Sazmining Podcast Episode 40: Brandon Quittem on How Energy Impacts Your Quality Of Life

Synopsis: In this episode of The Sazmining Podcast, Will speaks with Brandon Quittem, Head of User Acquisition at Swan Bitcoin. They discuss the role of crypto in the contemporary world, how will the government structure be in the future, cancel culture, and more.

 

Will Szamosszegi: Brandon, this has been a long time coming. I I'm really, really excited for this conversation. [00:00:30] Why don't you tell everyone a little bit about your background and how you got into, uh, crypto? 

Brandon Quittem: Yeah, absolutely. Hey, well, thanks for having me. Uh, I really appreciate it looking forward to this one. And in our previous chats, we've had a lot in common and a lot of rabbit holes that we just started to go down, but didn't quite fully flesh out. So I'm, I'm excited. This will be a lot of fun stuff here. My background, let's see, I'm a lifetime entrepreneur. So from a very early age, I was always starting little businesses, whether that was selling soda, pop to the construction workers and then hiring all [00:01:00] the neighbor, kids and buying, you know, soda inventory. And walkie-talkies up through, um, college when I sold Cutco knives, which I, I think a lot of Bitcoiners have done as well. That's sort of how I approach the world is problem solving. My brain is always going, my wife would probably say to a fault, um, but I'm always looking for a little problem solving and areas that need attention. 

Brandon Quittem: And so that's kinda why I approach the world. And so throughout my career, the one sort of thread that ties it all together is that entrepreneurial mindset. Um, I started [00:01:30] my professional career at Oracle selling software E P software, same deal territory, figure out, you know, if you hit your quota, good, if you don't, you're gone. And so it kind of put a lot of onus on the reps, which I, I thrive in that sort of environment. Then I took a little detour and built startups more along the lines of the four hour work week. So lifestyle businesses did that for about five years and it went really well. Wife and I, uh, had the ability to travel all over during that period and, and sort of did the digital nomad lifestyle. Then we got sick of that found Bitcoin moved [00:02:00] back to Minnesota where we're both from and fell deep down the Bitcoin rabbit hole in 2017. 

Brandon Quittem: Um, like most people bumped into it a few times prior, but I wasn't ready. It didn't click. I dismissed it, which I think is rational. Honestly, the first time you hear about it, it's really easy to dismiss, especially in like 20 11, 12, 13, however, in 2017, it stuck. And, you know, I, I decided very quickly, maybe two, three weeks into the rabbit hole that, okay, this is where I need to spend my time both because it's the most intellectually stimulating [00:02:30] thing I've ever come across. But also I really do resonate with the purpose here. The mission here of sort of taking power away from centralized structures, central banks and governments primarily, and pushing that back out to the people. I think that this aligns with my personal politics, but I think it's also the most practical way for humans to organize if we want good outcomes. And the reason there is because we're in the information age, right? 

Brandon Quittem: So information's cheap. And so what that leads to is people on the edges of the human [00:03:00] network actually have the most information for their local environment. And so we can, we can push decision decision making out to the edge, and that is what inspires creativity. That's what inspires innovation. And when humans do invent new things, let's say agriculture or Aqua ducks or the long bow or any of these famous inventions that benefits the whole of our species. And so what I see, you know, taking it back to present day, what I see here is government saying, wow, information. Technology's [00:03:30] cool. What if we used this to empower ourselves? Right? And China would be the prime example here of slurping up all the data and trying to sort of replace the functions of a government with big data, with biometrics, with AI, all these different things. 

Brandon Quittem: And from the state's perspective, it's a very powerful tool, but I think it's stifling. I think it's bad for the individual. And I think, you know, full circle, if it's bad for the individual, it's bad for the species because we are individuals, a famous quote was, I'm gonna, I'm not gonna say the quote, but the phrase [00:04:00] was essentially central planners want view humans, more like insects or just little worker bees, you know, drones essentially. But I think that that's a, an incorrect way to look at humans. I think humans are more like wolves and we form a Wolf back because that it is best for everyone when we work together. But not because we're some sort of mindless drone. And so, yeah, that, that's a long way of saying, I, I am very much on the mission of what Bitcoin represents and that's sort of what, what kept me here. 

Brandon Quittem: My [00:04:30] career in Bitcoin land went from just writing and trying to break in the industry to doing various consulting, kind of tying my old world to this new world. And then I ended up@swanswan.com, which is a Bitcoin only exchange, uh, end of 2019. And think my technical title now is VP of communications, but I've, I do user acquisition. I do email marketing. I do content marketing, my setup, little special projects internally, and then build process around them, primarily around mass customization. That's what I've been kind of describing [00:05:00] as lately. So we have a large email list. We have lots of products and we want to make sure that everyone who interacts with our products feel like they're getting the right message at the right time based on their needs. And so there's a lot of automation and logic going into this. It's kind of like software development meets communications in a way, uh, or marketing automation would be the, the industry term. Yeah, I'm very happy at Swan. I joined, I think I was like employee six and now we are just over 60 growing fast, although we're in a bear market now. So we'll see how growth goes. [00:05:30] That's probably enough for an intro. That's a mouthful. 

Will Szamosszegi: <laugh> no, that's incredible. And, and I'm so excited to dive into all those, all the work you've done first off on, uh, Bitcoin and Bitcoin mining and how that intersects with energy. And then also, uh, obviously what's happening in the market. That's actually really been top of mind right now with everything happening. The, almost like this de-leveraging, we've seen the, the craziness with Luna and now with, you know, the pause of withdrawals from some exchanges, uh, or one exchange in particular, in particular [00:06:00] potentially more. And so I've been trying to think through some of these ideas on how this plays out and how it affects sentiment and what role exchanges play within this entire ecosystem. And assuming that, you know, we go to a world where Bitcoin is a global reserve asset, what type of role do you see exchanges playing? And, and how do you kind of think about the, the business model and, and the level of risk that some of these exchanges are taken on? 

Brandon Quittem: Yeah, definitely. Um, I'll start with the big [00:06:30] picture. So I view exchanges honestly, as, as something closer to temporary, and I don't mean that exchanges are gonna totally go away, but I more mean their role in the ecosystem will diminish over time. And the reason why I say that is right now, the dollar is very clearly base money. Or you could say us treasuries, but more or less, the dollar is the standard that humans converged on. And I do believe that over a long enough time period, Bitcoin will be the primary asset that people hold. And so in that [00:07:00] type of world, you're not gonna necessarily need to exchange things to acquire Bitcoin. You're gonna be earning it. It's going to be the primary asset that humans use. And so in that world, yeah, you're not really gonna need an exchange, but in the short term, exchanges are a huge aspect of the ecosystem. 

Brandon Quittem: And if you look historically, exchanges are the best place to invest, right? A lot of people say, well, I don't know which asset to that's gonna win. So I'm gonna invest in picks and shovels. You might invest in quote unquote, crypto infrastructure and to date exchanges [00:07:30] are the best form of that. They make the most money and, you know, you see all these success stories. And so they, they play an oversized role today that also comes with risks because there's so much money to be made that attracts a lot of entrepreneurs and it attracts people to take what I would consider short term decisions. So Celsius, uh, appears to be blowing up in exchange. And you might say why? Well, because Celsius is lending their customers funds into extremely risky, [00:08:00] uh, financial products. Um, you might call them Ponzi schemes. I certainly would. Um, and in that situation, well, okay, we have Tara Luna blow up and that created a Daisy chain that causes all these other funds and exchanges to be under stress. 

Brandon Quittem: And in that situation, you're gonna lose customer funds and the people who leave their Bitcoin and other cryptocurrencies on the exchange are gonna find out very quickly that they are unsecured creditors at the bottom of the credit stack. And so I don't see any money being [00:08:30] left at the end of the day with Celsius that if I had to bet today, that's how I think it'll play out. But most likely it'll go to the lawyers and once the lawyers fight over it, uh, if there's any scraps at the end, it'll be years from now. And, and not a good situation. I see exchanges like Celsius, which is probably on the closer to the furthest end of the risk curve. Um, they're in bad shape right now, but not all exchanges are like Celsius. I don't want to pump my own bags here too much, but for example, Swan, we do not lend our customers money [00:09:00] out. It's not, it's not something that we do in our model. And so the, the amount of risks you take on by leaving your Bitcoin on Swan is significantly less than if you left it on Celsius. That being said, I very much believe that individuals should take self custody of their own Bitcoin because exchange hacks happen. Security incidents happen. I that's never happened at Swan. It's never happened with our custodian. I don't foresee that to happen. However, if you want to be actually secur definitely take your own coins, your own keys. 

Will Szamosszegi: Yeah. I mean, that's one of [00:09:30] the things too, like when you talk about leveling up sovereignty and talk about the sovereign individual, you have this transition that has been occurring. It's kind of crazy how accurate that book is in many ways, but talking about how information is disseminated, right? You had the printing press, which, you know, obviously made it a lot easier to spread ideas and, and have critical thinking. And, and that led, I would say in large parts of the separation of church and state, and it's kind of funny because with Bitcoin, [00:10:00] I feel like we're, you, you're looking at the early stages of that same type of idea, but instead of the separation of church and state, you're seeing the separation of something like money and state, right. And that's something that, you know, we've never had in human history, but I, I keep getting this idea that this is the beginning, and Bitcoin's the beginning of where you you're finally seeing, Hey, you don't need money in state to be one and the same, they can actually be separated. 

Will Szamosszegi: But the only way that you really can separate that is by [00:10:30] creating a better form of property. And then really giving people the ability to easily custody protect their money. And, and Bitcoin is, is really that, that killer application that, I mean, if I were to predict, I think that that's kind of what you're gonna see happen and what you're gonna see people doing as more and more of these types of things happen where people realize, Hey, it's not your keys. It's not your crypto <laugh>. Um, but that does take a whole nother level of responsibility, of course, like, how are you gonna custody the coins? How [00:11:00] are you, how are you gonna learn how to custody it? Like, are you ready to take on that responsibility because there's no forgot my password link that for you to click on, do you lose your keys? So it's a scary proposition, but, um, I mean, it, it's interesting to think like what ends up falling out of this? 

Brandon Quittem: Yeah, definitely. Um, two points, one on the sovereign individual, one on private keys. So yes, private key management is a non-trivial problem still to this day in the whole ecosystem. And I think the main reason is because [00:11:30] managing private keys is essentially trying to secure information and humans don't really have a history of securing information. Information wants to be replicated. Information wants to be free. It's hard to keep a secret. That's just inherent human nature. It's not like storing physical assets. We really do know how to store gold. Well, whether that's in a vault, pay someone to keep an eye on, or you bury it in your backyard, right. We Intuit how or protecting your food source or protecting the tool in a, [00:12:00] in, in a tribal situation. Right. We understand this, but information's not the case. And so we do really have to learn, and it's gonna take a long time for this. 

Brandon Quittem: And that's also probably why you see the majority of people opting for a custodial relationship because it's hard. And I think that that's going to continue probably forever. And I think that that's actually okay if the majority of people keep their coins on an exchange, but it's not okay. If the majority of the quota supply is locked up in a handful of custodians, right. That makes [00:12:30] the whole system vulnerable. Whereas the government could say, Hey, Coinbase, Kraken, Gemini, FTX your coins. Now, uh, have these new stipulations and gunned ahead, you must follow the rules. That's a scary situation. I don't think it kills Bitcoin, but it would be a kind of a seductive way for the state to try to exert power over the network and try to subtly induce changes. And so all we really need is a large percentage of the supply to take self custody. 

Brandon Quittem: And that sort of serves as like a security system [00:13:00] sign outside your house, or a big scary dog's gonna bite you. If you break in type sign, you don't even have to have a dog or a security system. Because what that says is, Hey, if you attack there is gonna be a cost to your actions. And that's kind of what self custody does, cuz if the state does attack and they fail, which is likely, it's gonna look really bad and it's gonna backfire. And so essentially what Bitcoin does is it increases the cost of tyranny. And this ties directly into the sovereign individual, which I read as a [00:13:30] book about mega political trends. What are these subtle technological changes that appear subtle initially like, okay, we can mass produce books. Now, how does that lead to the destruction of the church and state, right? How does that lead to all these other downstream effects? 

Brandon Quittem: And similarly with Bitcoin? Yes. We're in the information age now. So we left the industrial revolution and in the industrial revolution, the game was who has the most power. So who has the biggest army who has, who can own the seas. It's all about magnitude [00:14:00] of force. And, and that's kind of what the world looks like in the industrialized world, right? There's one global reserve currency they dominate and everyone else falls in line. The most recent version of this was led by the United States coming off of world war II. And I think it's fair to say that that trip has sailed it's over now, the old regime is gone, but we haven't really figured out who's in charge. Now we don't really know the new order of how this is gonna play out. But once Russia's us treasuries became confiscated. The game's up that [00:14:30] essentially says what should be as good as gold or as good as dollars or whatever the treasuries, that's now a political tool. 

Brandon Quittem: And so Bretton woods three, however you want to call this. But I think it's more that the information age is more than just separation of money and state, like you mentioned. I think it's a lot bigger than that. I think it's the wholesale elimination of the role of geography, meaning that if you work remotely, if your money is digital, if you can communicate electronically, right, you can live wherever you want. And that really [00:15:00] dramatically changes the relationship between individual and state. Whereas the old model is you live here, we can see your property, you must live next to your job. So it's easy to confiscate all these things. However, that's not the case anymore. Right? You can take your laptop and fly across the world and store your money in Bitcoin, which is unseasonable or unimpeachable property rights for every single person on the planet that really changes the power dynamic. 

Brandon Quittem: And I think it actually puts symmetry [00:15:30] back in the power dynamic in the industrial age, the power was all to the, the person with the most force. And so that sort of makes individuals subservient to the state. And I'm not here to say that there will be no governments in the future, but I would like to see more of a restraint on their power because I see, I see governments or states or central banks or, you know, monopolistic corporations, the same they're embedded bias. If you look at a state is living organism, their prerogative is to grow and expand and gain more power. It's [00:16:00] only natural. Um, that's sort of a conspiracy without a conspirator. That's just the incentives set up there. However, with Bitcoin, if the state overreacts, they, they try to seize property rights or they try to do what the population doesn't agree with. 

Brandon Quittem: What's gonna happen is that people can say, okay, fine. I don't like your rules. I'm moving all my assets into Bitcoin. There's nothing you can do to stop me. And so then the state goes, oh crap. I guess we have to play by the rules. And I think that creates a much better world going back to the early part of the conversation where individuals [00:16:30] do need to be free and that's what creates the best outcomes. And so I, I foresee the large mega state, which would be defined by the industrial revolution. I see that actually dissolving over the next 10, 20, 30, 50 years. And instead of let's say 200 countries, I foresee something more like 2000 countries will fracture and it will be more about intellectual capital. That will be the primary asset. So information or ideas that will be the most important thing. Yes. We're still tethered to commodities and we're [00:17:00] going through a commodities cycle now where we're realizing how important commodities are. 

Brandon Quittem: Um, but I think once we resettle, we build a new system, hopefully on Bitcoin, I think we will fracture or vulcanize however you wanna describe that. And then one last point is tying things together. Matt Ridley is one of my favorite authors and in his newest book about innovation, he did a study. And what he noticed was that the country is with the most freedom. So freedom of press, easy to create a business, a solid court [00:17:30] system, right? Rule of law, sort of these like foundational principles of, of Western demo, Western liberal society. What he found is the more free and open you are, the more innovation you create and the more innovation you create, the more wealth you create, right? And so if you wanna have a good society, you need free and open systems. And Bitcoin is the instantiation of that. That is the, the shield that allows individuals to be free and open and trade without any, anyone overlooking over their shoulder. And I think that ultimately is good for 

Will Szamosszegi: Everyone. Yeah. When, when [00:18:00] you introduce a new technology like Bitcoin, it's fascinating to see all the rippling effects that happen from that, not just from an individual sovereignty level, but how it affects geopolitics, how governments have to respond. It's like changing the dynamic that you see in how governments interact with their citizens, but also other governments in a free market kind of way. And I think that to your point, I can see that type of fracturing happening where all of a sudden you have a technology that [00:18:30] gives power to your citizens that makes it difficult for you to seize their wealth and makes it harder for you to tax their wealth or their property. That's something that you have to account for. And it, it will definitely be interesting to see how that plays out from a governance perspective. So you're thinking that there's gonna be how many different types of governmental organizations popping up and, and what type of timeframe do you see that 

Brandon Quittem: Happening? Let's say there's 200 countries now. I just 10 exit to 2000. So I just see an order of magnitude more [00:19:00] structures that we call governments today. I don't know what format will be. I would, I like this also. And in the same way that I like Federalists in the United States, where, okay, fine. We have a central government, which I think's role should be dramatically reduced, but then we also push decisions to the states. And that's good for many reasons. One the smaller, the form of government, the theoretically, the more that government represents the people that actually live in that space. Right. And so I think that's number one, important number two, [00:19:30] and our founding fathers understood these things well is states create experiments. They create a laboratory where you can try new things and you can observe the results. And, and then, okay, Texas's energy policy is doing better than new York's right now. 

Brandon Quittem: I wonder why. Okay. You can dig in, figure out the nuances here and maybe learn something through that crucible of competition. And I, I see the same thing with more nation states, right? I foresee many nation states going bankrupt. The people who allocated capital properly, maybe, [00:20:00] uh, forming special economic zones, maybe buying a portion of the United States that the government needs to sell off to raise funds. Honestly, I don't think it'll be the United States. It'll probably be countries that are even less wealthy, but it's possible. And the other side of this is that as this whole thing occurs, this whole shakeup that we're going through occurs, we're gonna see upstart nations, uh, you know, climb the ladder quickly. So for example, El Salvador, they're, they're trying to move to a, a Bitcoin standard. They're trying [00:20:30] to attract entrepreneurs, et cetera. No one even heard about El Salvador two years ago. 

Brandon Quittem: No one knew who the president que Le was. And even if their whole Bitcoin implementation is unsuccessful, which I don't necessarily think it will be, but even if it was their profile has 10 X, their attract their tourisms at an all time high, or at least in like the last 10, 20 years. And so point being, there's gonna be nations fighting for this new world, and they're gonna be creating golden passport programs where, okay, bring your Bitcoin [00:21:00] here. And you can have a passport, no, no tax or whatever. And so the incentives are beautiful where if you tyrannize here, some other country's gonna raise their hand and, and lure those people in. So again, it's a democratizing force. It's essentially, if governments are under the same pressures of competition as corporations are then the individual or the customer wins. And I think that's the best way to look at the sovereign individual thesis is governments would be looked at as corporations fighting for our business [00:21:30] rather than governments that lock us in. And we're we're cattle in the herd. Essentially. 

Will Szamosszegi: It's interesting to see how you plug into the network in a sense, or you start adopting this technology and it almost 10 X is your growth or 10 X is your opportunity. And you mentioned it with like putting El Salvador on the map. You could probably say the same thing for micro strategy and Michael sailor, even though right now, the, the price is down and you're seeing a lot of pain in the entire industry. I mean, the strategy that he's put [00:22:00] forth has allowed him to make micro strategy, a household name in many. And, and it's actually interesting. I'd be curious to get your thoughts on the current environment that we're seeing right now in the entire ecosystem and how you think that this shakes out, particularly with crypto and Bitcoin. Obviously those are two very different things, but how our particular, our particular ecosystem in market is going to be affected with everything happening in the macro economy, with [00:22:30] the fed raising rates, like the rampant inflation, and trying to get that under control. There are just so many moving balls and variables in this question, but how do you see something like this playing out? And yeah, I guess I'll just leave it there and kind of just, just leave it open for you, however you want to take it. <laugh> 

Brandon Quittem: Yeah, definitely. So I'll, I'll start off by saying I'm not a macro economist. Anything I say here is me trying to wrestle with a complex system. And what I would also say is that all of our financial priests [00:23:00] let's say, uh, our central bankers or Janet yell or any talking ads on TV, whatever they're talking about is also coming from a place of, uh, ignorance. And the reason is we've never been here before. Yeah. This time is different. It's kind of like famous last words, but I think it is true. It it's objectively true from a macro financial standpoint, debt to GDP is off the charts. We're heading into a recession and the feds trying to raise rates. This has never happened before <laugh> and it's bad. It's really, really, really [00:23:30] bad. And speaking of Bitcoin, Bitcoin's never been in an environment with tightening credit conditions. 

Brandon Quittem: So we actually don't know the answer to what Bitcoin does during this period in the short term. Would I say we bottomed out? I don't know, maybe I didn't think we'd be at 20 K today, but I also didn't think we'd see a billion dollars of forced liquidations over the last month. So, you know, that's one thing, the other thing is Bitcoin's prices is hovering around the 200 week moving average, which is historically been the, the bottom indicator. [00:24:00] I think we've like wicked below it a couple times, but that's more or less the, the floor. And I've heard it described as the LER floor and the 200 week moving average, essentially the, the Bitcoiners who DCA every day or every week, that's kind of the floor that they hold up, just a constant ground swell of by pressure. Whereas the, let's say the current price, when it's usually above the 200 day, that's more like the traders price and the height price. 

Brandon Quittem: The, they get to have fun pushing the price around, but the 200 [00:24:30] week is like fair price or like fair baseline. And so I would say 21,000 or whatever, which is 200 week moving average, right about where we are today. I think that's a really, really safe place to start buying or keep your DCA going. I wouldn't bet the farm at this price. It could be a while. And historically bear markets have been slow, but we are seeing signs of capitulation. The minors are selling a lot of for selling. And so to be honest, I'm surprised Bitcoin held the 200 week moving average with all this short term pain. But I think that [00:25:00] you, I think that's a good sign. Now, if we go big picture, zoom out, you know, what, what are we gonna do on this from a large standpoint? I think we're gonna get a lot worse. 

Brandon Quittem: I think the pain is just beginning. I think we're gonna see many developing countries, currencies fail as the dollar strengthens as risk continues to go off. I think we're gonna end in a multi polar world. I think the us treasury standard or, or Petro dollar standard as it's been called since 71 is over, I think China is going to try [00:25:30] to seize the opportunity. And I think that they've been laying the groundwork a lot better than we have the last two decades. They have their own demographic problems and otherwise, but I've never seen the us look this bad in, in my lifetime. And we're still way ahead of Europe, Canada, LA, I am et cetera. And so, yes, I foresee tremendous pain. I foresee Bitcoin getting ping ponged around in the short term, but I also see Bitcoin recovering first. And I see Bitcoin coming out of this chaos as the Victor. 

Brandon Quittem: And the [00:26:00] reason is these fi currencies are destroying themselves. I don't see inflation stopping anytime soon. I think it's going to get worse. And in that type of environment, Bitcoin is very unique because it is an asset that cannot be inflated. Its supply cannot be changed. And so as, as Fiat currencies go to infinity units, Bitcoin stays the same. And I think the, the challenge here Bitcoiners might say, or, or critics might say, well, I thought Bitcoin was a hedge. Why isn't it working like a hedge? And I think that's a fair argument [00:26:30] against Bitcoin to be honest. And my response would actually be all about information asymmetry. It's really, really, really easy to dismiss Bitcoin. And it's really hard to get it. It is a deep thing. It's not immediately obvious why it's good or, or right. And so I think what needs to happen is pain to cause more people to start asking questions, I would say from like, let's say 2010 to 2020 that decade, the most pointless decade in my lifetime, maybe the most pointless decade in the last 500 years, it was [00:27:00] cheap credit. 

Brandon Quittem: All our smartest people built ad products, nothing happened of of note. And we made a bunch of decisions in the short term that felt really nice that laid the groundwork for a lot of pain later, essentially just papered over oh eight, um, pumped up the everything bubble. Um, didn't invest in energy. Didn't invest in commodities, the us didn't diversify or supply chains, right. We did everything wrong, which is a champagne party. And now we're sort of paying the cost or paying the price for that. And [00:27:30] yeah, so I, I think it's gonna get worse. Bitcoin will pull through both because of economic reality, it's the right thing to do. So as more people start asking questions, they're gonna find it more. And because of the, the fact that the Fiat currencies are destroying themselves, and that's what they're engineered to do, that's the historic end of the debt cycle. And if we want to, we can talk about the fourth turning, which is sort of a, a social cycle or a generational cycle that sort of maps to these larger trends. Yeah. That's kinda how I see 

Will Szamosszegi: It. That's great. And I do think that [00:28:00] that's a, a great lead in, I, I do wanna touch on, on all this and, and the mining as well. So one thing that stood out as you were running through that though, is, is kind of this concept of something like a black Swan event, right? This is something that in both of our lifetimes, we've never seen, and it's really hard to kind of take yourself out of the present and look at things from a longer time horizon. And I think that Ray Dalio's book, the changing world order is something that I've kind of been using to try and look at this and navigate [00:28:30] it and see, okay, well you have the rise and fall of empires. And as you said, you know, kind of enjoying the champagne party <laugh>, um, at being the reserve currency, but that also comes with a lot of challenges and eventually leads to a fall of the empire. And that's kind of what you're seeing right now with the us and the in interesting wrinkle that you're seeing this time is that you have Bitcoin in the mix. And so now you have this technology with the decline of an empire and you have a rising superpower in China. And how does that all play [00:29:00] out? But how, how about I just pause there and kind of let you, uh, talk a little bit about, um, the fourth turning and explain the whole framework that you're using to look through all these ideas. 

Brandon Quittem: Yeah, definitely. So the fourth turning is a book written in the late nineties, actually the same year or one year apart from the sovereign individual. So I don't know what's happened in the late nineties, but those guys were on it <laugh> and it's a book about 80 to 90 year cycles. And the cycles in their thesis is around demographics and, [00:29:30] and generations. And the shortest way I can describe it is like every 80 or 90 years, the exterior world think institutions, politics, economics, schools, global order, et cetera. Um, we sort of outgrow those institutions. They start to decay and we look around and we go, whoa, all the institutions don't work, populism rises, economic inequality rises. Essentially. We start to feel the pain of our decay institutions and what do we do? Uh, we, we volt, we sort of, uh, [00:30:00] immune response to all the problems and it finally comes to a head and humans decide to take decisive action and try to fix the problem. 

Brandon Quittem: Unfortunately, the last three fourth turning. So the end of these cycles ended in war. So the previous fourth turning period. So, okay. Let me explain one other thing. There's about 80 or 90 years in between the full cycle in that 80 or 90 year period, there's four distinct turnings or, or periods that it's made up each with different characteristics. The fourth turning [00:30:30] is the, the name of the book. And it's the most interesting, that's what I just described. That's the end of the cycle when we rebuild. And yes, the previous one was 1929 to 1945, so, okay, great depression. Um, the thirties, which was rising collectivism, FDR new deal, massive deficit spending. We invented the federal or F D I C the world bank, the IMF, NATO, all these like crazy new world order, uh, type things that [00:31:00] were really radical at the time. Now we sort of look at them as part of daily life, but that's how these changes occur. 

Brandon Quittem: And then it led it right into world war II, world war II, obviously, uh, a very big deal after that, the us looks pretty good. We sort of re redo the game board, and now there's a new game with new institutions and we sort of reset. And after that really big, uh, blow up period, there's a period of peace and prosperity. We sort of retreat, we rebuild, everyone's sick of fighting, right? That's sort of the PACS Americana, [00:31:30] 1950s, uh, leave it to beaver type time period. Yeah. Then, then we can kind of go through those things. Um, it's a very large cycle, but that's, that's roughly the, the interesting part and okay, well, why are they predicting this? What do they attribute this to? That's all about demographics. And I think this is an interesting point, which is that humans follow very predictable patterns as we grow up in, and these patterns are, are very obvious at a civilizational level. 

Brandon Quittem: So the simple example would be okay, let's take the fifties. It's sterile, [00:32:00] boring. The music is lame. It's like white picket fence, leave it to beaver. Right. And growing up in that environment, the baby boomers, right? They were born during that period. They grow up and they're like, why is everything so lame? The parents are boring. The music sucks. And they essentially rebel against their parents. And that causes the transition to the second turning, which is the midway point. And they're essentially saying we want sex drugs in rock and roll. We want a consciousness [00:32:30] revolution. We want a civil rights movement. We want a religious movement. And if you look throughout history, halfway through the cycle, going back, you have the Puritan revolution. You have have the process reformation, all of these occur on that, the midway point or the second journey. And so it's essentially like, okay, then the boomers push back. 

Brandon Quittem: We gain all these civil rights. Society changes dramatically, but it's sort of an interior world change where the end of the cycle, the four journeys in exterior worlds by institutions and then the boomers grow up and then they become the yuppies [00:33:00] and okay, then they start then essentially society decays in the third turn in, we have this big cultural revolution. And then over time, our institutions start to decay cuz we're pushing back on. Um, right. It's all about individualism in the second turn in. And then you have the third turning, which would be like the 1920s. It's a period of excess or the 1990s and early two thousands where it's about deregulation and excess and you know, essentially another champagne party where they, the, the economy's going pretty [00:33:30] good and the institutions are starting to crumble, but nobody really cares. Okay. And that brings us right into the fourth turning, which is a period where we look around and we say, oh wow. 

Brandon Quittem: You know, this was, the transition was oh eight, okay. The crisis occurs. We need to fix things. And all of a sudden the politicians start emphasizing the problems in the third, turning in the nineties, politicians would pretend the problems don't really matter. Just everything's good. The economies come in, right? Bill Clinton thumbs up. But in the fourth, turning all the politicians are emphasized [00:34:00] in the problem populism's rising. And they, they essentially gain power by emphasizing the problem and saying, Hey, I'm the one to fix it. But that's where we realize, okay, society's not going great. And our institutions are failing it's time to fix them. And that brings us to modern times. We're right in the middle of the, the most recent fourth turning, I think it started around oh eight. They're roughly 20, 25 years each. So I predict somewhere around 2030 will emerge on the other side of this fourth, turning there'll be a new sort of financial order, a new institutional class or [00:34:30] a new new class of institutions will be born based on what we learned during this previous cycle. 

Brandon Quittem: And hopefully it comes out okay. I will say it looks pretty grim right now from a society standpoint. But the one thing to take away here to hammer home the thesis is that, uh, it's a symbiotic relationship between history and these defined generations and each generation. He gives an archetype like the hero, the mystic, the whatever, all these different things. And the constellation like which [00:35:00] age is the artist, which age is the hero? Are they late in life or are they young that consolation defines the mood? And that mood is how humans respond to catalysts. And that that's kind of the key thing. So history, AKA context creates a generation. So we're both millennials, we're born around the same time. So the world we grew up in imprinted on us. So that's history creating a generation we're defined by the context upon which we grow up. 

Brandon Quittem: Then as, as a relatively well [00:35:30] defined generation, the millennials grow up and then they start pushing back on that's the generation creating history, right? And then we push back on history, history pushes back on generation. So it's that, that dynamic, which is what creates this, this, uh, wave pattern throughout society. Um, you can see it as like a, a pendulum is order in high demand or is order and low demand. Are we nurturing our children like in the nineties or are we neglecting our children like in the seventies and eighties, right. [00:36:00] Is capital strong or is labor strong, right? You can kind of map all these wave points and, and they map very tightly to the thesis. And so we can use the thesis to predict economic inequality, failing institutions and the historical low trust in those institutions, cultural decay rise of populism, cancel culture. All these things are extremely predictable through this lens. And so, yeah, I think that's probably enough. It's a big one to chew on, but hopefully that's enough to like lay some groundwork. 

Will Szamosszegi: Oh no, that that's perfect. As you were [00:36:30] going through it, it, it remind trying to remember the saying it it's like weak men create hard times, hard times create great men, great men create great times and then great times create weak men, the cycle repeats. And it's interesting to think about that right now. It's, we're really kind of in that, uh, that weak men creating hard times era, at least in, in this country and think that you're seeing the ramifications in many ways, with [00:37:00] the high levels of inequality, the cancel culture, the dialogue, really not being around solving the tough problems that you have as humans, but instead going and attacking other people. I mean, at the end of the day, just taking a step back, removing a lot of the, like what frameworks that we look at, things that it might be economics or groups and things like that. 

Will Szamosszegi: But at the end of the day, we're all humans. And if you look at it, there, there are problems to be solved. You know, even though there is huge inequality today, your life is much, much better [00:37:30] than someone who could have been the richest person in the entire world 300 years ago, just from access to medicine, like ability to actually survive and live for over 40 50 years. And so it's kind of crazy when you see so much abundance today, when you compare it to like your grandparents or your great grandparents, but still seeing the amount of almost just divisiveness and hate among the population. It's kind of hard to see in hard to witness. And it almost makes you [00:38:00] crave the types of conversations where people aren't just trying to one up or dunk on one another, but actually trying to solve problems and figure things out. 

Will Szamosszegi: And it's kind of funny because when you think about it, Bitcoin in many ways is a catalyst to those types of conversations. It really gets people to think deeply about things and, and ties all these different aspects together, not only economics and, and money and things like that, but also just talking about real world energy, how you organize and how you approach problems. And I think [00:38:30] that all of that is kind of some of the, what we've been touching on here and what you've done a great job outlining. And it makes me want to dive into the mining in particular here. Right? So you've really led and pioneered a lot of great work among this discussion of how mining relates to energy and how that could play out over time and your, your work on calling it, uh, the pioneer species. How about you talk about what led you down some of these pathways [00:39:00] and how you're thinking about it today. 

Brandon Quittem: Yeah, absolutely. And if you don't mind, I'd love to touch on cancel culture before we transition. 

Will Szamosszegi: Oh, a hundred percent. Let's say I think 

Brandon Quittem: It, yeah. Okay, awesome. So to, to tie off the fourth, turning people will say, especially if you just get a taste that it feels like a horoscope or something like you're just predicting doom or you're predicting the end. And it's really not about predicting things. It's more about big mega trends and predicting how we'll respond. What is the mood at the time and how will humans respond to that mood? Right now, we're in [00:39:30] a period where the world's crashing. So we all wanna band together and solve the big problem. It's climate, it's economic inequality, it's whatever. And so that creates an environment where we band together. The instinct of a species is to collectivize and work together to overcome the big challenge. And how does that really cancer culture? Well, cancer culture is essentially an immune response to the fact that we all need to ban together to solve the one big thing. 

Brandon Quittem: So it's, it's under the, the assumption that if you're not with us, you're against us. [00:40:00] If you don't say that the party lines about climate change, then you are an evil person who's trying to destroy humanity, right? That's the level of that's how personal and how real it becomes for people. And if you look at that as a society scale, it's just getting rid of the people that aren't on the mission. And I would say it's a very toxic way of doing that. I think it's actually, it's more or less our lizard brain instincts taking over. And so I don't think it's healthy. I think it's totally wrong. I think it's totally unproductive. [00:40:30] And that, that's just the, the mood we're in though. Right. So, and I think the fourth turning sort of describes that. And then you also mentioned authenticity. I think that's also easily defined here. 

Brandon Quittem: Recent studies show that trust of institutions is at a, I think it's like as low as it's been since the early forties or something like that, or maybe the thirties. So pretty much since the last four turning it's the lowest trust in institutions it's horribly low. And what does that lead to? Nobody trusts the talking heads on the media, the politicians, or [00:41:00] anyone of any even corporate CEOs, right? It's all fed speak and corporate speak and people crave the authenticity. And so they're looking for more trusted allies to get their information from, to form connections with. And I think that's one of the main reasons why long form podcasts like Joe Rogan is so popular. He doesn't have a hidden agenda. He wears his curiosity on his sleeve and it genuinely feels like a, a genuine thing. And so we really do latch onto it. 

Brandon Quittem: And so people will say, I trust Joe Rogan [00:41:30] just to bro, more than I trust a, a PhD economist, because I don't trust a PhD economist to tell the truth. And I think that sort of defines where we are. And I think one other meta point here is that we evolved in a tribal situation. Our DNA was forged in a period where we lived in small hunter gatherer tribes of around a hundred people. And so our hopes, desires, dreams, fears, emotions, everything is based in that period of time. Cuz we spent the majority of our genetic life in that situation. [00:42:00] And now we're in this modern culture where we're defined by, uh, instant communication, uh, global nature, 8 billion people, global economies, cross culture, languages, media, all these things that are foreign to our biology. And so culture went on an exponential curve where biology's on like a really slow linear curve. 

Brandon Quittem: And that detachment between culture and our biology, I think is the primary cause of all of our modern disease of affluence or disease of modernity, right? We're like [00:42:30] over civilized in a way, why is everyone obese? Why is everyone having to take pharma to not be depressed? Why is everyone on heart medication and blood pressure, medication, diabetes, et cetera. These are consequences of modernity that we haven't quite figured out how to adapt with yet. And so bringing it back to cancer, culture and trust, I think what's actually happening online is that we have this innate desire for community, our tribe and in a tribe situation, [00:43:00] we're much less individualistic. We are the tribe. That's our fundamental unit where now we don't really have a tribe. We're isolated, we're living on the 37th building in Manhattan in 600 square feet and we're connected, but we don't actually satisfy the biological need of community. 

Brandon Quittem: So we seek it elsewhere. We go online and we find an online community that makes this feel community. We go to music festivals and play tribe for three days or we go to yoga class or CrossFit and we find community there, right? [00:43:30] Those would be, be healthy outlets to satisfy this deep need, but cancel culture and online little online bubbles where we have our own reality, have our own facts and we fight the other. I think that's more of a, a negative expression of this deep biological need. So in my opinion, in order to overcome this, we need to appreciate that biology is extremely powerful and we can't just let culture and technology and our brain engineer a future without satisfying those base needs. And to be honest, a lot of my, how I approach the world, [00:44:00] how I approach technology Bitcoin, make decisions. It comes from a deep per respect for biology. 

Brandon Quittem: Our body is very smart, but as a species we live in our head. So do I, by the way. So I'm acutely aware of how much I'm in my head and that's why I have to make sure I spend time outside and gardening and camping. And I re in the gym, et cetera, that brings me back into my body. And that balance I think is what's needed, which we don't have today. That's a super long winded answer for your transition. But if you have any words there, we can, we can start there before we get [00:44:30] into mind. Yeah, 

Will Szamosszegi: No, that, that was incredible. And, and it's interesting to see how it plays out too, right? Because when like naturally, you know, at the end of the day, you might not think about humans this way, but you're just an animal and it's not like you're this perfectly logical decision making machine it's, you're, you're driven in large part by, I would argue almost entirely by, by emotions, at least your, at least your non systematic mode of processing. And so it's interesting to see how [00:45:00] that crosses over online, right? Where you have this tribal animalistic way of operating, but then simultaneously you're going and battling for your ideas and trying to use logic and facts to support whatever decision you've kind of come to in your own mind. I guess we're all susceptible to it. I'm probably susceptible to it in many ways, but maybe I've shown to hear on this podcast. 

Will Szamosszegi: I don't know, but that whole conversation of taking the moral high ground is something, an idea that I've been wrestling with and seeing [00:45:30] like these online communities and these different groups where I'm personally very passionate about art, humanities, relationship with energy, right? That's one of the things that I think, and I think we're on the same boat here is you see human suffering getting reduced as the society gets better at harnessing energy. If you can harness energy, well, then you can provide much more for the human species. And right now, this huge debate going on, which I think is a valid debate and there are a lot of variables involved. So [00:46:00] it's, it's a discussion that should be had, but this whole discussion around, okay, what type of energy sources are you using as a species? Are you doing using non-renewable or renewable energy sources? 

Will Szamosszegi: And then who's really taking the moral high ground and saying, oh, we should use fossil fuels or we shouldn't use fossil fuels or you're killing the planet. And at the end of the day, if you all of a sudden snap your fingers and there's no more non-renewable energy sources around the world, every single person around the world would experience a very different standard of [00:46:30] living. If you were purely relying on renewable energy sources. So clearly I think the irrational person would say, okay, well, there's gonna be a transition that happens eventually, just by definition, you want to go towards renewable energy sources because you're gonna have more and more of it over time. And eventually by definition, if you're using a non-renewable energy source, it will run out over a long enough time horizon. But just the way that the discussion's being had right now is, is kind of crazy. 

Will Szamosszegi: And, and the way that it's being used to attack Bitcoin, [00:47:00] I think is, I don't know if it's disingenuous or if it's just, you know, misinformed opinions. But I think that what we're about to dive into here, I'm really excited to, to dive into with you, because I think that you've got a really, really unique perspective on how all of this relates, like how Bitcoin and mining relates to energy and how humans relate to energy and how that relationship has changed from the past to today and how it's going to change today to the future. The civilization gets better and standard [00:47:30] of living gets better when you can harness more energy. And right now you're kind of seeing the effects of not having or troubles that might arise by not having a good enough grasp on harnessing energy. <laugh> I mean, yes, crazy gas prices and, and everything else. Well, you want us as a species to be better at harnessing energy because then it makes your lives a lot more affordable and easier and allows you to focus on other things and build other things and improve and upgrade the 

Brandon Quittem: World. Yeah, there's so much here. And I think it's very timely as well, [00:48:00] right? Again, going back to the I'll call it the lost decade that 2010 to 2020 pre COVID, when nothing happened, we didn't really have energy problems. Commodities were low oil producers. Weren't making money, at least in the developed world. Things were pretty easy, but now we're in a period where, okay, global supply chains are disrupted. We have massive money printing and response to COVID. We have all these major forces that are putting commodities from the forefront and it matters a lot to get [00:48:30] this one, right? It's not just about energy policy for our own little pet political ideas, or because we're pro Bitcoin. We have these opinions. No, if we don't get our energy policy, right. People die. It is that that's the stakes we're playing. And we might say, oh, gas is too much. 

Brandon Quittem: So, you know, get electric car, right. That's kind of the talking point out of the, the cost of elites, which I think are the, the main source of poor policy and poor conversation around humans, relationship to energy. It's a very elitist, snobby place. [00:49:00] Um, and it's totally not detached from physics. When, when you're talking about the New York times, uh, latte, drinking, MacBook, champagne, socialist versus physics, okay. Physics always wins. And that's what we're experiencing right now. So let me try to break some of this down energy, as you mentioned, highly correlated to GDP. So as over time, the more energy we harness, the, the better our quality of life, you could say that's even the point of life is to harness more energy [00:49:30] so that we can make our life better. And in exchange, we essentially change our environment to make it more suitable for our unique species. 

Brandon Quittem: That's pretty much what we do. And that's that happened from thousands of years ago, millions of years ago, all species do this. We're just the latest in the most sophisticated at harnessing energy. I wanna use some flagrant examples here to really illustrate this. Cuz some people will still roll their eyes, energy and getting it right. So that means broadly distributed at low [00:50:00] cost and highly available, meaning 24 7 base load. Meaning if you have a premature child, you have a hospital that can turn on an incubator to keep your premature child alive. Okay. We take this for granted in the Western world. Most countries in Africa do not have steady power, so they could not put an incubator in the hospital. So if you have a premature baby, good luck, your baby probably won't survive. And I use this example and I know it's flagrant just to really make it human [00:50:30] because it's easy in the west to dismiss Bitcoin as an asset because we have a pretty good monetary system. 

Brandon Quittem: But most people on the world live under authoritarian regimes with really crappy currencies. So it's real on the monetary side, which, you know, check your financial privilege as Gladstein's book would say, but also it's even more real, I would say on the energy side. And for another example in Africa, if you don't have consistent base load power, you're not able to build anything. So there's no manufacturing in your [00:51:00] location, which means you're number one, you don't have those jobs. You don't have that economic output, but it also means that you're reliant on imports and imports are expensive, right? And if you look at these developing countries or energy costs are like three to five X or more. What we see in the developed world and energy is sort of a master of commodity. It it's upstream of everything else in the world. It's upstream of food. 

Brandon Quittem: It's upstream of housing, transportation, medicine, literally everything defense. And so [00:51:30] the countries that don't have good energy, they, there's no way for them to accelerate or climb the economic ranks in our planet. And one more hypocrisy to point out is that, um, the greens in the us will say, no, India, you cannot use fossil fuels. Um, you gotta use solar panels and wind or whatever. And to India's point, they're gonna say, well, wait a minute, now you guys spent a hundred years riding the backs of cheap, dense energy, AKA fossil fuels, which by the way, [00:52:00] yes, they have an economic or an environmental cost to them. Uh, of course they do, but they're also the best form of energy we've ever found. They're extremely dense. They're extremely cheap. They're extremely transportable, widely available, et cetera. They're actually a miracle for our species. And it's hard for people in modern times to accept this fact because the, the coastal elites or the educated folks, that's, that's like a taboo to say, we're all supposed to hate fossil fuels. 

Brandon Quittem: But the reality is that's why the industrial nations [00:52:30] became so wealthy today. That's why we can live in big houses and have big yards and have the, a luxurious life in the us. Other places that didn't get to ride on cheap fossil fuels. They're a hundred years behind us or 50 years behind us in many ways. And so the hypocrisy is that India says we wanna use the fossil fuels and we say, no, no, no. Only we get to do that. You know, you have to suffer forever. And so I think the, the reality here is that we need to approach energy on a much more serious basis before we get into any sort of solutions. [00:53:00] I just wanted to sort of set the tone that this stuff matters. It's deeply human and lives around the line, and then to tie it to the essay. 

Brandon Quittem: So I, I wrote an essay quite long essay, and I'm sort of known in Bitcoin for using biological analogies to try to explain these more ESO, esoteric technology trends or concepts. And I use biology because number one, I love it. I find it fascinating. So scratch my own it. But number two, um, what I found is that most people Intuit biological [00:53:30] analogies a lot quicker than they do technology or economics or distributed systems or cryptography. Most people don't really have, uh, a context for those to make sense where we're all from biology, we grew up in it, we Intuit it. And so it, it seems to stick more. So it's in a way it's using analogies and storytelling to Trojan horse complex ideas into their most digestible form. At least that's how I see it. And the, the three bullet version of this essay is that Bitcoin minors are symbiotic with energy, [00:54:00] uh, energy production, energy markets, how humans relate to energy and Bitcoin minor is 0.2. 

Brandon Quittem: They actually incentivize net new energy production. So they make the economics better for investing in technologies or manufacturing, whatever plants to produce more energy. And they do this because they produce a faster ROI. They decrease risk decrease cost of capital. And then the third point is that, okay, Bitcoin mins give us more energy at lower cost. And more energy is good for [00:54:30] humanity, because like we mentioned, in the very beginning of this little rant, energy is the master commodity and all human flourishing is downstream of energy production. So as a species, we need to embrace Bitcoin mining because it is a net positive, right? That it has positive externalities besides the fact that it offers universal UN UN impeachable property rights for 8 billion people besides the financial asset, it also helps us harness energy at a lower cost, more widely distributed, and more resilient. Probably stop there. You may have a point, [00:55:00] but we have a lot more to go on this topic. 

Will Szamosszegi: <laugh> yeah. A hundred percent. Well, the one thing I, I will interject there is that it's just fascinating how it bridges the two worlds of money and energy. So as you were talking about all the benefits of Bitcoin that's, what's being created from the mins, like the consumption of energy, there's a reason why there's a huge economic incentive for mins to continue to go and consume more energy and build up more energy generation capacity. The reason why is because there's so much value being created from harnessing [00:55:30] that energy and being put into the Bitcoin, the Bitcoin network that makes the Bitcoin network function. So it's just so interesting to see how all these things tie together and it's yeah, yeah. I'll, I'll pause there and let you keep going. <laugh> 

Brandon Quittem: Yeah. I'm tempted to go into very esoteric tangents about connecting the digital world to the physical world and all those type of things. But I think I need to focus don't let me get too off track. Yeah, yeah, yeah. Okay. <laugh> so what, what is a pioneer species? Right? That's the title? Bitcoin is a pioneer species. Um, so from a, a biology standpoint, um, [00:56:00] pioneer species are just a really unique type of species. And their role in ecology is to colonize a desolate landscape or a dead ecosystem, and try to bring it back to life. Okay. So the famous example is an island off of the coast of, um, Iceland, volcano, erupts kills everything on the planet. Okay. Is the planet just a rock in the middle of the ocean forever? Or is there a chance that we can bootstrap life? Okay. Enter the pioneer species? 

Brandon Quittem: The most common form of pioneer species [00:56:30] is a lichen, which is a symbiotic, uh, organism with multiple species. So it might be a fungus and a plant, or can be a, a, it can be a threesome you could say, and they just land on this area, maybe a bird poops, a seed on the island, or maybe it travels in, in the sea and or maybe it's an airborne spore. Something like that finds its way by chance on this desolate rock. And that pioneer species job is to start turning rock into soil. So the fungus [00:57:00] uses, uh, a root system to keep it simple, a one cell walled series of tubes and tunnels, and it uses chemistry to digest the rock. So it has an external stomach, literally digesting rock liberating, the, the base molecules from that rock to, to use in its own body. And then it has, um, let's say an algae or some plant attached, which are essentially just solar panels. 

Brandon Quittem: So the fungus steals, some solar panels puts it on their back and it just charges up. It gets food from the [00:57:30] sun through photosynthesis. And so those two work together to essentially digest the rock and then start creating soil. And that kick starts a process where more complex organisms then find themselves able to survive. Since that initial species sort of kickstarted the process of life fast forward a very long time, life gets more complex as time goes on. And eventually the system reaches its apex, which essentially in that area, what's the most complex ecosystem you can create where I live. That's an Oak [00:58:00] Savannah. So big giant Oak trees make a cathedral and they more or less shade out all the other smaller trees and all the other smaller trees, including the pioneer species are actually kicked out. Once it reaches its peak, right? So biology's always moving. 

Brandon Quittem: It's always a process, but then what happens those pioneer species, then they go somewhere else and then they go do this process again. Right? So it, it is a complex system like that. And obviously the analogy here is mining where the miners, they go to these net new energy assets, maybe it's a remote [00:58:30] river in the DRC democratic Republic of Congo, uh, which is a real example. They had a remote river, they put some miners there, the mins there, um, couldn't be, or sorry. They, they put a hydro dam on the river combined with minors and they couldn't afford that hydro dam because it's really expensive unless they had these Bitcoin mins to come there and sort of Symbio help them finance this operation. And this is common all over the world because energy assets are often stranded [00:59:00] and it's really expensive to move energy from one point to another. 

Brandon Quittem: And so what often happens is you build an energy asset and then it might take three to five years until you build the transmission lines to move that energy to where the demand sources. Cause unfortunately the remote rivers that are great for hydro aren't necessarily next to the major population set. So there's always that mismatch in supply and demand of energy and Bitcoin mins, essentially plug in there and they absorb that excess energy and monetize it, [00:59:30] which just literally improves the economics of the energy producers, which then incentivizes them to create more energy. So back to the pioneer species, okay, we colonize this new energy asset now energy's being produced. Okay, what does that do? We have new energy. We have someone has to use it, right? Incomes industry. Okay. We have all this excess energy. So maybe you put a aluminum S smelling plant, which is common in Iceland, where they have remote geothermal. 

Brandon Quittem: Okay. Well, if you have an industrial plant, you probably need [01:00:00] a place for people to live, to work the plant. So now you have houses going in. Well, if you have people, you need services. All of a sudden it's a city and you can kind of see how just by colonizing that energy acid as the nucleus, it becomes more complex, just like the ecosystem on the island. And eventually it becomes sort of a peak human civilization. And at the same time, those Bitcoin minors that initially bootstrap, the energy asset are now gonna be priced out of energy because end users, you and I, right. Consumers, [01:00:30] we might pay twice as much for energy to heat our house as a Bitcoin minor could pay in order to be profitable. So their profit driven, they say, well, energy's too expensive here. So I have to leave their ancestral Homeland and go try and colonize new territory. And so those machines are essentially repurpose and everywhere they go, they're seeding their little spark, a little seed of, of human prosperity. So I, I like to call 'em Citadel seed Bitcoin mins, which is if you're unaware of Bitcoin meme, the Citadel, [01:01:00] which we don't need to get into 

Will Szamosszegi: The, the way you just laid that out is, was beautiful. I mean, yeah, it, it is. It's incredible when you just think about those downstream effects and the way that you just laid it out, you have the minors come in, they help monetize and bootstrap the energy assets. They monetize it and all, they need people to work it. So you have all these people coming in and then all these other businesses go and service the surrounding area. And before, you know, it, you just, you have a whole [01:01:30] ecosystem that is now thriving there, and the energy is more expensive, cuz there's more demand for that energy in that location. And then all of a sudden you see the minors going to a new area where there isn't demand for the energy and, uh, rinse and repeat the growth and the spreading of the, the mining network. 

Will Szamosszegi: And, and so taking this, this example, adding another wrinkle to it when you're talking about how governments approach it, right? I mean we've seen governments take all types of approaches, embracing it, trying to bring mins into their area to [01:02:00] consume excess power. And then on the other hand, you've seen countries ban it like China, banning, uh, mining, or recently what's happened with New York and their approach towards mining. And so they're all gonna take different approaches. The mins are gonna go where they're welcome and try and monetize the excess energy. So what I think is really interesting is I recently just did a piece on, on what has transpired since the China mining ban, right? And so as soon as China Bann mining, you saw a bunch of miners have to be turned off and leave the country. [01:02:30] And you saw a huge drop in the total hash rate for the big one mining though. 

Will Szamosszegi: And so that was O obviously expected, but what wasn't expected was the black market that you saw develop in China for Bitcoin mine, and a recent estimate, just put it at roughly 22% of the global hash rate is still in China. Like just the black market mining network in China today is 22% of the global hash rate. And when you just think about that for a second, and I mean, the, I love the analogy you, you drew with the, you know, the pioneer [01:03:00] species, but there was a reaction of a government that was trying to quote unquote, kill the pioneer species in their country. And wasn't able to do it China, the most authoritarian government worldwide, most powerful authoritarian government worldwide tries banning the industry and isn't able to do it. I mean, it's just kind of crazy when you think about that, where you really can't shut this down. 

Will Szamosszegi: It's something that once it's been invented and now we're, you know, over a decade in it's something that's here to stay and, and no one really can [01:03:30] stop it. So if you can't stop it and all the incentives are pushing the network to grow and continue to expand, then that's when you start getting to some of these realizations or conclusions predictions that, that we've been talking about with Bitcoin becoming a global reserve asset. I mean, if you can't kill it and it continues to grow and all the incentives are for growth, what do you see happening to it? 

Brandon Quittem: Well said. I agree. And I think looking at it from an organism standpoint here, I think my celam, which is [01:04:00] the primary form that fungus or a mushroom takes is the right approach here. Or you could say the internet, right. The internet and MyUM have the same topology. It is a network of nodes. There's no center. Okay. You can cut a Meial network in half, just like you could cut the internet or you could like cut a cord in the internet and the data packets route around the issue, just like my Celia, you cut a few spots. Doesn't matter. It finds a way. And that's kind of what we saw here. If you wanna see an illustration of this, just [01:04:30] Google, my Celia, even mys gift, you can watch it grow in time lapse format. It's actually quite beautiful, but there's a lot of takeaways I think here, like, okay, what are our lessons from the China mining band? 

Brandon Quittem: Like what, what can we take away? The first one is that China? Okay. They said, no minors. Great. But what does that actually mean? They kick 'em out. Who does that? Who does that hurt? Right. What we saw was that the hash rate plummeted for six months and all the machines got moved around and sold. And we thought most of 'em [01:05:00] came to north America, but apparently not. But what we learned is that all you're doing is you're making an incentive for someone else to mine, right. By decreasing the hash rate by turning off your machines in China, you're actually making every other minor on the network more profitable. And so then you sell those machines, they find a new home. Okay. So what are you doing? It's just like the internet. You're gonna just ban yourself from the internet. That would be stupid. You can't shut it off. 

Brandon Quittem: Just like you can't shut it off. Bitcoin. You just be banning yourself and your [01:05:30] population from the benefits of Bitcoin. And so network effects that are sticky like that because humans actually want it find a way to stick around for a long time. So it's no surprise that China found themselves back with the fifth of the hash rate, which is honestly a lot. Yeah, it's truly crazy. Okay. What else did we learn here? You kick out the minors from a hostile territory, which I would say China is they're authoritarian. They can do whatever they want and they swiftly did so, but those, the minors to escape China, they probably found themselves into a more stable, [01:06:00] long term home. So China kicking out the network hurts in the short term, but it actually makes the mining network more decentralized and more resilient because those minors are in a more politically favorable home. 

Brandon Quittem: Okay. It also incentivizes governments to take action and say, well, if China's against it, maybe we should be for it. Right. So the game theory kicks off and it's incentivizes again, another nation state to take an anti-China position. What else do we know? Well, China's been trying to ban this thing for like a decade. And to be fair, [01:06:30] it's hard to say, did they actually try to ban it? Or are they just sort of like throwing out press releases and like halfway trying my guess is that they could try a lot harder than they have. So it's hard for me to say if they actually put their foot down or if they just like flipped it, uh, with a finger, but yet to be seen. But what I think is true is that Bitcoin is a freedom technology. It empowers the individual at the expense of any power structure, primarily state banks, central banks. 

Brandon Quittem: And that's incompatible, [01:07:00] Bitcoin's incompatible with an authoritarian government, which obviously China is. And so whether they ban it now or later, I think the result, the net effect will be China will say no. And I hope Western liberal democracies say yes to Bitcoin because it actually is the instantiation of classical liberal values, or even more specifically classic American values, founding fathers principles, which was technology at the time to be fair, we took the lessons of the monarchies in Europe [01:07:30] and the enlightenment period and classical liberalism and individualism. And we say, Hey, let's maybe have a more distributed power structure rather than this hyper concentrated power system. Maybe we want freedom of religion. Maybe we want freedom of speech. Maybe we want freedom of X, Y, and Z. And it turns out that Americans, the American idea formed the, the best government to date. Has it decayed? 

Brandon Quittem: Yes. Is there problems? Yes, of course, but on paper, I think it's still the best form of government that we know of as of today. And so [01:08:00] full circle, freedom technology is totally not gonna work out in authoritarian states. And so I expect them to continue banning it and I hope the Western liberal democracies decide to embrace it. If not, I, I think that's a really bad sign. I think that that shows weakness. I think that that shows authoritarian or technocratic tendencies to try to stop this thing. And I'm optimistic in a sense because we are seeing a percentage of the us political class, putting Bitcoin [01:08:30] on their, on their sleeve and, and promoting it, you know, Cynthia alumnus and Warren Davidson and a surprising ally, Ted Cruz, which I never thought I would say, there's a, there's a long list of politicians who, who are supporting Bitcoin on both sides of the aisle. And I think that's what we wanna see. I think we wanna see the politicians who are pragmatic right now and who actually do wanna be a leader, which sometimes means taking the stance that isn't popular, but you know, is right. Which I think is severely lacking in Washington. 

Will Szamosszegi: The line, you [01:09:00] said Bitcoin is incompatible with authoritarian. Regimes is, I mean, that is just to the core, the truth. Like when, when you think about it, not only from what we're talking about earlier, let's say you're a government, you try and ban it. The Bitcoin's gonna go to a jurisdiction that's favorable. And so you just, it's a net loss incentivizes you to not ban it. But thinking back to the China mining band, what I think was really interesting is yes, they Bann it. And now you have this huge black market for mining, [01:09:30] but not a lot of people know this, or actually, I, I assume that a lot of people don't know this, um, at this point, but why do you think China banned Bitcoin mining? Well, Bitcoin mining in a big way was being used to circumvent. The capital controls that you saw at the Chinese communist party put into place, right? 

Will Szamosszegi: Because let's say that you can't get your money outta China. Well, a much easier way to do it is for you to take that money that has sustained China, invested into mining hardware that prints Bitcoin and [01:10:00] prints money, and then allows you to circumvent the capital controls of the country. And so you actually saw this happening and some, some very large players and people that I've spoken with have predicted and, and talked about how that was a big reason for that decision. And it's just funny to see that the natural response is that they try and ban it, try and stop that from happening, but you're still continuing to see this black market. So not only just on the actual protection of private property and ownership with Bitcoin, is it [01:10:30] against the authoritarian ideals, but it's also against the authoritarian ideals and the sense that just the mining helps you circumvent the capital controls in a country, not saying that, you know, if you should break the law or go do something like that, but it's just funny to see when you see that playing out and you're seeing powerful authoritarian government, not really being able to, to stop Bitcoin on both mm-hmm, <affirmative> the custody and the mining side. 

Will Szamosszegi: Yeah, 

Brandon Quittem: Totally. That that's been the, the primary narrative I would say is invading capital controls, [01:11:00] which is of course true. Uh, it's the same reason why you see, let's say the city of Vancouver is like, I don't know, the stat's like 40% owned by Chinese people or something crazy like that. They're just trying to get their dollars out or their Rebi out in any way that they can. Bitcoin's just a really sophisticated way to do that. And I think the number is 50,000 us dollars is the maximum. Any Chinese, maybe family or, or individual can essentially export per year. And okay, that's a lot of money for a normal person in China, [01:11:30] but there's a lot of wealthy people in China where that's, uh, that's pennies. And so they're gonna find the skid ways to do so, but there is one wrinkle here and this narrative I heard, I'm no China expert. 

Brandon Quittem: It's very hard to learn something coming outta China and, and think it's fact. But I also heard that in their most recent five year plan, which China is very, very hard on these five year plans. One of them is about energy and doing a better job. I think it's also why [01:12:00] they're installing like two or 300 nuclear plants. It's going to be the biggest increase in, in nuclear, anywhere in the world. And they're doing all kinds of other investment renewables. So there's essentially an energy component to their five year plan. And what they do around these five year plans is they're, there's a lot of PO and circumstance. There's a lot of symbol symbolic actions that the government does to sort of promote the, the narrative that they want everyone to be on. And one of them's energy and in wan in unan where [01:12:30] there's, uh, essentially a lot of hydro, what was, I don't remember the exact situation, but something was, was stressed in the energy markets down there. 

Brandon Quittem: And I don't actually think it was related to Bitcoin, but they were having energy issues and Bitcoin minors are heavily there during the wets season. And so I heard that they just blanket band Bitcoin minors because it's sort of fits the meta-narrative of being good with energy, even though it's technically not true. It was just a broad stroke decision. And the reason why I, I lend this theory, [01:13:00] some credibility is because if they had, let's say 50% of hash power one year ago, it was about one year ago when they banned. And now they have 22%, that is an enormous amount of machines that they, that left and came right back mm-hmm <affirmative>. And if it was just about PR and PO and circumstance about banning it, and really they never left, that would make a lot more sense why there's so many now. And so that's one option, or it's genuinely that hard to find, and it's genuinely that profitable [01:13:30] where they're gonna keep doing it, even though it's illegal, right. It's hard to untangle these, but either way, Bitcoin's quite resilient. 

Will Szamosszegi: I, I didn't, I guess know everything that you just mentioned there, but I did hear about kind of like the energy demands and that being part of the narrative that was being pushed, which is pretty fascinating. One other piece that I wanted to touch on here, and this is kind of going back to the, the energy mix side of things, but I'm curious, and, and you actually touched on it here with the amount of nuclear power that China's putting forward is like, what, what's your [01:14:00] overall view on nuclear as an energy source right now? And like, not only just like how we're approaching it currently, but like how you think maybe we should approach it with, with everything that, that you 

Brandon Quittem: Know know about energy sources as well as Bitcoin and Bitcoin mining. Yeah. Good, good question. Good question. I think nuclear, the, the short answer is I'm very pro nuclear, but in order to understand why we have to talk about the two types of energy sources, one is base load and the type of energy that that produces is consistent [01:14:30] energy dense, right? It never turns off. And this is the type of energy that is base load would be fossil fuels or nuclear. And then you have, uh, intermittent energy or what we rebranded, I would say generously as renewable energy, which would be things like wind and when did, and, and Hydro's kind of in the middle, right? If it's wet season, Hydro's great. If it's dry season, there is no hydro, right? So it's, it's sort of base load, but sort of [01:15:00] intermittent with wind and solar. 

Brandon Quittem: The challenge here is that if it's not windy or if it's not sunny, you're not actually producing energy. And then you could say, well, what about storage? Okay, well, batteries are very expensive. And we, we literally don't have the pressure, the, the raw inputs to produce batteries in order to transition to a battery system. It's not possible, cuz we literally don't have the materials. Then people are trying to create these like low tech, but clever solutions like using kinetic force. [01:15:30] Like when you have excess energy lift a really heavy object, really high in the sky and that produces potential energy, which you can then use for gravity and weight later, all these zany ideas to try to store like a low tech battery, right. Instead of lithium, the other side would be like hydro, okay. You can just dam up all the water and then let it run through the turbine later when it stops raining, right. 

Brandon Quittem: That's sort of a battery. Okay. So you have base load steady all the time and then you have renewable which fluctuates. And right now fossil fuels are the [01:16:00] primary energy source. I forgot the percentage. I think it's over 80% still of energy produce as fossil fuels. And that is base load. You can't have a hospital without fossil fuels or nuclear, right? Cause you need steady energy. And so fossil fuels also have an environmental cost, right? We pollute, we reduce carbon. We right. There's cost to digging it outta the ground. Whatever we can discuss how bad or horrible those externalities are. But then you have nuclear, which the externalities are, uh, almost none. Our new power [01:16:30] plants, our new nuclear reactors are extremely, extremely high tech. The chance of them going, going wrong and causing issues is really low. However, there's public sentiment issues with nuclear. 

Brandon Quittem: It's very scary. Right? We remember Trenoble we remember the, the one Fukushima and there's sort of a, nimbyism not in my backyard. Nobody wants the nuclear plant in their city, right? Cuz of risk of the nuclear reactor meltdown. And I would say that the fear is actually, I mean, I get why it's a very emotional [01:17:00] idea, but the math is showing that nuclear is actually the safest energy source we've ever had based on human lives. And so I think that we, we should embrace nuclear reactors because that is literally the only way to get off fossil fuels and maintain a, a high quality of life. If we wanna get off fossil fuels, we can live in mud huts and we can turn off the internet and we can be substance farmers. Again, that's an option. And I, I obviously am joking when I say that, but there is a contingency of de growth or [01:17:30] Neo Malians out there who want us to stop having kids stop eating meat and just somehow reduce the population by 10 X. 

Brandon Quittem: And I find this to be a very seductive ideology. It comes from Thomas Malis. I'll do a slight tangent here cause it's related to biology. Malis was an economist in the UK, I think in the 17 hundreds. And he noticed that populations in the wild elk or deer or something, they would expand to the carrying capacity of their species. So they, they grow their population, eating [01:18:00] and eating, eating until they eat all the food. And then the population kind of overshoots. And then the population collapses cuz they ate all their mouth is then took that idea and applied it to humans. And he said, wow, look at the check, not look at the trend of humans. If we keep growing, we're gonna overgrow consume all our resources collapse and then we'll all die. And this is uh, seductive. Many people have thought this as true. 

Brandon Quittem: And a lot of people today still believe this. However, it's I strongly believe that it's fundamentally not true. And the reason is because humans use [01:18:30] tools, we create technology that actually increases our caring capacity. Simple example 200 years ago, about 50% of the population's job was to grow food a hundred years ago. It was like a quarter of the population today. It's like a quarter of a percent of the population's job is to grow food, right? And our population obviously grew that whole time. So we're producing more food with less time or energy. And so that is us literally changing our environment so that our carrying capacity increases. [01:19:00] Now, do you, do you ever see an elk plant, a garden, do Elks build nuclear reactors so that they can harness more energy? No. So we are, we are not Elks. We don't, we don't follow the same population ecology that elk does. 

Brandon Quittem: And so this idea that we need to reduce the population size in order. So we all can survive is just not true and so slight to there. But I really have to make that point. Cause I think that's actually what's driving the de growth movement and one sub indent [01:19:30] tab point here is that Bitcoin actually does help bring us back in balance with our environment in a way that's not obvious to most people. So in a Fiat system, which inherently leads to expansion of the money supply, which means we're essentially borrowing from the future to consume today. And what that does is yes, it's like pouring gas on the fire. We can create more businesses. We can grow faster and faster and faster, but because there's so much cheap money. So it's easy to access money to invest. That leads [01:20:00] us to invest in things we don't need like cheap plastic crap or uh, just capital missile allocation, like having 10 versions of Uber and none of 'em are profitable, right? 

Brandon Quittem: These are symptoms of an expansionary Fiat money supply and Bitcoin on the other hand is a deflationary money supply or monetary asset. And in that type of situation, all the technology we create actually makes the world cheaper. Right? Goods become cheaper. Our lifes become cheaper [01:20:30] because we do more with less just like with food. However, somewhere in the Kasey and dogma, somewhere in the central planner, dogma, they made deflation a, a naughty word and they say, we need this 2% persistent inflation in order to fund growth. Again, it's a seductive idea. Just like Marxism. It sounds good on the surface. But when the physics touches these ideas, it's just not true. And so in a Bitcoin world, instead of all this misallocation, there will be less debt in a Bitcoin world. There will be less credit [01:21:00] cards. There will be less zombie corporations. And instead when an idea is good than you can invest in it. 

Brandon Quittem: Right? And what that's going to do is actually broadly distribute the technological gains that our species creates by reducing the cost of our, of our living. And so in that type of world humans, aren't gonna have to work as hard because we're producing more with less today. We are pro producing more with less, but all those gains are being accumulated in the priesthood class, the financial elites, [01:21:30] the wall street folks, the coastal elites, whatever the benefactors of globalism, however, in a Bitcoin world, we'll literally consume less resources and inflation is the number one way that we consume more than we need. So we'll consume less resources, cost Sullivan will go down, which decreases the inequality that we feel. And it brings us into more of a homeostasis with our planet. And I think that that's actually a Trojan horse, although it's not an easy concept to grass that is a Trojan horse to get the progressives, the greens, [01:22:00] the people that currently take a, a defensive posture towards Bitcoin. If we sneak in with this idea, I think that that's a, a very powerful way in and Jeff Booth does a very good job in his book, the price of tomorrow and his recent essays to, to illustrate this <laugh> you asked me about nuclear and I'm talking about mouth mal 

Will Szamosszegi: <laugh> back to you. That was, that was great. Uh, I just want to connect these two ideas and make sure that I'm thinking about it correctly. Uh, cause I I've, I've never dove into this part [01:22:30] in this much depth. So when you're talking about how, and yeah, this is actually going off of, uh, of Jeff Booth's work, but when you're talking about how the adoption of a Bitcoin world is going to spread out the wealth and the benefits of technology to everyone, are you saying that that's because if everyone is holding their wealth denominated in an asset like Bitcoin, that that is non-inflationary and new things are created only, you know, net positive investments will be incentivized [01:23:00] and made. And then everyone who's holding Bitcoin is going to accrue value because they're holding Bitcoin and Bitcoin's going to be like the net benefit of the technological advancements of the society. 

Brandon Quittem: The, the short answer is that it makes everything around you cheaper, right? And ho holding Bitcoin is what allows that. Yes, there's less waste, but the reality is that anyone can access Bitcoin and the gains of productivity as our, at a species level. The more [01:23:30] majority of those will be accumulated into the increase in an asset price of Bitcoin, which can be seen another way as the decreasing cost of, of living. 

Will Szamosszegi: Yeah. Cuz right now you have a world where everyone's holding these dollars that are being devalued over time, just without like invisibly in front of your eyes as more is printed, but in a world where everyone's holding Bitcoin, you're not being devalued. Things get cheaper because the technology in your society gets better. And so that Bitcoin that [01:24:00] you had, it's still one Bitcoin, just like, let's say a, a million dollars is still a million dollars, but a million dollars is worth a lot less today than it was 50 years ago. Whereas the Bitcoin 50 years in the future is gonna be worth a lot more than your Bitcoin today. 

Brandon Quittem: Yeah, yeah, exactly. Another way to look at this is that right now in an inflationary situation, wage earners, they have to, okay. They, they make a profit at the end of the month, they have a surplus and they want, they they're then forced to invest [01:24:30] their dollars. They take a risk, get an education, take onto that. Then they take a risk in a career and hope they don't lose their job taking risks. And then they make some money, they get taxed and then they have to take another risk in investing in order to preserve the fruits of their label, that they already took multiple risks on what that leads to is the best investors, get the lion share of productivity from our species. And the best investments are hidden behind all these imaginary lines like accredited investor or access to deal flow. Or I live [01:25:00] in America so I can access to S and P 500 versus I live in Zimbabwe and I can't access us capital markets, right? 

Brandon Quittem: And so instead all the productivity gains go into Bitcoin. And so rather than a 2% persistent inflation, which is definitely lower and obviously lower here in America today, and way, way worse, all the developing countries have way higher inflation. So instead of that type of world, Bitcoin's price will increase at the cost of, [01:25:30] or at the speed of GDP growth on our whole species. So if someone in Zimbabwe finally joins the global economy, because Bitcoin plugs 'em into the single global monetary network. Now they use the internet to find investors to create this amazing new technology. Let's say it produces food at a better cheaper food. Now, one guy in Zimbabwe creates cheaper food. The entire world now gets cheaper food. And that that value is reflected in Bitcoin going up in value or [01:26:00] the opposite of that. The inverse that is the price of food declines, right? 

Brandon Quittem: So now the entire capital stock of our planet is contributing to this single network, the single thing. And it's broadly distributed proportional to the amount of Bitcoin that you hold, right? So wealthy people will still be wealthy and there will still be inequality and inequality is okay. And it inequality actually good. We don't want everyone to be equally allocating capital because there are people who are better at it. And there are people who are worse at it. And [01:26:30] there are people who try hard and there are people who don't try hard people who aren't actually gifted otherwise. And so we actually do want power laws to exist, but the game needs to be fair. That's the key and a Fiat world. The game is rigged the priesthood class. They changed the rules all the time. And Bitcoin is essentially saying, the rules of chess are fixed. 

Brandon Quittem: You know, now we can all play by the same rules. What if every time you played chess, your opponent could just change the rules mid game like, oh no, my paws are actually Queens. Like why would you wanna play that game? [01:27:00] And that's essentially what our economic system is today. And Bitcoin says, there's one rule system. They can never be changed and interesting what that does at a species level. Bitcoin's immovable and detractors will say, this is a bad thing. It's a pet rock. It's too slow. But the reality is Bitcoin chose terminal inflation rate of zero. It decided on these fundamental, simple principles and they're not gonna change. And so as long as humans find value in those principles, which is clear that they do it [01:27:30] is a monetary asset that humans want scarcity matters, right? As long as we care about that thing, then what happens is you can't change Bitcoin. 

Brandon Quittem: So all that can happen is the world around Bitcoin re architects in reference to this immovable thing. And that's actually the magic here. It's like inventing steel, right? With steel. We can now build bridges that we couldn't build before. With Bitcoin, we have a new foundation to the economic system that doesn't change that [01:28:00] will last a thousand years instead of recreate the economic system every 50 years. And that durable base layer allows us to create more taller buildings because we have a better foundation or another way because we're building out of steel instead of aluminum, for example, right? You can't have skyscrapers. You can't have Manhattan without steel. You can't build a golden gate bridge without steel. And so, yeah, that's kind how I see it. We're forced to adapt to this immovable object. And that's what allows us to scale as a species. It removes the decision point away from trying to [01:28:30] change the rules cuz the rules can't change. So instead of trying to cheat in politic and get close to the power source to benefit yourself, you just play by the rules and you go be productive. Cause that's the only way to get ahead. And that's a world that we can be optimistic about 

Will Szamosszegi: A hundred percent. I got one final question that I, I want to ask you. Um, I'm really curious to hear your answer to it. The, the question is what's one thing that you believe to be true that the majority of people would disagree with you 

Brandon Quittem: About I would say, okay, how about this one? [01:29:00] Mushrooms are tree farmers mushrooms. The reason why we have forests, the reason why we have forests is because mushrooms farm them. And this is okay. What does that even mean? That just sounds like, yeah, let's unpack this here late night nonsense. <laugh> okay. This starts way back. So the reason why trees have roots, it is hypothesized is because mushrooms live underground and those mushrooms are like an underground root system that trade information bidirectionally, they ship resources, they invent new [01:29:30] molecules and they plug into the tree roots and they form trade networks. And the mushrooms are like infrastructure that literally connect all the trees in the forest. And so this one tree trades some nitrogen with this other tree who trades them some carbon, for example. Right? And so the reason why mushroom or trees have roots was to go find the mushroom so they can have a better trade network. 

Brandon Quittem: Okay. Trees create fats and sugars. They create food by fo SIS, but underground is where they get the minerals [01:30:00] and they need these minerals. Like otherwise a tree would be a meter tall if they, if they didn't have a fungal ally to provide minerals, which are required to create a strong structure to grow so tall, taller, you grow the, the more food you can produce and now compete the, the other trees that are trying to out shade you. Right? So it's in a tree's advantage to form mu mushroom allies to survive longer. Okay. So a long time ago, trees didn't have roots plants. Didn't have that. What we call roots today. And it, I it's my belief that it's from the [01:30:30] mushrooms. So what is it? What, why are they farming trees? Okay, well a mushroom, it wants the food of a tree, right? It's a symbiotic relationship, but most people would say that plants are primary plants are in charge. 

Brandon Quittem: Okay. And I think that's our own bias cuz we see plants everywhere and they're beautiful. I love plants, but underground. You have the mushrooms. Mushrooms are weird. They're mysterious. They only they're like associated with death. They're associated with drugs. They're associated with weird food. We don't really understand [01:31:00] 'em but mushrooms. Life is primarily underground. And so it's our own bias, but mushrooms are far older. They're far more far more complex. They're far more, I would say intelligent, but it's kind of a slippery word here. Cuz most people think of human intelligence. They have a different kind of intelligence. And so what is a forest? A forest is an underground network of mushrooms promoting the growth of trees and the trees are just getting food to ship down to the mushrooms. But the real, the real primary angle is the, the fungi [01:31:30] underground. They also collect rainwater and they collect resources and they, they form an underground economy. 

Brandon Quittem: And they're ruthless. If, if a mushrooms network, let's say one fungal networks connected to 10 trees to keep it simple over on the far east side of the forest, um, they can sell carbon for, for three units per carbon. But on the west side they can get 10 per carbon. So what does the fungi do? It starves out the cheap one. It hoards resources, ships it over the other side where it can get a better [01:32:00] price for its product. And that's literally happening all the time, underground it hoards water. And then when there's a drought, the mushrooms sell the water up to the trees at an inflated price cause they understand supply and demand. This is, this is scientifically true outside. 

Will Szamosszegi: Oh my God, you are blowing my 

Brandon Quittem: Mind right now. 

Will Szamosszegi: <laugh> this is so wild. Oh my God, you just completely changed my entire way that I look at like trees and, and mushrooms. <laugh> that? That is fast. One, one thing that comes [01:32:30] to mind actually, and I have not fact checked this at all. Like I literally got this from I, it was like a Joe Rogan episode where I heard this, but this the, they were talking about how, um, I'm probably gonna get the place wrong, but how I, I think it was like, like Tokyo or someone, they had an entire, uh, network for their subway system and they found out that, do you know what I'm talking about? That, is it the fun, fun guy or some 

Brandon Quittem: Slim molds 

Will Szamosszegi: Slime mold. Yeah. They, they put it down to [01:33:00] try and see how they, how the slime mold would effectively route the entire subway system differently. And then it was more efficient and they ended up using that over the existing approach that they were using is, is that, am I actually correct on everything? I just said there <laugh>, this is like long time and I heard it a while ago. 

Brandon Quittem: I I'll, I'll give you the, no, there's a couple caveats here. So Tokyo subway system was already built. Um, and then they did an experiment where they put all the main hubs of the network, the [01:33:30] cities or the main train stations or whatever. And then they put oat flakes in each of those hubs, which is the slime mold's favorite food. They released the slime mold, which is technically not a fungus, but it, it used to be in the fungus kingdom, but they kicked it out for whatever human taxonomical reasons, which is pointless. But anyways, in the first 24 hours, the slim mold absorb like created a network. It grew to find all the food so explore and then it rearchitected its whole network into an efficient supply [01:34:00] chain essentially. So first it explored then it exploited that's, that's kind of an interesting way to look at, um, yeah. 

Brandon Quittem: Mental model anyways. But what we found is yes, it is more resilient and more efficient. However, they didn't actually go and build it cause it was already built. But what it shows us is that why is a ancient single cellular organism smarter quote, unquote than the best Japanese engineers to build the public works in Japan. Like that's a pretty humbling [01:34:30] realization, right? And what the slim mold actually solves is the traveling salesman problem, which is essentially a really computationally expensive problem, which is a sales rep has, let's say a thousand clients and it's moving around the city. They're all in different locations. How do you comp compute what's the most efficient route to, to reach all your stops, right? It's actually like a thousand factorial, right? That that's the type of math. It is to try to figure out the answer. So it's computationally expensive. 

Brandon Quittem: Our supercomputers [01:35:00] can't really even do this kind of math. However, a one cell walled ancient organism does this in its sleep without even thinking. And to me, this actually illustrates the power of decentralization versus centralization in a centralized system. We're trying to run this through a CPU. And to be honest, we can probably solve this with, uh, quantum computers or potentially our super computers where you have like parallel processing. That's the type of decision making we have to be. But for simplicity's sake, the slime [01:35:30] mold is like, it's not one organism. It's like a million organisms that work together in this little slime essentially. And so what's happening is the slime mold, um, that on the edge of the network. So the little individual units, they're all making decisions in their local ecosystem on where to go and why, and the sum total of all those individual nodes acting in their own best interest locally that forms the network right versus one brain pushing out orders. 

Brandon Quittem: [01:36:00] And Bitcoin is like this as well. The Bitcoin network is not a individual CPU. It's not a plan. It's not a, just a simple piece of software. It's actually individuals in the millions as the nodes and those nodes run software and they make decisions on what software to run and what to do. And should we change the software? Should we improve it? Should we tell a friend to join the network? Right. And the sum total of all of us individuals, both [01:36:30] computers and humans that actually forms an aggregate network, which we call Bitcoin. And so it's sort of this weird. Is it alive? Is it not, is it sort of like a meta species? Is it a super organism like the slim mold is, um, it sort of blurs the line between biology and technology, which is what fascinates me so much about this 

Will Szamosszegi: Thing. That is probably the best answer that I've gotten when asking this question, which is, and this question actually gives a lot of interesting answers. I'm, I'm so happy that you knew what, what [01:37:00] I was trying to remember and talk about with the slim mold <laugh> um, yeah, that man, dude, you just absolutely blew my mind. That that was awesome. But yeah, I, I mean, I think that that's a great, great place to wrap it up just, uh, in the Nick of time too, but man, we're gonna have to do this again. This was just such an interesting conversation and honestly like huge props to you and, and, and I'm just grateful to be able to have this conversation with you because the work that you're doing for the industry and I mean, everything that [01:37:30] we talked about here, it's, you're part of that pioneer species in, in a, in a really interesting way and playing your role here, um, with the work that you're doing, but these conversations, so huge, thanks to you for, uh, everything that you do, 

Brandon Quittem: Man. I really appreciate that will, and I, I feel the same, everything you're doing at SA this is important work and reframing humans' relationship to energy, sort of as the meta, uh, theme really of our conversation. And also what I think is the most important ultimate, [01:38:00] uh, positive effect that SA can have. Um, and I'm very proud to be on the call with you today and supportive of the org. Appreciate it, man. Take care.

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