YouSaid · the spoken record

Plan B

lines on the record: 51
first: 2021-06-02
most recent: 2021-06-02
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“Well, there's another Called side swap by a company called SideSwap Limited and they have for Android and iOS a smartphone app that lets you swap in app so you can swap mainchain Bitcoin for liquid Bitcoin and you can swap the other direction and you can swap dollars tethers for liquid Bitcoin actually in a trustless way so it's a kind of atomic swap So that seems to have captured a lot of people's imagination. They're building up more user-originated swaps where you can sort of place orders in it and be the provider. So at the moment, they're the middleman, but they are trustless way. So that kind of thing is possible too and present a nicer user experience because you have one app that can do both.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Blocks for every minute instead of being randomly distributed around a 10 minute mark. And two blocks is actually final for some technical reasons. Of course it has trade-offs, right? As with Lightning, the censorship resistance is not as good. And so I would say for cold storage, you should move funds onto the main chain. It seems like some people are doing that. They'll sort of do their dollar cost average stacking into liquids and then once a core or once in a while when they're built up enough, they'll convert it and put it in cold storage on a main chain. So that's another use case.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I mean, the exchanges and payment processes and kind of simple swap services will let you swap Bitcoin for liquid Bitcoin. And Liquid has other assets. It also has US dollar tethers and euros and different assets. So you would just, I mean, the user experience is very like Bitcoin. You set up a seed, you use QR codes to send a receive. So it's very Bitcoin-like experience. Plus, then you have the transactions are a bit faster because”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Thought processes of the people who built it. And we were certainly thinking the liquid will be interesting for traders because it offers advantages to them, but organically we're seeing a lot of people use it for just medium-sized payments because it's cheaper and faster and has confidentiality. So I don't think it's done as well. I mean, I think there will be more layer twos and the technology will improve over time. There are more being developed. There's the so-called state chain, people working on that nowadays.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“No, I mean, I think that like other networks, you end up with different protocols for different applications. So like the internet, you have voiceover IP, video streaming, web, and so on, and they're optimized for different use cases. And certainly for retail and micropayment, Lightning is just better. I mean, it's making a trade-off, so it's not as good for kind of security hot wallet risk, but for other factors like speed of finality is almost instant, the fee structure, scalability is much better. And we're seeing a bit of that with liquid as well, which is a kind of sidechain type of layer two. So it doesn't involve channels, but in the same way as Lightning, you can move funds in and out of it, that people use technology for what they want to use it for despite the...”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“why people where anybody with any kind of basic understanding of how things work would imagine that Bitcoin should be different. I mean, it's just shocking how people get. Such strong opinions about very basic facts, about networks, like any network, internet, like Starlink, GSM networks, radio networks, they all have layers and routing.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Laser links between satellites, and if you converted the whole network into a single broadcast massive Wi-Fi hub, it's transaction throughput. I mean, it's kind of the author throughput, it's latency, it's efficiency in terms of dropping data because too many devices are trying to talk at the same time will just fail. I mean, it would be thousands of times less efficient, just fundamentally so. And it's not, you know, people will throw out the argument, well, you know, computers get faster each year and all this kind of stuff. But, you know, the speed of light doesn't get faster each year. And at no point does it make sense to throw money away. So people use it more bandwidth every year too for higher fidelity video streaming, real-time interactive things. Demand for bandwidth and storage is insatiable. So at any point, you know, switch networks will win. And I don't understand.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“I'm really smoking over here for the audience we won't be able to see. But the level of understanding is childlike and just ridiculous. I mean, they'll make arguments that basically misunderstand supply and demand or assume that you scale networks by saturating the internet with microtransactions and no network ever was built like this. I mean, even the Starlink satellite network is not a broadcast network, right? It's got lots of routing within it. Many downlinks, thousands of...”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“To do a transaction is not really a usable metric because the blocks will get produced anyway. Some portion of them are actually empty for technical reasons. And as you were alluding to, the layer twos have a massive multiplying effect. And in a way, there are kind of informal IOU type of transaction systems i.e. the trading inside exchanges. I mean, there are coins changing hands very rapidly at a massive multiple of what happens on chain. And even credit arrangements between exchanges and institutional traders and so on means that there are coins moving around that don't reflect on the chain. So those you have for trust element, but the layer twos like Lightning and Liquid improve that to not single trust.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Close to zero in effect, like an empty block. Okay, the miners don't get the transaction fees, but most of the value is actually the freshly mined coins. And people have a choice of layer twos. So if they are paying for layer one transactions, it's because they find them sufficiently valuable that they want to do cold storage or they want to do a transaction which is harder to censor and a Bitcoin main chain has fundamental advantages so they're paying for something they value but incrementally you know if a block has got one more or less transaction it doesn't change the cost of mining it right so you know at least for the midterm the idea that it costs so much doors or”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Well, I mean, certainly Bitcoin Layer 2s don't They don't produce coins, right? They are just layer twos. I saw the... Somebody from PayPal commented the difference between in the Elon's thread they came out and said well the current chief architect at PayPal or something said well at PayPal we know the difference between someone networks and payment networks so I think you could make that argument for Bitcoin that the different layers are not Resulting in new coins being created. I think another confusion, because the media likes to sensationalize, is the cost per transaction, which is actually”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“In a much stronger sense than with compound investing in bonds or stock markets, they can see that the saving will have a higher value later. So in this time preference argument. And so the argument there is money comes from somewhere, so the money spent on buying Bitcoin and indirectly on Bitcoin mining in the alternative would have gone in buying consumer goods that don't last very long and end up in landfills. And so the industrial production cost of all those goods that filled up landfills and now that part of the, to the extent that Bitcoin's makeup part of the world's economy, the world has become less throwaway consumerist and filling up landfill and many consumer goods are made from petrochemicals, plastics and industrial processes.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Is the value of having hard money is very useful for society. The other thing is I think that Bitcoin is a savings technology, has pushed people towards paying more attention to saving who would otherwise be inclined to spend. Many people are very consumerist, right? They spend plus or minus everything they receive, they spend, or they take credit, and then they spend. And so some societies are heavier on saving, or they'll save 90% of their income, others are spend 90% of their income. And so Bitcoin tends to push people more towards saving because they can, in a more”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Monetary economists will tend to view predictability as an important factor, like that the supply curve is very predictable. In the case of gold, it's reactive to price. People will ramp up production if the price is high in Bitcoin that doesn't happen because of difficulty adjustment. So I think it's kind of fundamental. The other thing is it doesn't. Incrementally, it costs less because coins were mined faster at the beginning when the price was low. And that factor is continuing due to the stock to flow. ratio that the number of new coins per halving is shrinking. So ultimately when most of the coins are in circulation, it won't have cost a very big portion of the Value to extract them And I think people don't, curiously people don't. Moon gold production costs very much, but that's a very industrial process in itself.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Federation, you know, it's just a group of businesses or something, which is an okay structure, but you don't really need stake. I think stake makes it worse because then it's vulnerable to somebody amassing more money and gaining more influence and control over the... Allocation of new money that enters the system. So it ends up sort of looking similar to the current system, either a Fiat system with central banks and quantitative easing and this kind of stuff. I think that's how you end up with these very unpredictable supply curves for various coins. So I think”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I mean, I think in some ways I find the argument to be more economic than technical, which is that It may be a sort of fundamental need for hard money to have a cost of production, things which don't have a cost of production end up being politically sought after. resources are expended careering political favor so basically the cantalon effect bribery corruption wars and lobbying so all of those things can consume resources too but in an ugly and protective way so you know if a bitcoin is valued at 30 000 50 000 whatever the value is then People can economically spand up to that marginal value in chasing an additional coin so they will spend it long. Equipment and power infrastructure and electricity. And if it were just handed out to a federation, I mean, think of the proof of stake as basically”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“active in proposing a social positive social agenda, but often they get in a way that sort of grit in the gears and they prevent industry from solving problems. And this is one of them, right? So certainly we as a company were intending to expand in that region, but ended not being able to because the politicians kind of as an election year and they made a mess of it, basically.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“It's basically driven by energy, right? So I think the future ultimately will evolve more infrastructure. There's kind of a metric called the Kardajv Type 1 metric, which is some kind of civilization metric, which we haven't reached yet, which is extracting a decent proportion of the energy that lands on the planet via solar radiation and other sources. There's an enormous amount of untapped, even just not built, but even use of existing as a Quebec province case shows. Actually, the Quebec province is an interesting one because there is an interest from miners to mine in that province, but politics got in the way. So actually, sometimes politicians become”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“heat wave and the power use goes up. That's what happened in Texas earlier this year. They had a rolling blackouts because I guess there was a heat wave and everybody turned up their air conditioners and overloaded the grid. And so if you saw more Bitcoin funded grid infrastructure in Texas, residential prices are usually much higher than Bitcoin prices. So it would just, people would turn off some percentage of the Bitcoin mining and there'd be no power blackouts. So I think that's the future. The other thing is that in my opinion, civilization has followed a long arc of becoming”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“That can be turned off on demand, which is excellent for funding infrastructure projects because they have to make it, I mean, people have a political will to see green power in the world, but you have to convert that into finance, right? Somebody has to come up with billions of dollars to build new dams and so on. And those are done using project financing. And the project financing wants a business case to say, well, OK, we'll finance this billion dollar dam, but how are you going to pay it back? And if the way they're going to pay it back is heavy industry and there's no industry and there's no population there, they're going to say no. But if you have a long-term contract for mining, Bitcoin mining, and that can provide, they can supplement or subsidize the infrastructure. And then the industrial and residential demand is variable.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“One province in one country could fully power the Bitcoin network. That's a multiple of the entire Bitcoin network. So just a bit of context. Another thing about power is there's enormous amount of wastage. So power that doesn't end up getting used. Power stations take a delay to power up and power down in response to demand. The excess is just people are paid negative energy rates to get rid of the excess power because they can't balance it fast enough. So in aggregate, it's a very inefficient thing. And improving over time as people get more renewables and nuclear actually power infrastructure online. So I generally view that Bitcoin is actually a net positive for development of green infrastructure because it gives a steady baseload.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“The amount of hash rate that they estimate is from the country using Creek methods, and then they'll multiply it by that whole country's average. Source of energy, even though it's predominantly green because it's cheaper and unused. So they'll just throw out bad data. Another interesting data point, which we know firsthand, is in the Quebec province of Canada, which we have a data center in Montreal in the Quebec province. There's 37 gigawatts of hydropower, most of which is unused.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Mining is that it's very location independent. So for general power infrastructure, it's going to be around population centers, around heavy industries. And Bitcoin can be anywhere, right? So that's partly how it ended up being in these remote areas of China because due to the efficiencies of central planning, they massively built out hydro dams where there are no humans and no industry. And so they were just sitting there with a water pouring downstream, right? You can't just generate electricity and not use it. You have to send it somewhere. So they were just underused massively. So, you know, and people are engaging in extremely bad data science when they throw out metrics. You know, they'll take”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Well, I mean, I think there is, people are not so familiar with the energy sector in general, but the total amount of power in the world that is consumed by Bitcoin is quite small. So that tends to be renewable just because there's no extraction, refining and transport costs for the fossil fuels that are the alternative. And so, and the other thing that really favored Kind of green or renewable energy for”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“For people outside of the jurisdiction that's affected and there was already a shortage of minors. So if some of it sold, that alleviates some of that shortage. Because it's difficult to buy used equipment because you don't know how it's been treated, if it's been air filtered or overheated, over colloped, et cetera. So that's tricky.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“in time because it's capital intensive so it can't move that quickly. Takes time to build infrastructure and they would be talking about Moving it within a few months. So I guess between the lines it weren't actually move instantly. We'll certainly get a view on it, right? If you look at the hash rate and if it goes down, it stays down, that's because people can either mine it or move it, relocate it fast enough. So we'll see how it plays out. Doesn't matter, you know, I mean, I guess the point because people hear this and they sound alarming, but I mean, ultimately, you know, Bitcoin doesn't care, sounds callous, but it really doesn't. The difficulty will go down. Money will become more profitable.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“What's the electrical safety like what's the chances that the mine will catch fire? And what's the political overhang? Is there a chance that the local or national regulator could change the power price without notice or ask you to leave and ask you to stop mining its jurisdiction? So those sort of more sophisticated investors look at the non-pure price factor. They look at the quality and the political risk. And so that, I think, drove organically meant that hash rate grew faster outside of China. So that's changed the balance a bit. And there does seem to be people looking to move equipment, but I don't know how much spare capacity is just kicking around. If somebody says they want tens of per hash of hundreds, even extra hash of miners to move, you know, people are building just”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Hosting in power outside of China. I recall in a previous version of this a few years ago, the story was that some miners had secured power in Russia and driven equipment in trucks over the Russian border and set up shop over the border. But it seems like nevertheless a lot of hash rate continues in China. So I wouldn't be surprised if that plays out this time. Some may relocate and generally there has been a bit of a trend towards North America and Europe over the last few years without much fanfare just because I guess institutional investors doing mining are a bit more savvy about geopolitical risk. So they will say, you know, okay, 70 cents per kilowatt hour, but under what conditions, right? Are you using air filtration?”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“You need permissions to do many things, but you can't get the permissions, so everything is kind of in a gray zone. And then they make announcements to kind of soft tune what's happening on the ground. So if they think that something is getting too big, that they'd sooner shrink, they'll say something negative So generally speaking, things just flow around it like water like they will. So there's definitely a bit of news about people trying to look for”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Mean it's happened multiple times before, so it's always difficult to take it seriously because we'll have the China bans Bitcoin or China bans mining or China bans, I don't know, exchange trading or something. I think maybe some of it is context related. So people look at it from the point of view of the regulatory environment they used to living in and they think, well, you know, if our regulator said that, we would have to do something, take it seriously. But in China, the sort of... Regulations are handled differently. So effectively”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Advice that people give out, and yet it's Bitcoin and they're selling barely a month after they bought it. So I don't know what they were thinking really. I mean, in a Bitcoin space, it's sort of similar to the stock situation in having cycles, but just much higher sharp ratio and a volatility to go with it. So if you adapt for that, divide everything, divide the sharp ratio by 10, volatility by 10. It's something very similar, right? So I don't see, you know, people should catch up and learn that. It just takes a while to adapt to, you know, this kind of volatility and understand that there actually is something that is storing value for you over the long term, right? It seems, I guess it seems counterintuitive.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“stock market just stocks like stock index or individual stocks in sectors any financial advisor would tell you well don't buy that if you need the cash for you know three years plus right you should expect to hold it because the market has cycles it can be volatile it does well in the long term but in the short term it may go down that kind of”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Reactions by offering a share buyback for anybody who didn't like the strategy. So all those things take months and months, maybe six months or a year to set up. And if you recall going back a while ago, MicroStrategy organized... Institutional buyers, kind of private conference or something, and there were hundreds and hundreds of company participants. So we'll see. I mean, certainly companies can turn out to have weekends too, but they're at least operated on a five-year time horizon plus. And the other thing that's kind of surprising about time horizons is If you would buy”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“And I think that negative new cells, so news organizations will recycle old information that isn't even new, or China is a good one for it because of the language barrier. Sometimes people mistranslate things or amplify things. And then there's nobody really stepping up to explain what really happened. But the institutional bias, I think they're still there coming because it takes people maybe not familiar with how long it takes these entities to get to a position. They've got to do lots of tax planning, legal planning, get external advice from auditors and regulatory lawyers and figure out how best to hold it and maybe that involves board approvals for a public market company and In the case of even micro strategy, right, he went to quite elaborate lengths to Protect the company from adverse”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Elon apparently didn't actually sell the coins, or at least the ones that are on the balance sheet of Tesla, I guess, right? Because it's a public market company. I'm not sure that institutional buying is, you know, people form opinions based on little snippets of news and the media likes to Negative news or make it up or recycle it. And there's a lot of confusion. That people make about news are wrong. And, for example, the mining thing that we talked about last time, that the hash rate was down a large amount and it wasn't. They were looking at the effective extrapolate there and that that would hurt miners outside China and it actually helped them. And so the inferences are very confused and wrong. So if people trade them, that's kind of giving value to people who understand the market structure.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“You would expect them to be less phased and more long-term looking to be accumulating at this point. But that remains to be seen, I guess. Otherwise, I just think that generally Some people use leverage to buy lower down so that the leverage hasn't gone away, right? It's just shrunk. So probably some of that bought 30,000, 35,000 range or lower leverage or something. So I assume that it will, you know, now that some of that risk has been moved from the system and Coin's transferred hands that things will gradually get more solid and pullbacks less rare.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“I wonder if the asymmetry of buying power is part of it. The market is generally very net long and people don't like to be net short Bitcoin. The sort of buying power left on platforms is there's not that much reserve dollars to buy coins. And buying coins using leverages it's self-risky. Makes unlike And people who are interested in Bitcoin tend to end up very exposed. They don't have cash reserves because they'd sooner redenominate in Bitcoin. So you don't have that kind of market mak Sort of value, investor phenomena where there are, let's say, mutual funds and so on that are looking at endless reports and buying unvalued stocks that they think have long-term value. So, you do have some new parts of that, which is the institutional investors coming in.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“I think that there are people who stepped in to buy coins, certainly when a market hit the 31,000 around about there. I happen to be looking at the market when that was going on and it was insane. The price was jumping $1,000 or $2,000 every few seconds just jumping around as people were getting liquidated and other people were buying. So, I think there's got to be some coin transfer, every sale has a matching buyer, and some of those buyers won't be as leveraged or won't be leveraged or will be start better or become better at managing risk in having stop losses and smaller possession sizes and things like that.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“They won't do that again, right? Or they'll start more cautiously if they are using leverage, they'll use less of it, or they'll put stop losses, or paradoxically, maybe they will make higher leverage bets, but smaller ones that they can afford to liquidate. I mean, if you put on a 10x and it falls 10%, it's gone, right? It's liquidated. So at least then I think professional traders in, let's say Forex, leveraged Forex trading, things like that, they're going to look at the newsflow, make predictions, hope to be right, maybe 60% of the time, and make small bets, right? Lots of them. And so I think one of them is that people made large bets that became larger than they anticipated because it's quadratic effect, which people don't think about because when they're a small movement, it's more linear. It gets more quadratic as you get further down or further up. So yeah.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“I mean, I don't know the full data, but it seems like it's a big factor because you hear of people who've got liquidated, probably everybody knows somebody who's had a long position or like multiple positions, some of them liquidated. And that's typically it, right? They were holding and trying to increase their Bitcoin returns. And of course, since people have put on a long and got away with it without liquidation when the price was $10,000, are probably looking pretty good even today, right? And so there are some people who put these positions on or leave them for a long time, you know, hope to catch a wave price doubling. That gives them a lot of insulation where they can put a stop loss, which is still in the money somewhere in a market. So I think it's in terms of how this works going forward, I think that it's educational, like in a painful way, obviously, for many people.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“If you are shorting with dollars, then your dollars are shrinking in relation to Bitcoin. So you have the quadratic effect. So I think actually most of the short interest in the market is not really short. It's the long short, it's a Bitcoin neutral way to collect yield to lend money to people who are trying to go along. As Plan B was just saying, and same, I think most of the markets made up most of the short markets made up by that. So it's not actually exposed. And that is stable because you're betting the price will go down, but if it goes up, the collateral increases and vice versa. So that's completely stable and doesn't actually won't get liquidated, generally speaking, in a 10x increase or a 10x pullback. It's pretty stable. So go ahead”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“100 Bitcoins or 100 millibitcoins, you know, 0.1 Bitcoin. Same thing, just the ratio, right? So 100 units, and you go two times long and a price starts at 50,000, by the time the price falls to 33,000, which is only a 33% fall, you'd be 100% liquidated on that position, right? So you think, well, two times, and if you look at the upside, it's not as great as you think because you make a profit on the price increase, right? And then you want to convert that price increase into Bitcoin, and then you have to divide it by a new higher price. So the asymmetry is kind of not in your favor. And it's not that shorting is particularly safer. I mean, shorting Bitcoin is probably even more dangerous if anything because you have the same quadratic kind of effect in all.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“And just for some illustration of how the perpetual future is a kind of quadratic instrument, like if you're trying to buy Bitcoin more Bitcoin using Bitcoin, you've got a risk from the price falling when you're hoping it's going to go up, but you've got another compounding risk that makes it a squared loss, which is that the value of the collateral, i.e. the Bitcoin, is also falling. So you've got, you know, so basically if you”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“I mean, it's curious that probably people think that the market fall is driven by Panic sellers, so people who are trying to hold on to dollar value who didn't have to sell versus forced sellers, people who actually were just really trying to accumulate more Bitcoin but pushed it too hard on the leverage. And I'm thinking it may be more the latter than the former. So certainly some people will instinctively sell to preserve some dollar value. Maybe they'll think this is too much for me and they'll leave or they'll hope to time it and buy back later, which is also dangerous, right? It can turn around in a heartbeat too. So certainly that statistic about the $20 billion down to $11 billion.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Risk that I might lose some of the Bitcoin I have got. And so that's whether leverage trading gets potentially dangerous if you overdo it because it can, there's another saying which is Leverage can't make a bad investment good, but it can make a good investment bad, which is to say that you have something long term want to buy and hold. But if you over leverage a price pullback that you would like to buy kind of forces a sale to protect so that liquidation is partial or not full or something. Because if you certainly, some people are doing quite high leverage and that can completely liquidate portfolio basically or whatever's on exchange.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“I mean, the interesting thing is it doesn't have to even be the natural makeup of the average investor. It's just that those people are the survivors. Because if you don't take that attitude, you tend to get washed out, right? Or you panic, you would be inclined to sell in a dip or not buy in the first place because you're worried about volatility or something. So the people that either start out with this attitude or develop it over time, I think most people develop it over time. I think basically your investment portfolio denomination changes. That's been my view for a long time now, that I want to increase the number of coins I have. And if the price is plus or minus 50%, I don't even account for it. Like, you know, one point is one Bitcoin. The question is, how do I get more Bitcoin without increasing risk?”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“I do wonder if you would start to see more value investors. I mean, I tend to view it as a value investor, so the price falls or try to buy more. And you see that with stocks, right? There are analysts who are looking at it and saying, well, this is overweight or underweight based on courtly reports, expectations. And if it falls a bit, they will start to buy it with a fund or something, right? And so we might see some of that coming into Bitcoin in the longer term. if as more people gain confidence in the longer term trajectory, the long-term viewpoint, the volatility is normal, it's fine, it's necessary even otherwise the price would already be much higher.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“doing leverage or selling a bit and buying back. I use if you are inclined to day trade, at least restrict yourself to 10% of claims. That way, if it all comes horribly unstuck, you'll still have 90% of the claims cold stored. So I think a lot of what happened in the last month is down to over leverage. And that we can talk about, but it creeps up on people faster than they think. So as Bitcoin gets bigger, a higher market cap.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Excess income if you have a job into it, that tends to work out very well over a long period of time and certainly for myself. From 2017, I had come to the heuristic of buying any time and the price dropped by at least 20%. Below that, I didn't consider a dip. And so I bought my first post 20,000 16,000 and just kept buying down to 3,500. And I was kind of low on cash at that point. But, you know, obviously, if you're still holding those today, that looks pretty good, right? I think the other thing is you're talking about If as the market gets bigger, how will it adapt to this? And I think the way it adapts is kind of biological or evolutionary, that people who can't handle it leave, they put money in, the price drops, they sell at a loss, and they can excell. Maybe they learn not to do that in future when they see it come back, or maybe they don't, maybe they leave. But in any case, the coins just organically”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Exactly. Yeah. Yeah. And so You know, I mean, you'd think, well, he was saying he was surprised by that, right? But I think, you know, people have a reason to fear being out of market. So... Going back a few years, I had the come to the realization maybe 2014, something like that, that it wasn't that good an idea to day trade this thing to try and think, oh, I'll sell some now, I'll buy it back later, because basically looking at something very highly volatile, more so at that time, and plus or minus on some kind of exponential part of an S curve and otherwise a random variable. So if you sell and buy back, the odds are stacked against you. And another statistic which highlights this, that if you eliminate the 12 single-day largest gains in a year, Bitcoin loses money year on year. So your biggest risk is being out of market for any of those 12 days. And so, you know, simply buying more when it goes down, if you can afford that or just hold, you know.”
2021-06-02 · We Study Billionaires · BTC028: Bitcoin Update w/ Plan B & Dr. Adam Back (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT