Cmpresion is Kng

Every passage, on the record.

1. 00:00Idea

   There is the idea that learning for every single entity, learning is a form of compression. Learning is the process of acquiring knowledge or skills from data or experiences.

2. 00:36Claim

   Compression, in the computer science sense, is the process of reducing the amount of data needed for either the storage or the transmission of a given piece of information. We want to see how much of the signal we have to pass on if we eliminate all the noise. Even down at the lowest levels it's an energy game.

3. 01:08Claim

   We want to transform the least amount of energy in our learning process to get by in the world, to transform energy into reserves that we can access now or later, with the least amount of work, and the least amount of work means we don't want to pass on anything that's redundant because that by definition is a waste of energy.

4. 01:08Quote

   The goal of learning, and it's easiest again to think about this in the extended order context and in the human being context, the goal of learning is to make better decisions.

5. 01:39Claim

   A decision is always and everywhere an energy allocation. It's either zero or one, either we allocate or we don't, binary. Learning is compression, when we learn from data we try to find the simplest, most compact way to represent it, capturing the signal and ignoring the rest.

6. 02:09Quote

   And information compression, it is the water that we are surrounded by. We're doing this always and everywhere because that is the strategy that we use, that life uses, to outcompete every other strategy.

7. 02:40Analogy

   You know the size of your own head. Right, in your little P brain. And you are trying, that little P brain is trying to comprehend the entire universe. There has to be some sort of compression there, we have to get rid of things, we cannot keep track of everything.

8. 03:11Claim

   If we want to give ourselves the longest runway in an uncertain world, we're going to have to compress the information relevant to keeping alive and transforming energy into the smallest little packets that we can, and the more we can do that, the better off we're going to be.

9. 03:42Analogy

   Have you ever read a text and told yourself, okay, I've got to reply to this, but then you space out, you don't follow up, and the next day you see the message and realize the error in your ways, and now you're in a bit of a conundrum trying to explain that you didn't mean to ghost the person.

10. 04:43Analogy

    It's in our best interest as the extended order and human beings individually to say, why don't we just compress that information? We need a word, one word, and then all you would have to do is say that word or type that word, and then the whole situation is explained from start to finish.

11. 05:14Quote

    You don't have to do anything. You've compressed all of the relevant information. You've passed it on with one word.

12. 05:48Reference

    Now who wins in that example? Well, everybody wins, the sender, the receiver, and arguably the entire extended order wins.

13. 06:30Claim

    That means they have energy to do other things, either they can store it and allow other people to use it if they're using something like Bitcoin, or they can use it themselves. Everybody wins, and if they're exchanging that energy with someone else who has found a way through specialization to be more efficient, value has been added to the system by making it more useful.

14. 07:31Claim

    The hardest thing that we have to do is get to the bottom of everything, get to the truth. It's hard to know what is true, and it's also hard to know how to figure out what is true. This is where traditional academic research has come up against the problem of not having an economic constant, a tool that allows you to compress information further and further.

15. 08:06Reference

    If you do a little bit of research into this, you'll come across something called Solomonoff's theory of inductive inference, and essentially this theory makes finding the truth akin to following a recipe, and following a recipe is good because we're used to using those things in a more scientific way, we just call them algorithms.

16. 08:37Claim

    What using an algorithm is good for is that if you have the time and the energy to perform the necessary steps, you can't fail to solve the problem. Every member of the extended order is collecting information and trying to infer the underlying causes of that information, and this is difficult because of all the variables in a system as complex as the extended order.

17. 09:07Claim

    If we need compression, then it's very important that we learn to filter signal from the noise, and we don't want to compress down to the noise, we want to compress to the signal, the thing that actually offers benefit, offers value, offers utility. The better the compression, the better the outputs become.

18. 09:38Claim

    The recipe for inductive inference takes data, takes observations and outputs a rule by which that data is correct. If we find the hypotheses that explain our data, then we can more accurately predict future events, and that results in more energy transformed into a more orderly state, more information for less energy input.

19. 10:15Reference

    There's a similar idea, Occam's razor, which is a little bit more basic. Occam's razor is among all the hypotheses consistent with an observation, the simplest is the most likely.

20. 10:50Claim

    What we're doing is we're looking for the least amount of variables that has the highest probability of alignment. If we think about the outcome of a situation, the less variables equals a higher probability of alignment needed to output the observed end state.

21. 11:26Analogy

    Think of it like, if you have an eight bit hypothesis, that's much more likely than a 32 bit hypothesis, just based on the math. If you think about these things in coin flips, every flip is a bit, every flip has a 50 percent probability, so each bit contributes one half to the final probability, and as you increase, you see it's significantly less likely that we get a complex answer.

22. 11:57Analogy · condensed

    Say you're in the trenches in World War I or World War II, and you know for a fact there's only one soldier left on the opposing side, 400 yards away. A typical soldier with typical equipment isn't going to be able to shoot you from that far away, so mentally you're thinking the chances of getting shot in the head when you stick your head up isn't very high.

23. 12:35Analogy

    You believe a subset of soldiers are snipers, but you believe it to be small because you've seen lots of soldiers and haven't seen lots of snipers, so you say, maybe at the beginning it's 90 percent that it's a normal soldier and 10 percent that it's a sniper. You lift your head up, and all of a sudden a bullet ricochets off your helmet, now the probability that it's a sniper goes higher, let's say 50-50.

24. 13:12Analogy · condensed

    So now I've switched from 90-10 to, let's say, 60-40, leaning more towards sniper. I'm just going to peek up again to test whether anything else happens, and bang, another bullet off the helmet. Now my reasoning under uncertainty is 99 percent sniper, one percent soldier.

25. 14:13Claim

    As new information comes in, we need to update the hypothesis, we need to update our compression algorithm so that we end up closest to what we want, to map reality as close as we can to the truth, because the closer that we can map reality to the truth, the more we are going to be able to transform energy from inaccessible to accessible.

26. 14:47Reference · condensed

    This is where you start to get Bayes' Theorem. And probability theory is the mathematics of reasoning with uncertainty.

27. 15:20Claim

    Bayes' Theorem, basically, it can tell you how likely a hypothesis is given evidence, given data. In the real world we don't have all the time and energy necessary to calculate every possibility, that's one of the problems with Solomonoff's theory of inductive inference, there are too many variables in the extended order to go through that.

28. 15:51Analogy · condensed

    If we're following a recipe to bake a cake, and that recipe calls for 100 milliliters of water, you don't have to measure down to the single H2O molecule to get you to exactly 100 milliliters, you can get pretty close, because getting that last one percent of extreme precision is actually wasting energy.

29. 16:25Claim

    That's the trade-off, that's the choice you're making, that's the energy allocation decision that you are making. Now, any tool that allows us to compress accurately is going to be very useful.

30. 17:00Quote

    Compression tools are the most valuable tools for life. Nothing will return on energy investment like compression tools.

31. 17:37Claim

    We can think about compression during this process as a process of searching for patterns that match each other and then merging or unifying two or more such patterns to make one. If we're constantly doing that, we no longer have to devote energy to that sorting process, we can just look to the compressed algorithm at the end to get the answers we're looking for.

32. 18:12Idea

    The goal of understanding compression and how it carries over to learning is to highlight the value of a tool that is the ultimate compression vehicle. By using Bitcoin, we can compress more signal with less noise than has ever been possible. If compression is learning, then that means we, the extended order, can learn faster and more accurately with less energy input.

33. 18:46Reference

    And as Gigi has said in the past, the map is the territory in Bitcoin. The compression can't be manipulated.

34. 19:22Claim

    The more reliable compression becomes, the better you are able to adapt to future uncertainty by updating probability models as you go. And in Bitcoin, you know that the output is truth, it can be no other way. The information we receive from interacting only with Bitcoin is already in the most compressed state that we have access to.

35. 20:01Claim

    It seems like it'd be pretty useful if you could own a piece of this tool. Bitcoin is a machine that allowed for these leaps forward in compression, and this tool is going to be in demand, because compression is the single most valuable thing to life itself in its process of trying to create order in a chaotic world.

36. 20:33Prediction

    At this stage in the adoption cycle, at this stage in the understanding of what Bitcoin is doing, you have to opt in to this compression model, and in the future, just a little spoiler alert, this is not always going to be the case. Over time, there won't be a choice.

37. 21:05Claim

    Arguably there isn't a choice now, we just can't see the results yet, as the system isn't highly distributed enough amongst the extended order. But in the future there won't be a choice, you'll simply just be out competed, just like how in human beings compression, learning, outcompeted the other systems.

38. 21:39Quote

    Okay, owning Bitcoin is you're owning a piece of the compression machine, but you're not actually taking advantage of the compression that's coming out on the other end. The way that you take advantage of the compression that is the output of Bitcoin is by using Bitcoin as your unit of account.

39. 22:13Claim

    If you want to achieve significantly outsized benefits, the end result from using all of the information that Bitcoin is compressing, Bitcoin's superior compression, it turns out that owning small b bitcoin that has moved around the network is the best way to ensure your energy reserves are maxed out.

40. 22:44Claim

    You use the compression performed by Bitcoin, the protocol, to reach the conclusion that holding Bitcoin is the best use of your energy. The compression is everything divided by 21 million in combination with the incorruptible flows of real time energy, simply by observing the map rather than interpreting the real world flows.

41. 23:15Claim

    It's not possible to track the real world flows of energy without a tremendous amount of noise, or conversely, a tremendous amount of energy on the input side. We've eliminated the energy on the input side because Bitcoin takes care of that, and by the rules of the protocol we've also eliminated the noise, so you get the best of both.

42. 24:06Quote

    Learning is compression. Compression makes you more effective at energy transformation.

43. 24:06Claim

    If a tool makes compression more efficient, then history has shown it is wise to adopt it as fast as possible, because you're going to achieve significantly better returns on energy investments than you would if you had a compression tool that was less efficient.

44. 24:42Claim

    If using the most advanced compression tool outputs a message that describes storing excess energy reserves in Bitcoin as the most ideal use of energy, then it would probably be wise to heed that advice.

45. 25:12Reference

    And you've all heard the phrase, it's one of Michael's favorite, and it goes something like, give me a lever and a place to stand and I'll move the world.

46. 25:12Quote

    The compression answer and the true power of Bitcoin is give me a measure and I shall learn the world. Or as hopefully you've seen in this episode, give me a measure and I shall compress the world.

47. 25:12Claim

    The better understanding we have of the world around us, the better understanding that we have of the true state of reality, the true state of order versus disorder, the more effective we are going to be at life's overall purpose of transforming energy from inaccessible to accessible, generating information, the physical embodiment of order.

48. 26:00Claim

    Bitcoin is we are offloading that compression to a tool that doesn't physically exist, or at least its physical form looks significantly different to every other tool that the extended order has known up until now. What that means is if it's not recognizable, there's going to be a large gap between understanding what this thing is and jumping on it and using it.

49. 26:30Claim

    If you're going to pull the left-hand side of the bell curve, you're just going to ape into Bitcoin. The right-hand side of the bell curve is, I'm going to use Bitcoin as my unit of account while at the same time aping into Bitcoin, because viewing the extended order and all of its variables through this compression lens saves me tremendously on updating what the physical reality is in its current state.

50. 27:02Quote

    The true nature of the physical reality of the extended order at any one time is now possible by viewing it through this compression. It seems like a pretty big idea. Then again, I am a space cadet, so you never know.