SLP281 Cory Klippsten – Bitcoin Is For Everyone, Swan Bitcoin $1B run rate, Bitcoiner Ventures, Elon’s mistakes

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Cory Klippsten, CEO and Founder of Swan Bitcoin joins me to talk about various topics:

  • Working in the bitcoin space
  • Teaching newcoiners
  • Growing the auto-stacking movement
  • The latest with Bitcoin Ventures
  • Elon Musk’s mistakes

Links:

Sponsors: 

Stephan Livera links:

Podcast Transcript:

Stephan Livera:

Cory welcome back to the show.

Cory Klippsten:

Good to be here. Stephan. Thanks for having me.

Stephan Livera:

So Cory, there’s been a lot, going on. Swan has been growing phenomenally. We’ve got a lot of new people coming into the space. A lot of new jobs being created in the space, all this crazy [stuff], you know, Elon and Taleb going BSV, we’ve got plenty to get into today. I guess. Let’s just start with, where do you feel we are in the cycle? You know, are you a believer? Like I know you’re not a fan of STF, right. But of the modeling stuff, but are you a fan of the four year cycle?

Cory Klippsten:

I think we have four year cycles until we don’t. They’ll end at some point. I don’t know when that is — for business planning purposes, you’d have to be kind of an idiot not to plan for a major downturn in 2022, 2023, because that’s what’s happened before. So we’re kind of a mind to get as much repeating revenue as possible and make sure we’re well capitalized. And don’t overextend during a bull run to the point where you’d have to be letting people go and creating a horrible culture at your company. It’s much rather it’s better in this particular field with the types of cycles we’ve had to be a little bit more cautious in my view.

Stephan Livera:

Yeah and absolutely, I think the whole order stacking message is so important because here’s the thing you really, really want to have your order stacking or your DCA Bitcoin plan on during the bear market, because that’s when you accumulate the most.

Cory Klippsten:

Yeah. It’s a bear market product. It really is because I always call it automatic recurring purchases as opposed to dollar cost averaging or you can use auto DCA that’s okay. But no cause dollar cost averaging is kind of a trading strategy and it’s generally not the optimal trading strategy. If you actually have a big chunk of cash ready to go, and you’re in a bull trend because if you have an asset with upward skewed volatility, it makes more sense to smash all or most of it right up front.

Stephan Livera:

Right.

Cory Klippsten:

So I usually think about automatic recurring purchases as matching to your Fiat inflows. So really the product was created to pay yourself in Bitcoin or to get paid in Bitcoin. That was kind of the point of it.

Stephan Livera:

Yeah. And I think a typical strategy is to start with a lump sum, right? So it’s kind of like, you’ve got that newcoiner that person who is — they’re pre-coin, they’re a new coiner. Maybe they haven’t built their conviction yet. And so maybe you say, look, your lump sum, however much you’re comfortable with. But when you lump sum in, you need to be comfortable HODLing that for minimum four years or longer, ideally, and then set up the auto DCA, the auto stacking, automatic recurring purchases. I think that seems to me the reasonable approach, because here’s the thing, there’ll be a lot of people who might be coming in and they don’t know, am I coming in at the beginning, the middle or the late part of this cycle? And that’s the anxiety, most people feel right when you talk to people, I’m sure you’ve seen this when I talk to new people, they’re sort of like, oh, I’m waiting for a dip. I don’t know. How do you sort of answer that for them?

Cory Klippsten:

Yeah. I mean, I do this all the time as you can imagine. And what I tell them is our goal here is regret minimization. We want to give some way to enter the market here, where if it goes up, you’re going to be happy. And if it goes down, you’re going to be happy. And if it goes sideways, you’re going to be happy. And like, let’s figure out what that is. You know, basically what I want to say this was something that Rob Breedlove recommended on a YouTube video, but I think this is what’s worked for friends and family. And when I’m forced to give an opinion, I basically say for that lump sum part, before you get into the sort of automatic recurring purchases, just think about that total amount, smash half right now and do the other 50%, 10% a week for the next five weeks.

Cory Klippsten:

And that way, if the price goes down, you’re averaging in down. If it goes up, at least you got half of it in upfront. And I haven’t had anybody freak out and almost nobody gets through the full five weeks either because if the price you get, the price goes…

Stephan Livera:

Smash buy.

Cory Klippsten:

Cause they start reading like crazy. Once they’ve bought that first 50% of their initial portfolio allocation, they immediately listened to like 68 podcasts and reads 12 books and rip through gradually then suddenly and whatever else they can find. And all of a sudden they just want to smash the rest. So at least we’ve given them like semi responsible entry advice, but almost nobody makes it through that six week or the fifth week.

Stephan Livera:

Yeah. I think it’s almost like a psychological tool as well because people like, I think straight mathematically, you’re looking at some of the personal finance and some of the financial planners and bloggers and writers, they might say, yeah, lump sum is mathematically better. Just lump sum it all in. But the reality is people are not convicted when they start. Right. And so it’s kind of about getting people over the line, getting them started and then as they get more comfortable, then they naturally just put more in and you know, for many people, that’s been their experience.

Cory Klippsten:

Yeah. I have a funny Gigi story. You know, we lost him to the Norwegians a few months ago and he’s working at Seetee, so psyched for him over there. But I think on a bunch of pods last year, I was always saying something kind of complicated. Like the amount of value you’re willing to store in the Bitcoin protocol is highly correlated with your understanding of Bitcoin. Anyway, one of the last gifts that Gigi gave me was like, “Oh, you mean the more you know, the more you buy?” It was like, oh yeah, thanks. The engineer always simplifies all this flowery languages, but yeah, that’s really what it is. You know, that’s why we all work on education so much. Bitcoin is the story of adoption. Demand is not constant.Ddemand is growing based on the efforts of millions of people that are trying to orange pill, the world.

Cory Klippsten:

You know, I think there are still probably less than 10 million people globally that own a decent bit of their net worth stored in the Bitcoin protocol and have a pretty good understanding of Bitcoin and care about it a little bit. Right. It’s such a small number. I think it’s about 0.1% and I don’t think that’s changed that much in the last year. You know, this has been kind of frothy and we’ve added some true believers, but it takes time. You know, those people won’t get hardened and won’t really understand what Bitcoin is until next year or the year after that, as the tide washes out all of the poop and all of the dominoes and whatever else is all this worthless stuff with high market caps. So

Stephan Livera:

Yeah, I’m curious to get into views on the numbers. And so other guys like Croesus BTC have spoken about this idea as well. And I think we just see these numbers thrown around, right? So the current, I guess maybe a couple of months, or is that number is call it 100 to 200 million people who have some Bitcoin. Right. Which if the population of the world is 8 billion, then we’re talking 1% or 2%, but that’s people who have some exposure, right. And as you correctly pointed out, it’s only some fraction of that who actually have conviction who are actually holding a serious amount. So I guess, where do you think we’re at globally in terms of those numbers?

Cory Klippsten:

I don’t equate having a serious amount to having conviction either.

Stephan Livera:

Exactly.

Cory Klippsten:

So what I’m looking for is that intersection of people who actually own a decent bit and actually understand what they own. And that’s the number that I always point to that I think is going a 100 or 200x over the course of this decade where I think we’re going from like seven to 10 million up to a billion by 2030.

Stephan Livera:

Yeah. And so you’re saying those like — so that number is the people who have a significant amount and they’re highly convicted.

Cory Klippsten:

And understand Bitcoin. Yeah. And that’s the mission of Swan, right? It’s always about, it’s always about educating and selling bitcoin and you’ve got to do both because the whole point is we’re trying to create 10 million Bitcoiners just as one company, which in my personal definition of what a Bitcoiner is, I think there are fewer than 10 million today.

Stephan Livera:

That’s interesting to think about, Hey, and the other interesting stat is during these dips, we typically see a lot of people on say, Swan who are running in to smash by. Right. And Swan is an only buy service, right. There’s no sell. So that’s why listeners, you go to send your new kind of friends to Swan because they can’t sell. And so they won’t panic. They’re less likely to panic sell. Right. So I think you just should do that, but I think it’s interesting because then it’s kind of like, who are the people selling? Well, it’s probably some OG with old coins or it’s some whale participant who maybe is selling on some other exchange, but then all of the stacking people are out here smash buying in the dips.

Cory Klippsten:

Yeah. I mean, the last three weeks, I mean, we’re sitting here it’s May 28th. It’s a Friday. Our weekend is Sunday through Saturday, but yeah, our last three weeks have been our best three weeks ever.

Stephan Livera:

That’s incredible. And I mean, this has been because over the last we’ll call it two weeks. We’ve seen this big dip, right. We’ve gone from call it 60,000 down to at the bottom, maybe 30,000 ish. Right. Rough numbers. And as we speak today, it’s around 35,000 in US Dollar terms per Bitcoin. So it’s incredible that we’re seeing more people come in at this time now, after we’ve just taken almost 50% drop.

Cory Klippsten:

Yeah. I mean, these bull trend pullbacks are a very good risk adjusted entry points. So it makes a lot of sense. I scraped together. I’m even, opening up couch cushions and stuff and scraped together a little bit to buy some Seymour this week on top, on top of my auto sacking. I don’t have much Fiat left. Yeah. That’s

Stephan Livera:

The reality. So like, I guess for people like you and me kind of highly convicted Bitcoiners, that’s kind of the reality of our lives that we end up just kind of keeping a low fiat balance because we’re so convicted. So what does it mean…

Cory Klippsten:

Yeah. I think it was a Twitter exchange maybe between Nic Carter and Eric Wall or something, and just popped up in my feed. It was kind of old. It was probably three or four months old, but I just saw it for the first time. And it was — they were referring to the EMH and why it doesn’t work. And the reason it doesn’t work is because the people that understand that it’s supposed to work don’t have any more fiat.

Stephan Livera:

Exactly we’re already committed. Right?

Stephan Livera:

So then it’s about bringing new people in and ultimately people are social creatures, right. And it’s not, everyone is making logical and rational choices. Really. We make an emotional kind of — we sort of make a decision and then backwards rationalize, and we just kind of look at what our family and our friends are doing. And so I think that’s really the reality of it. And so I’m sure the same thing in terms of signing up users, it’s kind of like, you might get one person who signs up and then they, after a couple of months they’re liking the experience and they tell their family and then now their family’s in. And then that’s where the user growth comes.

Cory Klippsten:

Yeah, it is. That is a big part of it. You know, we’ve got, I think 7,000 affiliates now that send people to Swan, but you should all listen to, you should go to Swanbitcoin.com/livera. That’s the best, one of the 7,000 to sign up. But yeah, I mean, that’s really good. And then we’re starting to spread into these high net worth networks of folks like YPO chapters and CEO councils and a bunch of employees of some Fortune 100 company, all kind of telling each other. And it kind of happens that way as well. And international has been just absolutely massive as well. A huge boost since we opened up outside the US just for wire transfers. So we’re not doing the auto DCA. We are going to actually let people DCA after sending a wire transfer, but that’s probably, again, more of a solid bear market strategy or something that you might just do if you really feel like doing that. I don’t love that product personally, but a lot of people have asked for it. So we’re going to just offer it and sort of let people fund however they want and use the product, however they want

Stephan Livera:

The auto stacking that way. Yeah. So as an example, they might do wire in a large sum and then say, I wanted to buy a little bit every day as opposed to a lump sum all at the start. Okay. So with Swan, what’s the story looking like with users and the amount of stacking going on?

Cory Klippsten:

Yeah. I mean, obviously, it’s been pretty exciting. I think we went public with a number for the first time, maybe five weeks ago or something like that, which is that we grew from obviously like zero to a billion dollars in our first year. So that was pretty cool. That’s a billion dollar run rate sales. So that’s pretty exciting. And I think it’s good to show that a Bitcoin only company can grow and grow fast and build a good brand. And I think the growth has continued at a very rapid pace since then. You know, so a little startup that just got going and is already over 10% of cash apps Bitcoin sales is pretty cool.

Stephan Livera:

It’s really impressive given the relative size of the organizations we’re talking about, right?

Cory Klippsten:

Yeah. I’ll take 10% of the market cap. That’d be nice, but I think we’re a long way off from that.

Cory Klippsten:

They do a few other things besides sell Bitcoin. It turns out it’s actually a pretty awesome company. I’ve got a lot of friends over there.

Stephan Livera:

Yeah. And so it’s interesting because online, some of our haters, or if you will, and there are some people who are experts in hating Bitcoin, right. And so they like to say, “Oh, see, Bitcoin is only for the rich tech bros or it’s only for these people in their mom’s basement.” And things like that. And I think part of the story is actually showing why Bitcoin is for everyone. Isn’t it?

Cory Klippsten:

I’m glad you said that specific phrase. Yeah, we’re actually in the middle of a big effort to record hundreds and hundreds of people on camera under the aegis of Bitcoin is for everyone. So this is celebrities and athletes and grandmas and your cousin and Daniel Prince’s daughter, and every podcaster, and pleb and Swan and whatever. Like everybody’s just kind of recording these videos. And yeah, we’ll be distributing those and getting lots of other companies involved in that over time and just kind of putting a human face on Bitcoin and showing who’s actually involved in this. People from Jamaica and people from South Africa and people from Gambia and people from all over the place talking about Bitcoin. And I think it’s going to be really powerful and you know, we’re putting some real love into the production and the editing and gonna kind of distribute it as widely as possible. And give a little bit of a counterpoint to some of those narratives out there about what the Bitcoin monoculture supposedly is. Cause it ain’t a monoculture at all.

Stephan Livera:

Yeah. Yeah. And I mean, even inside the Bitcoin world, there’s all different kinds of, there’s all different points of view. So it’s interesting that people say that about the Bitcoin people when really, if they were to look inside more deeply, they’d see there’s all these disagreements within the community about little things like — I think most people kind of broadly agree on the key ideas. But there’s kind of little disagreements here and there about it. So.

Cory Klippsten:

Well, there are going to be 8 billion of us. We’re going to disagree a lot, but we’re roughly sort of moving in the same direction, which is what’s important.

Stephan Livera:

I wonder that and yeah, and it kind of appeals to this, to a certain kind of person right. In the earlier days, or even today, it appeals to a certain kind of person who maybe is a little bit more curious and is perhaps a little bit more willing to question and go outside what the normal TV is telling them to do. Yeah.

Cory Klippsten:

Yeah. I mean, you find out very quickly if if you thought that you might’ve been sort of a contrarian or didn’t really care that much, what people think about you and your views and then you find yourself being a hardcore Bitcoin or then you’ve probably confirmed that you were correct about yourself, you know? And then also like if other people use that as a as a slag on you over the course of your life, or use that as something you weren’t playing nice with the other kids or why can’t you just like stay in the straight jacket in the corporate job? And you got to put in four years, you can’t job hop, like whatever it is, you’re finding out what the returns are to non-conformity if you’re a bitcoiner.

Stephan Livera:

Yeah. And so there are things where we as Bitcoiners support them a lot more like we’re over-represented. So another example would be remote work, right? A lot of Bitcoiners are into remote work and a lot of Bitcoin companies have remote work because it’s just saying, and this is even before all the hysteria-19 lockdown, whatever, like, we were just more about that. And so I think that’s interesting as well. I know, I know there’s a side bitcoinerjobs.ca so let’s chat a little bit about that. What is it? And you know, why should people go work in a Bitcoin job?

Cory Klippsten:

Yeah, absolutely. So on your remote work point, we just want to work with Bitcoiners and people that love Bitcoin and only hold Bitcoin. Like that’s a prereq. You can’t be into anything else. I mean, really don’t even let people like appreciate much.

Stephan Livera:

Sell your chairs too.

Cory Klippsten:

Sell your chairs and you can no chairs. No chairs at Swan, at least we don’t supply chairs for you. Like everything is chest up. If you have a chair there, we don’t want to see it. Thanks Pierre. Thanks for that one. But no, I mean, I think it’s only natural. It was never a question for us. We never tried to have an office because the best Bitcoiner for each role was whoever that was wherever it is. And things run very efficiently now with slack and zoom, and it’s all you really need, telegram and Twitter for external.

Cory Klippsten:

So I can zoom for internal and a tiny bit of email and you’re good to go. So it’s just never been a question. I don’t know. We’ve got like 35 people probably now on our Monday morning meetings, it’s all pretty flat. We don’t have second line management yet. So there are people that manage people that work for me, but like it’s still super organic and sort of self-organizing, which is really cool. And what lets you do that is because we’re all kind of it’s like everybody being in skull and bones, like we’re all Bitcoiners. There’s a shared understanding and there’s honor and there’s integrity. And then you’re trying to you’re on this mission to drive adoption. And that means helping people through their customer service issues or helping them with their onboarding or helping them think about their purchase plans or how to get their bank to release the Fiat from the dirty Fiat system

Cory Klippsten:

To buy some beautiful orange coin like we’re all kind of on the same exact mission all the time. And it just requires very little hierarchy and very little management at any level because everybody knows exactly what the right thing to do is all the time. We always just say internally and externally, like, we’re always trying to do the best thing for Bitcoin and for Bitcoiners. And only raise a hand if it’s unclear what that is. It’s very rare that it’s unclear what the best thing is to do.

Stephan Livera:

Yeah, that’s awesome, man. I think it’s good that because in years gone by when you were trying to teach people how to get in, you’d often have to send them to some exchange, where there’d be all these different coins and it’s just like, it’s so confusing to people. And especially for one, when someone is new, then they would come to you with all these questions of like, oh, Stephan, I saw this old coin and I know you’ve been telling me about Bitcoin since 2013, but I actually went and bought XRP or something, something stupid like that. And I would just get so annoyed and now that there are actually Bitcoin only companies I can tell them to go to, it actually saves me a lot of time because I don’t actually have to spend all these time, like, cause they’re less likely to go and get told by some crypto influencer that they need to do their own research and read the white paper and it’s all just LARPing Right. So I’m very grateful that that exists now.

Cory Klippsten:

Yeah. And I got to get a big shout out to the ones that were in market before us in particular, you know the Bull Bitcoin guys with bull Bitcoin up in Canada and then Aleks and Amber and Australia. They kind of paved the way and showed that there was appetite for that model and that you could be Bitcoin only. And you know, obviously that, I think somebody like Obi over in the UK with coinfloor that used to sell other coins was kind of shown that you could be successful doing Bitcoin only and decided to go that route. And obviously it’s been years now doing a great job with Bitcoin only, and Swan is proving the same thing, which is really cool.

Stephan Livera:

Yeah. And then as Bitcoiners, it is a common thing where people get so engaged into the Bitcoin ecosphere that they’re — okay so they’re listening to podcasts, they are reading articles, they’re reading books. And it’s only natural for many of many people to want to work in the Bitcoin sphere. But then the trade-off the dilemma for many of them is that they feel like, well, they might be earning a lot more in their fiat job, but they might be a lot more passionate about working in a Bitcoin job. How do you think about that? And when someone asks you that question, how do you help them?

Cory Klippsten:

That is the dilemma typically. You know, and there’s just not that many Bitcoin jobs, but I think that will change dramatically because like I said, I think we’re going to a world where you’re going to move very quickly beyond just mining and exchanges being profitable as industries around Bitcoin. And I think it’s obviously not really this cycle because there aren’t a lot of companies that are making tons of money, Bitcoin only outside of those two industries yet. But I do think this next bull run, whatever it is, 2024, let’s say or something like that, I think you’re going to start to see the rise of companies that start to make a lot of money around payments around culturally related things like Bitcoin as a cultural movement is going to be 10 to a hundred times bigger than let’s say, like CrossFit/Paleo/quantified self/carnivore, which kind of came up in 2008 – 2009.

Cory Klippsten:

And millions of people have made careers and millions of dollars out of that movement. And I think Bitcoin is way bigger than that, right? Like Bitcoin should be like paleo CrossFit plus surfing plus kiteboarding plus skateboarding eighties culture, whatever it is all wrapped into this one giant thing. So I’m really bullish on all kinds of Bitcoin related products and services and being the Bitcoiner’s choice in almost any field. Right. Kind of the way that like Jeff Vandrews kind of set up as being like the guy that helps you sort out your, your ownership structures related to Bitcoin and how good that’s been for him. Or maybe like like a Lyn Alden being like the macro research person that really gets Bitcoin and weaves it into these other narratives. I think there’s the Bitcoin personal trainer is going to crush it in every city because Bitcoiner wants to talk about Bitcoin and you know, all the time and is going to prefer that personal trainer.

Cory Klippsten:

So I think that’s already kind of starting to happen organically. And you mentioned Bitcoinerjobs.co, which is sort of just a little side project that I started and then recruited a guy named Nathan. Who’s been on some of the podcasts, he’s built it out. And you know, that right now is just matching Bitcoiners that want to work in Bitcoin companies. And there have been dozens of matches and there’s many hundreds of jobs posted there. And you know, it’s really exciting. We use it, tons of companies use it hilariously. Like I started the thing and I looked at like, who had the most jobs posted and it was like two of the top three were River and Strike, which are probably like the two companies that overlap with what we do in the US the most.

Cory Klippsten:

And I was like, Hey, whatever community resources, it is what it is. Yeah. You know, so, it’s been great to see that taken take off. And I think it’s important when there’s a real vision, it’s important to have when there’s like an RV crypto, it’s important to have a Swan signal when there’s a crypto jobs, it’s important to have a Bitcoinerjobs when Andreesen raises $1.8 billion for shitcoins it’s important to have a Bitcoinerventures.com. So you always have to kinda like get rid of the crap and there’ll be something that’s worth doing. But I think in the long run it will actually be a lot bigger than the crypto stuff is now.

Stephan Livera:

Right. Yeah. And it’s, I mean, as you were saying, it’s just like setting up a Bitcoin-only business. It’s the same, it’s just setting up the Bitcoin only equivalent of some of these other things. And so, yeah, I think the Bitcoin jobs thing is interesting. I get it quite often as well. Right. I get a lot of DMs. I try to give people a bit of a tip on that, but I guess here’s my thoughts on it. I think for most people you’ll be earning more money in your fiat job, if you’re comfortable with just doing your fiat job and you think you can save more and more sats this way, and you’re comfortable with that, then stick with it. But for people who are at that level where they’re like, look, I’m really, it’s really soul draining for me, I would be comfortable taking a pay cut to go work in a Bitcoin job then. Okay. That’s probably the point where you might think about doing that. But of course it doesn’t work for everyone because as you said, there’s just not that many Bitcoin jobs, but you know, there might be some jobs out there, bitcoinerjobs.co has. And sometimes the people in the space, you start doing something.

Cory Klippsten:

This decision has been, this is the same decision that everyone always makes, whether they want to stay in corporate versus go work for a startup. It’s not really any different. And again, I think over the next few years, you’re going to start to see Bitcoin only startups perform more on par with what you would expect from like top Silicon valley backed startups. I think you’re, you’re starting to see that, right. You’re starting to see like larger rounds go down for the lightning labs and the Casas and the rivers and the strikes. We haven’t announced anything, but you know, our valuation is rather high at this point. And I think that’s good. I think that it will start to show people that they can come and start Bitcoin only companies. And you’re going to give top, and mid-level employees like fairly hefty equity packages, and that’s always been the thing, like, do you leave Morgan Stanley or Google to go work for some Silicon valley startup, mostly for equity and take that bet and bet on yourself and bet on your choice of which team to join and your ability to help that team succeed, you know?

Cory Klippsten:

And so I don’t think it’s going to be, it’s just going to be normal at some point to make the same kind of decision to go get into Bitcoin as it’s always been to leave corporate and get into entrepreneurship.

Stephan Livera:

Right. Yeah. That’s a good way to put it. And ultimately it’s all about trying to help turn Bitcoin into money, right. Because money is the largest market. And so if you can assist in some small marginal way, you can sort of help push the ball a little bit further along with everybody else in here, trying to do the same thing then I guess. Yeah. It’s that same bet that people take. So it’s an interesting point you made you raised around valuations and doing rounds. Let’s get an update from you on Bitcoinerventures. What’s the latest there that we’ve got to share?

Cory Klippsten:

So anybody who’s been following, so it’s an Angel list syndicate. The four partners are Stephan. Your host here, myself, Louis Liu from Mimesis capital and Yan Pritzker, the author of inventing Bitcoin and my co-founder at Swan. And yeah, we just try to find good Bitcoin only startups that want to benefit from having a lot of people sort of in the ecosystem. So it’s usually going to tend to be a little bit more consumer facing where kind of the founders and the, in the company or the product are pretty well-known and pretty popular. That’s a lot easier to get a syndicate to put money into then maybe like some B2B software type startup. So yeah, we did our first deal last year. About this time it was in Q2 was Unchained Capital last year, a months ago, we completed our second deal, which was a BitRefill, saw some, so Bitcoiner ventures is on those two cap tables.

Cory Klippsten:

And then the third one is going down right now. Can’t say who it is because your entire audience may not be accredited in the US but if you go to Bitcoinerventures.com, there’s a link right there to the Angel list syndicate, or you can just go to angel.co and search for Bitcoinerventures. And and then you can apply and get certified by angel list and contribute to that check sizes anywhere from like a thousand bucks to $50,000 our typical check size into a startup is 200, 250K. So that’s what we’re doing into this current deal. And basically the setup is the four partners take no fees, no carry. And all four of us have to agree to invest in the exact same syndicate on the exact same terms. So we’ve got skin in the game and we’re trying to select companies that we want to be a part of and that we want to invest into. And so yeah, it’s exciting to have deal number three on the way. And we hope this eventually becomes such a big deal, that it’s very easy to turn it into a committed capital fund. And someone that is a little less busy than Stephan, Cory and Yan might actually be an active manager of a fund in the future. And maybe it goes that direction, but we’ll probably always keep the syndicate alive.

Stephan Livera:

And I’m excited to be a part of it. I think it’s a good way to add to your investments in Bitcoin, if you want to contribute into certain businesses that you like. You know, so obviously Unchained capital, I’m a huge fan of them. Now, of course, they’re a sponsor of my show as well, but I’m a big fan of their business and the way they are, and BitRefill as well, also helping people who really want to live on Bitcoin and actually buy vouchers and be able to earn sats and then directly spend those sats. And I think it’s such a excellent business that it’s really helping people achieve that. So that for me is I’m very excited about that. And of course the current deal, which I can’t name, but I think it’s a really great company.

Stephan Livera:

So I’m excited to see where that goes.

Cory Klippsten:

Yeah.

Stephan Livera:

So, all right. So there’s a lot of other things going on in this space, I guess, narrative wise, if you will, right now, some of this stuff, isn’t really, how would I put it sometimes it’s not necessarily about the actual facts, right? It’s like the energy debate. Sometimes it’s not actually about how much electricity Bitcoin is using. It’s actually just about certain power dynamics that are playing out in a way. I want to get your take on all this Elon Musk stuff going on and you know, what, what do you think?

Cory Klippsten:

I mean, I think it’s one of these things it’s not unlike the I forgot what the, I forget what the psychologist that named this effect, but it’s basically like when you read one story in the New York times about a field that really well, and you’re like…

Stephan Livera:

Gell-Mann Amnesia something like that.

Cory Klippsten:

Yeah. Something like that. Anyway, you know what I’m getting at. And basically it’s like, when it’s in your own field, you’re like, oh, well, that’s BS. And then you read the next story and you don’t know much about that. And you assume that all the facts in the story are true and that it’s good reporting. You know, it’s kind of like that for me, Elon like I am aware and have been for many years that he has aggressive detractors of him personally, and the way he does business and the way that sort of Tesla makes money and spaceX and this, that, and the other things. And you know, how he actually operated at PayPal and what happened at the end and all those kinds of things. And you always kind of just brushed it off because I wasn’t really all that interested.

Cory Klippsten:

I actually do. I actually have spent quite a bit of time in EVs and Tesla long ago, like pre Bitcoin. And so I was kind of a fan and I still think that model X’s are dope. They’re great cars, but watching him come and wade his toe into Bitcoin and just absolutely just poop on everything like a toddler and be wrong. So often with such sort of apparently vehement, certainty, while being, provably, incorrect you know, it just, it made him look really, really bad because now I’m going back and I’m not the only one that’s going back and checking in with friends that have been skeptics of all kinds of other things that he’s done in the past that I’ve given him a pass on because I was broadly a fan of cool cars and going to space. You know, I don’t know.

Cory Klippsten:

I don’t, I think he thinks that he’s going to be able to dig himself out of this at some point, and we’re never going to forget. I will never trust him because the border for me of when I can trust somebody, it’s totally fine to be wrong, but you have to know what you know, and what you don’t know. And you have to clearly mark it. You know, you have to clearly mark when you’re off in territory where you’re not certain, then you may not have all the facts. And that’s, what’s been just so dramatic about Elon in particular, because he’s been stating things as fact without caveat that are false. So I can’t trust him ever again because I know he’s that type of person and that’s hard. It sucks. You gotta kill your heroes, I guess when they act like that Taleb who we should bring up it’s hard to say.

Cory Klippsten:

I mean, I must be in the top 1% of Bitcoiners as far as Taleb expertise and reading all the books 9 million times or whatever. But and it’s hard, man, because obviously I’m a big fan of the books. And Swan was derived from black Swan. Cause I think Bitcoin is the biggest black Swan in history. And yeah, this, this latest turn for him has been a dramatic amount of showing one’s behind to the world as uninformed, as egotistical and straight up wrong. So it hurts. We actually, from the Swan handle today was the day that we unfollowed Nassim from the Swan handle. We always only follow 21 people, right? Yeah.

Stephan Livera:

The changing relationship.

Stephan Livera:

Yeah. We’re following 20 now. And and we’ll see, we’ve gotta follow somebody else next week. Yeah.

Stephan Livera:

I feel that this space is very challenging for newcomers who have an ego. And I think sometimes when people, don’t kind of set that aside and look in the case of Nassim, I think, I mean, I’m still a fan of his books. Like I loved Fooled by Randomness. I really enjoyed reading that book. That’s probably my favorite of his books, but it seems to me like he let his personal antagonism and you know, that deterioration in the relationship with Saifedean kind of color, the way he saw Bitcoin. And now this recent thing is he’s going on some BSV conference with like Craig Wright and some of these other BSV people.

Cory Klippsten:

Yeah. He accepted the coingeeks speaking fee or whatever they pay people. I don’t know how they get people to go to that thing, but yeah, very disappointing. And he fell for the stupid trope of like, well, it says cash and cash means paper cash. Right. And it’s like, no, bro. that’s like Fiat medium exchange. That’s not exactly what he’s talking about. We’re talking about a bearer asset. That’s what cash is.

Stephan Livera:

That’s a shame.

Cory Klippsten:

So yeah, it’s disappointing.

Stephan Livera:

Yeah. But, and like for people who’ve come into the space, I think it just, it really requires a certain level of humility. Right. You just have to kind of shut up and do the reading and shut up and do the listening to the podcast or watching the YouTube or ask questions, but in a way where you’re sort of, you’re not coming out with such a forceful confidence about “I’m right. And this is the only way” it could be because many people in Bitcoin have come before and have asked those same questions and answered those same questions. And I think it was really disappointing with Elon as well. Right. Because he comes in. Think’s he’s — I mean, sure. He’s a smart guy probably. Right. Like he’s a highly intelligent guy, but I think he came in not having done the research and just thought, just like an engineer, oh, I’ll just change this dial. Just raise the block size 10x and just totally ignore the multi-year debate and infighting and basically civil war that we had in Bitcoin because he naively thought, oh, just 10x the block size. And therefore we’ll get more transactions. And there’s no trade-off for that. “Why? I don’t know why you idiot Bitcoin people didn’t just do that?” Right. And the reality is he just didn’t understand the history.

Cory Klippsten:

Doesn’t get it at all. And you know, it will be interesting to see how it plays out because I do see — it’s only been a few days now since Ray Dalio started to really say things that feel kind of more inline with an understanding of Bitcoin and appreciation for it. And he said dumb things many times about Bitcoin, but somehow it was so clear that it wasn’t actually really emotional. He was really just parroting things that his social circle or his lieutenants had said to him, like talking about underlying technology, maybe there’s something to blockchain, all the things. And the government can ban Bitcoin anytime they want to. And all these kinds of things, but like, they were kind of just repeated, talking points. You never saw an indication that he’d actually like tried to understand it and come out one way or another.

Cory Klippsten:

And I kind of give all dude’s pass when it comes to that. And then you, you’re kind of seeing mean I’m kind of have to be a little bit of a fan here and give him a pass because he is kind of living by the principles that he purported to have. Right? Which is he’s not going to have an ego about it. He’s going to be able to change his mind once he actually understands what’s going on. You know, you’re kind of seeing it happen. I don’t know if some of these people will get around to it. You know, it’s a race against time for Charlie Munger. If he’s going to be around long enough to do his own research and understand the truth. You know, Nassim does a lot of dead lifts, but he eats a lot of pasta and he may not ever actually appreciate Bitcoin in this lifetime. It’s very possible he never will, I hope he does though.

Stephan Livera:

That’s hard for people. Hey, and yeah. And you know, one other factor that is worth bringing up is it’s hard to learn in public, especially when you’re already famous. You’ve already got a following. Maybe it’s difficult for you to then turn around and say, “Oh, wait a minute. Maybe I was wrong about this thing…” And it’s hard. Like, it’s, of course we can talk about it, but

Cory Klippsten:

I think it’s such a horrible character flaw. That’s massively ego-driven to feel like you have to pontificate about something that you don’t actually understand yet and you’re seeing it with Mark Cuban, you’re seeing it with Taleb. You’re sealing it with Elon. You see it with Munger. Like you’re seeing it with a lot of people that feel like they have to give an opinion on something that they don’t understand. And so then we get to how we kind of open this section, which is like, it’s really difficult for me to have respect for somebody that doesn’t know where the line is between the things that they actually know and have a firm grasp on and what they’re just opining on without actually understanding it. And I just can only imagine now when you see this happening with something that you care about as deeply as Bitcoin and that you study as much as we have, and you way more than me, and you see people just like talking out of their … about this subject that we care about. I now just think of like all of my friends that have had subjects that they know deeply and all of the people they’ve had to put up with pontificating about theirs. It makes me much more careful about opining and stepping over the line in other subjects that’s for sure.

Stephan Livera:

Yeah. And so I guess really disappointing is the Elon case, right? Because this company had gone and bought was, I can’t remember off the top of my head, maybe 1.5. Yeah. $1.5 billion worth of Bitcoin. And was seemingly unaware that Bitcoin’s mining hash rate protects the overall network. And it doesn’t just naively scale by the transactions. Right. And so then holds Bitcoin on the Tesla balance sheet, but then say, “Oh, see, as Tesla, we’re not going to take it as payment anymore.” It’s like, do you understand that that hash rate it’s one and the same thing it’s securing the overall network. Right. And I don’t understand how he could have, like, how did he get there? Right?

Cory Klippsten:

I don’t know. I mean, the timing of the news about their new sort of plan for renewable energy credits that came out like a day or two after that. And the fact that he screenshotted a Tesla press release, and didn’t sort of tweet it out in his own language about shutting down the I don’t know. I just think he’s gotten a lot of pressure from a lot of people and Tesla’s supposed to be this green energy company, and it’s very dependent upon subsidies basically. And so they’re just kinda like playing this habit, both ways thing, right now.

Stephan Livera:

Yeah. That may be it, I think. And it’s a real shame because it just people were pointing out, even Elon from one or two months ago had just responded to like Jack Dorsey saying, yeah, it actually does incentivize renewable energy for people who care about that. Right. And it just seems like a massive hypocrisy, but you know, what can you say? Right? We’re in this little world and we can’t access all the normal people out there who hear what he says, so we’re kind of stuck.

Cory Klippsten:

And he has a board, right? He does. He’s not master of his domain. You know, so he gets a lot of pressure and he has stakeholders and he can say he doesn’t care about money as often as he wants to. But a lot of the people around him that can outvote him and influence him and make things in other areas that he’s passionate about, like really difficult for him, they can influence what Tesla does, what SpaceX does, what any of these companies do. It’s a lot of stakeholders with a lot of money and a lot of power. And I don’t think that he holds over 50% of the power. However, you might quantify that in any of his ventures, except maybe the boring company. Right. Like if other people want to gang up, they’ll have a quorum and they’ll be able to make him do something different with space X and with Tesla.

Stephan Livera:

Yeah. So he has to play the political game a little bit there. And then there’s the whole mining council aspect of it as well. I’m wondering what you think on that?

Cory Klippsten:

Yeah. I mean, obviously caveat that I’m on the advisory board of Riot blockchain, which is a big north American Bitcoin mining company on the NASDAQ. But you know, I’m not that worried about it. Like if the game theory in Bitcoin is broken and we don’t think it is, then mining cartels are a problem, but we don’t think that’s the case. We’ve seen this happen before. And it just seems like more FUD. And I think like riot already publishes their energy mix in all of their public company reporting. So signing up to a council, that’s supposed to be transparent about their energy mix was an easy yes, there’s not some sort of like cabal of miners coalescing around this as Saylor said, he just grabbed the people that he could, throw them on a zoom or a conference call and invited Elon.

Cory Klippsten:

And that’s basically all it was so far. So I don’t know. I mean, I think that it’s a really, really good idea to always be skeptical of councils and cabals and sort of things happening behind closed doors, anywhere around Bitcoin and seeing two of the four founding members of the cryptocurrency, council, whatever, being like Fred and Brian freaks me out obviously. But there can be lots of different lobbyist organizations and lots of different councils, and there’s not going to be any one organization that ever speaks for Bitcoin and Bitcoiners. You know, it’s a free and open marketplace and we can all volunteer our time and our resources at any moment. And I think the other thing that people might be discounting, and this is basically just as soon as Bitcoin got into the five digits, there’s so many Bitcoiners with so much financial resources at this point that if there’s ever actually like a real threat to the network of some kind, I just think you’re going to see if you thought UASF and some of the PR efforts were somewhat organized in 2016-17, like I just think the way this community would spend time and value to protect Bitcoin against a threat would be orders of magnitude larger than anything we’ve ever seen before.

Cory Klippsten:

And it would have lobbyists and lawyers and all kinds of social media, this, that, and the other. And it would be all decentralized because there is no fricking CEO and there’s no Consensys in Brooklyn and you know, so it wouldn’t be controlled, but I think a lot of people would be chipping in and making things happen. I mean, look at what Chris Callicott and the TVP guys — sorry, the Bitcoin venture fund BVF. And in Texas they in their friends kind of got a Bitcoin bill. I don’t know really what’s in it. You know, they got something that I’ve been told is fairly favorable passed in Texas. And I think that’s very sort of repeatable and they can do that over and over again if needed.

Stephan Livera:

So I guess to summarize, then it’s kind of like, the North American mining pools sort of came together for this council thing. And I guess the reality of it though, is that their combined hash rate is probably something around 10% of the network. So even then it’s not really like the whole network is going this way. And so I guess…

Cory Klippsten:

There’s not much chance of any of the other companies at that table cooperating on anything that Marathon wants to do.

Stephan Livera:

Right. Yeah.

Cory Klippsten:

Like, no one that’s really like into Bitcoin is about to follow that path of trying to mine clean blocks and join Mr. Wonderful or Mr. Blunderful as I like to call them. You know, let’s not, mine any blood coins like it’s guys are just talking out of their … trying to like gather attention for themselves and try to if you, if you introduce inefficiency into a market, you create a spread and you can take the spread and that’s what they do. They try to introduce inefficiency into a market because then there are two different prices for the same good. And they can take the spread even if they only take part of it.

Cory Klippsten:

So if you create a market by saying like, Hey, blood coins are bad. My non-blood coins are good, pay 1% more than Mr. Blunderful can take half of a point. Right. You know, and Mara can do the same thing. They can say like, oh, we’re mining, clean blocks. Then we OFAC scan them when they didn’t get coinjoined in the last six hops or whatever it is pay a little bit more, but they’ll have a mining pool that they’re taking one or 2% off the top or whatever the economics are because some other people want to — it’s like, co-op advertising it’s like all the McDonald’s franchisees sort of putting it into the pot so that McDonald’s runs the national campaigns. That’s what, holding up a flag and saying like, “Hey, you can say that you’re in Bitcoin, but you’re one of the good ones.” Like that’s creating that opportunity for the weak minded people to go and decide that they want to get on board for that PR move. And they’re just grifters. It’s just like Lawsky creating with DFS. Right. It’s like exact same thing. It’s just grift.

Stephan Livera:

Yeah. And it’s like trying to differentiate, right. They’re trying to be in Bitcoin, but then differentiate in a way the protocol really doesn’t recognize that way. And they’re just trying to externally impose their view to try to get everyone else to come along with their narrative. But we don’t actually have to go with their narrative. We’ll just say like, no, actually you’re just factually wrong. There is no blood coins. And even this whole, notion of Virgin coins straight from the mining that those are untainted and whatever the reality is, miner fees are also included as well into those blocks. And so they also quote unquote, taint the block and over time, right. If we’re all right about this thing and Bitcoin is going crazy way higher, it is naturally going to shift over to being more about fees than about subsidies. So it just is a completely flawed narrative. And I think it’s the smart people understand that this is not a thing. But I wonder will the masses go along with them or does it matter that we go out there and debunk these things? Or do you think it doesn’t really matter in the end?

Cory Klippsten:

I don’t think it really matters in the end. And you know, a good movement actually wants a diversity of voices and you don’t actually want to shut them down. And I’m kinda like, as I’ve been in the space a little bit longer and I’m running a company, that’s growing a little bit, like it’s totally fine to have some diverging opinions about small aspects of what’s going on. And like it’s totally fine to use. While Saylor is essentially now like a cat’s pod that’s going and dealing with that thing and he can use and spend some of his credibility that he’s gained with the Bitcoin community by instead of what I think the morally upstanding thing to do would be not give an inch cause they might take a mile and it would be say like, it would, it would say like, no, we’re not doing anything except for the moral case for fossil fuels talking points.

Cory Klippsten:

Right. And that’s what we’re going to say, and we’re not going to. And Bitcoin mining is more important than Christmas trees and X-Box and aircraft carriers and anything else. There’s nothing more important. And we’ll keep on making that point for the people that want to go down the rabbit hole. But the mainstream press is only going to cover something that directly counters and addresses the point that’s being made. They’re not going to bring to the masses that hour long debate from first principles that explains why the point was stupid in the first place. And I think Saylor understands that and he’s decided that he’s willing to spend some of his credibility with the Hornets by engaging in what is essentially like a disingenuous debate sparked by people in the wrong. And he’s just going to kind of throw him a bone and kind of deflate that. That’s what I think is going on. I don’t think he’s stupid. I think he actually understands exactly what’s going on.

Stephan Livera:

I think he understands, but yeah, you never know. But it seems to me like it that’s he’s trying to, maybe he’s also another way to think of it as he’s trying to give Elon a quote unquote bridge to come back in to kind of walk back your past mistake and just understand actually a lot of the energy usage in Bitcoin is renewable anyway. And actually arguably is more renewable than many other industries that already exist today. And people are clearly comfortable with those other industries existing.

Cory Klippsten:

Yeah. I mean, we have to get really comfortable with politics and talking points and kind of debate, right. Like I don’t, I don’t think it’s an accident that like Brady and Pierre and Bitstein and are all like champion debaters like they’re used to this, they’ve been doing it since they were kids. And I think we’re going to see more and more people with PR skills, political skills. I mean, think of what Saylor had to go through with his company. Imagine the meetings he had with crisis PR as they went through like SEC lawsuits and shareholder lawsuits and the stock price plummeting 99.8% and sticking it out and coming all the way back like he’s been through this before, this is not a PR crisis within an order of magnitude of things that he dealt with 20 years ago. Like he’s fine. He’ll deal with this and he’ll keep his eyes on the prize. And I think the prize is bitcoinisation.

Stephan Livera:

All right. Well, I guess we’re kind of wrapping it up then. Do you have any tips for listeners out there as they you know, try to build or grow this movement out there?

Cory Klippsten:

Yeah. I mean, I always like to just shill Yan’s book, cause I just think it’s such a great starting point. So Yan Pritzker.

Stephan Livera:

And you can get it for free, right? Swanbitcoin.com/freebook

Cory Klippsten:

Yep, exactly. So inventing Bitcoin, I really just try to get people to spend that two hours and kind of start there and then listen to episode 71 of Stephan Livera’s show, which is the monologue show where he breaks down Austrian economics in relation to Bitcoin. But I think it’s a really powerful one and I still recommend it all the time. But yeah, we got our YouTube channel taken down with no explanation from YouTube this morning. So getting deplatformed again. Yeah, but we’ll spin up a new one here in the next few days, but [it] keeps happening and we don’t obviously do anything at all wrong with regards to that. But every once in a while, I don’t know if it’s someone complaining or some anti Bitcoin, somebody says something, but yeah, we got taken down extensively for promoting illegal services.

Stephan Livera:

I think it’s one of those false reporting things. So I don’t know some automated machine went wrong and stuff. So I don’t know, I guess at the end of the day, it just…

Cory Klippsten:

You’d think they’d check with you.

Stephan Livera:

Yeah, exactly.

Cory Klippsten:

And ask a question after you’ve had like a few million views or whatever we have, you think they’d want to check with you, but they don’t,

Stephan Livera:

That’s a shame. Get the material out there and get people learning about the scene because as you said, the more you know.

Cory Klippsten:

Absolutely. Yeah. I think that’s right. And you can engage with me and our entire team. In real time basically around the clock at a t.me/swansignal. So that’s the telegram group for Swan and that’s where we can discuss our shows and talk to our team. It’s just a really good place to hang out. You know, we also the guy who started cafe Bitcoin on clubhouse, which is now on Android, so no more complaining that there’s no Android, but yeah, it’s a good place to hang out, talk some Bitcoin, learn some, a lot more really interesting scheduled rooms there. Now I think we have 10 different languages that have a weekly room just talking about answering questions and kind of debating issues of the day. So it’s a really good place to find us. Yeah. Otherwise I think you’re probably still running the reader ad about Swan private client services, but I’ll show it briefly and just say you know, that’s, it’s going really well.

Cory Klippsten:

I think we’ve surveyed our, our customers yet from this first cohort, but I would guess that it’s definitely a five-star product. Being able to have somebody experienced, really talking to you about Bitcoin. So if you’re looking to move your family office into Bitcoin or your company or something like that, swanbitcoin.com/private, and we just hired our second person for that unit guy named Terrence Yang who’s pretty well known in the space Yang Ventures on Twitter and one of my favorite Bitcoiners to listen to on clubhouse. So he’s joined Steven Lubka as the two guys kind of running things for Swan private. So bullish on that.

Stephan Livera:

Awesome man. Well, thanks for joining me today.

Cory Klippsten:

Yeah, my pleasure. Thanks, Stephan.

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