Ecosystem

Video Transcript:

Video Transcript:

Video Transcript:

Accretive dilution. Something that traditional finance uses as an explanation for doing merger and acquisition of companies to increase the amount of earnings per share for your shareholders. But Micro Strategy, Michael Sailor has very much uh brought new life to this explanation of issuing more shares at one price, the market price, and buying more Bitcoin with that to drive the amount of Bitcoin per share up over time and drive long-term value into his company. Now, interestingly enough, Bitcoin in of itself has its own form of accretive dilution. This is the word used associated to the dilution of shareholders to give them accreatively more value. Now when it comes to Bitcoin’s version of accreative dilution, it works in a bit of a different way. There is continually more Bitcoin miners joining the network fighting for one of the 144 slices of the Bitcoin cake available per day, otherwise known as the 455 Bitcoin distributed in 144 blocks per day. Now, when the price goes up, there’s even more incentive for more miners to plug in online and capture this revenue, which increases it from about 144 a day to an even greater level. And so what the network does is it has a difficulty adjustment which reconstrains and raises difficulty to make sure there is only about 144 blocks being found per day aka one block roughly every 10 minutes. And so what you’re having is this effect of more miners earning from this 455 bitcoin. So they are effectively diluting themselves. But the accretive part is this that if 10% more hash rate comes online, it represents potentially 10% more energy being consumed in the network as well. So the electron value of Bitcoin has gone up another 2,000 megaww in this 10% increase example. So accretively, the Bitcoin has gained more value being repriced against more energy. The value mechanism of Bitcoin is its production cost and its exchange rate with electricity because the exchange rate goes both ways. It’s not just consume energy to produce Bitcoin, but potentially selling energy to buy Bitcoin. Now on the micro strategy side of things, it gets a little bit interesting because what I’m explaining here is that Bitcoin has a production flaw and that represents its own form of value mechanism versus the Bitcoin to dollar price. Now, if the Bitcoin to dollar price is recognized as the value of Micro Strategy shares, it essentially means that the Bitcoin per kilowatt hour production floor average, let’s say it’s 50%. It’s actually less, but Bitcoin per kilowatt hour. And if we applied it to this price chart, that’s per Micro Strategy share. So what if people viewed Micro Strategy shares not for their underlying Bitcoin per share, but actually the value and exchange rate of Bitcoin to electricity being a true fundamental value of these shares because it’s how much energy you can buy with your Bitcoin. Uhund 27.5. So this is a way of perceiving essentially the underlying value of Bitcoin which is recognized in Micro Strategy shares um as the price of Bitcoin as the shares value. I’m giving you another fundamental layer which is essentially the energy value of these shares. Now the reason why I would use this as a new perspective on looking at the sort of accretive dilution nature is that when the bull market takes off if the production floor for Bitcoin is about 60,000 and the price is hovering 20,000 the price was to double production floor would still not be able to catch up. So it would be now 25%. So the way that people treat the difference between the share prices and Bitcoin per share and the gap between these two, if the price of the shares gets too high, essentially the shares are trading at a massive premium to their underlying Bitcoin value that you can assimulate the comparison between the Bitcoin price and yes, I’ve got it in a chart for Micro Strategy pricing, but you can you can work with me here. Bitcoin to dollar and Bitcoin to kilowatt hour as a value mechanism that truly in the peak of the bull market the ability for these shares to drop is people observing that the share price could drop one to one par is the worst case scenario but Bitcoin can drop to one to one par of its production floor so potentially Bitcoin’s production cost could be a true value metric underneath the price of Bitcoin. underneath the price of Micro Strategy shares. So, it’s just another interesting way to view the production cost of Bitcoin as a value exchange rate from the physical world because with finance being focused on finance, they can get a little bit disconnected from the reality of the world sometimes aka 2008. So yes, an interesting other way of viewing Bitcoin’s accretive dilution properties of the miners diluting their own revenue, but their revenue being priced against their energy use and that being the assigned value mechanism of their exchange rate of electricity to produce Bitcoin that can go both ways in our future world of building Bitcoin electricity grids where all the different homes can trade energy and money interchangeably through compute power. Thank you for listening. I hope you enjoyed this other perspective. There is obviously going to be multipliers that you can apply to these different levels and interesting ways to model out the long-term value of these companies along with all the other Bitcoin Treasury stocks that will come. See you next time. Goodbye.

Video Transcript:

Hello there and welcome to the hash power academy from Latin America. I’m currently living over here for a couple of months and uh while I’m here I’m looking to explore and from the content side of things storytell any particular projects of interest particularly in this area. So, in this video, I’m just going to explore the idea of Bitcoin in Latin America across all the different avenues, whether it’s things that are already happening or things that could happen in the future. But overall, Latin America is growing and thriving whilst there is a a lot of noise and chaos in the northern hemisphere. And for the past 5 years, I’ve been traveling here on and off the uh health and pandemic years, shall we say, and spent a lot of time in Mexico and just noticing, you know, the differences of culture, language of course, and and just seeing all these sorts of societal level changes, especially whilst I was spending many of many years and sorry, many hours of that time delving into Bitcoin content online. And on the physical side of that, seeing different things happen such as electrical power cuts and going, “Hang on, if there was Bitcoin mining here, all this excess solar that was creating this instability of their grid and the temperature changes, especially seeing all these sorts of different opportunities that that Bitcoin will have here in the future, because I know there’s a lot of similarities across the different countries in Latin America. I can’t speak for all of them. Um, but definitely in the South America side of things, it’s new to me. So, here I am and I’m looking to explore and connect with people from all different levels to to understand what’s happening here and tell those different stories and produce content for it as such. So, diving into one of the first things from from a user side of things is there is a lot of layer 2 usage here because the need for trade and transaction particularly in dollars. Yes. um is needed here. There is currencies across this entire continent that are inflating slash going into hyperinflation at particular points of history. And so people are quite familiar here to earning what they can and spending it as quick as possible so that the prices don’t going up don’t go up too quickly. And that’s an interesting perception or an interesting psychology to explore that that people recognize that their money holds no value and is leaking value by the second. So they have to go and spend it as quick as possible. And it’s almost as if uh everyone in the northern hemisphere on their five to 10 to 15% inflation per year just being this sort of uh boiling the frogs in water by heating the water slowly and realizing that we’re hitting those uh 100% points where it comes to the amount of interest versus income GDP that countries earn. But that is quite a detraction from the conversation here. Why are people in Latin America storing their time and energy in digital dollars such as USDT on the different layer 2 chains? It’s because they are trying to escape inflation and that’s very important. Across the Bitcoin layer, we’ve got lots of events here I’ve noticed. So, I’m definitely interested to go to a different different sort of events here across uh the different countries here. And then on the developer side of things, there’s also quite a developer community across this entire continent. There’s obviously quite a range of salaries here in comparison to the northern hemisphere and more economically developed countries that we’re going to find people that have grown up on the internet here in Latin America and have developed software skills and going into job roles that bring and access higher economic value into their into their countries that may not be as an average quite high in income. So these are great opportunities that Bitcoin and the wider digital asset space, yes, are creating income streams for areas that that were more physically constrained in what they could earn. And that brings us to the mining side of things that there is mining developing here at scale now. And some of the things that may happen over this next year of 2025 to continue is if there is instability on the tariff side of things, whether Bitcoin mining machines are exempt or not from high tariffs, well, it’s going to make that decision of whether people want to send their mining hardware to deploy in the US with those higher costs or to places such as Paraguay. And somewhere I’m quite interested in is the south of Argentina, which has lots of oil fields. And so there’s gas being released and you have to burn it. And so seeing those other economic opportunities for the Bitcoin network to be physically built out because you got to understand that the the analogy of California and natural wealth in that local area being found, gold, the gold went out and goods, services, businesses, and people flooded in. And so the opportunity that Bitcoin offers is wherever Bitcoin mining is locally deployed. It’s consuming energy locally or from the sun or a hydropowered dam. The example being Paraguay where they have a dam that produces more power than sometimes what the country needs. So it sells the excess for a very cheap rate to Brazil. And if Bitcoin mining is offering a multiple uh amount of revenue per kilowatt, megawatt, gigawatt, well, why why would you sell it at a cheap price if there’s some new way of economically turning energy into money at a higher rate? And so we are seeing a lot of increase in the amount of mining deployment here in Latin America which is really important because it’s the issuance of the the last remaining million bitcoin plus fees into an area that is naturally growing thriving developing as well and they can fast track the development into the 21st century because I always take the example of England in the sense that we have these very old infrastructure systems, the sewage systems and all these sorts of things. Even even the way they’re constantly ripping fiber C, you know, fiber cables, the old cables and replacing it for fiber where because we already set up these other infrastructure pieces. Uh it’s more costly to have to replace that infrastructure than it is to just build new. So the opportunity here in Latin America is they can accelerate their infrastructure development to the modern 21st century of all these different new digital rel related payment systems and new forms of energy systems. And that means that any form of scale out of Bitcoin mining justifies more energy buildout which builds out more Bitcoin mining until there is a fair market pricing for the energy that the local level people can buy it. And this brings us to the other side of things, grid instability. I have noticed that there is more frequent power cuts here in Latin America from all my different travels and experiences than there is in other places. Now there being say more violent weather, temperature changes, uh access to energy that may not be as reliable or fluctuations on their grids, whatever the the exact grid instability problem is, it boils down to this. Bitcoin mining is an economic buyer of energy that will sell it at a higher rate if there’s a way of doing so. So, they’re naturally buying and selling energy opposite to the the grid, which means it’s bringing stability to the grid. There’s too much energy on the grid. Solar is at full beam. There’s no clouds. Um, there could be a very high increase of of supply and not enough demand. miners can overclock potentially and and and capture that that excess. And to the downside, loads of cloud to come over or too much too much uh too many storms, not enough of all the different power sources, too much uh demand balanced against supply, something needs to switch off. So if there’s a natural seller of power that will switch off and scale down when the grid needs it that that that balance of the power to buy it or to sell it means that grids remain more stable. So that development of grid infrastructure here could be greatly beneficial. Um well sorry the bene the benefits of Bitcoin mining bringing that level of stability increase to these grids. And yeah, the the other side of this is there is a lot of non-renewables here. Burning of plastic couple of miles away. There’s all these different ecological issues here of extractions of different things and poisoning of rivers. And so developing new types of energy and compute systems that create economic incentives and monetize stranded energy assets like a renewable, you know, hydro dam in the middle of nowhere and the industry locally has left. Um the the running costs are fixed costs to that dam. So if they can’t sell all their power because the local area is not buying it enough, those fixed costs that they have go to a smaller group of people. But if a buyer such as a Bitcoin miner comes in and takes up the large significant volume of that energy and thus a large large percentage of those fixed costs, it means that the other users of the grid get less of those fixed costs and they’re more closely paying just the energy cost as to what’s defined by the market. So yeah, Bitcoin in Latin America. This is going to be the first video just to delve into a few different topics. But yeah, looking to explore different opportunities across this entire stack in all different ways. And the main thing is to probably go to a few events. So if I go to any events, I’ll let you know. Um, obviously I’m speaking here in English. Uh, I will try and make sure that there is a transcribed Spanish version to this as well. Thank you for listening and I hope to see you in the next video. Goodbye.

Video Transcript:

Hello there and welcome to the Hash Power Academy, your place to learn anything to do with Bitcoin. The topic of today’s video delves into the idea of Bitcoin trust fund kids, which leans on the topic of Bitcoin inheritance. Think about it. If you are growing your Bitcoin wealth at any age, I presume you want to financially reach the level of potentially having a family. And the next step of thought from that is teaching your kids how to manage and hold and secure Bitcoin. And then the the finality of that is when you’re not involved and there is an inheritance process to pass that orange wealth, that bloodline retiring stack to your next of kin. And there are some problems in that. And we can explore history just to demonstrate that at any level of wealth, especially kings and queens, that you had that king that built the empire and then passed away and quite literally handed the keys down to the young prince and it all went wrong from there. whether it was that they didn’t assign the importance of that money to themselves because they didn’t put the work and energy in because they didn’t exist maybe at the point and this isn’t a bash on people that have inherited great wealth in fact if you are one of those people reach out because there is many things I’m looking to build and they cost a lot of money there’s lots of amazing things that come out of it so the idea of this is It’s a harsh statement, but I think it’s fair. You value nothing when you can afford everything. And you truly get boiled down to the sentimentality of things. And I think that might be one of the disconnects that if someone, especially young, is handed money with no assigned cost to the physical effort required to make it, earn it, and work for it. This is why we have this very age-old statistic that 70% of families lose their wealth by the second generation. And this gets even better interesting. 90% of families lose their wealth by the third generation. So it is absolutely fundamental that if you would like to be one of the Satoshi era bloodline retiring family names and helping your family preserve wealth into the future in a way that they can assign the true value and cost to the money. There is an interesting effort that needs to be made collectively and I’m looking for your feedback as well on this and the comments as to how we can educate our children of the future to preserve their time and energy in a way that whether it’s inherited in time and energy from someone else’s work or themselves that they they lead a path to making sure they don’t recklessly spend it and blow it on Lamborghinis, shall we say? how we can prevent this for our particular family and be the 10%. And uh not to make it all about mining, but uh the the key issue with say the fiat currency side of things is that we detached the idea of what money was from the physical world in the 70s. We disconnected our money, numbers on an account and salaries and whatnot. we disconnected it from gold and the average age that people have kids has gone up. Uh there’s all other different socio socioeconomic and political aspects to this and uh women entering the workforce at that particular point in time that’s changed things. But what doesn’t change is that we have a form of money that everyone’s detached from in the idea of just spend it now because it buys you less tomorrow. And I think that detachment from money and that concentration of wealth to those has created an accelerated amount of concentrated wealth and a wealth gap in our world that there will be a lot of Bitcoin trust fund kids as well as just normal trust fund kids shall we say or Bitcoin wallet kids. There’s several problems to this which is the question then may become how do we help our kids assign a value to the money and mining comes into this because what is Bitcoin mining it’s the educational perspective that Bitcoin didn’t just appear every single bitcoin was produced and computed with an electrical cost whether it was that at the start with Satoshi and CPU use and a very nominal amount of energy where it was high 50 Bitcoin quantity per block with a tiny amount of energy to today going into tomorrow which is a massive quantity of energy to produce a tiny amount of Bitcoin. But in that process there is a new pricing system to understand the cost of Bitcoin through electricity. And I think if the digital nature of Bitcoin creates a psychological lack of responsibility, because I’m sure everyone has just and paid without thinking twice as to, oh, let me check my bank balance. If you’re truly in a credit world, a lot of people’s consumer behaviors and spending psychology is on the fact that the detachment of the physical checking of our wallet to see if we actually have the the the money available to spend. The detachment into this physical uh physical aspect going into digital means that we now spend money in a way that can be more reckless and irresponsible because it’s just click and pay. It’s been made so easy. And I always reference the buy now and pay later, the the the misalignment between actions and consequences. But the fundamentals come back to the fact that Bitcoin is this new form of money on the internet digital and swells this wealth that means that there will be people that need to hand it off to their kids. They want they will want to whether they build and spend with it, which I think is an a smart thing to do. Um and also the aspect of what they hand down to their kids. if their kids have had an educational journey into Bitcoin and learning about the energy side as well. I feel like if kids can conceptualize physically a large mining site and the amount of Bitcoin that one large site can make can make this tiny amount of Bitcoin per machine with all the noise and energy use. I feel like there’s it it’s my biased opinion in that particular front, but I feel like helping kids understand that they’re digital orange wealth that they inherit and making them understand the the the timeline and the physical cost side of the money will just help them understand its importance to preserve into the future for their generation and so on. There’s all other different social aspects to how we spend money. But that’s come from the fact that especially the last 50 years, even longer, that we’ve got money that is not worth the paper it’s printed on quite literally. And that’s created an environment where people spend recklessly and hyper consumption and the quality of materials that the the Bitcoin hard money standard does introduce a society where people focus more on quality. Why would I let go of my Bitcoin for anything other than something that I believe is a good experience and high quality? Good food, good travel, good people, good conversations. That’s what we want. And the aspect of the end of that enjoying enjoy that life full of adventure and experience that we can afford now stacking Bitcoin in this collective investment vehicle of a planetary scale. Still that problem. How would we hand it to our kids in a way that they understand all of those pieces of knowledge that is required to not recklessly spend it? And it’s they need to assign the money to some form of physical attribute whether it’s their work, their time and energy. One idea I have is in the debt money system world of nations and governments if this is an idea and I’m very much interested to get your thoughts on this that um for example if I have a child in the future and they go and work which I would like them to do and understand their exchange of time and energy into money that if the government takes 20% of it as a tax bill I would rebate that 20%. So it’s almost ensuring that their time and energy and their work that they do is fully preserved that 100% mark. So if they want more money from Elpadre, they need to go and work harder and not have their effort to work more put them in a higher tax bracket to take more, which makes things like sugar taxes in England quite paradoxical. you’re going to apply a tax on sugar to make people consume less sugar. So why is there a tax on earning and working more? Are you trying to make people work less or the system’s messed up and we’re just trying to figure it all out? But when it comes to that inheritance aspect, another thing is I’m uh currently in discussions with a hardware wallet provider that’s got a very interesting piece of technology that I’d like to explore because the biggest issue with the handing handing off of Bitcoin wealth to our kids is truly to that piece of information, the private key, whether it’s a single private key, multi-IG setup, custodial setup that uh has a transfer and an an inheritance process. There’s all these different pieces, but I like this particular this this company that developing this technology to allow the handling of signatures and backups and all these sorts of things in a in a more human way. Raising that technical level to a more human interface is very much what is needed. Again, if any of you have particular ideas on how we can hand this digital bloodline retiring wealth to our kids and and allow those dominoes to continually fall over time, comments and questions very much for you. Thank you for listening. I hope you enjoyed this video. I did as well. And I will see you in the next video. Goodbye.