“A Tale of Two Systems” presented by Alli Shaw 5/12/25

00:00 Thank you'all for being here today. I am 00:02 here to talk to you about money, but 00:07 maybe not in the way that you think I 00:10 would be here to talk to you about 00:12 money. I am here not to sell you 00:15 anything, but I'm here to advocate for a 00:19 money that more accurately reflects the 00:22 value of our work. And I'm going to do 00:26 that by comparing and contrasting the US 00:30 monetary system, which is the system we 00:32 currently use, and the Bitcoin monetary 00:35 system. Um, but before we jump into 00:38 that, I have a very basic question that 00:40 I had to ask myself um before even 00:42 presenting this. And that question is, 00:45 how often do you think about 00:48 money? My guess is a lot. So whether 00:52 it's shopping, saving, or investing, you 00:55 think about getting up in the morning 00:57 and the reality is you have to decide, 00:59 am I going to buy my lunch? Am I going 01:02 to pack my lunch? Am I going to buy that 01:04 amazing coffee up the street? Or am I 01:06 going to make it at home? So you're 01:08 making monetary decisions all the 01:11 time, but have you ever taken the time 01:15 to understand how money actually works? 01:19 And as you can see this is this visual 01:21 up here it it looks very complicated but 01:24 the reality is that money its job is 01:28 actually quite simple. Money's job is to 01:32 accurately reflect the value of your 01:35 work. 01:37 So it's not just reflecting the value of 01:40 your work in just a sphere of we're 01:44 talking about systems and we're talking 01:46 about money and policy and things like 01:48 that. It is very personal because what 01:52 happens to our money affects us. It 01:55 affects our families. It affects our 01:57 entire communities and economies. So I 02:00 will just share two personal experiences 02:03 where my family has been impacted by uh 02:08 mismanagement in the monetary system. So 02:10 in the 02:11 1930s the value of my 02:14 great-grandfather's work was destroyed 02:16 because of bank mismanagement. And as 02:19 you know 1930s that was the great 02:21 depression. So the vast majority of 02:24 people, if not all, in the US were 02:27 significantly affected by mismanagement 02:30 of the monetary system at the time. So 02:33 let's let's fast forward though. That's 02:35 that's the um the mismanagement most of 02:39 us remember. We've learned about it in 02:41 school. But let's fast forward to the 02:43 1980s. So in 1986, the value of my 02:47 father's work was destroyed because of 02:50 government mismanagement. So I don't 02:53 know how many how many of y'all are 02:55 connected any way to agriculture or 02:57 farming or own land or anything like 02:59 that was nice. Um so you know what goes 03:04 into farming and what happened in the 03:08 1980s was an agricultural crash because 03:13 uh the government had printed too much 03:14 money. It had caused significant 03:17 inflation and they were trying to get a 03:19 hold of inflation by ramping interest 03:22 rates up. So when my father was farming, 03:25 he was looking at 18 plus interest 03:29 rates. And we're not talking about, oh, 03:32 my dad's going to go out and buy a 03:33 Ferrari. We're talking about interest 03:35 rates on seed, interest rates on 03:38 equipment, interest rates on fertilizer, 03:41 all of those things that you have to 03:43 take out a loan for to put food on our 03:46 tables, right? So, my dad lost 03:49 everything in that crash that it would 03:51 have been the equivalent of about $3 03:53 million today simply because of 03:57 mismanagement of the money. So, at the 03:60 end of the day, it was all about the 04:02 money. 04:05 But it's helpful to step back and say, 04:07 okay, well, if we have to trust all 04:10 these big players with our money and 04:12 what's happening with the system itself, 04:14 let's ask, why do we even need money? 04:16 Maybe we can just opt out of the system. 04:19 Well, let's see. Money actually makes it 04:23 easier to trade what you have for what 04:26 you 04:27 want. So, for example, I have eggs. Joel 04:31 has a cow. 04:32 That would be hard to trade, right? 04:34 Although with the with the price of eggs 04:37 right 04:38 now. Maybe it wouldn't be as hard as we 04:41 think. Yeah. One to one. Um, so that's 04:44 hard to trade. It's hard to trade a cow 04:46 for a house or definitely a house for 04:48 eggs. So money solves that problem. It 04:51 makes it easier to trade. So that's what 04:55 money does. It values our work by 04:57 empowering us to purchase what we need 04:59 and want so that we don't have to trade 05:01 things anymore. We don't we don't have 05:03 to have a bartering 05:05 system. But money doesn't operate alone. 05:08 Money operates within a system. Just 05:11 like what I mentioned before, we have 05:12 the US monetary system and the Bitcoin 05:14 monetary system. Those are operating 05:15 within a system. But what does the 05:18 monetary system do? Well, it creates, 05:21 distributes, and regulates the money. 05:25 And this is really important right here 05:27 because in the US monetary system, the 05:31 US dollar is what's being created, 05:33 distributed, and regulated. With 05:36 Bitcoin, in the Bitcoin monetary system, 05:40 Bitcoin is being created, distributed, 05:44 and regulated. So, whenever you hear 05:46 Joel or me or anyone talk about Bitcoin, 05:49 we could be referring to Bitcoin the 05:51 monetary system or Bitcoin the money 05:55 because it functions as both and it has 05:56 the same name. I don't I don't know why 05:58 they did that, but that's what they 06:00 did. All right. So, the US dollar is the 06:03 money in the US monetary system. So, 06:06 let's talk about the big players within 06:08 the US monetary system. There's the 06:09 banks, the central bank, and the 06:13 government. These are all major players 06:16 that are managing our money. And of 06:19 course, we have taxes. 06:20 So that goes without saying. So a 06:23 monetary system has to manage two 06:25 things. Who owns what money and the 06:28 total amount of money. So we can think 06:31 of this as a spreadsheet. I don't know 06:33 about you, but sometimes my eyes cross 06:35 looking at spreadsheets, but I promise 06:36 this is going to be a simplified a 06:39 simplified spreadsheet. So, let's look 06:41 at the US dollar system spreadsheet 06:44 first. This number is the only number 06:47 most people think about my money. How 06:49 many dollars do I 06:52 have? But dollars in the system is also 06:57 just as important. Now, why is that 06:60 true? Because it determines what my 07:03 dollars can buy. It determines my 07:06 purchasing power. So if you take my 07:08 dollars, divide them by all the dollars 07:11 in the system, it determines what stuff 07:14 I can 07:16 buy. So if I have $100, there's $1,000 07:19 in the system. I'm able to buy 10% of 07:23 the stuff in the system. So what happens 07:26 when dollars in the system goes 07:28 up? If that 07:30 increases, my purchasing power falls. So 07:34 it's fallen by half. I'm down to 07:36 5% of what dollars can buy 07:40 now. So, we can ask the question, well, 07:43 how many dollars are there exactly? 07:45 Because it changes the value of the 07:48 dollars that I 07:50 have. Well, currently there are $22 07:54 trillion in the system. So, right now, 07:58 $100 can buy a one gram set of gold 08:02 earrings. I know those are kind of hard 08:03 to see, but it's just a little two 08:04 little stud earrings. So, $100 can buy 08:07 you one gram set of gold 08:09 earrings. But has the US dollar supply 08:12 always been 22 trillion? And has a $100 08:15 always bought this much? That may seem 08:18 like an obvious question because I know 08:20 many of us remember days when, you know, 08:22 gas was under a dollar and things like 08:24 that, but it's worth looking at. 08:28 The US prints 7% more dollars on average 08:32 every 08:34 year. So the numbers of dollar or the 08:37 number of dollars in the system has 08:39 grown 75 times since 08:44 1960. So in 1960 there were $286 billion 08:48 dollar in the system and $100 bought 88 08:53 grams of gold. So that that's a 08:55 significant difference of what of 08:57 purchasing power in the 60s as opposed 08:59 to now. So when that number is rising, 09:03 our purchasing power is 09:05 falling. Printing money is a major 09:08 reason why you see all of these prices 09:10 rising across the board of going to the 09:13 grocery store. It doesn't matter if 09:14 you're buying a house, whatever you're 09:16 doing, prices have risen just across the 09:19 board. So we'll use we'll use a Big Mac 09:22 as an example. Hopefully hopefully the 09:24 restaurant we're in won't mind too much. 09:27 Um the price of Big Mac from 1968 it was 09:31 45 cents. Now it's up to 09:34 $529. So that has gone up 12 09:37 times. And Campbell Soup has gone up 10 09:41 times. So the same stuff is more 09:44 expensive. All of these things have 09:45 increased in 09:48 price. But wait, there is a caveat here. 09:52 Hasn't that number gone up? Haven't 09:55 wages gone up? Well, yes, but also no. 10:00 They have gone up, but they have only 10:03 gone up half as much as inflation. So, 10:08 what you've got now is your wages by 10:10 half as much soup and Big Macs as they 10:14 did in 1975. You are working the same 10:18 hours. you were doing the same work, but 10:21 you can only buy half of what you did 10:23 back 10:25 then. So, we have so much more money in 10:28 the system now, but why don't we feel 10:31 wealthier even though we have more money 10:33 in the system? Well, as Adam Smith said, 10:36 wealth does not consist in money, but in 10:40 what money purchases. We've known that 10:42 since 1776, so quite a while. 10:47 So a de decrease in your purchasing 10:49 power it equals a decrease in the value 10:52 of our work. And that's something that 10:55 has really uh struck me as as I've 10:59 engaged with Bitcoin, as I've engaged 11:01 with the US monetary system, as I've 11:04 seen my my family's history in this. The 11:08 reality was it wasn't just money that my 11:12 great-grandfather and my dad lost. It 11:14 was their work. It was a lifetime of 11:17 work put into the land, a lifetime of 11:19 work put into the bank. So, it's it's 11:22 the value of our work that's being um 11:25 that's being harmed here. So, what's 11:28 going on? So, let's let's break this 11:30 down just a little bit. Well, banks keep 11:33 spreadsheets with all the green numbers 11:35 of my money. Each bank records who owns 11:37 what. 11:39 Federal Reserve makes sure two people 11:41 don't own the same dollars. So, they're 11:43 keeping track of all the money in the 11:46 system. And it's actually a giant 11:49 spreadsheet or a database. It just runs 11:51 on computers and they keep track of all 11:53 the dollars in the system, even the ones 11:55 in your 11:58 pocket. But how do those dollars in the 12:01 system change? That's a that's 12:04 definitely a question worth asking. So, 12:07 we have a Federal Reserve Board of 12:08 Governors and we have Jerome Powell as 12:11 the head of that chair and 12:15 literally he can click a mouse button 12:19 and he can change that number to 12:22 whatever number he wants. Now, he's not 12:24 going to call it printing money, but 12:27 that's in effect what it's doing. There 12:29 are all sorts of of uh different 12:31 reasonings behind that money is printed 12:35 but it in effect it is hurting your 12:38 purchasing power in the way that he is 12:40 in the way that he does it. So if the 12:43 dollars in the system go up easily my 12:45 purchasing power decreases quickly and 12:47 as the number of dollars go up the value 12:50 of the dollar goes down. So in 1935 a 12:55 dollar was worth a dollar. 12:58 today down by 95% it's worth 5 cents 13:03 which is just a significant loss when it 13:06 comes to the value of our 13:08 money. So could we tie this number uh 13:11 the number of dollars to gold? Yes, we 13:13 have tried that before in the US 13:15 monetary system. We tried making a paper 13:17 promise for gold where literally a $10 13:20 bill would say there is deposited in the 13:22 treasury 10 $10 worth of gold coins. So 13:26 you could literally take your money and 13:29 get gold for it. But in 1971, the US 13:34 government broke that promise and took 13:36 us off the gold 13:39 standard. So now $10 is $10. It's it's 13:43 the paper it's printed on. So what about 13:47 different governments? Well, I have I 13:48 have good news and bad news in that 13:50 regard. Um, the US dollar is actually 13:55 the strongest currency in the world 13:57 right now. So, obviously, I'm sure 14:00 everyone knows this that every country 14:02 prints its own money out. So, you know, 14:04 if I'm going to go to Britain, I'm going 14:06 to have to exchange my US dollars for 14:08 for British pounds. So, everyone is 14:10 printing their own money out, but the 14:12 money that they print um is not even as 14:16 strong as the US dollar. So when you 14:19 look at how much value we've lost, it's 14:22 significant in other even more 14:24 significant in other parts of the world. 14:26 So the dollar is still king right now, 14:29 but that's that's having an impact on us 14:32 and the entire 14:34 world. So are there any other options? 14:36 Well, this is presumably why you're here 14:38 because I have the great news of saying 14:41 there is another option and that option 14:45 is Bitcoin. 14:48 But what exactly is Bitcoin? Well, we 14:52 mentioned this a little bit earlier that 14:53 Bitcoin is a monetary system and it runs 14:57 on software and it creates its own money 14:60 again called 15:03 Bitcoin. So, it works like a 15:06 spreadsheet that runs on 15:08 computers and it keeps track of my 15:11 Bitcoin. If only I had 10 Bitcoin right 15:14 now. I think it's at 103,000 per 15:17 Bitcoin. That would be really nice. But 15:20 um it keeps track of my Bitcoin and your 15:23 Bitcoin and it limits the total Bitcoin 15:28 in the system to 21 million. Anybody 15:31 remember what the total amount of US 15:33 dollars in the system 15:36 was? 22 trillion. So this has a hard cap 15:40 of 21 million and it cannot be 15:46 increased. All right. So Bitcoin 15:48 software has hardcoded rules about who 15:52 owns what and to enforce that 21 million 15:56 limit. Now this is a very important 15:59 point because when we were looking at 16:01 the US monetary system, do you remember 16:03 the big players in that system? Right? 16:06 the banks, the Federal Reserve and the 16:09 government. Bitcoin automates that. So, 16:12 Bitcoin as a monetary system is not 16:15 being manipulated by individuals or 16:19 organizations or governments. It's 16:22 hardcoded to 16:24 automate these uh these rules that it 16:27 essentially lives by. So, it's an 16:28 important distinction between how these 16:31 two monetary systems function. So the 16:34 two two main rules are who owns what and 16:36 to enforce that 21 million limit. So 16:38 first rule all right ownership of 16:41 Bitcoin is protected by encryption keys. 16:45 Now if you have further questions about 16:48 encryption keys then at the end of this 16:50 I will hand them over to Joel because 16:53 how this works is too genius for me. Um, 16:56 I have looked into it and it's it's 16:58 incredible the way that the encryption 17:01 keys work. But the main thing you need 17:03 to remember is that it would take all 17:05 the computers in the world a billion 17:07 trillion billion trillion years to crack 17:11 one Bitcoin key. Now, if you use a third 17:16 party, you know, that that is a 17:18 different story as far as how that 17:21 works. So things like third parties can 17:24 be hacked. But in self-custody with your 17:26 own encryption keys, it's it's basically 17:29 unhackable as as Joel would say. All 17:32 right. So the computers running Bitcoin 17:34 software, they connect to each other and 17:37 they make exact copies. So there's not 17:40 just one overall spreadsheet keeping 17:42 track of that. all the computers on all 17:44 the networks are keeping track of it 17:48 until there's over a 100,000 Bitcoin 17:50 computers running uh running the network 17:52 and they have all the same 17:55 numbers. So if I have a key, I can send 17:58 or spend my 18:00 Bitcoin and the numbers change on every 18:03 computer. Again, not a centralized 18:05 computer, every computer that is running 18:07 the Bitcoin software. All right, rule 18:10 number two, the enforcing the 21 million 18:12 limit. So, this is from the White House. 18:14 The Bitcoin protocol permanently caps 18:17 the total supply of Bitcoin at 21 18:20 million coins and has never been hacked. 18:23 The White House has done its homework 18:26 and this is what they've this is what 18:28 they've said. So, it's never been hacked 18:30 and it limits that 18:32 supply. So, 21 million is all the 18:34 Bitcoin. No one can make more if they 18:36 try to. Bitcoin is hardcoded to 18:40 disconnect them. So they're over here 18:43 with their little spreadsheet in their 18:44 system all by themselves. There's no no 18:47 connection that's happening 18:49 there. All right. So the value of 18:51 Bitcoin is going up as more people adopt 18:54 it and the money in the dollar system is 18:58 losing 18:59 value. So money in the Bitcoin system is 19:02 gaining value. But, and this is a very 19:05 important question to interact with, 19:07 Bitcoin's price is volatile. I'll just 19:10 tell y'all a little story. When uh when 19:12 Joel gave me, you know, he he 19:15 periodically gives gives Bitcoin away 19:17 and I think he gave me $30 and uh when I 19:20 opened my account, it was like you have 19:22 $30 and then suddenly it was $29.99 and 19:25 then suddenly and then suddenly it was 19:28 30.05 or something like that. So, you 19:31 know, I say that to say don't let that 19:34 make you nervous. You're just able to 19:37 see in real time what the market's 19:40 doing, which is pretty incredible uh to 19:43 be able to do. So, let's talk about that 19:45 volatility, though, so that y'all have 19:47 the confidence to be able to see what's 19:50 going on here. All right. Where does 19:53 that price volatility come from? Well, 19:55 we're still extremely early in the 19:57 adoption cycle. We're at 3% of adoption. 20:01 Um, Bitcoin in 2025 is at 3%. So, that's 20:04 like online banking in 96. I I don't 20:07 know anyone who did online banking in 20:09 96, but I wasn't thinking about it at 20:11 the time. Then, um, social media in 2005 20:14 and the internet in 1990. So, all of 20:17 those technologies have changed the 20:19 world, but it took time for them to 20:22 change the world. So, we're just very 20:25 early in the adoption phase. Another 20:27 thing to keep in mind is how volatile 20:29 the world is. It's incredibly volatile. 20:33 There are things going on all over the 20:36 world. But the US dollar is actually a 20:39 big player in all the things that are 20:42 going on in the world. So the US dollar 20:43 right now is 20:45 18% of the entire world's money. Again, 20:49 US dollar uh is is used by other nations 20:52 as well. 20:54 So the US dollar is like a large ship in 20:57 a large ocean. The dollar is sinking 21:02 slowly and Bitcoin in comparison is only 21:07 1.3% of the world's money. So again, 21:10 back to that volatility 21:12 issue. Bitcoin is a little bit like a 21:14 small little boat in the ocean. It is 21:18 getting there and it is growing, but 21:21 right now you're going to feel it. 21:22 You're going to feel the ups and the 21:25 downs. Yes, smaller systems go up and 21:28 down more easily. Larger systems are 21:30 more 21:31 stable, but Bitcoin will get there. It's 21:34 just going to take time. So, when in 21:37 doubt, zoom out. And this is very 21:39 important to keep in mind again as you 21:41 see that volatility kind of going up and 21:43 down. All right, this is Bitcoin's price 21:46 history every day. You can see all the 21:48 jagged edges there. uh the drops and the 21:51 and the um the higher points as well. 21:55 But look at it. Every year that's 21:57 starting to smooth out. Every two years 22:01 we're pulling back even more. It's 22:02 smoothing out even more. Three years. 22:05 And as you notice, it's all uphill. It's 22:08 going up in value. And four years, 22:11 you've just got a nice smooth line 22:14 there. All right. This is uh as Joel 22:17 mentioned at the last meeting. This is 22:19 this is one of his favorite quotes and 22:21 it has really grown on me because we 22:24 tend to overestimate the effect of a 22:27 technology in the short run and 22:29 underestimate the effect in the long 22:32 run. So, one of the things, especially 22:36 for for you guys who've never really 22:38 interacted with Bitcoin uh before, 22:40 Bitcoin is not a a 22:43 get-richquick scheme. As you can see 22:47 from this PowerPoint, it is a new 22:49 technology that is changing the world. 22:53 But again, that takes time. And so, you 22:57 know, in the long run, being able to 23:00 automate a monetary system, it's never 23:03 been done before, not in the digital age 23:05 of being able to do that. So, again, 23:08 this is not about some kind of 23:10 get-richqu scheme. You know, you're not 23:11 going to have a million dollars in your 23:13 bank account tomorrow if you invest in 23:14 Bitcoin today. But the technology and 23:18 the genius behind it is what we're 23:21 investing in essentially. um it's the 23:24 solutions that solve so many of the 23:27 problems uh in the monetary system that 23:29 we're using. So all that to 23:32 say we have something now that my 23:34 great-grandfather and my father never 23:36 had and that is a choice. They were able 23:40 they were forced to uh to use the 23:43 monetary system that they were born 23:46 into. 23:48 um you know and in some ways that worked 23:50 out well, in some ways it was absolutely 23:53 devastating. So it it's beautiful to me 23:56 that now we have an option that we've 23:59 never had in the history of the 24:01 world and that option is Bitcoin, a 24:04 better system and better 24:08 money. Thank you all so much for having 24:11 me. 24:15 If if you want to if you want to learn 24:17 more um we have Joel Bumgar.com live and 24:20 it's got all of I mean as you know Joel 24:23 has an incredible amount of resources 24:24 that he's created himself. All of those 24:27 resources are going to be available at 24:28 Joel Bombgar. Also if you are interested 24:32 in just the community of Bitcoin of 24:34 being able to ask real-time questions uh 24:36 feel free to join our um Bitcoin group. 24:39 We have a little Facebook group and that 24:41 way you know we can answer any questions 24:43 you have in in real