May 13, 2024 | Read Online

Byron Gilliam

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"What then is time? If no one asks me, I know: If I wish to explain it to one that asketh, I know not."

- St. Augustine

Bitcoin Booed. Time For a New Narrative?

Has an investment asset ever been booed by a crowd?

Credit default swaps would have deserved it for causing a global financial crisis in 2009 but even then, no one blamed the asset itself, they blamed the bankers peddling it.

Has software ever been booed?

The closest is perhaps a crowd of Apple developers jeering a giant visage of Bill Gates at MacWorld 1997, but there again, they were booing the man, not the software he wrote.

Technology of any sort?

I imagine a crowd of the original Luddites may well have booed a Spinning Jenny at some point, but if so, no smartphones were there to record it so we'll never know.

I can therefore only assume that Bitcoin made triplicate history at Ohio State the weekend before last when it simultaneously became the first investment asset, the first computer code and the first technology to be booed by a football-stadium-sized crowd.

Bitcoin may have made even more history than that: According to Michael Saylor's most recent presentation, Bitcoin is also an idea, a brand, a commodity, a monetary asset, a Treasury asset, a capital asset, a bank, a "path to peace," "digital gold," a "digital city," "digital time" and "pure economic energy."

I doubt that any of those things had ever been booed before last weekend, either.

But is this also why Bitcoin was booed?

Bitcoin is not only that long list of things, according to Saylor, it's also the best of all those things.

Better still, there's "no second best" of any of them.

Bitcoin is "the best idea" and "the second best idea is worth nothing."

That's a big statement and perhaps indicative of why Bitcoin seems to have a growing image problem.

Bitcoin ETFs, for example, were such a surprise hit with traditional investors because Larry Fink took the opposite approach, focusing everyone's attention on the single narrative of digital gold (probably the best elevator pitch for an investment of all time).

Michael Saylor insists that bitcoin is much more than digital gold ("a not very good narrative") and that, I think, is where we get in trouble — because some of his claims are so grandiose, even I want to boo them.

Time is on our side (apparently)

Here's the YouTube summary of Saylor's presentation:

Spoiler alert: All of those "bests" refer to "bitcoin" of course, and in each case (you guessed it) "there is no second best."

Some of these claims are well reasoned.

Bitcoin is the best digital commodity, for example, because it's the only one all regulators recognize as a digital asset without an issuer. (Saylor and Gensler are weirdly aligned here.)

I can also see his argument that bitcoin is "not just the best digital commodity. It's the best commodity," because it's the only commodity with a fixed supply and the only one that is "digital, programmable, inelastic, durable, divisible, portable."

Makes sense, got it.

But he starts to lose me at "Bitcoin is the best bank" — because I don't think Bitcoin will give me a mortgage and I wouldn't want my mortgage denominated in bitcoin, anyway.

He loses me a bit further with statements like "Bitcoin is a digital city" — because if I can't take a long weekend there it's not any more useful to me than Pyongyang.

And here's where I get completely lost: "What [Bitcoin] really is is digital time."

I guess it's true that "no amount of money will buy you more time or bitcoin" (he means buy you more than the 21 million cap).

But does that mean "we have bottled time in a bitcoin?"

If so, I'd like to uncork a bottle and pour myself an extra hour so that for a change I can get this newsletter in before my deadline.

But maybe he doesn't mean it so literally. "Proof of work mining," he explains, "is in essence digitally transforming time into an asset."

I always thought proof of work mining transforms electricity into an asset, but I might be missing something.

Or maybe he does mean it literally? "We have figured out how to duplicate the benefits and the characteristics of time."

Great! How much bitcoin do I need to be 25 again?

I really would like to understand because, according to Saylor, Bitcoin will "improve your life, family, product, service, company, institution, government [and] world."

But that's not all!

Bitcoin is "not the solution to every problem in the world," he concedes. "It's just the solution to half the problems in the world. But every other problem in the world you're gonna need economic energy or power to solve and this is how you harness and channel that power."

I would love for that to be true, but I can't tell you how that would work.

Perhaps that's because, like St. Augustine, I can't tell you what "time" is, either.

Nor can anyone else, though, and as an investor, maybe that's all you need to know: "The best investment," Saylor tells us, "is something everyone needs, no one can stop, and few understand."

Following his keynote, Bitcoin must have a little more upside because there's one less person that understands it (me).

But I don't know.

If we want bitcoin to go up, we need more people to understand it, not less — including the kind of people that booed it at Ohio State last week.

For that, we may need to pick a narrative we can all agree on.

― Byron Gilliam

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