TMBA568: ‘I’m Fiscally Bitcoin and Socially Ethereum’

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It goes without saying that as internet entrepreneurs, we are fascinated by the future of money, and it’s hard to talk about the future of money without talking about cryptocurrency.

Greg Gerber is our go-to when it comes to simplifying the complicated world of crypto.

We’ve invited Greg back on to the show this week to talk about the state of crypto in 2020.

As this conversation unfolds, you’ll hear about the philosophical differences between Bitcoin and Ethereum, the emerging lending industry in the crypto space, and how Greg hopes to help more people go down the crypto rabbit hole with his newest venture, BitLift.

Disclaimer: These are just our opinions, and are presented for informational purposes only. They are not intended to be considered as financial advice.

See the full transcript below

 

 

Listen to this week’s show and learn:

  • How the Bitcoin market has changed since our last conversation with Greg. (10:00)
  • The major differences between Bitcoin and Ethereum. (23:20)
  • How Greg earns a passive 14% return on his cash. (41:42)
  • What the value of Bitcoin might be five years from now. (56:25)
  • Greg’s long-term vision for BitLift. (1:05:00)

 

Mentioned in the episode:

Before the Exit – Our New Book
TMBA Masterminds
Partner With Us
The Dynamite Circle
Dynamite Jobs
Dynamite Deals
Tropical MBA on YouTube
Greg Gerber
BitLift
Michael Saylor
Coinbase
Lightning Network
Nexo
Crypto.com
BlockFi
Strike by Zap

Enjoyed this podcast? Check out these:

TMBA422: Crypto: What’s It All About?
TMBA430: The Philosophy Of Crypto
TMBA557: Ascending the Staircase

 

This week’s sponsor:

Today’s podcast is sponsored by Smash Digital.

Smash Digital is a growth agency filled to the brim with unicorn images and SEO memes.

A team of SEOs who actually know how to use SEO instead of just selling SEO to people who don’t know SEO.

An agency with so much link juice, you’ll need a mop and a bucket to clean it all up.

A group with actual skin in the game, ranking their own portfolio of profitable businesses, and offering the exact same services to clients.

If you want to have Smash Digital in your back pocket, check them out over at SmashDigital.com and a big thanks to Smash Digital for sponsoring the show.

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Have comments about the show?

Do you have ideas for things you’d like Dan and Ian to discuss on future episodes?

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Thanks for listening to our show! We’ll be back next Thursday morning 8AM EST.

Cheers,

Dan & Ian

 


 

 

 

 

Full Transcript

Greg: I like to say that I’m, you know, fiscally Bitcoin and socially Ethereum. And I think that really sets up kind of like the whole Crypto space right now.

TMBA ident

Dan: Hey, happy Thursday morning. Thanks for listening to the pod. Today’s show is the topic for anyone, I’m assuming this is you. interested in the future of money. And we’re gonna bring the heat this week. That’s the intention. Quick personal note. And speaking of bringing the heat, I was just up in the northeast of America for a month, visiting friends and family. And now I’m on the road back down to Austin, Texas and I pulled over to bring this conversation to you here today. And I’m on a 19-year consecutive streak of avoiding winter. I don’t know maybe that’s the origin of this podcast is really just us wanting to avoid consecutive cold and dreary weeks.

But it’s not just about weather. I mean, one of the things I’ve noticed is just for me personally how important it is to be around people who are more interested than myself in the things that I’m working on every day. It’s tough for me to be the only person that’s interested in remote work, that’s interested in you know when countries are going to reopen and, and where entrepreneurs are moving and internationalization and these things that we work on all day long here at the TMBA, in the DC, at Dynamite Jobs, if I have to sustain that solo and just through phone calls every day, it’s intellectually tiring relative to you know, being in Austin, being around so many DC-ers, being around Bossman, it just brings me an incredible amount of intellectual energy. It’s a continual lesson I learn over and over again is just how important it is to be around like minded and really makes me nostalgic for DCBKK, which is our event that would be happening around this time of year, every year and I just so so look forward to the day when hopefully things can normalize somewhat and that us as like minds, as listeners to the TMBA, we can all get together again, I look forward to that.

And this conversation is actually directly related to one of those meetings, someone I met in person through a DC event, which is our private community. So today’s guest is going to shout out the Dynamite Circle and if you want to read about that you can check out Tropical mba dot com slash DC. And now look, this is a way for us to hang out with people that are more interesting, that are smarter than us. And today’s guest is just one example. If we’ve done what today’s guest did, and accepted Cryptocurrency as business payments, just a few short years ago, we would be rolling at it all, right, I’m not gonna grind that gear too many more times. I had such a great time speaking with today’s guest, Greg Gerber, who’s been on the show before and has proven himself to be a leading thinker about Cryptocurrencies like Bitcoin and Ethereum. And I fully concur with the way he describes himself on his website Bitlift dot com as ‘your wingman down the Crypto rabbit hole’. He is this and so much more. So join us on today’s rabbit holes. Here’s what you can expect: how the crypto landscape is changing, the practicalities and philosophy of Bitcoin and Ethereuium, and their uses. Why MicroStrategy’s Michael Saylor recently spent many hours hunched over a computer, buying Crypto, and so much more. One of the just little nuggets is how Greg gets a 14% return on his money every year. There’s this a lot packed into this conversation. I hope you enjoyed it. And just some technical notes. This episode goes into some fairly deep water relating to the original ‘White Paper’, written by Satoshi Nakamoto, who has lent his name to Sats, which are the smallest fraction of a Bitcoin that can be sent, we also talk about using Bitcoin as a legit savings vehicle and products in the crypto space that are similar to CDs or certified deposits. But that seemed to be returning much higher interest rates. So there’s a lot to get through. I hope you enjoy it. It’s gonna be a wild ride. Trust me, hang on. Let’s get going.

Music

Greg: My name is Greg Gerber. I’m a developer. I’m the founder of Bitlift. I’m a long term DC-er. So shout out to all the DC errs out there. And since 2013, I’ve been building products, sort of at the intersection of Crypto and e-commerce, or what I like to call Crypto commerce.

Dan: And for DC-ers, we know you as the guy we go to when we want to get questions about Cryptocurrency answered in a way that’s not political or religious, but just kind of informational.

Greg: Sure, yeah, we have some developers in the group that can go deep on that side, we’ve got some investors in the group that can go deep on that side, I think I land kind of somewhere in the middle.

Dan: And how would you describe that middle?

Greg: It’s practical. I came to Bitcoin because I was in e-commerce and I was looking for a way to get paid without the banks and these sort of Pay Pals and Stripes of the world holding on to my money for me or freezing my accounts. There’s so much like paperwork. And I sort of stumbled into Bitcoin because of that, this idea that we can use cash, essentially over the internet just to pay each other and we don’t need any middlemen. That was a major eye-opener for me. And I wanted to use it as a tool, making money is always top of mind as well, but I wanted to really use it.

In 2013, I started my first, one of my first businesses, and I did it solely as a way to acquire more Bitcoin. I’d already invested as much money as I had into it. And I was looking for ways to stack Sats, stack more Bitcoins, and accepting it as payment was the way I came up with to do that. And I’ve done over 10,000 Bitcoin transactions with customers since 2013. So I essentially averaged my way into my Crypto holdings over lots and lots of small payments. I hadn’t sold any Crypto except in the very first week that I kind of started using it. And then, you know, around the time that we talked last time, I had been acquiring all this Bitcoin for, you know, five years at that point. And that was the time that I decided to start selling a little bit of it. Not all of it, but enough that I had kind of reached some of my goals. And I sold some Bitcoin at that time, and then I’ve been stacking more on top of it ever since that point. And you know, when I reach my next goal, I’ll sell some more.

Dan: A lot of people see, you know, Cryptocurrencies as a tool to make money quickly as an investment vehicle, but you’ve actually seen it as an actual tool that you can use in your business.

Greg: A lot of people, they learn about Crypto from the media, and the media only hears about Crypto, again, when the price is doing crazy things. There’s this big difference between investing and trading as well, when you talk about making money with Crypto, you know, investing is a long term game. There’s a reason Warren Buffett is an old guy.

Dan: Can you tell us a little bit about what you were up to at Bi lift dot com?

Greg: The long vision is, I want the Bitlift to be the place that people refer people to when they want to learn about Crypto. It blows my mind that, you know, in 2020, it happens all the time, “Greg, I’m ready to get started with Crypto, where should I go to learn about it?” And there’s still no specific spot to point people to. There are thousands of places, there are some really awesome thought leaders and some amazing books. But there’s no concise place where it’s just, ‘Go here, learn everything you need to learn from a beginners point all the way to some more advanced topics’. So, that’s the long term vision, but also this idea of Crypto-commerce, and really practically using Crypto along the way, you know, it doesn’t only have to be used for investing, it doesn’t only have to be used for payments. Just like money, it can be a store of value, it can be a medium of exchange, and we can use it for all those things. So Bitlift is a good place to kind of tinker and experiment with this idea of using Crypto as a medium of exchange and learning about how to use it from an investment perspective as well.

Dan: I try to talk as little as possible. But I got to tell my story here. One of the themes of this show is how much of an idiot I am, and had I used Crypto as a tool in my business and accepted it from you and others who offered to pay it to me as a medium of exchange in return for DCBKK tickets. I wouldn’t be speaking to you on this podcast from an attic in my parents’ house. I would be speaking to you from a satellite phone from a yacht in Mexico.

Greg: I’m not quite sure that would be true. But maybe, if you had held on to it long enough. And by the way, if you had sold it the day we talked last, I mean, I looked up when we talked last time. It was December 15th, 2017. It was two days before Bitcoin hit its all-time high.

Dan: What was the price the last time we spoke about Bitcoin?

Greg: It was $17,000 and 2 days later it was $20,000. And then it’s been lower than that ever since.

Dan: And why is that the case, or sort of interpret that for those of us who aren’t familiar with the market?

Greg: I’ve come to have a much better understanding of kind of market cycles when it comes to Bitcoin. I think a lot of it is driven by this process called ‘the halving’ that occurs in Bitcoin. And a lot of it’s driven by the media. And there is a stable upward slope. However, it’s incredibly volatile, and it’ll boost 10 times pass it, and 10 times under it along the way. And I think part of it is also driven by what I mentioned with this, these ‘halving’ events and the amount of Bitcoins that are created is cut in half every four years. That also drives demand. So when the price or when the amount of Bitcoins gets cut in half, there are half as many Bitcoins, new Bitcoins being created to go around. And lots of people out there are holding on to theirs, they’re not selling them. So when new people come in, there’s less Bitcoin to be acquired. And that tends to drive the price up, that drives the media, the media drives more people, and then we blow 10 times past what might be the actual value of Bitcoin. And then we take a few years to correct back from that, and then a halving comes in the cycle happens again.

Dan: You mentioned that Bitlift is the place to go to learn the basics of getting involved in Bitcoin, you mentioned you got involved vis a vis a business, I got involved vis v Coinbase. I’m curious, you know, a lot of us have it on our to-do list, ‘Hey, diversify 1% of your net worth or 5% into maybe some Ethereum, or some Bitcoins or whatever’. For the people like me who have these things on their to-do list for years or months, what are some intelligent ways to get started taking action in learning about and investing in Crypto?

Greg: One of my favorite first steps in getting involved in Crypto is to just buy a little bit, get that FOMO out of the way because it is going to move what and it is going to take you months or years to really get a deep understanding of this thing, tinker with it, lose it, just mess around with it, and start playing with it. And once you do that you’ll, for whatever reason, Crypto news will start coming to you, articles and Crypto things will start happening around you once you have some of it. So that’s the really simplest first step. The next step is just investing basics really, having very specific goals: what are you trying to achieve, that’s another big thing, I tell people out the gate – investing is a tool to help you achieve what you want to achieve. You don’t just wait around for the price to go up and then think it’s gonna keep going up and just hold it forever. What’s going to get you to that next chapter in your life or, or up to the next ladder rung. And if you know what that is, map what that correlates to in the Bitcoin price and sell when Bitcoin hits that price, don’t mess around, this is the reason you’re doing it. So really having a personal goal, I think is also a very important starting point. And then start with only Bitcoin. You can dabble in a little Eth too because there’s a lot to understand there. But Bitcoin really is the best starting point.

Dan: When you say ‘Eth’ you mean Ethereum?

Greg: I do. Bitcoin and Ethereum are two very, very different, it’s hard to even call them Cryptocurrencies, because I mean, they are but they just represent two very different things. And we can get into that. But I would just start there because they’re very fundamental to the kind of Crypto universe and understanding how to use them and how to store them. And learning how to set limit orders and limit sells and just putting orders into these exchanges and using how to use the exchange, learning how to use them. That’s a very important first step. At some point next, you would probably, really you’ll understand that the core value prop of Crypto is that you can hold on to it yourself, you don’t need a bank or a custodian or an exchange to hold your Crypto. So learning how to take custody of your Crypto, once you’ve bought some of it, and being comfortable doing that would be a good step. And then thinking about diversification, understand that there are other projects that are trying to accomplish different things. And some of those things you might believe are needed in the world. And you can diversify a bit into those as well. Bitcoin, I would say is the sound money, and it would probably be the foundation of most portfolios. But there are lots of other things that you can kind of diversify into, have that plan ahead of time.

Dan: What’s your perspective on someone like me who holds, you know, 90% of my Bitcoin is with Coinbase right now. And part of the reason is, you know, I have a full-time job, essentially. And I’m very bad at paperwork and administrative things, generally speaking. And so I thought, well, rather than learning how to be the custodian of my own Crypto and be responsible, which I’m not, how about I just use a service like Coinbase? And keep my Crypto with them? What’s your perspective on that?

Greg: Having a custodian hold on to your Crypto sort of flies in the face of the purpose of Crypto. If you want a bank holding on to your money, then give a bank your money. If you want to get outside of that system and invest outside of that system in a way that you’re not beholden to a person or an institution, then buy some Crypto and get it into self custody, typically, via a hardware wallet or a device like that.

Dan: From my perspective, I would say, I agree with you philosophically, but from an investor’s perspective, it seems I’ve got a decent exposure to a high upside plus a decent hedge against things like the US dollar. But are you suggesting that that’s not a sound strategy?

Greg: In a lot of ways, I actually take my investor hat off, when I think about custody, and I put my entrepreneurial hat on,

Dan: I see.

Greg: You need to think about having backup plans for backup plans. In your business, you have to diversify risk in a different way than you necessarily would with your investable assets. And, like Crypto to me, it’s like I’ve talked about how I have this practical approach. It’s not about investing necessarily. It’s about: how do I store my wealth in a way that no one else but me is responsible for it? That’s a blessing and a curse in some ways. But as someone who’s operated businesses and has dealt with, you know, big risk, I think there’s no one else I’d rather have responsibility for my money than me. You’ve been down to Chase you. You’ve met bankers before you want those guys responsible for your money. That’s crazy.

Dan: My question about taking custody of your own Bitcoins is I have a vague fear that I would mess that up somehow. What are the chances that somebody who puts a great deal of Crypto wealth into their own responsibility does in fact mess that process up?

Greg: There are definitely ways to mess it up. But I think if you took the right approach and started small and were careful and really understood what it was you were doing, and that doesn’t mean spending years reading books about it, that just means tinkering with it. How would you evaluate a tool that you’re going to use in your business: evaluate the wallets, find the one that makes the most sense for you and fling $10 at it and then and then light the thing on fire and then rebuild it again to make sure your $10 is still there. Once you’ve done that a few times. All fears about self custody will go away.

Dan: It almost feels like since the dust settled from our last podcast, we had two, you know, kind of big things happening. One is this enormous price hike that happened in 2018, where Bitcoin went up to 20,000. And it was just every news article was about Bitcoin and, and in the mainstream press, and you also have kind of this retroactive 2017, where you had a bunch of young people writing term papers, essentially called ‘White Papers’ and getting raising millions and millions of dollars for these initial coin offerings. And it seems like those two events are ancient history now. And I’m curious if you could interpret those two events for us with two years of hindsight. What was that Ico craze really all about? And is there still a part of that DNA in the Crypto community?

Greg: There is. The DNA of what happened during the Ico boom is still alive. And well, it’s now in the yield farming and lending world of Ethereum. I like to say that I’m, you know, fiscally Bitcoin and socially Ethereum. And I think that really sets up kind of like the whole Crypto space right now. It’s like Bitcoin is the money. And I think a lot of people. even in Ethereum, would agree that to be the case. Ethereum is more like this fuel concept for powering this global supercomputer that you can build applications on top of. It was almost like the recreation of startup investing and of entity creation and corporate structure, and this idea of flinging out tokens and selling these tokens, it’s kind of like shares in your business, and they may or may not have these governance voting rights. And it was there was a lot of excitement around investing in that stuff all driven by Ethereum because it was possible on Ethereum.

Dan: So to translate that for someone who really knows nothing about it, are you suggesting that most of these ICOs were actually just subversions of Ethereum? They weren’t actually a whole nother brand of Cryptocurrency?

Greg: Absolutely, probably 95% of the ICOs that happened, were actually just tokens launched on top of the Ethereum blockchain. There are definitely other people trying to build blockchains of their own. There’s some interesting stuff happening there. And none of them have really got any traction.

Dan: When you say ‘on top of the blockchain’, what is your most useful metaphor for helping the rest of us understand blockchain currently?

Greg: Maybe I would think about rewards points sort of a thing. When an airline or a business wants to get into a rewards programme, they don’t build a database and build a system for issuing points to their customers, they purchase into some SaaS tool that makes that possible. And then they manage the sort of liquidity of their points and what people do with them. Ethereum is a platform for managing your rewards points, so to speak. I mean, it can be used that way it can be used for a lot of things. But the Ico boom was really about that particular use case.

Dan: And the reason they wouldn’t write their own blockchain is because Ethereum is popular or is it because it is so difficult to do from a technology perspective?

Greg: I think the reason that they were using Ethereum was because Ethereum was so hot. You could build your own database, but no one would care. If you mentioned the word Ethereum and Ico then people care. So I think that was a little part of it. Another big piece of it was, you know, the regulatory place wasn’t the same then. You could go to Coinbase, buy a bunch of Ethereum, move it to your wallet, and then just start investing in ICOs all over the world without having to KYC or, or kind of give up your personal information to those projects.

Dan: That’s ‘know your customer’.

Greg: Right. Yeah. today, if you’re building a product in the Crypto space, if you’re selling Crypto or you have customers that are using Crypto within your products, you need to legally not only know your customer but you also legally need to track what they’re doing with the Crypto and with the tokens that they’re using in your system. You even need to track what they did before buying your tokens and after they get rid of them like within five hops or something ridiculous like that they’re tracking you.

Dan: And is that against the original principle of Bitcoin as well?

Greg: Totally.

Dan: So how do you reconcile that sort of new reality of regulation of all this stuff?

Greg: The regulation has changed a lot. And quite frankly, a lot of people were scared that the government was going to really crack down harder on the Crypto space. And what happened actually, that they embraced it, they’re keeping their enemy closer, essentially. And they’re really making sure that anyone in the Crypto space, any startup or business in the Crypto space is following anti-money laundering rules and doing this ‘know your customer’ stuff. But they’re also completely allowing it to happen. And that’s a good thing. And you can still use Crypto without going through those processes. Just like you can use cash like paper, Fiat dollars, you can still use dollars, without the government knowing what you’re doing, how you got it, who you’re giving it to what you’re doing with it. Now, that could change over time, I wouldn’t be surprised if in, you know, 20-50 years, there’s no more cash at all, and even government money is run on blockchains. That wouldn’t surprise me at all. But for the time being, I could still send you Crypto and no one. There’s no intermediary. No one has to know who’s doing that or why. Just like we could do with cash.

Dan: When we talk about Cryptocurrency it’s like Bitcoin or Ethereum seem to dominate the conversation as if they’re essentially synonymous with Cryptocurrency itself. And even your description of these ICOs seems to corroborate that basic idea. Is that how things are in reality?

Greg: As of today, yes, but Bitcoin and Ethereum are very, very different. Bitcoin is sound money and every day that goes by that Bitcoin continues to produce new blocks and continues to do exactly what it was set out to do since the day it was launched, Bitcoin gets stronger. That’s why you see people like Michael Saylor or some people investing millions, or hundreds of millions of dollars into Bitcoin. People are not investing hundreds of millions of money into Ethereum in the same way. People are using Bitcoin as a hedge against the financial system, people are investing in Ethereum as a venture capital investment. Ethereum is this playground of what does the future of decentralized everything look like? And Ethereum wants to be the supercomputer that powers all of it. And that’s, that’s a huge, huge goal. And it’s got a lot of road bumps, to get there, Ethereum is having a lot of trouble right now, they’re also having to rebuild their entire system from the ground up to scale to allow for this, this future that they see.

So, Ethereum, there’s a lot of really fun, cool projects, things happening on Ethereum and, and the Bitcoiners, you know, snub their nose at it because Ethereum doesn’t really know what it is yet. And there are so many projects on there – a scammer all the way to, you know, someone who really knows what they’re doing can launch a project on Ethereum without anyone’s permission, and that causes some problems, but it’s also the beauty of Ethereum. You can’t say the same for Bitcoin. Bitcoin has released a few new features over the last few years, and all of them were really, really low level, technical things that most people would not even know exist.

Dan: As someone who knows a lot of people who hold Bitcoin, sometimes the dream, or the future that a Bitcoiner or might imagine is, I imagine a world in 10 years where Bitcoin is as powerful as gold or where, you know, countries and central banks use it as a reserve currency or they hold it as sound money like you’re saying, what is that sort of future that folks that are into Ethereum might dream of: what are some of those futures that it could power in terms of an operating system?

Greg: One of my favorites is kind of what happened with the Ico boom, this idea of rebuilding the way corporations work and corporate structures work and the way governance works, how groups make decisions collectively, that can all be done in a decentralized way now meaning, you know, there is no CEO, there’s no boss, there’s no person counting the votes, it’s software that runs all of that. I think people in Ethereum, they’re not, they’re not as interested in sound money as they are in just tinkering, they’re the makers of the Crypto space, right, and Bitcoiners are very conservative. And, you know, Bitcoin had to kind of decide to be that way. ‘The White Paper” talks a lot about payments and about e-commerce and about using Bitcoin more practically. But we really found out during the last big boom, that Bitcoin can’t be used by every person on earth 1000 times a day, it gets backed up really quickly. And the fees go through the roof. And it’s not really good for being digital money that’s used the same way credit cards are used. However, Ethereum would like to see Ethereum used that way or, and/or tokens on top of Ethereum used that way. And in order to accomplish that, they’re gonna have to reconstruct even Ethereum from the ground up, and that’s what they’re doing with Ethereum 2.0 right now.

Dan: Could you maybe take a stab at: ‘Well, why not? Why can’t Bitcoin be used that way?’ Because I remember when, you know, you see that you can pay for your Starbucks coffee in Bitcoin and that kind of thing. And you start to think, Well, you know, why isn’t this just like, Visa now? What is the holdup? It does seem like Cryptocurrency would lend itself to this kind of ease of transaction.

Greg: Wow, it’s a big topic, “Why can’t Bitcoin be the Visa?”

Dan: I realize I’m asking you to wade into deep waters. I don’t want you to present yourself as some developer on this project, or whatever, interpret it for those of us who don’t think about it that often.

Greg: For me to understand why Bitcoin can’t scale to be Visa or to be like the money we spend on the internet every day, you really have to understand what money is and where it comes from. Money is gold, or it was gold. Hundreds of years ago, money meant gold, and people would literally interact with gold. And it was a terrible tool for exchanging. And it definitely wouldn’t work over the internet. Gold only worked in person. And it was hard to verify. It wasn’t as portable; you couldn’t put as much of it in your pocket as you need it as you might have wanted to. It was a terrible tool, but it was the best that we had. And Bitcoin has created digital gold. So yes, now we have this new tool that is literally 1000 times better than what gold was. But it still can’t quite .. even Visa is not moving gold around there. It’s a second layer, a third layer, a fourth layer on top of gold, that can release all these efficiencies. And the faster you want it to be, the higher up the chain you got to be. And the more sound you want the money to be the lower down the chain, and you want to be and Bitcoin is the lowest foundational level of digital money.

Dan: So it’s almost like then the metaphor with gold really holds up in an important way. Is this really about that other important element of money, which is debt? If you combine institutions and then debt with digital gold, couldn’t then the Bitcoin logo be right next to the Visa logo. Isn’t it just a matter of debt and enough people cooperating, enough institutions cooperating?

Greg: I think it is, one thing I also came to learn about, about this, and I always have had a very negative view on debt and I still do, for the most part, I mean, debt is something that’s really driven by the banking and the financial institutions, because that’s how they make their money. They want you to be in debt, not too much debt, because they want to get paid back, but just enough to keep them making their percentage on your, on your debt. There’s a whole new industry that is booming within the Crypto space, and it is around lending, this idea of lending. And what I came to learn is that you know, like Mark Zuckerberg, for example, if he wants to buy an island, he doesn’t go sell his Facebook stock, he just takes out a loan against his Facebook stock. One thing that you’re seeing a lot now is, especially long term holders of Crypto, they some of them are depositing and using some of these lending platforms to borrow against their Crypto, if they need money, and they want to start using money, they just borrow against their Crypto to do it.

And not only does it mean they don’t have to sell their hard asset for a soft asset, like fiat money. But also there are no tax consequences, which is a big driving force of this. When you sell your Bitcoin you pay capital gains tax in the US, as far as I understand. You pay capital gains tax but if you borrow against your assets, and you spend that money, you never have to pay those taxes. You could actually continually borrow against your hard assets forever. And the same thing goes for your house or any other asset. People who have wealth and have assets, it’s the way that they use money. They don’t sell those assets to go spend the money. They borrow against them.

Dan: I want to try to ask you about some more practical things that you’ve been thinking about. And one is you were an early mover in terms of Crypto commerce, this idea of accepting Bitcoins from a small percentage of your customers is growing. But I don’t know too many people who do it and certainly then the idea of companies simply diversifying their profits into Bitcoin is one that’s been a hot topic this year on the internet. I’m wondering if you could touch on a little bit of that and give us your perspective on how we might diversify our businesses, not just our personal portfolio. into Crypto

Greg: Using Bitcoin as a medium of exchange, meaning like spending it, interchanging it. That was a really hot topic in the early days of Bitcoin. And it’s because very few people used Bitcoin. And what we saw in the end of 2017, early 2018, was that there wasn’t enough. Bitcoin couldn’t can not handle thousands of transactions per second, it can hardly handle 10 transactions per second, to be honest. So while everyone was super excited, leading up to that point, it became crystal clear that Bitcoin is not this isn’t the right tool for the job. Bitcoin is a store of value, and you can, you know, move it around over the internet without any middleman, which still holds very true. But it’s not the best tool for buying coffee is the example that constantly comes up now. So second,

Dan: Why hasn’t that collective realization then compromised the value of Bitcoin itself, because that was one of the key promises in the early days of the coin.

Greg: It may have been a misguided promise, to be honest. There’s also a lot of people who talk about how money goes through various stages of its existence. And the first stage of it is, is that it starts out as a store of value. It starts out as something that people want to hold and believe has value and that value will go up. If you are holding on to an asset that you think is going to be worth twice as much next year, then why would you spend it on coffee. However, over time, the more people that hold on to it, the more stable the price will become. It will, at some point, not start doubling every couple of years, it could be a stable asset.

Dan: Right just because you know, real estate isn’t easy to change hands necessarily doesn’t mean we don’t value it greatly, for example,

Greg: Yeah, and we don’t we don’t transact in houses. I mean, maybe some people do, but I don’t buy my coffee with houses. Right now Bitcoin is a house. It’s not a medium of exchange yet. So the end, it’s also, and then the next stage after that is once people start spending it is that it becomes this unit of account, which is this – everything in our world in the States is denominated in US dollars. You know, a coffee at Starbucks is $3. But eventually, it might be 3000 SATs or satoshis or pieces of Bitcoin. And that unit of account piece is kind of the last piece of the puzzle. You know, when you get into Bitcoin, you get excited about all these different things. And maybe we jumped the gun a bit on making Bitcoin a unit of account or treating it like one or even a medium of exchange, and the second layers and third layers need to be built I think before we can start using it that way,

Dan: So who, if anybody, would it make sense for listening to this, entrepreneurs doing transactions through companies like Stripe and things like that, should we be thinking about Bitcoin from a company perspective? Or is it too early days for them?

Greg: It’s not too early to think about using Bitcoin for payments and whatnot, especially if you’re an entrepreneur, or if you have a business, there are a tonne of benefits to using Crypto in your business. However, there’s not a lot of benefits for the consumers to spend their Bitcoin. It works out negatively like they pay all the fees, there’s no credit card company they can call to get their money back if something goes wrong. There are no rewards points or systems like that. None of that exists on the consumer spending side for Bitcoin yet. And I think we will get there. But I think it’s gonna happen on the second and third layers built on top of Bitcoin. And I do recommend integrating it, learning how to accept it and use it like eventually, this is how your payment processing will work. So start using it now start stacking Sats now because who knows what the value of them will be.

Dan: Stacking Sats means Bitcoins?

Greg: Stack Satoshis

Dan: Not to be too technical, but when you say a layer on top of Bitcoin, is that going to be an Ethereum layer? Or is that a computer program that just dips into the blockchain and says ‘Hey, give me some Bitcoins here? I am authorized to take them’.

Greg: What it means is that every transaction that happens on, for example, a second layer will not take place in the Bitcoin blockchain. So for example, ‘The Lightning Network’ is the best proposal we have so far for what a second layer on top of Bitcoin could look like. And basically, the way it works is some, it’s sort of like opening a tab at a bar. I mean, you could pay for each beer independently with cash. But most likely, you go to the bar, you open a tab, you buy a few beers you buy around for the house, and then you close up at the end of the night. That’s kind of how ‘The Lightning Network’ could work, which means that instead of having to squeeze, you know, 10 or 20 transactions onto the Bitcoin blockchain, you only have to have two one to open your connection to ‘The Lightning Network’ and one to close it.

Dan: That’s why I’m curious, why isn’t there a Stripe company that just goes and, you know, gets venture capital funding and buys you know, x numbers of millions of Bitcoins and just allows its users to transact in Bitcoins and then goes back to the blockchain every day at the end of the day and settles up, so to speak.

Greg: To move Bitcoin, it, you have to use the blockchain. So another analogy I like to use that helps you kind of understand this limitation of Bitcoin in the blockchain is imagine that there’s a bus that leaves every 10 minutes from Austin to Los Angeles. Only, you know, 100 people fit on this bus. And, in the early days of Bitcoin, only 20 people needed to ride the bus so everything was just on time and working smoothly. And every and every 10 minutes in the Bitcoin blockchain, a new block is created. So it’s just like this bus. And what happened during the big boom was that, you know, once we started getting close to 100 people needing to ride the bus, people needed to pay more for their tickets. So they started to auction off the tickets, essentially, imagine that the ticket was five bucks for everyone but now it’s going to be you have to pay more than the next person. So only a finite amount of people can ride the bus regardless. And if you want to get on the bus, you have to pay more. And that’s exactly how the blockchain gets clogged up. And it’s why even if another company wanted to allow people to transact in Bitcoin, they can do that, like when you trade on Coinbase, every trade isn’t happening on the blockchain, it’s just happening in their coin base database. It’s a second layer, essentially and all the transactions back and forth between all Coinbase users, that happens off-chain, it’s cheaper for Coinbase. It’s cheaper for the customers, it’s faster, more efficient, and they’re not clogging up the bus. And there are proposals to build things like Coinbase, but it would be a decentralized version of it. And ‘The Lightning Network’ allows more peer to peer payments to happen on a second layer.

Dan: That’s a wonderful explanation. Now, while I’m tossing bombs at you. What is the transaction costs of me interacting with Bitcoin, it was surprising for me, for you to say that there was a transaction cost and I’m thinking like a Visa card, they charge you 3%. Well, who’s charging 3% when you’re transacting with the blockchain?

Greg: I don’t have the prices in front of me right now. But every Bitcoin transaction involves a transaction fee. And that’s the fee, the lowest amount is one Satoshi per byte of data that’s involved in your transaction, that’s a bit technical, but it’s a very low amount of money like a penny to send a transaction if all transactions fit into the blocks. Once the blocks become full, meaning there are more transactions happening on the chain, I need to up the amount of fee that I include in my transaction to ensure that it fits in the block. Because this fee is going towards miners, miners are the ones that are processing all the transactions and processing all the blocks. And they’re going to sort of rank all the transactions that exist based on how much money they can earn. So if someone else is willing to pay 10 Sats per byte, and I’m willing to pay one, my transaction gets priority. And that’s, that’s the way that this works. But there is a small fee. Now what happens, the blockchain can get really, really clogged up. I’m talking during the peak of 2017, there were some transactions, I was spending hundreds of dollars in one transaction, because it had a lot of inputs, meaning there was a, you know, I received payments in e-commerce. So I have a lot of people paying me to then spend that chunk from lots of different transactions has a lot of data in it. And I mentioned it’s one Sat per byte of data. So some transactions can get super expensive.

Dan: You wrote in a document that we shared that ‘I earn passively 14% on my cash today’, that is going to be the headline of this blog post. Unbelievable. This is the dream, especially in today’s day and age when none of this seems so certain. Give us a view of how you’re doing this.

Greg: Please don’t make the title of this episode ‘How to earn 14% on your cash today’, that’s just clickbait. But it’s technically true. There are a lot of these institutions in Crypto. There are CFI institutions, which are centralized finance. And then there are DFI protocols that are this decentralized software running on the Ethereum blockchain. And both of these, there are these two kinds of different ways of approaching this new world of lending in the Crypto space. There are a few centralized companies like Nexo and Crypto dot com and BlockFi is a big one in the US. All of them, if you deposit your Crypto with them, they turn around and lend that Crypto out to people who are willing to pay interest to borrow. And it’s the exact model that banks use when you deposit your dollars into a bank, it’s not your dollars anymore, it’s the bank’s dollars. And now they can turn around and they can loan it out. In fact, they can be hypothecated and they can also loan it out 10x times the amount that you put in.

Dan: Now, what’s confusing about that Greg, though, is given what you’ve just taught us it does seem like well, who would want to borrow Crypto given that it doesn’t transact that easily.

Greg: Traders, mostly traders.

Dan: Okay, so tell me what they’re thinking, tell me what they’re doing.

Greg: Traders are trading, they don’t care about sound money. They’re just trying to grow their stack, and they’re transacting off-chain. So it’s not even for the most part, well, in Ethereum, they’re doing it on-chain, but they’re trading, they’re in the business of trading, they’re active traders, that’s the business that they’re in to earn their daily income, which they then probably convert into Bitcoin and stick in their hardware wallet in their vault. But in the meantime, they want to leverage up their trades. And so they borrow as much money as they can from as many people that will give it to them so they can go trade. And if you’re in the high-frequency trading business, for example, it’s lower risk, because you’re not holding on to your positions for as long. So you can really, really lever those up.

Dan: Now, when you deposit your fiat currency in a US Bank, you get insured up to say a quarter-million dollars, or what I don’t know what the exact number is, what are the insurances when you put your Cryptocurrency into these lenders when you deposit with them,

Greg: These Crypto lenders, they have insurance as far as like security, and safety goes, and they have insurance, I think Lloyd’s of London, which is a giant insurance company, who insures lots of banks and lots of businesses, they insure some of these Crypto lending businesses as well. What they don’t insure against is the volatility of the Crypto market. That just is what it is. But if something happens, within the business that you’re lending to, or if there’s a hack of some sort, those things have been insured. The risk is still there. And just like, you know, there’s risk and putting your money in Chase and Wells Fargo, I mean, have you ever had to because the money hasn’t been stolen, and the FDIC hasn’t been called o but if and when that happens, I can only imagine when do you think you’re gonna get your money back? When’s the FDIC gonna cut you a check? How long is that going to take? I would love to see that tested.

Dan: Now, you’re saying you’re earning 14% as of today, you know, 2020. I mean, how confident are you in this in terms of – are you putting all of your Crypto into these things? Because this is one of the coolest things I’ve heard about in a long time. I haven’t even explored these ideas, or are you hedging here saying ‘this can’t go on like this forever?’

Greg: This is a really important point in my particular strategy, I am not lending my Crypto, I’m only lending my dollars, because my dollars are already in a bank account, anyway, with you know, Joe Schmo down at the corner, Chase Bank, and I don’t trust him. So I trust these centralised and decentralised sort of lenders and borrowing institutions as much as I trust Chase. I trust them more essentially, but I take my cash position and I split them up across them. And I’m talking about just my cash, my Bitcoin is my Bitcoin it’s in my vault and I would never deposit or give custodianship up of my Crypto hard assets. However, I have investments and other things. I have cash that I want to have on hand in case, for opportunities, and all of that I keep with these lenders because they pay me on one of them I earn 12% in USD and 2% in their token. That’s where the 14% comes from. I lock it up for three months, in some cases, to juice up my the amount of interest they’re willing to pay sort of like a CD, at a normal bank,

Dan: Or like a timed deposit but actually pays you money.

Greg: And this is literally the fact that people are not using this and they’re still depositing into their Chase savings account to point one percent is mind-blowing to me, I get that it’s a bit intimidating, and they don’t understand it. But they don’t understand what’s happening at chase either at all, they just blindly trust it. And I think if you want to blindly trust things, you might as well blindly trust the person that’s paying you the most.

Dan: That’s a really compelling argument. A lot of Bitcoiners, Cryptocurrency folks, they get derided as tinfoil hat people, right? They’re very genuinely distrustful of institutions and governments, you share a lot of that distrust, but you seem very reasonable about it. I’m curious, is there an incident, or a story or some information that led you to this point where I would say, you know, on the scale, you are much less trustful of financial institutions than the average person you’ll bump into on the street, for example,

Greg: I have absolutely had issues with financial institutions. I’ve also had issues with payment processors, if any of you have run a business on PayPal, for example, once you reach a threshold, they start digging into your account, and if they don’t like you, they will close your account. The reality of finance today is that it’s centrally controlled, and managed by these gatekeepers. One of the biggest turning points for me was, after having my Bitcoin self custodied for years and years, I really did end up with this, like, there’s this peace and this calm. I am not worried about anyone messing with my wealth, no one can touch it. Not only is it appreciating, yeah, it has its volatile times, but I understand the market cycles a bit. And once you’ve had it for a while, and you understand that it’s not going anywhere you can start to think you start to think differently.

Dan: Part of the way I’m interpreting what you’re saying is, and I’ve had brushes with this, I’ll just share one specific example. And maybe you can riff off of this is when I sold my business in 2015, I deposited the money in Chase. And then it disappeared for two weeks.

Greg: How many months, six months, a year, two years of planning selling your business, it finally happens, then the money is just locked or frozen, you probably didn’t even get an email or a call for 24 or 48 hours. You had to call them to find out I did ‘Hey, where’s my money?’

Dan: I did. Then their answer was, ‘We don’t know’. That’s a story for another podcast. A question I want to ask you is, you mentioned that everyone asks you about Crypto taxes. Why? What are they asking about? I get the sense that people partially think they might not have to pay taxes, or there might be some tax avoidance possibilities with Crypto, certainly, there is a part of the community that’s of primary interest for them.

Greg: You’re right, that that is why I think a lot of people ask about Crypto taxes, they think people are in Crypto because they’re dodging taxes. And that’s also why they kind of keep Crypto at a distance. In a lot of cases, they don’t understand that that’s not necessarily the case at all. They’re just trying to use more efficient money and a better store of value. I think once people understand that Bitcoin is just an asset. I mean, technically it’s property. And you pay the exact same, you pay the exact same taxes on your Bitcoin as you would on any other investment or asset. You pay capital gains tax, which is just the difference between where you bought an asset and where you sold it. You just pay your tax on that at the end of the year.

Dan: Greg, I think I can read into this, I know what people are asking you, because they’re wondering if someone’s going to call them up about 2016 and, and say, ‘Hey, that, we saw what you did. And you didn’t know at the time, you know that the US government was going to be comprehensive about this. And so we want to talk to you’, and people are worried that maybe a transaction they did four years ago might come back to bite them.

Greg: It will come back to bite them, they should pay their taxes. (laughs)

Dan: Okay, so a few points that you brought up. I mean, I really appreciate you dropping some notes for me, I’m infinitely curious about this stuff. But it is nice to keep it focused here. First question, what is the biggest upside potential? If you have $1,000, and you want to go start a wallet and learn how to manage your money? What do you think is the better bet in terms of the upside of your investment right now? Is it Ethereum or Bitcoin?

Greg: If you have $1,000, you should work on increasing your income and not be investing in Cryptocurrency.

Dan: That’s so true.

Greg: You had a podcast with Rob Walling, a couple of weeks ago, this idea of ascending the staircase, right. And there’s this certain stair that you get to where you’re like, “I have some money that I can start investing”. And, you know, it’s going to be at a different level for everyone. It’s this point past, all of your expenses are covered, you’ve got some savings in the bank in case they have a catastrophe, and you’re really in a comfortable place with your income. Now you can start thinking about investing, and it’s likely not $1,000. Now, however, if you don’t trust your bank, or you’re worried about what’s happening with the Fed, and the money printing that’s going on in the world today, if you want to hedge against that, that’s not necessarily investing. That’s just protecting what’s yours. And I would recommend just using Bitcoin for that. And you can do that in any amount, $5. In fact, one thing I’ve seen happen many times is people get into Crypto for the first time. And for the first time ever, they have a savings account. You know, the fiat money is so fleeting. Not only is it inflating away, but just at every turn prices are going up and they’re having to spend it, spend it, spend it. Their Bitcoins are a little harder to spend. So for the first time, they’ve got this place that they can stash, even a little bit of wealth, and now they have real savings. And that’s something amazing and that’s a definite use case.

Dan: I want to ask you for your hot take on, I think, at least in the entrepreneurial space, one of the biggest news items in the Crypto space was the revelation of Michael Saylor, who runs MicroStrategy essentially described hedging his company’s bets against the US dollar. He was concerned that they had too many US dollars on their books, and that they didn’t have good strategies to invest them in necessarily. And so instead he bought an epic crap tonne of Bitcoin. What’s your hot take on that revelation and how it’s been treated on Twitter, and how it’s affected the Crypto space.

Greg: Michael Saylor represents people who have been in finance for a long time, who are willing to take the time to understand what money actually is, and have gone down the rabbit hole and have been convinced just by their reading that Bitcoin is the soundest form of money that’s ever existed. The amount that he was willing to spend, it almost didn’t matter, it could have been 5 billion, it could have been 500 billion. The fact that he is someone who is a CEO of a public company, and has, you know, a lot of people looking to him for really important decisions. And this was the decision that he made. That’s I think, what’s really important. And then the second piece of that is, he did buy a crap tonne of Bitcoin, he bought 38,000 Bitcoins. That’s, you know, he spent 400 and 50 million, I think, to do it. And, you know, roughly 500 companies can acquire 38,000 Bitcoin before every company owns every Bitcoin that’s ever existed. And there’s something like 10,000 public companies in the world. If 1% of companies did, public companies that did what he did, there’d be no more Bitcoin. So this just gets you to really understand how scarce of an asset Bitcoin is. The fact that these really smart people have been in finance a long time, it’s taken them 10 years to understand what Bitcoin is, it still means we’re at the very, very early stages of this.

Dan: Who do you have to go to to buy that?Do you have a secret cigar meeting room with Satoshi himself? How does one even buy such a huge quantity of Bitcoin?

Greg: There are some really good interviews with him where he breaks down his process for acquiring the Bitcoin. However, he also talks about how he was sitting at a computer, he was trading like 1000 times per hour or something to slowly acquire. His goal was – he didn’t move the market and the market didn’t notice that he was acquiring this much Bitcoin. It’s really fascinating. My guess, though, he just bought direct on some exchanges, he bought via OTC which is, it’s sort of like, between just direct between people that these, these orders are not on the order book in the exchange, where other people could buy the same Bitcoin he was buying, he was buying a direct from people, like over SMS or chat or on the phone. I bet you he was just getting picked going wherever he could get it is probably the answer to that.

Dan: All right, Greg, to end here. What I want to do is toss out some issues to you and get your hot takes on them. It’s 2020 just guess what you think the price of Bitcoin would likely be five years from now?

Greg: Five years?

Dan: Would you bet on I’m not asking for a prediction. I’m just saying where would the number be that Vegas would put it at, you know, 50% over/50% under at this price?

Greg: I’d probably go back to the stock to flow model that values Bitcoin based on scarcity. And five years is a perfect amount of time because we’re about one year from what this model would predict to be the next peak. And it’s a four-year cycle. That’s two peaks from now. And basically, the stock to flow model puts Bitcoin at like 1.2 million per Bitcoin in five years. Give or take a few years.

Dan: What are the chances that Bitcoin goes to zero? In the sense that it was this first-mover that showed the possibility of Crypto, but that another mover came in and you know, made a better mousetrap and everybody sort of jumped ship and decides to go another way?

Greg: The current market cap of Bitcoin is $200 billion. I haven’t seen anything go from 200 billion to zero. I can’t see it going to zero. In fact, it’s not possible because I’m never selling my Bitcoin. So it can’t go to zero.

Dan: What does Ethereum 2.0 mean?

Greg: Ethereum 2.0 is an attempt to increase the throughput and scalability of the Ethereum blockchain. In order to do that, one of the big big changes that is that they have to change the consensus mechanism of Ethereum, meaning the way that all of the network participants decide on an outcome, they’re changing that from proof of work, which is the same system that Bitcoin uses to proof of stake. So this way that all the nodes on the network, collectively make a decision is changing. It’s theoretically faster but is it as it’s not as proven, it’s nowhere near as proven. There are other consensus mechanisms as well. That’s the one that they’ve decided on. They’re also going into this concept of ‘sharding’, which is taking the database, splitting it up into 50 different, different pieces, and allowing certain transactions to happen on certain shards. It’s all about improving the scalability and the speed of the Ethereum network. The problem is, they’re rebuilding the Ethereum network from the ground up, like Ethereum 1.0, which is what we use today, it’s gonna exist as either one little shard or kind of just one smart contract within Ethereum 2.0. If Bitcoin was to even change, one tiny, tiny, tiny thing, everyone would freak out. Ethereum is rebuilding their whole system from the ground up. So it’s a big change?

Dan: Do you feel like there’s an opportunity for entrepreneurs to come into the Crypto space and make money selling shovels to everybody who’s interested in going for the gold rush?

Greg: There are people selling shovels to people who use Crypto. But the amount of people using Crypto is still relatively small. I forget the numbers, but there’s like 10 to 20 million people maybe who are using Crypto. There are people selling hardware wallets, for example. I would call that a shovel. I think the smart people have kind of realized that being a banker, on top of the Crypto ecosystem is the sweet spot right now. There will be tonnes of projects, products built on top of the Crypto ecosystem. It’s just a small ecosystem still.

Dan: Is there anything else technically or philosophically about the state of the union, so to speak right now in Crypto that you’d want to share with the audience, things that they might explore?

Greg: The more you learn about Crypto, the more you kind of lean on really the fundamentals of money. It’s always something I go back to. One of the biggest aha moments for me was understanding the properties of money and that money is just a tool created by humans to allow us to interact in this way. And, I’ve spent the last couple of years not focused at all on all of the hot new startup stuff, but going back and really understanding the fundamentals of money and why does this entire ecosystem have value? I think that’s where the best time can be spent in terms of trying to really grasp what’s happening here. There’s a lot with the regulatory space. I wouldn’t be surprised if we start seeing these CBDCs, the central bank, digital currencies, governments are going to start releasing their own Crypto. And they’re not going to be anything like Bitcoin, probably not even like Ethereum. But they will exist and people will become more and more comfortable. In order to pay their bills, they’re going to be using this like Fed coin that’s going to exist in this app that they’re going to download from the government to, to spend their money. And that’s just one tiny step away from using Bitcoin instead. And it’s gonna work the same way. And I think there’s a lot of things happening that are moving us closer and closer towards people using Crypto without even knowing they’re using Crypto. There’s a really cool company called Zap that has this product called strike. They’re building on top of the Bitcoin Lightning Network. And basically, their pitch is that your bank account now speaks Bitcoin. And instead of you spending Bitcoin, you just connect your bank account, kind of like a Venmo app. And underneath under the hood, they’re using Bitcoin and The Lightning Network to move money around. But as a user, I don’t even know that Bitcoin is involved in the process. And I think a lot of the technicalities of Crypto are slowly being extrapolated away. And pretty soon, in the next decade or less, everyone will be using Crypto in some way, shape, or form, whether they know it or not.

Dan: One of the topics you brought up or themes is, you know, the entrepreneurial rungs of the ladder, and when investing comes into that. And you also mentioned a sense of security and financial freedom that you’ve experienced by holding your own Crypto asset assets and taking responsibility for them. Since one of the major themes of this show is financial freedom, I’m curious as to how you think about financial freedom, how you experience it, and given that you have a great deal of financial freedom how does work find a space in your life anymore? How do you stay motivated to work and for a lot of entrepreneurs, they work because they want to get to the point where they can become full-time investors or they want to pay the bills even, can you share with us your concept of work and your concept of financial freedom?

Greg: I mean, entrepreneurs understand Crypto better than anyone, because this idea of freedom is the reason why so many people start their own businesses in the first place, freedom from their boss, freedom from their company, freedom to do what they want to do. So entrepreneurs get that better than anybody. The first phase that everyone goes through is – we got to put food on the table, and they don’t really care how to get to that point. Once you’ve got food on the table, you got to get out of debt. And you know, you get a job, and you have a structured income to get to that level. At some point, you want to get to the point where all your expenses are covered, and you have the savings to feel you’re not at risk. But what’s interesting is, no matter the size of your savings, or your investments, there’s something strange about income. I don’t care if you have 100 million in the bank, if your income is cut off, you start scrambling to find some income. There’s a reason why l a lot of wealthy investors and stuff invest in bonds and these low interest-earning, income-earning investments, essentially. And I think, once you’ve built up enough wealth, using that wealth to generate income is a really important next step because it takes even that next level off where you know, not only can I pay my expenses, not only do I have enough saved for a bad time, but it’ll continue to grow forever. And I think that that’s a big next step.

Dan: It’s almost like we’ve been working out that muscle for so long, like systemic cash flow thinking that if all of a sudden you have a cash pile, and it’s leaking, it doesn’t matter how big the pile is. It drives to a tee every single entrepreneur that has had a wealth event or you know, wealth decade or whatever, it drives them crazy to be burning money, absolutely crazy.

Greg: It does. You cannot you can’t just have a number that’s going down for the rest of time.

Dan: What are you working on a day to day basis and what’s motivating you do that? Let us know what you’re working on. And what’s your motivation?

Greg: In my day to day, I’m working on Bitlift. Bitlift is my, the way I get, I express all of what I have to offer in Crypto. It’s a slow go, because we’re a small team, but it’s something that’s just so fun for me, I would love for it to start generating income. But that’s more because I would love to grow the team and have more people involved. And you can then justify, you know, growing your team if the business is self-sustaining. So I think I’m working towards that. But really, Bitlift is just, it’s a playground for Crypto things. I’d love for more people to learn about the foundations of Crypto, the way that I approached it, the way that it’s been successful for me is the only way that I know to really teach it and explain it. So people who it resonates best with our, you know, entrepreneurs and people who’ve started businesses I have, who have taken a piece of their income along the way and invested it in Crypto, and then have kind of gone back to understand as you generate more wealth, what do you do with that wealth to preserve it, not necessarily even to grow it just to make sure that it’s not being inflated away, for example.

So Bitlift is really a playground for that. And Bitlift and Crypto commerce is really my sweet spot because I’ve just been in e-commerce for most of my career. And I love the idea of people using Crypto for e-commerce and it doesn’t necessarily mean spending Bitcoin. There are tonnes of awesome projects happening in the Crypto space that are going to really fuel the future of payments online. And I don’t think any of the projects yet are at a state where everyone could start using them, but I want to be there and I want to be ready and I want to have stuff to sell and I want to contribute to innovating in the Crypto payment space and the way people use Crypto to shop online.

Dan: How might listeners collaborate with you on Bitlift because you have a small shop there. You said, it’s not a big project yet, you’re just sort of early days, what sort of people you’re looking to hear from

Greg: I’d love to hear from e-commerce entrepreneurs that want to get into Crypto and want to start accepting Crypto as payment. We have a marketplace component to Bitlift where anyone can sell their products directly in Crypto, like an Amazon would, except a Bitlift never touches the money. The Bitcoin or Ethereum, or whatever the customer pays with goes direct between the merchant and the shopper. So that’s one side of the e-commerce business. The other side is that we sell Crypto-related products direct to people who are just getting into Crypto for the first time. Anyone who’s into the kind of intersection of Crypto and commerce or is into e-commerce and wants to get started with Crypto, hit us up on Bitlift and we’d love to help you out.

Dan: Greg Gerber, we appreciate you coming by the show and sharing your knowledge here today.

Greg: It’s been super fun. Thanks, Dan.

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Dan: Big ups to my guy, Greg Gerber. I appreciate Greg and what he’s done for the DC community and us here at the TMBA podcast. Obviously with Crypto, this is such an evolving story. Looking forward to having Greg back on the show for regular catch ups. So if you have questions for Greg or topics you’d like to see addressed, feel free to ping me Dan at tropical mba.com and we will get to them. And just to mention again, big shout out to Bitlift dot com. Greg has some amazing information and swag. Super cool. Bitcoin related swag over at Bitlift dot com, head over there, sign up to their newsletters. It’s all really really good stuff. So shout out to Greg for creating that resource when he could probably just be sitting on a yacht somewhere, but he’s going to work for us so we appreciate it, Greg, and that’s it. We will be back next week. Shout out to smash digital dot com, if you got any SEO needs, check out our sponsor, Smash Digital, the preferred SEO partner of the TMBA community. That’s it. I gotta get back on the road. I appreciate you listening. We’ll be back as always, next Thursday morning 8am. Eastern time. We’ll see you then.

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