“First they ignore you. Then they laugh at you. Then they fight you. Then you win.”
- Gandhi (or maybe somebody else)

I just got back to Prague after 11 days of non-stop bitcoin business in the good ol’ US of A, and I have quite a lot to talk about with you all. The biggest news, as you may have heard, is that El Salvador recently became the first country in the world to make bitcoin legal tender. 

I listened to a couple minutes of the announcement live at the Bitcoin2021 conference, and I think it will be interesting to any of you who don't know that much about bitcoin or still look at it merely a speculative investment.

This whole fake internet money thing is getting serious now. While I think the governments and central bankers of the world have been paying attention to bitcoin for a while, this changes the game. El Salvador is a tiny country both in population (6.5 million) and economic ($27B GDP)  terms, but they have already started a chain reaction of leaders across South and Central America publicly voicing their support for bitcoin as well. 

It remains to be seen what will actually happen in other countries in the coming months, but the prospect of bitcoin beginning to fulfill its potential in developing nations with poor financial infrastructure is encouraging beyond words. I’ve never felt more enthusiastic about working in this industry. But it’s not all sunshine and daisies, I’m afraid.

With timing that I doubt was a coincidence, US Senator Elizabeth Warren recently called cryptocurrency mining an “environmental disaster” and “scandalous” on a publicly broadcasted Zoom call, citing faulty metrics such as energy consumption per transaction to purposely paint bitcoin in a poor light. 

I particularly enjoy the wording at the end [6:40]: “undermine environmental justice” — nevermind that she’s asking irrelevant and misleading questions about Central Bank Digital Currencies (CBDCs), which would not require mining or vast amounts of energy consumption precisely because they are centralized and thus not at all comparable to bitcoin in their very nature.

For reference on the supposed environmental injustice taking place, here is a chart comparing bitcoin mining’s estimated emissions (in tons of CO2) with the total estimated global emissions.

There are only two possibilities here:

  1. Elizabeth Warren is uninformed as well as misinformed about bitcoin, and sincerely believes it has a much worse environmental impact than it really does while simultaneously not understanding any of the practical benefits of having a global, decentralized, open monetary network.
  2. Elizabeth Warren is purposely fearmongering.

It doesn’t much matter to me whether (1) or (2) is true. But it is quite clear that the efforts of establishment politicians and the mainstream media to undermine bitcoin’s continued adoption and development are ramping up. I would love to see their realization that bitcoin is disrupting the status quo turned into productive action to improve legacy systems faster and to compete with bitcoin so that all the citizens of the world can experience a more prosperous future. At the same time, I lost my faith in the benevolence of governments and the honesty of the mainstream media long ago, so I am ready for a lot more misinformation and fearmongering to come. 

I’ve already explained in the ebook and past newsletters that it would be very difficult for the US government to try to ban bitcoin at this point. Ultimately, if they are going to do it, they must first get a majority of the American people to think that bitcoin is bad for the world in some way. Perhaps it would be difficult to do that by pointing out that it is global, decentralized, and permissionless, providing financial inclusion to billions of people around the world who still do not have bank accounts or stable currencies and who may be living under authoritarian regimes.

And it might also be hard to convince people that bitcoin is bad by discussing how it has the largest open-source development community of any project in human history, leading to rapid innovation such as the work that Jack Mallers and his team has done to make remittance payments instantaneous and practically free for the people of El Salvador. 

So what’s left? Well, something much more powerful than logic and facts. Emotions. 

Make people think that bitcoin is aiding unprecedented amounts of money laundering and fraud. (It’s not.) Get the masses believing that bitcoin’s growth will destroy the planet. (It wont.) Instill fear and uncertainty into as many hearts and minds as possible.

The big issue of course is that they’re already far too late to convince everybody, or even a vast majority. So those who are convinced by the fearmongering will just have one more thing to be outraged by, and we’ll all carry on hating each other. But that’s the pessimistic outlook.

After the experiences and conversations I’ve had the past two weeks, my outlook is actually much brighter than before. I met people with all sorts of different backgrounds who have gone down the rabbit hole and changed their path in life so that they can get involved in the bitcoin industry. 

Among the hundreds of people I talked to, the encounters that stood out the most were with a handful of folks who have built their careers in the energy and traditional finance sectors, but are now pivoting to bitcoin and bitcoin mining. I learned about more than $100MM worth of investments going into bitcoin mining projects that will utilize stranded energy and help develop more renewable energy production capacity. I talked with so many brilliant and talented people who, like me, are far more enthusiastic and passionate about working on bitcoin than anything else they’ve ever done in their lives. And on top of that, I heard about institutions and corporations accumulating bitcoin faster than ever before, viewing it as superior to gold and much needed in times of unprecedented money printing and rapidly rising inflation.

Honestly, the fundamental case for bitcoin has never looked stronger. Seeing the money and talent pouring into the industry is as bullish a signal as there can possibly be. The only problem is that with more success comes more attention, and for bitcoin that means risk. First they ignore you. Then they laugh at you. Then they fight you.

There has been a good amount of ignoring and laughing in the past 12 years. Now comes the battle for fair regulations that foster innovation and progress and protect citizens' rights. I don’t expect it to be an easy battle, nor do I expect that price will be immune to more volatility as politicians debate bitcoin's merits. But this is why bitcoin had to be decentralized in the first place. Let’s see if it’s up to the task.