Bitcoin Tech Talk #510
Interesting Stuff
Surplus Elites and Revolution - Edgar and Co. argues that when societies produce more credentialed people than available elite positions, the frustrated surplus destabilizes the existing order. The French Revolution was initiated by bourgeoisie lawyers like Robespierre and not by peasants. The most interesting historical precedent is Victorian Britain, who avoided revolution by channeling surplus elites into colonial emigration and industrial expansion. This is one of the subtle reasons for fiat money’s durability in that bureaucracies can be expanded much further than normal, giving surplus elites more places to go.
Old Money Estates - Ben Black argues that modern families should stop dividing wealth equally and instead concentrate assets to compound across generations like the British landed gentry. He profiles a cautionary tale of a family farm held five generations, liquidated by a stepmother within a decade due to lack of governance structures. The modern solution isn’t rigid primogeniture but family trusts, constitutions, and intentional successor selection based on fitness. A fascinating blend of historian and financial strategist pushing back against what he calls the “shortsightedness of modern individualism.” Unfortunately, the biggest barrier is still the government, who in England have destroyed many historical estates through taxes.
Young Adult Costs - Johann Kurtz shows how previous generations accessed valuable social capital like trusted communities, functional schools, and safe neighborhoods for free, which current young adults must now purchase. His main insight is that these things are still available but are rolled into home prices. This has resulted in home price-to-income ratios hitting 5.0 in 2024 versus 3.2 in the 1990s, median first-time buyer age jumping from 29 to 40, and the “desired husband” income being 58% higher than what available men earn. Expensive suburban housing isn't luxury but now necessary infrastructure. You're buying supervised childhoods, quality schools, and safety that communities once provided organically. Societal debasement is as real as the fiat debasement which caused it.
AI Boom Trajectory - Groundbreaker makes a purely financial analysis of the AI boom, and it has some real insight. He does this because he argues that the boom isn't a tech cycle but a credit-driven real estate cycle identical to 2008. Credit-driven cycles only require deceleration and not collapse to break the market as these companies are on something like a refinancing treadmill. He notes that the risk is very centralized. Of the roughly $2.1 trillion in cloud obligations, half is owed by just OpenAI and Anthropic. OpenAI's valuation step-ups decelerated from 1.9x to 1.23x per round while burning $115 billion. And these aren’t even the worst! There are lots of leveraged players who only need a little softening of sky high prices to blow them up.
Rigged Betting - Quoth the Raven writes this reflection on gambling, markets and trading. He was triggered by a McGregor bout where the fighter appeared compromised and argues both sports betting and financial markets have become rigged. He cites massive puts on oil before a Trump ceasefire announcement, NBA players manipulating prop bets, and officials trading in companies affected by their own policies. He made me wonder how much of the daily anxiety we feel is suspicion that zero-sum games are being rigged against you.
What I'm up to
Orange Pill Order - I talked on this podcast for two hours, talking about everything from my origin story to BIP110 and Production Ready. I thought the most interesting parts were where we discussed strategies for young people today and how to take advantage of the opportunities that Bitcoin gives them.
BTC Prague Debate in Korean - The panel I did with Jeff Booth and Natalie Brunell has been translated to Korean. This is a debate we need to have more of given how much video content a relatively short panel from the conference has produced. Here is Part 2.
Nostr Note of the Week
