Episode 44: Crypto Craziness Part 1 - The Gospel of Bitcoin Jesus Roger Ver and Bitcoin Carnivores

Bitcoin and cryptocurrency are unusual in their own right, but even in this already bizarre world, there are ideas and personalities on the weird end of the spectrum. Roger Ver, who is called "Bitcoin Jesus", is pitting his own Bitcoin Cash (or "BCash" if you're feisty) against Bitcoin Core. There are also the Bitcoin carnivores, who not only eschew central banking but the eating of fruits, vegetables, and "toxic grains".

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An Introduction to Bitcoin and Blockchain

Firstly, what is a blockchain? A blockchain is essentially like an Excel spreadsheet of balances and transactions EXCEPT that no one person or entity can control the spreadsheet because it’s distributed among many different computers owned by different individuals around the world. 

Imagine going to an arcade but instead of spending money on tokens you give money to the owner and they mark down how many times you can play a game on a piece of paper instead. When you want to play, the owner activates the game, subtracts an amount from the spreadsheet.

This system would be easy to hack if you could get access to the owners spreadsheet. But imagine that EVERYONE who goes to the arcade has a copy of the spreadsheet that updates everytime someone either plays a game or pays money to get on the spreadsheet. Then to “hack” the spreadsheet you don’t just have to change the owner’s, but EVERYONE’s spreadsheet.

There’s also different types of blockchains with different purposes (called “use cases”), but for this intro we’re only going to focus on the one people really care about right now and that’s Bitcoin.

Bitcoin’s current primary uses cases are censorship resistance (i.e. no government can control its transactions or freeze its account) and as a highly secure store of value. For the time being at least, it’s too volatile in price to be used as a reliable currency. 

Bitcoin was created by somebody going by the name of Satoshi Nakamoto. He published Bitcoin’s white paper in 2008 and created the first Bitcoin software in 2009. Nobody knows who Satoshi really is, but there’s plenty of theories and scandals surrounding that controversy, which we’ll get into later in this series.

Each computer running the official Bitcoin Core software is called a node in the Bitcoin network. Almost anybody with a computer can run a node. You can even run it on a Raspberry Pi, which is basically a ultra-cheap, itty bitty computer. As bitcoin.org explains,

A full node is a program that fully validates transactions and blocks. Almost all full nodes also help the network by accepting transactions and blocks from other full nodes, validating those transactions and blocks, and then relaying them to further full nodes.

One reason Bitcoin developers take so long to change anything in the Bitcoin Core code is because they want to ensure it’s sufficiently decentralized. If it becomes impossible for things like the Raspberry Pi to store the ledger, then they fear that the nodes will become centralized by those with the wealth and power to run the expensive hardware and storage space required. One side effect of this is that it slows down transaction speed on chain, requiring off chain solutions for the speedy transactions required for making purchases, such as the Lightning Network. This is the primary source of contention between the Bitcoin Core and Bitcoin Cash communities, which we’ll get to later.

A Bitcoin miner is someone that uses a computer to solve complex mathematical calculations necessary to group recent transactions into what’s called a block. This process is called “proof of work”. For their service to the network, they’re rewarded with new Bitcoins. There’s a limited number of Bitcoins that can be mined, that number being 21 million. 

There’s about a hundred years to go before all the Bitcoins are mined. After that, well, if no miners want to accept miniscule fees for their proof of work, let’s just hope that, if Bitcoin becomes a world reserve currency, it doesn’t stay the world reserve currency or else we’re all fucked.

Blocks are only accepted by the rest of the network if it’s legitimately hashed by miners. According to blockgeeks.com,

In simple terms, hashing means taking an input string of any length and giving out an output of a fixed length. In the context of cryptocurrencies like Bitcoin, the transactions are taken as an input and run through a hashing algorithm (Bitcoin uses SHA-256) which gives an output of a fixed length… in the case of SHA-256, no matter how big or small your input is, the output will always have a fixed 256-bits length. This becomes critical when you are dealing with a huge amount of data and transactions. So basically, instead of remembering the input data which could be huge, you can just remember the hash and keep track.

Hash rate basically means how fast these hashing operations are taking place while mining. A high hash rate means more people and software machines are taking part in the mining process and as a result, the system is running smoothly. If the hash rate is too fast the difficulty level is increased. If the hash rate becomes too slow then the difficulty level is decreased.

Since the harsh rate perpetually gets harder and harder as more miners join the network, you need perpetually more computing power to complete this process. The result isn’t very environmentally friendly. According to enemy of the people Illuminati shills CBS,

Some estimates say more than 60 percent of the processing power used to mine bitcoin is in China, where it relies heavily on the burning of coal. 

Coal and other fossil fuels are also the largest generator of electricity for the rest of the world, and coal is a significant contributor to manmade climate change. Burning it produces carbon dioxide, a gas that is a primary contributor to global warming.

Estimates vary, and a true figure could be impossible to come by because of the intentionally anonymous nature of bitcoin use. But Dutch bitcoin analyst Alex de Vries, who operates a Bitcoin Energy Consumption Index on the website Digiconomist, has produced estimates he believes are alarming.

If bitcoin miners are using the most efficient machines possible, the lowest amount of electricity they could possibly be using is 13 terawatt hours, de Vries said in an interview. That's about as much as the entire country of Slovenia. 

De Vries said less conservative estimates make it entirely possible that bitcoin is using as much energy as Ireland, which consumes about twice as much as Slovenia, or about 0.7 percent of the U.S. total.

The problem is getting worse, said de Vries, who estimated the annual amount of energy consumed by bitcoin rose by a fifth in the final weeks of 2017.

By the way, unlike the network nodes, Bitcoin mining is totally centralized. There’s gigantic warehouses with endless rows of computers mining Bitcoin all day. If you try to mine Bitcoin with your crappy laptop, you might get a cent’s worth in a year if you’re lucky.

Each transaction uses cryptographic technology and this ensures that the blockchain is using identical copies of the blockchain. When you sign a transaction with a private key, anyone in the network that knows your public key can verify that your signature is valid. 

You control your own Bitcoin transactions with your private key that’s stored on a file in a device called a wallet. Each wallet has an address that you can use to receive funds. There are two types of wallets, hardware wallets (or cold wallets) and software wallets (or hot wallets). Hardware wallets are the safer option since your private keys never leave the piece of hardware externally connected to your computer whereas, with a software wallet, if a hacker has access to your computer, they can also theoretically get access to your private keys. Nobody can send from your wallet without your private keys, which is what Bitcoin is all about: getting rid of financial middlemen and giving yourself total control over your own finances.

HOWEVER, part of the double edged sword of Bitcoin is that -- since there’s no middleman to go to -- if you fuck up and lose your private key, or accidentally type in the wrong address, or get hacked, or lose your seed words, or any number of things that can go wrong, there’s nobody to come crying to. Your money is gone forever!

Okay, if you’re still lost, I’ll let you in on a dirty secret. None of that matters to you. All you really need to know this: If you’ve got some Bitcoin, when the line goes up on the price chart and it is in the green, that means good. If it goes down and it is in the red, that means bad. The greener and upper it is, the richer you become. The redder and downer it goes, the poorer you become. That’s really all you need to know.

Bitcoin Jesus, Bitcoin Cash, and the Battle for the Soul of Satoshi

If you go to Bitcoin.com, you might expect that you’d come to a website advocating for Bitcoin. However, you’d be totally wrong to make that assumption. You see, Bitcoin.com is owned by its CEO Roger Ver and he really fucking hates Bitcoin (notated BTC on exchanges). Or, more precisely, Bitcoin maximalists. A Bitcoin maximalist is basically a Bitcoin Core cultist. Besides being typically carnivorous and enormous fans of the second amendment, a Bitcoin maximalist also dogmatically hates all cryptocurrencies with the exception of Bitcoin. And they especially hate Roger Ver’s favorite cryptocurrency Bitcoin Cash (notated BCH on exchanges), which they deridingly call Bcash, much to Ver’s umbrage.According to Investopedia,

 Ver was also an early investor in a number of related blockchain projects, including Kraken and Ripple. In 2012, Ver launched bitcoinstore.com, offering thousands of items for sale with customers allowed to transact in bitcoin. Throughout the process of advocating for bitcoin and related projects, Ver earned the moniker "Bitcoin Jesus," as many saw him as an evangelist on behalf of the cryptocurrency.

By the way, don’t call Bitcoin Cash “Bcash” in front of Roger, and don’t worry, you’ll find out why soon enough.

Bitcoin Cash a fork of Bitcoin. A Bitcoin fork is basically a clone of the Bitcoin Core ledger which picks up where Core left off and moves in its own direction henceforth. 

The Bitcoin Cash fork was the result of two diverging camps of Bitcoin developers and investors. As I mentioned earlier, the Bitcoin Core people didn’t want to make the blocks bigger and bigger in fear of seeing the centralization of nodes. One side effect of this, though, is that the on-chain transaction fees are larger and take longer to process. 

Bitcoin Cash people say that theirs is the true Bitcoin, despite being a clone of the original. This is because, according to them, their vision for Bitcoin is closer to Satoshi’s than the Core team. They maintain that Satoshi wanted this to be a currency, after all. Not some goofy store of value. They’re sorta Orthodox Satoshiists. To them, using it as a peer to peer currency to circumvent banks and governments is the one true and only way for Bitcoin to be a thing. They basically say, “Fuck it, make the blocks big as fuck and who cares if it becomes centralized. It likely won’t happen anyway because Moore’s law and capitalism and freedom and all that. We want to actually spend this shit, not just HODL it.”

So, did I just use an alien word there? Did I mean to say “hold”. No, I clearly said “HODL”. “HODL” stands for “hold on for dear life”. It’s basically what millennial and Generation Z retail investors tell themselves when they lose 99% of their position in a cryptocurrency and want to ward off suicidal thoughts. As for the origin of the term, the Wikipedia page for HODL tells us,

It originated in a December 2013 post on the Bitcoin Forum message board by an apparently inebriated user who posted with a typo in the subject, "I AM HODLING."

Roger Ver is a super, ulra, hardcore, mega-libertarian. So, what do you do if you’re a super, ultra, hardcore, mega-libertarian? You compare everything you hate with ANTIFA, duh! In a Youtube video Ver put out on July 1, 2019 titled “BTC Maximalists are the ANTIFA of Crypto”, Ver says -- after showering heaps of praise on professional asshole Steven Crowder no less,

The people that hijacked the BTC version of Bitcoin are like the ANTIFA people that want to physically use violence to suppress dissenting opinions. And if you don’t believe me I’ll show you a website that somebody put up there.

Roger shows us a website -- which, by the way, I could not find this website on Google no matter how hard I tried -- which is titled “One Punch for Ver”. It’s basically a bunch of memes advocating people to punch Roger Ver in the face.

So, obviously, it’s representative of Bitcoin maximalists as a whole right? Ver has a huge sample size I imagine. After all, all Bitcoin maximalists are totally ANTIFA according to the video title, right? Well, according to the website F.A.Q. that Ver shows as he’s scrolling through it, it says,

Question: Who are you? Answer: We’re two guys from China. Our exactly [sic] location will not be revealed, but one of us has already seen Roger Ver last year at the Shape the Future Summit around Grand Hyatt hotel from Hong Kong. We also guarantee that both of us know how to deliver a punch.

In response, Ver gives these two Chinese guys (and apparently every Bitcoin maximalist) a stark warning,

If you try punching me, I’ll choke you into unconsciousness.

When Ver first heard about Bitcoin he became instantly obsessed. And by obsessed, I mean really obsessed. As Ver told everyone’s favorite responsible interviewer Dave Rubin,

I was so excited about this. I heard about it as I was eating breakfast at around 10 AM with the full intent of going into my office that day. Didn’t make it. I stayed home and read about Bitcoin all day. I stayed up all night the next day until around 4 PM the next day and I got too tired and I fell asleep for only about an hour. And then woke up again and read all about Bitcoin.

And I went on sleeping maybe an hour and a half per night for about a whole week, until I got so sick from lack of sleep that I had to call my friend and say, ‘Help me, I’m so sick!’ He came and picked me up and drove me to the hospital and they gave me some sort of a sedative or something and I passed out asleep for maybe twelve or sixteen hours. But then woke up again and it was all Bitcoin... And it’s been all Bitcoin all day everyday for seven years now.

Ver tells Rubin that he became a libertarian (or, as he prefers to call himself, a “voluntaryist”) in junior high when his mother grounded him from playing Ninendo and forced him to read instead. Serendipitously, the book he randomly pulled off the shelf was called Socialism by Ludwig von Mises. At first glance, Ver thought it was a pro-Socialism book. But after reading it and coming to the realization that price controls are whack, Ver went on a binge of reading pretty much every libertarian book ever written.

Ver claims he has firsthand experiences that confirm the Austrian ecnomist’s theories about money are correct. What experiences were these? He saw inmates using cigarettes and other garbage as a means of exchange while serving time in Federal Prison. And BOOM, Mises was definitvely vindicated.

According to Investopedia,

In 2002, Ver was sentenced to 10 months in prison for selling explosives via eBay. It is common for Ver critics to point to this part of his personal biography as a means of portraying him in a negative light.

According to the information and plea agreement, Mr. Ver sold explosive devices described as “Pest Control Report 2000” on the online auction site eBay. He purchased approximately 49 pounds of the devices from a supplier in South Carolina, and sold at least 14 pounds of the devices to bidders on eBay. While engaging in the business of selling explosive devices, Mr. Ver stored the explosives in a residential apartment building and mailed the devices via the United States Mail in a manner contrary to Postal Service regulations.

What the hell is Pest Control Report 2000? Well, it’s basically a quarter stick of dynamite used to scare off large pests on farmland. According to federalregister.gov,

Explosive pest control devices contain black powder, flash powder, and/or a similar pyrotechnic composition. Many of these devices contain flash powder, a high explosive, as the component that produces the audible report. These devices are used for wildlife management purposes as an effective deterrent and are necessary for pest control efforts within the agricultural, aquacultural (commercial fishing operations), horticultural, and aviation industries. Commonly known as “bird bombs,” “shell crackers,” “seal bombs,” etc., explosive pest control devices are used to deter wildlife pests without harming them.

Ver has a different take than the government. He claims that he was only selling firecrackers on eBay and the whole thing was just a way for the government to make an example of him for being a libertarian and talking shit about the FBI.

Investopedia continues,

In 2014, Ver renounced his U.S. citizenship, becoming a citizen of St. Kitts and Nevis in the process.

So, what and where is St. Kitts and Nevis? And why is Roger Ver a citizen there? Well, we’ve been listening to this libertarian guy for a while now and, since we’re fair and balanced on this podcast, let’s give the deep state a word in. According to the CIA World Fact Book, Saint Kitts and Nevis is located on,

...islands in the Caribbean Sea, about one-third of the way from Puerto Rico to Trinidad and Tobago…. Following the 2005 harvest, the government closed the sugar industry after several decades of losses. To compensate for lost jobs, the government has embarked on a program to diversify the agricultural sector and to stimulate other sectors of the economy, such as export-oriented manufacturing and offshore banking... 

Saint Kitts and Nevis is among other countries in the Caribbean that supplement their economic activity through economic citizenship programs, whereby foreigners can obtain citizenship from Saint Kitts and Nevis by investing there.

So, you might think, cool, Ver finally escaped the Communist States of America for selling firecrackers and now he lives in an island paradise. He's all good right? No! Escaping the United States is merely one step in the total libertarian utopia endgame. You see, Ver is trying to create his very own country. No, this isn’t Jonestown. It’s called Free Society, which doesn’t sound like a cult at all.

According to freesociety.com,

We plan to establish a rule of law based on libertarian principles and free markets. We don’t see the need to recreate traditional government structures. The rule of law / constitution can be included in the final agreement of the land sale, and will be an extension of the existing contract that will be put in place with the government that granted us the sovereignty. 

Enforcement will happen through private arbitration, competing court systems and private law enforcement. It is important to establish a proper rule of law, as our project will set an example for the industry and create an important precedent with governments and the world. We want to make sure the constitution is solid but avoid the inefficiencies of existing government structures.

Ver tells Bitcoin Magazine,

We were planning to have an initial coin offering, but the regulators have kind of gotten in the way of that at the moment. But basically, we are working out the details as to how people can participate directly… 

Thanks to cryptocurrencies, now there is a way to fundraise for people all over the world who are interested in this. Myself and my other friends all have a fair amount of capital now because of cryptocurrency. Dying with a pile of money isn’t any fun, so let’s make the world a better place...

There will not be a government. It will all be private institutions and private organizations…”

By the way, did I mention that Ver really hates it when you call Bitcoin Cash “BCash”? On a YouTube channel called Bitcoin Error Log, there’s an interview with Ver where he makes it clear that he needs a safe space for Bitcoin Cash. Dylan will play the interviewer and I will play Ver. Here’s how the video goes:

You are a cheerleader of BCash so people point at you as somebody who would be the source--

Continue insulting me, I’m not interested in continuing this! It’s Bitcoin Cash! Get it straight and if you do that again I’m going to end the interview because I’m not interested in being insulted, okay? I’m promoting Bitcoin Cash!

It’s not an insult. Why do you have to take it personally? It’s just a name. I actually like it better.

I’m being insulted here! I’m being insulted! I don’t need to be insulted by you! I have enough money. I was a self-made multimillionaire before I ever got involved in Bitcoin! I don’t need to have my buttons pushed by people like you on the Internet! It’s Bitcoin Cash!

Roger, the only reason you want to call it “Bitcoin Cash” is because you want to co-opt the brand. 

I think Bitcoin Cash has a more legitimate claim to being the Bitcoin that was outlined in the bitcoin.org website. So yes, that’s my position.

You want people to think that it’s Bitcoin.

It is Bitcoin. Read my lips. 

No, it’s Bitcoin Cash... With the amount of Bitcoin people think you have and that you may have spent on BCash, you’re going to have more --

I would like an apology at this point! It’s not BCash. It’s Bitcoin Cash.

Look, it’s what I call it. I’m not doing it on purpose. It’s just so easy. It’s a nice name, it really is.

This interview is over. I don’t need to be insulted. I was a self-made millionaire before I even got involved in Bitcoin, now I have even more money than --

Who cares if you’re a millionaire? That has nothing to do with anything. 

I don’t need to be insulted by some person on the Internet. What’s your gross annual revenue for Exotica?

None of your business!

Less than a million dollars, huh?

That has nothing to do with the conversation.

Your gross annual revenue is less than a million dollars!

Of course!

That means you don’t know how to run a successful business! “Of course!” We do more than a million dollars in sales most days!

We’re not running a business here. I think there are only three people that want to call Bitcoin Cash ‘Bitcoin Cash’: you, Jihan, and your sock puppets. Okay? Because there’s nobody else--

(ROGER THEN FLIPS OFF THE WEBCAM)

Goodbye! I’ve never hired a single sockpuppet and I don’t need to be insulted! But please post this so the entire world can see how incredibly rude you are to me!

Bitcoin Carnivores

For the moment let's take a seeming digression into the world of the all-meat or carnivore diet. While this might sound extreme, you will be pleased to learn that they also eat eggs so they aren’t fanatics. Shawn Baker, otherwise known as the “Carnivore King”, eats 4 lbs of steak every day. He cites the ease of the carnivore diet as one of its strong points, saying,

I just have to think: how hungry am I and how many steaks do I want to eat.

Baker cites numerous health benefits to his transition, including improved digestion, lower blood pressure, and the sexual vitality of a twenty something. 

It should be noted that most doctors are more than skeptical about the whole “don’t eat any fruits, vegetables, or grains at all” health plan. Christopher Gardner is a professor of medicine at Stanford University. When he was confronted with the carnivore diet, he was initially confused over who the diet was for,

Are these T rex? African lions? Or humans? Assuming humans, this sounds disastrous on multiple levels.

In summary, I think a ‘carnivore diet’ is inappropriate for human health, bad for the health of our planet, abusive of animal rights and welfare.

So, why are we talking about this? Because there is a small contingent of Bitcoin enthusiasts who also adopt the all-meat lifestyle calling themselves, naturally enough, “Bitcoin carnivores”. Michael Goldstein, founder of the Satoshi Nakamoto Institute and “bitcoin and meat maximalist”, explains why these two seemingly unrelated things are in fact birds of a feather,

The 20th century was disastrous for human health and wealth, and the rise of central banking and industrial food was clearly a major reason why.”“Bitcoin is a revolt against fiat money, and an all-meat diet is a revolt against fiat food.

Once someone has grown capable of seeing beyond the lies and myths that experts peddle in one domain, it becomes easier to see beyond them in other domains as well.

But Goldstein is on to something, namely how cryptocurrencies attract weirdos because cryptocurrency itself is weird. This point was made by Neeraj Agrawal, communications director at Coin Center,

There is probably a bit of self-selection going on here. You can’t really work in cryptocurrency without an openness to weird ideas.

Saifedean Ammous, author of forthcoming book The Bitcoin Standard and economics professor at Lebanese American University, is another proponent of “bitcoin carnivory”, asking “Why have variety when you can have the best?” Like Goldstein, he is also leary about experts meddling in your financial and dietary affairs,

The people who tell you to eat your 6-10 portions of indigestible toxic grains a day ‘for a healthy and balanced diet’ are the same kind of people who tell you central banks have to determine interest rates for a modern economy to function.

He retweeted the account @SteakAndIron who said,

I haven’t found a problem that can’t be solved by increasing meat, decreasing carbs, lifting weights, HODLing bitcoin, and disregarding govt.

Ammous responded positively,

I had 99 problems but bitcoin carnivory solved every one!

Ammous convinced Ferdous Bhai, who runs Crypto Insider with 21MIL, to adopt bitcoin carnivory as well,

You convinced me to embrace a meat and water diet. First Bitcoin maximalism, now this.

We live in a digital world, so we can’t transact with gold, but Bitcoin has all the properties of gold, which was the earliest form of currency that we know of. The philosophies and principles behind Bitcoin are ancient.

@TsonicTsunami credits the diet with improving his financial discipline,

HODLing required strength, meat provides the energy and strength in spades.

Perhaps inadvertently, The Paleo Manifesto author John Durant offers the best explanation for why Bitcoin enthusiasts would be drawn to carnivory. Durant puts forward paleo as an alternative to the “left-wing plant-based movement”. Considering the right-wing emphasis on tradition and a return to the past, it makes sense to think of the Paleo-diet as a right-wing diet. If carnivory is extreme paleo, and bitcoin enthusiasm is extreme libertarianism, it makes sense that being attracted to one would involve being attracted to the other. 

But there is another important reason: It’s simple. Consider another nutritional trend that took over Silicon Valley: Soylent. These tech nerds love the idea of not having to think about eating at all, and “eat meat” is a pretty simple rule to follow. Bhai says that this is a primary factor. He doesn’t have to think about what he eats and only eats once a day.Goldstein mentions how he only spends 10 minutes grocery shopping, most of that time spent waiting in the checkout line.

Sources

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