It’ll be great.”

CJ Wilson (01:12:45):

And I think one of the things is, it doesn’t really require as much money as it does require, I would say, thoughtful action. I think that’s the biggest thing. And going back to what Jimmy was talking about a little bit, I would come up with a catch race for that, which is to say that sound money can’t be double spent. And that’s one of the reasons Bitcoin is honest, it’s sound. And as a result of that, you have to make choices and you have to live with the consequences of those choices. And you have to confront those choices and you have to evolve as a person in that regard.

CJ Wilson (01:13:17):

So for us, we’re trying to make sure that we make thoughtful actions. As we’re building this out, we make one move, we make the right move. We go that way. We’re not looking to be super splashy and say, “Hey, we’re going to get a BLIP, we’re going to do an Airdrop, send everybody.” We have to be practical. So far we’re internally funding, but we do have a Twitter handle. I’m going to pull it up really quick to make sure so people can follow up.

Preston Pysh (01:13:44):

I’ll have links. You guys give me the links that you want. I’m going to put it in the show notes so that whatever app people are listening to this on, just go to the show notes, open it up, the links are going to be there, and I will update these links as maybe more things become available. As long as you guys share it with me, I’ll go back in and make sure that it’s been updated into this discussion, help these guys out. Your point that you made earlier, CJ, about trying to engage with people that are in a position or ready to receive the message, that truly want to understand what’s going on, by focusing on them, I think you guys are just going to have a profound impact on all of this.

CJ Wilson (01:14:25):

Listen, Warren Davidson at the Texas Blockchain Association event a couple weeks ago, he said, “America was there with the airplane. We invented the airplane. We’ve been there with the industrial revolution, and we’ve been with space and flight, and technology, and the internet, and all these things we’ve been there. So why would we miss out on this? How could Washington DC be willing to miss out on potentially the most innovative financial technology in the history of the world? Why would America blow it? Why would they have any incentive to blow it?”

CJ Wilson (01:14:55):

And I think that the thing is that we’ve seen so far that it’s been majority of, I would say more conservative politicians that have really adapted to it and looked at it from a fiscal sense first and said, “Oh, okay, this is something where because it’s limited, the scarcity and those type of things, they rationally make sense.” But I think on the progressive side, it’s a great argument too, because the thing I like to say is the economic ladder is very hard to climb.

Preston Pysh (01:15:19):

Today, really hard.

CJ Wilson (01:15:19):

There’s a lot of people in the way, but the bottom rung is the slipperiest. It’s so slippery to get off that because banks are charging fees, overdraft fees, you want to check, that’s a fee, all this other stuff. And these people that are making very little money, they might be paying the same amount in fees that they do in rent for a month. So they’re losing a month of rent or two months of car payments or whatever in fees to these banks, whereas through Bitcoin and with some of these innovations, you’re basically able to say, “Hey, now you can hold something with no carrying costs.” And that alone is the deal. Then you say, “Oh, you can transact through the lightning network with minimal fees instead of a 2% or 3% fee, instead of through your ATM or something like that.”

CJ Wilson (01:16:06):

So you’re able to use this money, this cash in such a more efficient way. So maybe at that point, maybe people can stand up a little bit more instead of slipping and falling on their ass because there’s so many difficulties. And so that’s really a great message for the progressive side that tends to focus more on social programs and things like that. And think about if there was endowments, and endowments are holding Bitcoin and things like that, pension funds are holding Bitcoin. They have a long term debt obligation. If they are able to set that long term debt obligation easier with less money invested today, there’s less default risk from a pensions, there’s less default risk on loans, there’s less default risk on insurance.

CJ Wilson (01:16:41):

The default is the number one killer of the economy because that’s when you need a bailout. If you have a non-profitable break-even year, you’re not defaulting at that point, it’s when you lose everything and you go bankrupt that you become a liability to the system at that point, whether that’s a corporate liability, an airline getting bailed out for 30 billion or whatever. And one of the things, like the Trump thing, was he wanted to put a limitation on companies being able to buy back their stock that had been receiving public funds. And I thought that was a good innovation, regardless of whose idea it was within the system, if you’re bailing a company out, and they’re turning around like 18 months later like, “Our stock is up.” And they buy a bunch of it back and shoot the stock price up even higher, then they’re enriching themselves in a way.

CJ Wilson (01:17:23):

It’s capitalism and it’s a market, it’s a way of doing things, but I do understand that there’s going to be some pushback or some, I would say resistance from people as a result to seeing these people borrow to enrich themselves and crush it. Bitcoin doesn’t really allow that type of stuff to happen. You want to get a loan? You can borrow money, but they’re only going to give you 40% of your deposit. And by the way, they’re going to charge you a pretty good amount of rent to not re-hypothecate it. If it’s in really low rent, then they’re re-hypothecating it, and then it’s getting shorted by the CME.

CJ Wilson (01:17:52):

So there’s all these things that happen to Bitcoin that are just much more upfront on the table and honest, and it’s like, “All right, boys, the flop is out, put your cards on the table. Who’s got what?” And I think just like when I was playing baseball, you can take accountability. And if you take accountability, if you’re willing to take accountability, you will learn, you’ll get better. And as a society, if we take accountability for our mistakes, as a government, if we take accountability for our mistakes, we can grow and move on. But if we don’t do that, and we just have this fiat brain of, “Oh, we’re just going to print forever and everything’s going to be fine. And we just keep borrowing and blah, blah, blah,” it’s going to be very bad for a lot of people.

CJ Wilson (01:18:24):

And America will sustain itself as a great place to live versus Venezuela or something else, we still going to experience massive inflation. It might not be quadruple digit hyperinflation like Zimbabwe, but it’s going to be terrible for a lot of people worldwide if we let the system keep going. So Bitcoin needs to stand up and people need to adopt it because it’s going to be the only thing that prevents them from falling on their butt or their face or whatever else, and not being able to hand something down. If you have enough money to hand it to your heir, that’s a W in life. And that’s what Bitcoin really is all about, is that long term investment thought and low time preference.

Preston Pysh (01:19:02):

Guys, this was just an awesome chat. I thoroughly enjoyed this. I’m going to have a link in the show notes for your Twitter feed, CJ and Jimmy among the other things that we talked about. And I just really appreciate you guys taking time and all your contributions to the space. What a pleasure to chat with you guys.

Jimmy Song (01:19:20):

Oh, thanks for having us. And yeah, we look forward to doing this again sometime. Always, always fun to be on your show.

CJ Wilson (01:19:27):

Thanks, Preston. Appreciate it. Jimmy, always good to share the stage with you, buddy.

Preston Pysh (01:19:31):

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. 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.

Outro (01:20:04):

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