SLP88 Conner Brown – Bitcoin is Money, not Payments

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Conner Brown joins me in this episode to talk about his journey of learning about Bitcoin and why Bitcoin should be thought of as money, not payments. We talk about:

  • How he came to learn about Bitcoin
  • His journey coming from the Bcash world view to the Bitcoiner view 
  • Common pitfalls in learning or reasoning about Bitcoin
  • Dealing with Ripplecoin shills

Conner Brown links:

Sponsor links:

Stephan Livera links:

Ministry of Nodes:

Podcast Transcript (Sponsored by GiveBitcoin.io)

Stephan Livera: Hi and welcome to the Stephan Livera podcast, focused on Bitcoin in Austrian economics. Learn the economics and technology of Bitcoin. Today, my guest is Conner Brown, but first, let me introduce the sponsors of the show.

Stephan Livera: Firstly, Kraken. Over my years in Bitcoin, I’ve been really impressed with the way Kraken operate. They’ve got just this incredibly strong focus on security. They have consistently acted ethically in the space supporting various initiatives. They’re one of the longest standing Bitcoin exchanges. They’re consistently rated the best. They’ve got a high quality platform. They offer some of the best liquidity in the industry. And they’ve got high trading volume and low fees with no minimum or hidden fees.

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Stephan Livera: Next up, Unchained Capital, they do Bitcoin financial services, and they’re offering a really cool two or three multisignature vault product. You can use Trezor or ledger, you still maintain control with your two keys, and Unchained would hold that third key, and they can co-sign for you if you need that. And multisignature helps to protect you against that proverbial $5 wrench attack as you can distribute your keys. So if you create an Unchained vault, you also get three free months of access to Saifedean Ammous’ Bitcoin standard research bulletin.

Stephan Livera: And Unchained also offer Bitcoin collateralized loans. So you can get USD liquidity without selling your Bitcoins. And this can be tax efficient for a hobbler because you might not trigger a capital gains event in doing so. And so while that loan is outstanding, it’s stored in a dedicated multisig address under collaborative custody. So to learn more and sign up, go to the Unchained Capital link in the show notes.

Stephan Livera: All right guys, my guest today is Conner Brown. He is actually a long time listener of my show, and I’ve noticed he’s been doing some really cool things in the space, in his own right as he’s now becoming an educator himself and writing articles, and doing some teaching as well. I was really keen to get him on to talk about this whole theme of Bitcoin as money, not as payments. So in this discussion, Conner talks about his own journey of learning and how he now helps explain some of these different common pitfalls. I really enjoyed this conversation and I’m sure you guys will enjoy listening to it as well. Here’s the interview.

Stephan Livera: Conner, welcome to the show.

Conner Brown: Hey, Stephan, thank you for having me on.

Stephan Livera: Yeah, it’s great to finally speak with you. I know you’ve been a long-time listener for a while, so, and I know you’ve been writing and putting out a lot of good material, so I thought it’d be interesting to get you on. I guess just for the audience who may not know you so well, just give a bit of a background on yourself.

Conner Brown: Yeah. So hi everyone, I’m Conner Brown, I’m right now a law student. I’m currently pursuing a legal path in life, but maybe that’ll transition to Bitcoin pretty soon. But my background is in debate for a long time. I did that for about seven years, studied philosophy, sociology and then decided to go the law school route because that was really the only way to stay afloat. The way I got into Bitcoin, it was pretty interesting.

Conner Brown: My friend, Sam Garcia, he was really… he’s all into growth hacking, and he was like, “Here’s what you need to do. You need to start a writing career, Conner.” And I was like, “Okay, I don’t know what to write about.” And he’s like, “Well, you’re at Stanford, so just write about Blockchain. That’s a big thing.” And I was like, “Okay, sounds good.” Started learning about Blockchain, and a year later now, here I am and completely fell down the rabbit hole, but it’s been a wild journey.

Stephan Livera: Excellent. So what was it that made you go from talking about Blockchain into Bitcoin more specifically? Is it just because Bitcoin is first?

Conner Brown: Yeah, I mean, no, not at all. It’s actually the opposite I think just because intuitively when you’re learning about a new technology, you start with whatever’s the most cutting edge. And Bitcoin, when I first got into it, I’m looking at the most mainstream of resources obviously. I’m just googling around on the word Blockchain. I find like Laura Shin’s podcast and it was really Blockchain agnostic.

Conner Brown: Bitcoin throughout all of the mainstream stuff just felt very outdated. Like it’s there, it’s in the background. “It was a nice stepping stone, but we’re onto bigger and better things.” It was like the takeaway for a while. And it was really a strange path because Bitcoin is such a weird interdisciplinary thing and I really didn’t have any of the foundation that’s required to understand it.

Conner Brown: And so, when you first start learning about it, you don’t… or at least the average person, I think they don’t come from an Austrian perspective like you did. And so, it requires a lot of re-evaluating your own beliefs of the world before you can even make sense of this thing that we find. And I think for some people like me, that leads to them getting tricked for a while in the early days. And luckily, I had enough time to really invest and figure out, “Oh my God, there’s a lot more here than I initially thought.”

Conner Brown: And I think that was one of the big reasons why, and I’ve mentioned this on Twitter before, that I initially totally bought into the BCash narrative. And it was like for maybe a month, but it was very compelling based on just initial skimming it and looking at limited sources, and not really understanding the many multifaceted parts of Bitcoin.

Stephan Livera: It really reminds me the way you were mentioning how people talk about Blockchain agnostic and so on, and they don’t… perhaps a good resource that they should have read is Gwern, Bitcoin worse is better? Have you read that one?

Conner Brown: I’ve not read that one. I’ve never heard of that one.

Stephan Livera: Oh, I’ll have to show you afterwards. But essentially it’s like this article, it’s a couple of years old now, but it talks about how in certain ways it looks like it’s worse, but actually these are the trade-offs that in some sense Bitcoin has made. So Nic Carter has written a recent article about this idea of the trade-offs Bitcoin made and how Bitcoin bites the bullet. But I’m also interested to know at that time that you were in the BCash world, were you already a libertarian before that or what was your… how did you stumble across that worldview?

Conner Brown: Well, I think this is actually a great question because I wasn’t at all. And in fact, if anything, I was probably leaning more left. And there were times in college where I would’ve considered myself a socialist. And I think this is something that actually gets to the heart of why Bitcoin can be so difficult to understand because it is a change in money, and money is something that is deeply ideological. It’s something that you never consider as being something that is important to how society functions.

Conner Brown: And it’s similar to a language in the sense that what language you speak and communicate with has certain philosophical presumptions baked in, right? And your money has that same thing. And if you speak one language your entire life, you can’t even really imagine what’s outside of that. And I think that because we’ve always had one form of money before we encounter cryptocurrencies, then when we find this new medium of exchange store of value thing, we think of it as a new payment system. And really think of it as, “Oh this is like a new…” just like Venmo is a new form of payment, Bitcoin’s a new form of payment.

Conner Brown: And that was really, what is it… the BCash narrative is all about is payments. And there’s really not much there in the sense of like it’s minor improvements on payments at first glance, but the real change is money. And so to get back to your question of was I originally a libertarian, I think that Bitcoin changed me in that sense because it taught me that a lot or we believe that a lot of the problems that we’re seeing comes from that base assumption, some of those key philosophical elements of our money and how they turn into militarism or increase inequality, or corporate cronyism, and those sorts of things that before I just thought, “Well, we just have too many greedy people in this world.”

Conner Brown: It’s a very naive take on it, and then after learning about Bitcoin, I’m starting to think, “It’s not greed, it’s simply a rational system of incentives.” When a nation state controls the monetary base, of course the people in power are going to have a incentive to spend in the short term and benefit for themselves at the expense of other people in the long term. And so, it’s just so fundamentally changes everything you believe about the world, or at least for me. And that was a really weird thing to feel because you have to lean into it a little bit. I mean, a lot of people I think are… they have a hard time giving up their beliefs in the world that they’ve built up over the years.

Stephan Livera: That reminds me very much of this idea of having a conspiracy without conspirators, right? That you’ve got central banks and politicians, and regulators and so on, and each of them is not out to get everyone else. It’s just each person is looking out for themselves. And naturally what happens is the politicians will tend to give money and give resources, and give power to people who empower them. And if you’re a politician, it’s easy for you to spend now and push the cost on to future generations.

Conner Brown: Yeah, no, I think that’s entirely the point. And that’s why we have to have a monetary base that’s ruled by math instead of short termism from politicians. And that was really just a mind-blowing realization that seems so painfully obvious. That it’s not that these people lack some sort of critical moral character that all of us would easily refrain from doing such things if we were in office. It’s simply that if you have the ability to create $1 billion out of thin air, then people are going to spend up to $999 million trying to get that from you.

Conner Brown: And it’s purely in both of your incentives to do that. So I completely agree with the conspiracy without conspirators. I do think also that this is part of why BCash is such a weird thing, is because it, Bitcoin attracts the type of people that are naturally contrarian in a way or are willing to go that extra mile and think outside the box, but it also attracts people that are just straight up conspiracy theorists.

Conner Brown: And so, it becomes this weird thing where you have the contrarians who want to be contrarian to the contrarian group and you can like endlessly. And so, like BSV went even further in that direction. And it reminds me of that flat earth documentary. I don’t know if you’ve seen it. It’s hilarious because in the flat earth community, you have a bunch of people who are actually conspiracy theorists about the flat earth community itself and they believe that some of the key leaders of the flat earth movement are actually NASA or CIA conspirators. And so, they’ve forked off to create the flat earth flat earth conspiracy, and it’s incredible. And I’m like, “Oh my God, it’s BSV.”

Stephan Livera: Yeah. And that to some extent, if you look at some of the personalities who went that way into the kind of the BCash, BCash SV, some of them, you might say they preferred to be the big fish in a little pond. They weren’t happy to try to actually win as Bitcoin.

Conner Brown: I totally agree. For me it was, I heard this thing is like you don’t get… It’s much more compelling when you hear a bad argument from the side you’re on than it is when you hear a good argument from the side you’re against. Like hearing someone defend their position badly is an extremely strong way to turn you off that view. And the more I learned or the more time I spent in the BCash community, I was just very unsatisfied with the arguments they’re making.

Conner Brown: And I think this comes down to the payments first money type thing, but also in the sense that when they’re talking about things like block propagation or things like that, they can’t defend the node perspective or the fact that blocks are going to have difficulty or mining is going to be more profitable if you’re centralized. All of those things, their arguments were just empty hand-waving type stuff.

Conner Brown: Roger Ver saying whatever hand-wavy stuff he does. And after that, it was like on one side you have extremely credible, nuanced, arguments in favor of smaller blocks. And then you have Roger Ver, who is a politician at heart. And so I think that was another big thing that was painfully obvious after a little bit of time.

Stephan Livera: In my view, it was also a lot of affinity scamming going on because Roger Ver is a libertarian and was able to convince many other libertarians, and what we would refer to them nowadays as the lolbertarians. The ones who didn’t really know what they were on about and they just got fooled because some of them didn’t have quite the level of technical knowledge or quite the economic understanding that the Bitcoiners had. And unfortunately for them, it was quite costly.

Stephan Livera: And in many ways, I would have liked these guys to be rich, right? I would have liked fellow libertarian types to be rich, but unfortunately, people like Roger Ver were going around and saying, “Oh, all the real libertarians back then, are still in BCash.”

Conner Brown: Yeah, no, it’s really funny looking back on the time I was thinking about it. And things like the block size limit, that’s central planning and we should have much larger blocks so the market can, the fee and things like that. It sound compelling at first and then you start thinking a little bit more about it and you’re like, “Wait a second, the market deciding the block size, isn’t that just exchange rates between BCash and Bitcoin?” And you’re like, “Oh wait, okay. So the market is deciding these things. It’s not centrally planned.”

Conner Brown: And I mean, it all doesn’t really hold up under scrutiny but with some… but this goes back to how much time it takes. I mean, I’m in law school when I’m learning about this stuff. I basically spent all my time learning about Bitcoin over the past year and put classes on the back burner, and I was very time rich, which is something we hear a lot. It’s like I had the luxury of really digging through this stuff and understanding it.

Conner Brown: And that’s something that is really frustrating when someone new comes to me and I know that they work a lot. They don’t have the expertise or time required for parsing this out and that’s where it can get frustrating. But yeah.

Stephan Livera: Yes, so there were a few different claims that the BCashers put out and I think it might be instructive just to try and speak through some of them. And now the way of understanding Bitcoin more from this money, not payments view as you mentioned. So some of them would say things like there are multiple Bitcoins. Now, I covered this recently with Giacomo as well, but that was definitely another lie that they pushed.

Conner Brown: Yeah, I think that was something that was interesting. And I got into it a lot with Andreas Antonopoulos and I think a lot of people get mainstream, like start getting into Bitcoin through him. And there is even several videos by him where he was like… and I guess this was around the time the fork was happening, but he was like, “There is no such thing as the true Bitcoin. Everything’s Bitcoin, it’s what you want.” I run multiple nodes on all the different implementations and they’re all Bitcoin. No one can say what Bitcoin is.

Conner Brown: And I think things like that to someone who doesn’t have much time in it, you start to be like, “Oh yeah, it’s just this philosophical position. Everything’s Bitcoin.” And I think pandering to the idea of cash in the whitepaper, my God, so much time spent on that. And the idea that the ‘true Bitcoin’ is the one in the white paper because the word cash is used. And I think this gets at crucial understanding of money that I came to later through Shelling Out and some of the other great monetary pieces.

Conner Brown: As you know, cash is really something that is important for trustless transactions so that different societies can interact and start engaging, and trade between communities that they don’t know they’re ever going to see again. And I think understanding the distinction between cash means, “Hey, LOL, I can go spend this,” versus cash is something that is a stored value, amount of value and time and energy. That was another big shift and understanding that I went through that it was just so painfully obvious after that.

Stephan Livera: Yup. And I know you mentioned this earlier, but this is another common BCasher lie, which is about this whole, “Oh, the block size limit is central planning. And therefore, if you’re a real free market libertarian, you should be a BCasher,” kind of thing. That was the argument that they would present. Now, what’s your response to that?

Conner Brown: I mean, the free market is what people voluntarily do, and if you voluntarily are running a certain software and your node, then that’s what the market’s signaling. And it’s about where we come to consensus. So I think that initially that seemed very compelling. But that was also because I didn’t have a really strong background in economics or anything like that. And so I was like, “Yeah, this seems really unfair. Why are they making these things so high so they can profit off of it?”

Conner Brown: I mean, it was like this really simplistic view and you start breaking it down more, and just working through it and you’re like, “Well, actually people were voluntarily trading between the two coins. One is trading at a much higher price than the other. People are voluntarily choosing to run their nodes. One has got a lot more nodes and activity than the other.” I mean it becomes obvious when you look at the actual market dynamics and take a step back from whatever they’re handwaving about.

Stephan Livera: Right. And so I think that’s part of it. And something for me that was quite a good explanation that I found was Giacomo Zucco, because he had a tweet thread about this a little while back now. And he was basically explaining that the difference between the BCasher world view of trying to keep transactions super cheap versus the Bitcoiner world view of making verification accessible, right? So it was about do you want ease of transaction or ease of validation, or ease of verification?

Stephan Livera: And ultimately, I think that is the most convincing argument, which is that ultimately, we have to remember what Bitcoin is about. It is about challenging the government’s control on money. And if you don’t have something that can be easily verified, well then, you’ve already given up the game. If you’ve given up that decentralization of validation, you’ve given up. You’ve lost. So what is the point, right? That’s an angle that I typically take as well on that point because I think it’s a very misunderstood point around Bitcoin and BCash.

Stephan Livera: Now, what about this idea of Bitcoins are to be spent and not hoarded, so to speak?

Conner Brown: Yeah, I mean, this is something that I think again, is really compelling from someone who’s never really thought about money before. I mean, it’s the same way that people were convinced to give up their gold, or at least that was the government justification for giving up their gold. And the Great Depression was, “Look at all these people like hoarding their gold, these evil people. We need to take their gold from them because they’re just really making an unsustainable economy here and hurting us all.”

Conner Brown: And I think that it’s really funny because one of the most important parts of money is store of value. And so in creating a narrative around spending instead of hoarding, they’ve actually shot themselves in the foot a little bit because they’re killing the thing that bootstraps the thing that they like. I mean, if you’re spending your Bitcoins, you’re not hoarding them, you’re not storing your value in it and you’re not creating that beautiful virtuous cycle of how money comes into existence. And you’re just trying to skip to several stages later in the monetary process.

Conner Brown: And so, I think once you understand, well, wait a second, this is something that has to first be a store of value, then we can use it as a medium of exchange later because right now we see tremendous upside potential in it, then it makes a lot more sense why would you spend it when you have fiat. You spend the terrible money and you save the great money. So the spending narrative I think also: compelling at first, falls apart after a little bit when you understand monetary evolution.

Stephan Livera: Precisely, yeah. And I think that’s really a nice articulation of the effects really of that interplay between Gresham’s law, which is what applies when there is a legal tender law and then Thiers’ law, which is what applies when there is no restriction or government price control in effect. And it also ties in with this whole BCasher… not just BCasher, but also this idea of “Oh, merchant adoption is what matters”, right?

Conner Brown: Yeah, merchant adoption is another thing that comes up a lot, not just to BCash. I think that was a big place, but also just anyone that you’re talking to Bitcoin and you’re like, “Yeah, I’m interested in Bitcoin.” They’re like, “Yeah, but can I spend it? Where can I go buy a coffee with it?” And you’re like, “Well that’s not really what makes something a money. You can’t really go and use your gold that has an $8 trillion market cap at the coffee shop down the street. And it has to go through these stages.”

Conner Brown: And that was another thing that was one of the… it was just so cringy to watch these videos of BCashers going around and trying to… it felt like they’re almost trying to con people into accepting Bitcoin Cash because they were like, “Oh, it’s merchant adoption. I know I just rode in your taxi for the past 30 minutes, but I’m not going to pay you. I’m just going to like teach you how to open up a Bitcoin Cash wallet and send you this. And one day you’ll figure it out and I just increased merchant adoption. So there you go, B-Coin cores.” And you’re just like, “Oh my God. So cringy.”

Stephan Livera: And ultimately, it’s like here’s the thing, if you really like something, you should not want to give it up. Right? Like if you really love Bitcoin, you want to hold onto it. People should theoretically be trying to spend with Fiat and say, “Oh you want money, I’ll spend my Fiat for you and I’ll hold my Bitcoin. Oh, but you’re trying to pay me. Okay, well, I would like you to pay me with Bitcoin because I think that’s the better money.” Right? That’s if you really loved it, that’s what you’d do.

Conner Brown: They’re so desperate, they just give away their cash. I mean, it’s really funny thinking back on it, but to an outsider perspective, you’re just like, “Oh yeah, that makes sense because I spent my money and that seems important to spend money because that’s what I do with it.” And the fact that it’s so compelling speaks to the problem of our money today, is that people don’t think about saving.

Conner Brown: It really speaks to the philosophical state of money in society, is when we have been using an inflationary currency that incentivizes spending and consumption instead of saving and investment, then naturally, this is going to be compelling for people that have been inundated with this for years, cheap credit and consumer spending. And so, they’re playing to that broken narrative and that’s what’s so world-changing about Bitcoin. Is that this new language that has these new philosophical concepts and better, that completely shift that dangerous paradigm.

Stephan Livera: Precisely. And I think that is also one of the difficulties that Bitcoiner have with communicating the value of this to a normie, because a normie perspective is, “Oh, this Bitcoin, what can I do with it?” Right? They’re thinking use cases, right? It’s a different mindset.

Conner Brown: Exactly. And I think that it’s really bizarre because people don’t think about their money in terms of its monetary properties, but they really think of it in terms of its ability to move in a payment system. And I think that this leads to a lot of people thinking money is subjective, arbitrary. We have the Yen, we have the Dollar, we have the Peso, but really they’re just all separate beliefs and they never consider, or at least I never considered monetary properties before learning about Bitcoin.

Conner Brown: I never thought about scarcity, durability, verifiability, portability, fungibility, all of those really important characteristics that make someone use a certain medium of exchange or a store of value, you never consider that. You think this is just a belief. You these people pass this around and we all believe in it. And the fact that I can pass it around anywhere, the fact that merchants adopt this thing shows that the belief is strong and therefore, it’s a good money. And the opposite is true. It’s a question of what are its monetary properties and how do they stack up against competitors.

Stephan Livera: And so, the other big, big one that came out of the BCasher world and some of the payments type people would think of it this way, is, “Oh my God, high transaction fees. No one is going to use your Bitcoin and well, maybe it won’t be secured in the long run because the high transaction fees.” What do you say back to that?

Conner Brown: I mean, that was something that I was definitely sold on for a little bit. It was just like why? It’s needlessly expensive over here. And that was something that took a while to come around to. But once you start understanding it as a store of value and you start understanding the reason that the transaction fees are high is because there’s demand there, and the demand is there because it has these incredible store of value properties, then those transaction fees look hilarious in a way.

Conner Brown: I mean, they just look so minuscule in relation to what people are willing to pay for final trustless settlements in today’s world. I mean to, to move gold costs hundreds of thousands or millions of dollars. And so, getting confirmations from the Bitcoin chain for just if you’re willing to lower your time preference enough to allow for a couple of days, you can get it with just a few cents. And even if transaction fees go up to a hundred dollars, it’s still just massively better than other things that people store value in.

Conner Brown: You look at real estate, gold, like I said, or these other things, they have massive expenses. So when you move from payments to money, the transaction fees look much cheaper. And I think that Lightning really taking off was also… and me using Lightning and understanding Lightning as this is a layered solution to money in the same way that our system is today, where we have settlement between banks and when you have consumer payments on top of that, I think that was also pretty big. And you can see how this financial stack builds out and the transaction fee varies based on what level of the stack you’re using. So I think that was all very important for me, learning more about this and bringing it all together.

Stephan Livera: Excellent. So we’ve covered some of the common BCasher or just normie ways of thinking. What were some of the resources? What was it that helped turn you around?

Conner Brown: I think the first thing that really was compelling to me was Murad’s segment on the Off the Chain podcast. And it was funny because I saw it because I think the Apple store or I don’t know, some platform took it off the platform when it first went up for some reason. And I don’t know if that was a fluke, but I was like, “Oh, what is the secret knowledge people are like de platforming?” And so, I listened to it Murad just gives this incredible argument for Bitcoin as a store of value and money as an evolutionary concept.

Conner Brown: And for the first time, my thoughts about money as, “Oh, it’s just a payment,” to, “oh; this is a thing that has multiple different elements. You have store of “value that slowly evolves over time.” That just blew my mind. And because for the first time I heard a compelling argument that really seemed to get to how money worked in a very logical way outside of “this is just a belief”. And when I stack that up against the other arguments I’ve been hearing, it just destroyed them.

Conner Brown: So then I started, “Okay, where can I find more about this money thing?” And so, that’s why this podcast is surreal for me because I then found your podcast and your first couple of episodes just blew my mind. I called my dad, I’m like, “Dad, you have to listen to this. This is crazy.” And all during the month of October 2018, I listened to like every single one of your podcasts, all the Noded podcasts, and just about of Tales from the Crypt. And just it was such a bizarre month of my life because so much information was being downloaded. So much of how I understood the world was changing and like a really, really short span of time. And that was just really crazy.

Conner Brown: I think another really big resource for me, this was around the same time was Stop and Decrypt, and the work that he put out on medium was just incredible. And I think this is separate, but I also had some thoughts on Ethereum. I was like, “Oh, Ethereum seems really interesting. We could build finance on top of it.” And his pieces on sharding and just the importance of full nodes helped me understand how Bitcoin works, how it relates to other systems, why that this idea of selling sharding is not super attainable. And he has a great piece on BCash as well. All of that just completely, convinced me in a really short span of time. And it was a really strange experience.

Conner Brown: I’ve just never experienced something in my life like that where, suddenly there’s this whole new understanding of Austrian economics, which I’d never heard of. There was new understandings of the role of government and it was also so exciting because I went from thinking, “Oh I’m interested in Blockchain and it’s going to make payments more efficient,” to thinking, “Oh my God, I’m part of a revolutionary struggle to separate the money and state in a way that has never been done before.” And there’s this weird like element where you find yourself in this great historic moment that’s super exciting.

Conner Brown: But anyways, yeah, that’s… I could go on and on. I found Twitter for the first time, that was mind blowing. Just having so many brilliant people talking. I’d used it a little bit before, but it was mostly for memes and stuff, or whatever. Nothing interesting. And so, that was also really crazy. I actually just made a Twitter to go and personally think Stop and Decrypt for his articles. I was like, “I just made a Twitter. I don’t really know how this works, but I just want to say thanks.” And that’s how I got started just on Twitter and here we are.

Stephan Livera: There you go, fantastic. I can appreciate it for someone coming from the perspective you had, it would have been a massive, massive shift in the way you think. And then to just 180 flip is not an easy thing.

Conner Brown: No, it’s not. It’s a little bit scary. I think there is a few days where I was like, “Am I part of a cult? Like am I really getting tricked here?” And I don’t know, it was a very strange time. But at the end of the day, my background is in debate, philosophy, law school. It’s all about just stacking up arguments and seeing where it falls. I’m not someone who ever is really wedded or I try not to be, I think everyone has biases, but I try not to be wedded to a single ideology and I’m willing to just see where the arguments lay, and pick up the pieces, and figure out what’s real.

Conner Brown: And I kept doubting how compelling these arguments are. I was like, “This can’t be this crazy. This can’t be as compelling as it is.” But when you stack them up Bitcoin just blows your mind and it’s all there waiting to be found. Yeah.

Stephan Livera: Excellent. Let’s talk about there was this funny Buttcoin tweet I thought it’d be good to touch on. So it’s again, coming back to this whole payments versus money idea. And so, the tweet says, “There isn’t a single God damn thing that Bitcoin can do for retail that Apple pay doesn’t already do 10X better.” Now why might that be compelling to the typical Buttcoiner or person who’s like an anti-Bitcoin person?

Conner Brown: I mean, I think this goes back to all of the things we’ve already been talking about, which is money as a payment instead of money as a store of value. That is something that people forget about a lot. I think that it goes back also to people don’t realize the importance of money in a lot of the big historical events we’ve seen in the past few years. I think that thinking about the financial crisis in 2008 or something like that, we don’t understand the monetary and the average person doesn’t understand the monetary implications for an event like that, of what allows cheap credit, what allows these sorts of highly illiquid loans and things like that, and poor allocation of resources. And I think that all of that comes back to monetary problems.

Conner Brown: I don’t know, and maybe it’s because every sort of money that we have in the world is so similar. Every single money is Fiat based, that they all seem so similar and the differences just seem like different payment systems. I’ve tried to think a lot about this because it seems so obvious in retrospect, but at the time, money really seems like a form of payment and not much else, and it’s just a number. And I think another part of it is complexity theater with central banking and things like that. Like money, at least for me, the way it was created seemed so damn confusing.

Conner Brown: In a way it’s like trust the experts, don’t worry, there’s like all these geniuses at the Federal Reserve somehow that are pulling the strings properly. I think that’s another thing that makes it really hard for people to question their money. But yeah, I think that that, that little post on Buttcoin sums up just how difficult it can be for people to understand money on an ideological level as being we’re seeing it even. I mean it’s difficult for people to even recognize money as an issue.

Conner Brown: I think a lot of theorists, and when I was in college, I really love critical theory and a lot of them, super communist. And I think a lot of that comes from not understanding money’s role in things. I never hear read any of them speaking about money at length and the problems that can have. And I think a lot of people misconstrue problems with capitalism or free markets with problems with money. And so, I think that’s another thing that has really been difficult to sift through, is money is almost in plain sight and it’s so pervasive. It’s also completely hidden. You can’t see outside of it because you can’t view it from a distance. And so it leads to people blaming other things for monetary problems.

Stephan Livera: Right. And I think it’s good to now transition a little to now your experiences in teaching Bitcoin to other people. So tell us a little bit about that.

Conner Brown: Yeah. So, I’ve taught a decent amount in my life. I was a law school admissions test tutor and I really love teaching. And so, I taught some classes at Stanford. We had a class at the Law School called Cryptocurrencies, and it was really funny because my professor was actually an Austrian economist type. He really enjoyed contract law because he thought it embodied subjective valuations between parties coming to a mutual understanding.

Conner Brown: And so, we started class on the first day and he’s like, “All right, I’m going to teach you guys about crypto currencies.” And he’s like, “So you have Bitcoin and you have Lightspeed, and those are the two main coins.” And I was like, “Litecoin, do you mean?” I was like, “Oh no, this is going to be a bad class.” And so, it was really funny. We ended up… But after I talked through it with him, essentially I became like a T.A for the class and ended up teaching the class. But it was awesome class.

Conner Brown: We went through Bitcoin, we used The Bitcoin Standard as our reading material. And the other thing I’ve done is I’ve been teaching high school students in the area. They come to Stanford for these little like pop up classes. And the one that I teach is Bitcoin, how Bitcoin will change the world. And it’s so difficult because it’s so interdisciplinary, but essentially looking at the different stages of monetary evolution, how Bitcoin is superior store of value, medium of exchange, unit of account relative to traditional systems.

Conner Brown: And I think the other thing is teaching about the macro landscape and we’re in this really strange historical moment where we don’t really know what’s going to happen with our global monetary system. We know it’s going to be terrible. We don’t know when it’s going to happen. But central banks are really just clinging onto their last shreds of credibility and people don’t think about that. And so, I think just when you lay it all out there, it becomes really painfully obvious.

Conner Brown: But I think that that’s one of the big thing about teaching, is Bitcoin really doesn’t make sense unless you view it in this macro landscape of, all right, what is the current state of money around the world? How are the different central banks operating? And what did 2008 teach us? And I think that when you line all that up, it’s like that scene in the end of the wolf of Wall Street where he’s like, “All right, sell me this pen.” And the guy’s like, “Oh, it’s a great pen. It’s a great weight.” And he’s like, “No, ask me to sign something.”

Conner Brown: And I think when teaching Bitcoin, that’s a big part of it, is you have to recognize the dire times that we’re in monetarily, and then the need for Bitcoin is just painfully obvious. But you have to formulate that and explain that. And it’s extremely difficult but crazy rewarding too. So…

Stephan Livera: It’s fascinating because it’s also very difficult to explain to someone in a Western country why their money system is not adequate, because from their perspective, “Oh, the U.S. dollar or the Australian dollar, they’re both fine. Why do I need to change?”

Conner Brown: Yeah. I think it’s a really difficult thing and I think that that’s why a lot of people at Stanford, a lot of people are into Ethereum, big time and they don’t understand the value prop of Bitcoin because, “Well, it’s actually good if a government can manage the monetary supply”. They need it so that at a time of crisis, they can respond to these things. And when I’m talking to them about that, if you can’t get past that really deep assumption of ‘should a government have control over the money supply’, then it is nearly impossible to crack through and get through to them on the value proposition of Bitcoin.

Conner Brown: I’ve had several things where we’re there for a Blockchain meetup and we’re talking about it, and they’re like, “Yeah, but we need to make sure the government has control of the money.” I’m like, “Why are you here?” And a lot of them love things like maker DAO or things like that, which is the same idea. It’s like let’s just take a bunch of tech bros and make them a central bank, and let’s hope that with even less experience, they can somehow do some sort of bizarre interest rates scheme and manage the money supply. I mean, it’s really a nightmare.

Conner Brown: But they believe that manipulation into the market is better than the subjective preferences of each of the individuals acting in the market based on their own desires. And so, when you have that fundamental assumption, which is almost philosophical in a way, then it’s really difficult to break through and explain the proposition of Bitcoin.

Stephan Livera: Great. And the other common one is people thinking of Bitcoin like it’s just gambling. And in some speculative sense, it’s like being a poker player and you’re making that sort of probabilistic bet or call. You’re calling a certain amount because you think you’re betting a small amount of your portfolio that you can win a massive amount.

Conner Brown: Yeah, I think that the asymmetric bet nature of Bitcoin is huge and it’s a difficult thing because even the asymmetric bet in my mind doesn’t quite articulate Bitcoin, because there’s no… like either you hold it or you don’t, but in either ways you’re taking a gamble. Like if I’m sitting here and I’m laying out, “All right, here is some really strong arguments in monetary history. Here’s the current macro landscape. Here’s all the beneficial aspects of Bitcoin. Here is, the monetary properties of Bitcoin that are unprecedented and would be almost impossible to breach.”

Conner Brown: So on top of all that to say, “No, I’m not going to hold any,” that’s a huge gamble. That’s a really huge gamble to look at all the logical arguments and say, no. And because you’re betting that it won’t. I mean really only hold in fiat what you can afford to lose, right? Because if you look at it from a logical perspective, the risk is in traditional monetary systems. And so, I don’t know, I think it’s such a strange thing and I don’t… I think unfortunately for a of people.

Conner Brown: I was just talking to the guy from blockchain.info. He’d been in Bitcoin since like 2014, still works at blockchain.info. And he was like, “You buy a lot of Bitcoin. Like you don’t just put your money in the S&P 500?” And I was like, “You put your money in the S&P 500 and you’ve known about Bitcoin for five years?” He’s like, “Yeah, I mean you just trust historical returns, right?” And I was like, “What are you talking about? Like that’s where all the risk is.” And he was like, “Well, what do you mean? Bitcoin is where all the risk is.”

Conner Brown: And it’s such a strange thing. And I guess if you can’t understand Bitcoin in this sort of macro landscape of precarious central banking and really having no levers left to pull, I mean, interest rates are like what, 2% negative across the world for large parts of it. If you don’t understand it in that space, then it’s going to seem risky. But when you do, suddenly it’s the risk off trade. Suddenly, you’re the risk averse guy. In my own life, I’ve always been extremely risk averse and I think that Bitcoin fits well within that because you’re just stacking sats and whatever’s the safest soundest place that is truly provably scarce. And so in that sense it’s like the anti-gamble, but yeah.

Stephan Livera: Yeah. And speaking of gambling, the other common sticking point for newbies is “Oh, it’s a volatile, why would anyone use that as money?”

Conner Brown: The volatility thing really gets me because you articulate it as, “Oh yeah, well, I think this is going to be the new global reserve asset.” And they’re like, “Yeah, but it’s so volatile.” I’m just like, “Of course, it’s going to be volatile in the upper direction. What are you talking about?”

Conner Brown: And I think that this is a strange thing because when someone doesn’t understand money, they expect of Bitcoin to come into the world and suddenly be a perfect store of value, medium of exchange and unit of account simultaneously. Like it’s just going to pop into existence and then it fills all the roles of a money perfectly. And I think the big turning point for me was saying, “Wait a second, this is an evolutionary process.”

Conner Brown: We can use it as a medium of exchange, but right now it’s still in its black hole stage where it’s just sucking up value from all of these inferior forms of storing value, and that is going to be accompanied with massive volatility. And as that tapers off, then we get into a more medium of exchange role of the money.” So I think that’s really a hilarious take, to try to want all of it at that one time. It really comes down to patience, letting this thing mature and volatility is good because orange coin go up and we’re all happy. Right?

Stephan Livera: Exactly. Yeah. I think that is a big… I’ve made similar comments before as well about how people just think Bitcoin should just come into the world perfectly formed, and it’s not like a child that has to grow up. It should just be perfectly formed and what they’re doing is it’s almost like not giving it a time to grow up, and they’re just expecting everything to just be ready at once.

Conner Brown: Absolutely. I mean absolutely, the perfect being the enemy of the good is definitely a big issue. And I think that’s another reason that people are going to have their minds blown by Bitcoin because it’s something that evolves. And people that write it off in 2015 are going to look back at and they’re like, “Wait a second, now it has the Lightning Network on top of it. Now it has things that I can’t even talk about right now because they’re going to be something someone develops in 2021 and it’s going to be even better than Lightning Network or something like that.”

Conner Brown: So this evolutionary process of Bitcoin, not just in its monetary, but in the actual nature of the protocol itself is just unlike anything we’ve ever seen. And I think expecting everything at one time is just going to blow people away because it’s going to evolve beyond what I think even you or I can imagine right now.

Stephan Livera: Oh, also, I know you had some skirmishes with the Ripplecoin shill at university. Tell us a little bit about that.

Conner Brown: Oh, that was a fantastic day. Yeah. I was taking a class at the business school and it was just basically a finance class for different people from different portfolio managers or hedge funds would come in and talk about what they’re working on. And one day we had a professor from the business school who also happens to be on the board at Ripple, come in and talk about Blockchain technology. And part of me didn’t even want to go to the lecture. I was like, “I know how this is going to go down. It’s going to be so difficult. I’m going to just be cringing the whole time.”

Conner Brown: But I go in and for the first 30 minutes, it’s talking about the beauty of the Ripple protocol, whatever that means. And she’s talking about how banks are using it and all of these different… just doing the classic Ripple marketing pitch. And then she starts comparing it to Bitcoin. She’s like, “Now Bitcoin on the other hand, look at this thing, wasting all this energy, stealing electricity from rivers there. Bitcoin…”

Conner Brown: Let me make this one thing clear, I’ve been working on this since 2013 and everyone says it’s secured cryptography, through cryptography. But let me tell you this, it’s not, it’s secured economically. And if a miner gets 51%, he’s going to steal all your coins and just crazy stuff. And I’m sitting there and I don’t know what to do. I asked a few questions, but it was just really bizarre because you’re at this great academic institution. I love Stanford. You expect your professors to have good integrity and be upright, and really try to pursue knowledge and important ideas.

Conner Brown: And I was like, “Oh my God, this is a professor shilling a coin in class.” So I got really upset and I wrote a long letter, and sent it to different… so she was a visiting professor in the class. I sent it to the professors and they said, “Well, we’ll get back to you on this. I’m really, really tangled up right now with stuff, but we’ll definitely look into this and get back to you.” Never heard anything about it. And it was so frustrating.

Conner Brown: And so I was talking to other Bitcoiners and they’re like, “Wait a second, this happened?” And I was like, “Yeah.” And they’re like, “Why don’t you just post this on Twitter?” And that was when I learned about the capabilities of Twitter and things going viral, because I posted the letter and it just immediately blew up. And it was a little bit terrifying, honestly, because I really wasn’t expecting it to go viral, but I got millions of impressions and I’m just sitting here like, “Oh boy, the Ripple army is after me.”

Conner Brown: And nothing ever really came of it. There was a story in the Stanford newspaper about it. She made some comments on Twitter in response to me where she said, “This is a caricature of my lecture,” and my letter basically just said, “All right, here’s the claim that you made in class. Here’s four different points that say why this is wrong. Here’s a nice piece of research or here’s an article to explain what you should’ve said here.” And it was really never addressed.

Conner Brown: And I specifically asked on Twitter, I was like, “Can you please say which parts of the lecture you think I mischaracterized?” Never answered. There was never any substantive remark and it just got passed off as well. This is an introductory lecture, so we want to keep it really simple. And I was like, “That’s not quite what you’re doing, but because no one really understands this stuff yet, you can get away with that.”

Conner Brown: And that was really frustrating to me, is that it was perceived as this is a difference of opinion when really it was things that… and you can read the article, it’s still on my Twitter feed. But yeah, it was not things that were just like subjective opinion, it was like, “All right, here’s how the protocol works,” and that was a really frustrating moment. But seeing the Bitcoin community’s reaction to that and just the… I don’t know, it was just a really beautiful moment because you see the community stand up for you and support you.

Conner Brown: And I went to a lot of meetups and people have been like, “Wait, are you the Ripple student guy on Bitcoin, Twitter?” And I was like, “Yeah, that’s me.” And so that’s been really… it’s so cool. It’s such a beautiful community and it’s really just been inspiring to just keep working and keep learning. So, yeah.

Stephan Livera: Yeah. I remember the day you shared that because I remember re-tweeting you that day and retweeting it up. And I saw like Jeremy Welch retweeted it and a bunch of people just hit retweet and then it just blew up. And then I think some of the Bitcoin news sites tried to get your perspective and post it on their side as well. So that was really cool. And it was a good article, I remember.

Stephan Livera: So look, I guess, what’s coming up for you next? Are you doing some more education? I know you’ve written an article recently, a great article on “Bitcoin has no intrinsic value”. What have you got coming up?

Conner Brown: Yeah, so I’ve got a few different articles in the pipeline that I feel like I’m constantly thinking about this, and I have like way more ideas than I know what to do with. I think one of them that I’m hoping to work on and get out soon is Bitcoin is American, and that’ll be going through the ideals of the American revolution. The incredible courage it took to really change the concept of nation state and challenge that on the global stage, and how Bitcoin is the exact same type of position in a monetary sense instead of a political representation sense.

Conner Brown: But at this point, I’ve got a few others another on intersubjective systems and refuting the money is subjective, arbitrary belief. And right now I’m still on the legal track in my life and I’m just trying to figure out where I fit into the Bitcoin landscape. Because I sit at work right now and all I can do is think about Bitcoin and I’m just like, “I need to transition as soon as possible.”

Conner Brown: So we’ll see, hopefully, some good announcements in that regard as well, but I’m still just trying to figure everything out because it’s been… I mean, it hasn’t even been a year since I even learned about Blockchain. Before, like a year ago, I didn’t even know Blockchain and Bitcoin related. So, it’s been a whirlwind and who knows where it goes.

Stephan Livera: Excellent. Well, look, I think you’re doing a great job, so thanks for that. And yeah, look, just before we let you go, make sure you tell my listeners where they can find you.

Conner Brown: Yeah, you can find me on Twitter. My handle is @_ConnerBrown_, and that’s probably the best place to find me. Obviously, feel free to reach out and I love talking to Bitcoiners. And I also just want to say thank you for your podcast. I mean, you truly… I don’t know if I’d be sitting here if it wasn’t for the amazing content that you’ve put out and it’s huge. It’s been amazing for me and I’m sure that there’s other many, many other people like me that need some nice place to get good, honest information. So, I mean, I honestly can’t thank you enough for this.

Stephan Livera: Oh, you’re welcome. Thank you very much, Conner, thanks for joining me.

Conner Brown: Yeah. Thank you so much.

Stephan Livera: Hope you guys enjoyed that. If you want to subscribe to the podcast or find the show notes, you can go to StephanLivera.com. Make sure you share the episode with a friend or if you want to share the podcast, maybe tell them to start with episode 71 or episode 67 with Plan B. Review and rate the show. And also, if you got any feedback, you can DM me on Twitter @StephanLivera or email me at… the email is StephanLivera@pm.me. Also, if you’re looking to sponsor the show, you can email me there as well.

Stephan Livera: Lastly, just a reminder about ministry of notes, the Australian Bitcoin education start-up. So keep an eye out on that one. Thanks guys. That’s it from me. See you next time.

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