Bitcoin to $10 million: the rise of the Bitcoin aristocracy? | Interview with Dan Held

they don't want to buy bitcoin and they never bought it then i'm sorry for being dumb what am i supposed to do shove it down their throats then held growth leader kraken thinks bitcoin could grow to 1 million dollars or more at that point he believes bitcoin's network effect will be large enough to challenge government-backed fiat the governments will attack crypto in what you define as a crypto mass distinction event satoshi built the blockchain to build bitcoin and he built it to be an incredibly resilient tool against governments but in a final showdown between crypto and governments which side would you choose according to held there's only one right answer if you don't buy bitcoin now and it keeps going up in price you'll be punished by that this is our latest interview with dan held growth lead at kraken [Music] so in a recent interview with peter mccormack you claim that bitcoin is now experiencing a super cycle which as you predicted in our latest interview back in the summer will lead bitcoin to be worth one million dollars well what happens when the whole world wakes up to bitcoin's value prop uh being this decentralized store value that's not seasonable could go to a million so what do you mean by bitcoin super cycle and how did you come up with this number yeah so that number was a range by the way but uh you know if we were to look at you know what super cycle represents it means that this time is different the previous market cycles before bitcoin those speculative run-ups that we saw in 11 13 and 2017 those all were declaring a macro bull run and macro being the rest of the world but then we had hit and when covet hit we had money printer go borrow we had people start to lose faith in the existing financial institutions and in our government um so we have this huge moment i mean this is a one in a hundred year moment the last time this happened it was spanish flu back in was it 19 19 18 or something literally 100 years ago so you know this is a moment that was a catalyst moment to kind of bring bitcoin's value prop into focus like why does bitcoin matter why do we need bitcoin and in covent was a good way to to bring that into the global awareness so we have that we also have institutions recognizing bitcoin as goal 2.0 and all of these pipes plugged in pipes as in ways people can buy bitcoin both in the institutional level and on the retail level we never before had these sort of pipes plugged in it was a really hard it was really hard to go buy bitcoin back in 2017 and 2013 versus now where it's so easy to buy and store for any type of purchaser so for many of these reasons bitcoin shouldn't have a normal cycle i would say bitcoin is is easily worth between one and ten million dollars of bitcoin if we look at global stores of value and look at bitcoin as a um if you look at it like the total addressable market of storing value bitcoin is very undervalued at the moment so for me the super cycle represents a breaking of the norm a breaking of the typical cycles to where we might see bitcoin move up all the way to a million in this cycle which would be unprecedented and i don't think any of us are expecting it i'm just saying it could happen because of all of those events that i named off also conversely what it could mean is that we have a semi-normal cycle so we go up to two hundred thousand four hundred thousand dollars bitcoin but then maybe we only have a 20 30 dip maybe the bear market isn't as intense uh because this time around we have institutional buyers who buy and huddle we have retail buyers who buy and hodl people aren't just in it for a speculative run anymore people are buying it because they see bitcoin's value so that's where i think we might see a less intense bear market in a previous interview with us bitcoin skeptic francis coppola said that the economics of bitcoin don't make sense to her she said that the functions of bitcoin as a means of exchange and as a store of value are incompatible the incentive structure around a long-term store of value that you expect to appreciate over that time does not work for a medium of exchange to be fair most people right now uh abandon that means of exchange narrative and see bitcoin mostly as a store of value as you said so uh you on the contrary think that bitcoin can still realize both of these two narratives so can you expand a bit on this theory sure yeah i mean it's pretty common sense like i don't want to go spin bitcoin unless i hold it right like so we have to enter the store value era first where people decide to start store and park value in bitcoin um you know my my thing is that the medium of exchange era where people use bitcoin for everyday payments we're just really too early for that sort of thing you know we don't if people don't hold it already then why would they want to go spend it you know you have to hold it first you have to believe in it first it has to reach a very high market penetration in terms of the population of owning it um and the volatility has to come down over time and bitcoin has to exist and continue to exist in people's minds as a real money now this takes this takes like a decade or two um that's where medium of exchange is just too early of a use case but i believe long term as bitcoin becomes universally held by everyone to store value then eventually they're going to want to go spend it and if the volatility subsides and there's a huge network effect let's say like 50 plus percent of the population owns it then network effects start to kick in where other people want to receive it uh whereas right now you've got a chicken and egg problem where first of all not that many people hold bitcoin or own bitcoin two you've got like great so a merchant wants to accept it but no one wants to spend it which is a you know it's a two-sided problem and everyone's like oh it's great for the merchants and i'm like cool well no one wants to spend it so that doesn't matter whereas in the future you know i think as the volatility subsides people don't look at it as it like a um again bitcoin in its final iteration in the final part of its growth trajectory becomes very boring you know it's it's like a gold so right now people don't want to spend it because they believe there's a lot more upside which is i think a logical conclusion and and why i also huddle as well you claim that the bitcoin narrative right now is so dominant that it overshadows all other crypto narratives and you even said that the defy narrative is also not working why do you think so why can't dfi and bitcoin thrive together yeah so bitcoin's narrative is is so dominant because it's finding product market fit this is a terminology used by product folks to talk about how my product is solving a problem bitcoin solves a very real very in our face problem that all these institutions and retail traders across the world are seeing they're increasingly being persecuted to store value i mean in europe we have negatively yielding debt this is ridiculous i mean this is insane it never has occurred in all of recorded human financial history uh people are having to pay their bank to hold their money in europe so we're seeing the central banks and governments across the world punish savers and push them into riskier and riskier assets which they do not feel comfortable doing to the tune of tens or hundreds of trillions of dollars of wealth doing this because they're forced to bitcoin offers them an escape and escape out of this system bitcoin offers them a way to preserve their wealth and to store value in a way that no one can can seize from them bitcoin's value prop is immensely valuable in this context especially when we're looking at a hundred year event so bitcoin it's it's store value narrative has never been more clear than now why it's valuable and the problem it's solving for the market is huge um most of what we see in the crypto space is a lot of solutions looking for a problem that's not how you build things you build things because you build a solution that immediately solves a problem that's what bitcoin always did and so uh you know with d5 products i think we're all very optimistic and interested to see what happens there but certainly bitcoin's narrative of storing value in this moment of covid is magnitudes higher more important and i think more visible and understandable uh with d5 you know again we all are all interested in seeing what happens there but it's a bit more complicated of a narrative you know how do you how do you explain d5 in 30 seconds to someone on the street so now let's look a little bit more far in the future so in an article called what happens if bitcoin succeed academic john danielson from the london school of economics envision a dystopian future where a small amount of bitcoin huddlers will be the wealthiest people in the world a sort of bitcoin aristocracy this world according to this academic will be a world of huge wealthy inequality and this description reminded me of some of your latest statements when you said that no coiners will be impacted very negatively in the future uh you said that they will end up on the wrong side of history and you even compare the bitcoin to an evil ai that will punish everyone who did not embrace it so is this the future uh is this kind of future that the bitcoin community is looking forward to yeah so that's called rocco's basilisk and it's a thought experiment so it's not necessarily about an evil ar ai or not it's more of a thought experiment that a lot of people like to uh to come up with um the thought experiment is if you don't back the the ai now you'll be punished by the ai later and bitcoin does that in a bitcoin isn't built to do that but i'm just using an analogy a lot of tech folks like to use because it's an interesting dot experiment if you don't buy bitcoin now and it keeps going up in price you'll be punished by that because i mean there's no physical violence here there's nothing like that it's just more of a purchasing power you will have lost out on accumulating more wealth because you have ignored bitcoin is what i meant by that statement even if you don't like bitcoin you still you still should buy it just in case it it pans out because if bitcoin is the new world reserve currency and you didn't buy it you know you you've missed out on the largest appreciation of wealth in human history so that's the context there and i think bitcoin when it comes to inequality bitcoin is the most fair launch of any other asset that has ever existed you know bitcoin unlike private you know unlike equity and tech companies wasn't only exclusively available to accredited investors you also didn't have to be a certain citizen of a certain country to have access to the financial markets of bitcoin you could anyone anywhere could trade a bitcoin for local fiat cash so bitcoin i would say is the most equitable launches in human history and when we look at like how equitable is bitcoin versus the ownership percentage of stocks like bitcoin isn't this like really asymmetric thing where there's only a few whales that hold it all a lot of the analysis only looks at on chain addresses and just doesn't identify those addresses as exchanges or or hedge funds they try to pretend that those are individuals which is i think a really disingenuous way to look at bitcoin ownership percentage uh there's been a recent analysis and i forget who did it and made that analogy of like dolphins whales and a few other kind of more fun analogies for different ownership classes and they did a good job of parsing out and filtering out some of those those on-chain addresses that were exchanges and so i don't think you know i don't think that we really see like this huge income discrepancy i mean the idea that um the most fair launch in history isn't fair is is kind of absurd um anyone could have mined bitcoin anyone could have bought bitcoin uh the worries that there's gonna be this aristocracy i mean awesome yeah these people saw the future and bet on it in the most fair way possible they deserve all of the wealth that they they should have and maybe just maybe these individuals will be smarter than existing bureaucrats or aristocrats who just accumulated their wealth through stealing it from others maybe these individuals who actually earned it will decide to allocate it effectively by building companies and tools and products so i couldn't be more excited to have individuals like bitcoin hodlers own that wealth versus some other individuals who would seize it from others using illegitimate means okay so you don't think that uh this kind of bitcoin aristocracy will kind of uh coincide with a large amount of no coiners which will be living a miserable financial life yeah i mean those no coiners are the ones who profited off of the existing system and chose to ignore bitcoin their entire lives so you know what what am i supposed to do shove it down their throats like there's they have to be able i mean if they don't want to buy bitcoin and they never bought it then i'm sorry for being dumb the article by john danielson that i mentioned earlier seemed to coincide with some of your theories uh some some of your other theories uh because uh this this author said that in this dystopian future uh this uh bitcoin aristocracy will be attacked by the government because this bitcoin aristocracy will just become too powerful and it will be a danger for those governments you also said that um sooner or later the government will attack crypto in what you define as a crypto mass distinction event he also said that bitcoin is the only crypto that would be able to survive such a catastrophe uh why would governments want to attack crypto in such a way and the why would only bitcoin survive such an event yeah bitcoin the original intent of bitcoin is to be very antagonistic towards governments i mean bitcoin undermines their entire power and authority by removing money from their ownership uh this is of course undermines the entire existence of most governments as soon as you remove their ability to print money and regulate the economy then they will slowly lose relevance you would eliminate 90 percent of government jobs because they basically go into this giant bureaucracy over hundreds and hundreds of years so bitcoin i mean that's the whole reason why blockchain was created satoshi built the blockchain to build bitcoin and he built it to be an incredibly resilient tool against governments um i mean that's why he's like he openly mocks governments both in the fir the only message he includes in the bitcoin blockchain his birth date uh referencing how trust is required to make it all work and how they've reached our trust um you know satoshi's a very libertarian freedom-oriented individual so ultimately that's what this technology is useful for is to be resistant against state-level attacks what we see with a lot of these other cryptocurrencies or crypto assets is that they they destroy the entire reason why they sh why they exist to uh you know so they'll degrade some other decentralized uh properties or they'll degrade some of their state level censorship resistance in order to have higher throughput on layer one or something you also have currencies that are like different crypto assets where they have founders that are well known i mean satoshi was sued anonymous for a reason he wanted to make sure that he wasn't the central point of failure where they could come attack him and they could undermine confidence in bitcoin by attacking him as a human that's why we never knew who he was and that's why he left he wanted bitcoin to stand on his own merits and we don't see a lot of these other chains seek to do that they've never operated in a very antagonistic intense environment and satoshi you know satoshi must be a bit older because i think he understood the 1990s you know the cypherpunks um the cypherpunks battling encryption standards in the 1990s with the us government so that's where i think like with these other coins they they allow for higher throughput but eventually all you can do is run these uh nodes in the amazon aws um you know it increasingly trade off decentralization for supposed improvements but when you look at them long term you're like well long term if there's ever a government attack there's so many weak points here that you know you could easily crumble versus bitcoin which constantly is paranoid about being state level censorship resistant all the time all right cool thanks a lot dan for joining our show today yeah no problem that was dan helder growth lead at kraken i'm giovanni your host if you enjoyed the interview don't forget to smash the like button and subscribe to our channel

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