A Bitcoin Discovery

Every passage, on the record.

1. 00:00Claim

   It is basically a refinery of taking other people's information that is easier to vary and running it through a system of gears and interworking connected pieces that on the other end spit out Bitcoin on a regular basis, and over time that means that I get Bitcoin using other people's money.

2. 00:00Claim

   Without giving too much away, it's essentially using MicroStrategy as a refinery, as a vacuum to suck up the excess liquidity from degens that are willing to gamble in fiat dollars, and to turn that into Bitcoin.

3. 00:00Reference

   It's essentially using MicroStrategy as a refinery, as a vacuum to suck up the excess liquidity from degens that are willing to gamble in fiat dollars, and to turn that into Bitcoin.

4. 01:30Claim

   It's almost a 100% strike rate, and a way that you make it impossible for the fiat not to flow down to the bottom of the gravity well, which is a Bitcoin output, taking excess supply from individuals who don't have access to the same information as you.

5. 01:30Analogy

   You can think of MicroStrategy the stock as a tool, right, going back to the David Deutsch interpretation of information as information, information being physical, and knowledge being information that has causal power. We are building a tool and it is as physical a tool as an excavator. The point of an excavator is to dig a hole; if the entire goal of society was digging holes and everyone around you had shovels, along comes an excavator, you're better off, because the excavator can increase the efficiency of the extended order of all of the individuals that are involved in that economy.

6. 01:30Reference

   Going back to the David Deutsch interpretation of information as information being physical, and knowledge being information that has causal power.

7. 02:52Claim

   There's only one excavator that can ever be built, and you know that the excavator is going to increase in utility, it's going to increase in value, because people around you will recognize that this is a more efficient way of transforming information, so the excavator price is going to go up. That's akin to MicroStrategy: you're saying that more people will eventually come along and recognize that this thing is better than the alternative.

8. 02:52Claim

   What we're doing when we're digging the holes with it is we're taking fiat dollars that are easier to vary and we are refining them into Bitcoin, and it's not against the will of the individuals that are supplying the fiat, it's just that there's no escape because we are the bottom of the gravity well. You can put yourself in between those two systems and provide a service, and for that service you are rewarded, you are paid in information that is harder to vary.

9. 02:52Analogy

   There's no escape because we are the bottom of the gravity well. The pressure that is occurring from the suction goes from fiat to Bitcoin.

10. 04:23Prediction

    If this continues at this rate, in twelve months time I will share it, because you probably think I'm talking out my ass, but no, there is a tool that you can use to turn other people's dollars into Bitcoin on a very reliable basis week in and week out.

11. 04:23Claim

    It doesn't matter what price MicroStrategy is, because it doesn't matter what price the excavator is, you're using the excavator to dig the holes. All the investors that invest in MicroStrategy and hope that the price of excavators go up, that's one thing that you can do with it.

12. 05:10Claim

    You can also use the tool for what it is most efficient at, and what it is most efficient at is removing fiat from individuals who lack the information that you or I might have, and it is this ability to leverage the knowledge, the information with causal power, that is opening up this arbitrage opportunity.

13. 05:48Claim

    This is so far past what is normal, past what other individuals would see as having any amount of excess acceptable risk. If you didn't understand Bitcoin this strategy would appear to be the ultimate risk-on strategy, you couldn't be any riskier, but if you do understand the tool, it's like if you didn't understand how to drive the excavator or how to use the bucket.

14. 06:28Analogy

    You could crush someone, you could crush yourself, you could drive it off a cliff, you could do lots of stupid things if you didn't understand all of the things that are in place. But guess what, they are all in place. It's like you've taken all of the components that didn't go together, the steel, the pistons, the fire, the gasoline, you put it all together, and the output, if you get everything right, is reliable power at an incredible efficiency rate.

15. 06:28Claim

    That's what you get when you create an engine, and I think I have discovered an engine for turning fiat into Bitcoin, and to do it reliably time and time again, every single day.

16. 06:28Claim

    Imagine that you were in a position where you had enough Bitcoin, you were happy with your stack, that it was going to go up forever, and that you could, if necessary, live off that Bitcoin forever, you were never going to be able to diminish your stack. What does that provide you? It provides you a tremendous amount of freedom.

17. 07:42Claim

    Could you improve the generations to come? Of course, always, right, you're basically generating more and more wealth, your ability to perform transformations in the physical world, that's what you're improving all the time when you're holding Bitcoin.

18. 08:25Claim

    You are bringing all these little elements together that don't necessarily provide an advantage on their own, but together form a tool that allows you to provide utility and to provide value. The value that is being provided here requires no employees, no overhead, no office, no anything, and it's a refinery of taking other people's fiat and turning it into Bitcoin, and you can do it again and again and again, and it doesn't matter if MicroStrategy goes up, it doesn't matter if it goes down, it doesn't matter if Bitcoin goes down, none of those things matter. All that this tool does is allow you to transform fiat into Bitcoin.

19. 08:25Claim

    How much MicroStrategy you control determines how much fiat you can suck out of the system, and when you suck the fiat out of the system, you are taking it away from individuals who are operating on information that is easier to vary, they don't have as good an explanation of the world around them as you do, so you're taking advantage of that.

20. 09:16Claim

    I will take your fiat, I will turn it into Bitcoin. There's only so many Bitcoin, and as I take your fiat and turn it into Bitcoin, there's less and less Bitcoin for everyone else, so I'm like the garbage man of the informational realm.

21. 09:46Analogy

    I am gathering information that is less ordered and I'm transforming it into more ordered information, always and everywhere, like a big net or a big funnel taking information that is a little bit scarce, which introduces a lot of noise, which means it's very ineffective at transforming future information. We're removing that noise, and what spits out on the other end of the refinery, if what's going in is orderless, is the hardest information that there is: nothing is harder to vary than Bitcoin.

22. 09:46Prediction

    I might be wrong, but I think after twelve months time, if I were to share to you what this financial tool is, I think that it continues.

23. 10:43Prediction

    I think the excavator gets stronger, or the bucket gets larger, the more people are doing this. The vacuum gets more powerful because you're sucking more and more fiat if you have more MicroStrategy. I don't think the opportunity is so small that it can be oversaturated, in fact I think it's the other way around.

24. 11:15Claim

    You already have to have Bitcoin exposure for this to make sense, because if you didn't have Bitcoin exposure the smartest thing to do would be to get maximum Bitcoin exposure first, because you're never going to outpace this. This is just a tool on top to accelerate other individuals not being able to shield themselves from money getting harder.

25. 12:00Claim

    The best thing you can do is just simply get Bitcoin, transform your excess energy into Bitcoin as fast as you can, because every day that I'm doing this it's actually helping your stack, it's helping everyone's stack inside of the system, because the order is increasing, the information is increasing, so I'm doing the work for you.

26. 12:00Analogy

    Much like how running a node can be seen in the Bitcoin circles as just mandatory, you sort of doing your part when it comes to Bitcoin maximalism: it's like, do you run a node? Yes or no, if not, why not, you should be, that's how you become a sovereign individual, as you run your own node, you run your own version of Bitcoin and you check everything for yourself.

27. 12:55Claim

    Once you get to a certain level in Bitcoin, of course you employ this strategy, of course you use this tool to help suck fiat out of the system and turn it into Bitcoin.

28. 13:26Analogy

    It really is a machine, you don't have to do anything to it, you just have to turn it on, there's no active participation. You can almost think of it like a miner: this thing creates Bitcoin from mining fiat.

29. 14:15Prediction

    A year from now I'm gonna come back and I'm gonna tell you exactly how it worked, exactly how much Bitcoin was able to be generated from the strategy that would not have been brought into the system otherwise, how much order would have been created.

30. 14:58Idea

    I mentioned a few podcasts ago that I was working on the information theory of value, and going through the different components of this, the different pieces of information that needed to come together in order to form this complex system.

31. 15:49Quote

    If you are looking, I would say keep looking, because this is an opportunity that it might be around forever, but it also could stop tomorrow.

32. 16:27Quote

    If this is me going dark, it has been fun talking about Bitcoin, and either way, I will definitely be back to give you an update on whether or not it all worked out.

33. 16:27Open question · condensed

    He leaves open whether or not that arbitrage window closes, and says there might be other windows in the future, unresolved until the promised twelve month update.