THE PHYSICS OF BITCOIN | INTERVIEW w/ GIOVANNI SANTOSTASI EPISODE 78
like never SW It’s Time to Let It Go got me going like I’m literate know you feeling it I got you feeling this he R have you ever stayed up to the sunshine came through fourth Corner in the crun time need to go fle on Rel like just one time have a fun [Music] time me do you believe in moners I’m talking dreams so that’s how you know if you got to go and get get to win coner I had to go out and get it without a spor kept it real never CR that’s now I can go out and get it how I want to # bless I [Music] [Music] what up YouTube Rumble Twitter thank you guys for joining us over on the Ryan M show today is Tuesday April 30th it’s 9:30 p.m. and I have an amazing guest for you today uh we’re going to talk about the physics of Bitcoin aka the Bitcoin power laws and I’m going to be joined by a special guest javani and I want to say I’m saying that right jaavan I wanted to say Giovani at first but I think I got that right make sure you guys swing over and follow him on Twitter I’ve also Le leave left links to his YouTube his Twitter uh we’re going to dive into the topic this man claims that he he has a theory called the Bitcoin power laws and that he has the ability or has figured out where Bitcoin is going to go based off a system or a formula that he’s created and I’m so interested to hear more about this story but before we dive into it can you tell us a little bit about yourself and did I say that right how how we’re going to describe that yeah perfect very good very very good uh so um my background is uh I am an astrophysicist I got a PhD in astrophysics and uh I work in the field of gravitational waves that have this vibration in space and time and then at a certain point in my career I went to uh Neuroscience uh my dad died of ALS actually the same thing with Alini had the same illness you know and uh I got shocked by that because you know I was relatively young and so I kind of decided to go in a more applied field uh and use my skill of math and physics to understand how the body works I I I ended up studying uh the Neuroscience of sleep in particular it was not ALS it was more like Alzheimer because you know a lot of people have a um cognitive problems as v h and sleep is a big component to that and so I use my skill of math and physics to try to understand how the brain works during sleep I even have a patent uh that allows uh you to basically track your own brain and then through sounds I can improve your deep sleep that is uh where most of the memories are created during sleep and then actually we show through different scientific studies that we can improve a cognitive performance of both young people but is the advantage is even bigger with older people uh and I tell you this because it’s kind of a almost like this the Story of My Life of uh trying to apply the same principle of physics and math and trying to understand very different things like I told you about these gravitational waves when the brain and now bcoin uh so in physics we call them universalities when we find a pattern that is a you know a pattern that applies to many different systems even if they are very very different from each other uh you will think that Bitcoin has nothing to do with the brain but there are things that are in common because of the laws that describe one system are very similar to the one that describe another one and this is very common idea about these power laws because power laws are one of these universalities they come up everywhere in nature I have some slides that uh I can show you in a certain point if you’re interested I can show show you yeah you can show your screen where they come from yeah yeah uh one second let me get you set up here and then I’ll let you uh take it over yeah whenever you’re ready yeah uh so I’m going to try to share you should be able to share with photo yeah with camera if you can with camera and uh let’s uh find the window okay it’s this one all right oh man I have so many more questions that aren’t even the Bitcoin so so um basically my adventure with Bitcoin was uh all the way to 2013 um when uh in fact let’s go to the start here um yeah this how I called it I called it human Value Ash rate energy time and price because these are the things that are essential to understand about Bitcoin right there is human value that goes into Bitcoin uh there is a ash rate that is related to energy time is a very Central component to understand coin and Price Right Price It’s also human value um but um um the the difference from many other analyst is that actually I bring this scientific understanding and I have this pictures somebody made this using AI one of my followers and I love it because it’s basically this kind of like a renaissance man that looks at Bitcoin like if it was like you know a planet or a star and we are trying to use the same principle right it’s almost like feel some time when I talk about this stuff like you know Galileo when you know my Countryman when he was trying to convince people to look in his telescope and nobody wanted to look right you know somebody some of the priest or some of the uh clergy were refusing because we thought oh this is a devil’s instrument you know like he wanted to convince them were moons around Jupiter look at this you know because it’s now the earth that is at the center of the universe is the Sun and then there are other planets with little moons around right so the Earth is not unique and so I was trying I’m do I like this analogy that I’m doing basically I’m trying to understand bcoin like if it was a science uh and because it has so many characteristics that makes it different from any other asset it’s not behaving like NASDAQ it’s not behaving like gold is it’s behaving in a completely different way they make it much more similar to Natural laws than like an asset and I know it’s sounds crazy but uh I have actually a case you know I have all the data to show that it’s true and uh and usually if if you want me to continue to tell you the story uh basically the story is this right as a physicist we are trained to plot data uh in a way where we are trying to find a relationship between two quantities right it could be pressure and volume it could be far an object moves versus time or stuff like that uh like if you’re studying the planets you want to study okay I have this planet it’s a distance a certain distance from the Sun how long it takes the planet to move around the S and then maybe by doing that you find a pattern and then you’re trying to understand why that pattern what is the origin what is the cause of that pattern so I try to do the same thing with Bitcoin uh in fact even before I bought my first Bitcoin that I bought my first Bitcoin in 2012 you 20 yeah 2012 I heard about Co in 2010 but uh I I didn’t act on it uh I I liked the idea but you know it took me another couple of years you know that is you never want to wait with Bitcoin it’s a very bad idea even at that time you know and but uh even before jumping in I being an scientist I wanted to look at the data right so I downloaded the data from that is one of the beautiful thing about Bitcoin we have all these data right we call it onchain data we can download it’s opposite source so you can try to get uh you know the ash rate the number of addresses the number of transactions the price all this information it’s like the first experiment in human history where you can do this because you know all the other set maybe you can get the price but you know you don’t know how many users that are involved with that system it’s really this Amazing Experiment where we have money where we have a people commitment that you know we have so many things coming together and we can study all these how these things relate to each other so the usual chart that uh they show on TV is this chart right this what we call uh linear chart so basically we have the price um like the normal price the people are use at 10,000 20,000 30,000 and then sometime there are dates on the xais but uh one of the things I do I use the number of days since Bitcoin was created and right now we are about 5,500 something like that uh but you know 365 will be a year right and so you can see it’s about 15 years that we of history and the CH with chart it’s not very impressive right okay sure Bitcoin went from being basically flat in the beginning of his history you cannot even see what was going on there uh see the first bubble looks like almost nothing then you know the second bubble then this huge big bubble where he went up to almost 65,000 and then he crashed right and this is what we show on TV because they most of the time they want to make fun of Bitcoin like this very volatile asset right that yeah sure maybe now it’s worth it $770,000 or whatever 63,000 but you know look how he crashed in the past right you crashed so much that maybe lost 50% of this value and or more in fact you know going from 60% to 60,000 let’s say 65,000 to 16,000 it’s big right uh it’s a big loss and so you you’re not really uh confident about this asset right if you’re a normal investor you think it’s trash right yeah sure it’s going up but who knows you can go all the way to zero maybe one day given the volatility right and and so you you are lost in the noise right this a physicist way of thinking about this is that there is a lot of noise maybe there is a signal there and is there a way of extracting the signal from the noise that by the way part of my dis ation as an astrophysicist was to understand different methods of extracting the signal from the noise that is really interesting right if you want to understand something like Bitcoin because there is a lot of noise but there is also a signal so one of the things that for people that don’t understand that explain what noise is what do you mean by noise give us an example no noise and you know sometime you can say that with almost anything some some men’s noise is some others men uh signal right for example when I was studying the brain the brain has so much information that sometime uh you have to exclude some type of data because otherwise you get overwhelmed so it’s basically if let’s say you’re focus on something right let’s say for example I want to understand the trajectory of a rocket and the rocket will blow you know will move a little bit in the air because maybe there is wind or uh it’s a you know it’s vibrating Etc the real trajectory of a rocket is the signal and the vibration and the uh you know all the additional stuff that is happening to the rocket you can call it the noise there are times where the noise so big that you lose you know like’s say there was an hurricane and the rocket was moving around it was kind of getting lost well in that case the noise so big that overwhelms the signal right uh but in general if a sign if a noise is small we can focus on what counts what matters to us and it depends on your focus like if you are focus on the bubbles the bubbles become your signal if you’re focus on the overall trajectory that is your signal right in my case eventually I want to understand the bubbles but in the beginning I wanted to understand if it was a general Trend so these bubbles are a distractions are noise do does that answer your question absolutely okay and so one way to eliminate or reduce the noise is to do this trick because it’s basically like a bunch of tools right in every profession there are tools that we use like a carpenter we use you know something to get a you know a square angle or whatever the same level you know same thing with science one of the tools that we use is we take the log of one of the axis in this case if let’s say I take the log of the y axis and the log is this function in mat where basically we imagine we are taking like a a drone right so we are flying above a forest and we are trying to see the forest instead of the trees and to do that we basically look at big changes so imagine I’m trying to describe how maybe different animal sizes relate to each other right you know maybe their volume versus the weight or something like that and I want to go I want to make a chart of all the animals all the way from a know maybe a mosquito to an elephant I will get lost like kind of like the first chart that we saw because the elephant so big and comparing with the mosquito that it will not be proportional so one way of doing it proportional is to focus some big changes like maybe by a factor of 10 so 10 100 thousand 10,000 so the log allows us to do that because basically imagine the log is this function where if I write a number this thing called the scientific notation sorry if there is so much technical stuff but it’s a relatively simple concept so imagine I write 10 as 10 multipli by one right then I write in that case I use what is called the exponent so 10 to the one is 10 so if I have 100 it would be 10 * 10 that is 100 right so that number can be written as 10 to the two right then I have th that is 10 * 10 * 10 that number will be a th right and it will be written as 10 to three so you can see the pattern right 100 is 10 to two th 10 to three 10,000 10 to 4 100,000 10 to the five so what we log does you put this number inside this little box and it spits out the exponent so for example in this chart you can see one that is 10 right this when the price was 10 uh when it was 100 on the y axis we see two so that is the log of 100 the log of a th000 is three the log of 10,000 four so it’s not very difficult once you understand the concept but the beauty of doing it in that way now you see how different of a chart we have relatively to the first one it’s the same data but now it looks much more organized right it looks like see first of all the bubble in that in the beginning was almost invisible now it’s very visible right this one around uh you know 2000 10 um 11 right and we had this big bubble and then so these stars are the alings then we had the second bubble uh and every time we seem to go up basically almost by a factor of 10 right so first one was $10 the other one was around you know few hundred few hundred dollars then the other one was a thousands of dollar the last ones was 60,000 but you see how we give the same weight in a sense because we are all represented kind of equally of course of course we are growing up because we are bigger and bigger price but it’s much more uniform type of pattern and even if you are not trained as a scientist you’re almost fascinated right this is the famous rainbow chart right that everybody’s familiar with uh it’s like it looks like there is something regular there right and you don’t know quite uh what it is uh because our human eyes is not very good in picking up this kind of not straight line Trend we like straight line it’s easy to say oh here there is a straight line right but if it is not straight line uh it’s more difficult but it looks much more regular and the bubbles seems much more contained in compar with the general part right it seems that it’s actually going up and in a very consistent way now it looks also it’s kind of flattening out buta is actually an illusion because uh the reason why it’s flattening up is because uh in this particular graph uh what we look a straight line will be an exponential growth so if you have a an exponential growth is very common growth in in science anytime you have something that doubles at a given rate like let’s say you have a interest right in in a bank account that of course is almost nothing but imagine you made 5% every year right so 5% every year you have this consistent gain uh if it is compounding it becomes an exponential right uh it’s a very common type of growth that you see like maybe virus you know if you have a virus inside a a vile or something it will tend to double itself in know given amount of time uh and so that growth is very fast and is called exponential well in a graph like that an exponential growth will look like a straight line and you can see that Bitcoin is not a straight line in this graph so it means that is not an exponential it’s something else and so we are trained as a physicist to if we don’t find a straight line immediately right in the linear graph first because many relationship in SS are linear uh initially and then if you don’t see a linear you go to this other graph where you have a log of the y axis versus a log of the x-axis you don’t see at straight line you do another trick that you you you use your Ultimate Weapon as a scientist that is you take the log of both sides you take the log of x and the log of Y and this is very common in many areas of physics but is very uncommon with Assets in fact this why you know I discovered this actually in 2018 uh I was already fooling around with these power lws but I was looking at like for example the price the relationship between price and addresses where addresses can be used as a proxy for adoption even if it is not exactly number of users it’s kind of proportional you know you have to be a little bit careful but I was Finding power laws there this this kind of relationship that I will describe in a moment they are called Power laws uh and but I it took me time in fact I was the first one I don’t know why nobody else noticed uh because it’s very uncommon to take the logarithm of time in the context of assets we do it all the time in other area of physics but in assets because they almost never you get this kind of relationship right but you can see immediately what happens by doing this trick so basically we have a price the log of price in the y axis and we have a log of time in the x-axis and what do you see well uh I I saw these guys I I you know probably you know them they have this show called what Bitcoin did uh and they show this chart and they called it the chart that you cannot see because it’s so weird right have you ever seen Bitcoin behaving like a straight line right because yes it has oscillations right goes up and down but now it’s not curved anymore it’s like straight right it looks straight and it’s straight up right it’s so weird what is going on there that is really weird and so um as a scientist though I was trained to recognize this as a power LW because if you see a straight line even even a vaguely straight line this like this right because really the price is oscillating around that orange line so what you can do you can use this mathematical tool is called a regression that allows you to find kind of like an imaginary line that represents the average right represents the average behavior of this SPH that is kind of like straight right one of the things I could do to make it even straighter I could average right so imagine I take a the average of a price of be coming over a month over uh five months over a year and what you will see that these bubbles became smaller smaller also the bottoms become smaller and smaller and they tend to approach with orange line so the Orange Line represent the general Trend and in a straight line it looks like a straight line and the beauty of that is uh that I immediately recognize it as a power law and I will tell you in a moment that these power law are more than just like a little model right it’s not just like another guy they say oh okay here I have this formula or this method that algorithm that tells me what Bitcoin could be in the future or you know what how Bitcoin behaves it tells us something very profound about the nature of Bitcoin because this power lot tends to be in nature for a reason usually there is some kind of mechanism that produces this power law and many times these mechanism are like iterations like you know imagine there is a process where the input is also the output then the output comes the input so and you go like in a feedback loop like that and if you think about Bitcoin you can imagine a lot of these type of feedback loops right for example adoption right more Bitcoin are more beiners will be because more of us are going to tell other people we are going to Orange people more more people and so the input that is a many bitcoiners there are right now is also going to influence the output then you take the output that is the new input and you go in a cycle like that and it turns out that you can show mathematically that when you have a syst like that that behaves in this way like in a feedback loop you get this power lws it’s like a very relatively simple math exercise to show and what is a power law a power law is actually a very simple thing I know that some listener think oh you know this guy is talking about these weird things actually is one of the simplest relationship right right really the simplest relationship is a straight line if you have like you know two quantities that are proportional to each other let’s say y equal x it’s one of the simplest thing that you can imagine right in terms of a relationship between the two things well the next step is what if I take the power right so for example a parabola so you have y equal x squ right everybody studied the parabola it looks like it goes up like this right like a hockey stick uh we say sometime over price went parabolic right um when we have an asset that grows very fast well um that two of X squ is what is called the power so this why it’s called the power low every time you have a quantity that is I thought I I brought you here see I have this slide where if you have y equals some constant the constant is what links one quantity to another in this case for Bitcoin is price and time right and then really the most important number is this n n is the exponent and uh and that number can be anything it can be like in the case of a parabola is two right but it can be three it can be 3.5 it doesn’t have to be an integer it can be a negative number in the case of a negative number then what you will see is that it goes down instead of going up uh it can be a fraction you know it could be one half or 0.5 or whatever in the case of Bitcoin the that exponent is 5.83 that is very very close to Six and this number 10 to 17 I know that can confuse some people but is basically I have an app that I also can share with your audience uh that people can go like a graphing calculator and put it already this equation there and you can click and you can play I had many of my X followers playing with these and they have a lot of fun because basically this equation it’s the simplest POS equation can you imagine uh and how do you derive this equation this equation is nothing else when the slope right if you go back to this graph once you draw that line using a computer algorithm that finds the way you find that line is basically an algorithm it says hey let me find find the line that has the shortest distance from every single point in my data set and and the algorithm finds this line and then it gives you basically two numbers because a line needs two numbers to be identified it’s the slope of that line and the Y intercept so if we go back here the slope becomes and again it’s relatively simple math but I’m not going through it you’re good but the slope becomes respondent uh and it’s very important to understand this exponent because I will show you some other example in a moment that of other power laws in nature where it’s almost like the DNA so this one this number 5.83 is the DNA of Bitcoin so it’s so a vet importance this is one of the beautiful thing about doing this methodology because if you find a power law and then you you extract this information that is the uh exponent the power then there is some meaning behind that value and as a scientist you’re training to try to find that meaning what what is the meaning what is the consequence what does it mean where does it come from right there is a mechanism some kind of mechanism some kind of code that is producing that particular number and that it becomes kind of the fingerprint of the DNA of bco now this small number uh all what it says because you see look at how this formula works it’s very simple form foral you give me a day from when Bitcoin was born because all this is calculated from January 3 2009 so let’s say the they zero right when the coin was created well zero to anything is zero I multiply by 10 to many 17 that is a very very small number like 06 Z one yeah and the price is zero but kind of makes sense right it tells you when Bitcoin was created it was worth it zero right and then you tell me okay what about day one right day one this 5.3 we can round it up to six right so to make it simple so taking the power of six it simply means you multiply the number six times so if we have one day one I multiply one by one by one by one it’s one right it’s one so one multiply by 1017 so that means a day one it was not quite zero but it was 0.601 right it is uh 100 millions of a billion of a dollar it was nothing right and now you can put 10 days 100 things and so on right and uh we have a video in my YouTube channel where my son is like a video maker and I had we had a lot of fun because we thought what if we make this simpler for people to understand and so we came up with this analogy of uh one kilo is equal to $1 and then what what will be something in nature that represents the price of Bitcoin at different stages so we show that within uh like a few hours Bitcoin becomes the size mass of an atom if one if one kilo is a ma is a one1 doll then within few hours become bin at the weight of an atom within few days I don’t remember but something like that people can watch the video within few days becames the weight of a sell then within a month it becames the weight of mosquito it took about $800 800 days 880 days something like that for Bitcoin according to this formula to became $1 to be dollar Pary and so with this calculation you can actually say okay when when Bitcoin became $1 it took 800 days so about something like three years right two two years something like that uh and if you go and check actually in a chart when Bitcoin really became a$1 it’s something on the like 920 days so the formula is off by a month or something like that it is extraordinary if you think right because it’s still an approximation but if I can tell you the price of Bitcoin within few months not just the you know the current price but also the price at any given moment of history of the coin when it was $1 when it was $10 people should go and check themselves you know try substitute days there and calculate what the price of the coin is it’s amazing it’s a this why you know people are excited about this because when many other people T you’re saying I can just go and pick some random date right now on coin market cap and you can give me an estimate of what the price was yeah like you know for example if you put a um here can I give you a date can I just randomly pick one so the audience can see yeah yeah he give me one second keep you can keep talking give me a second I’m gonna pull up the chart so then I’ll have you do it and I have actually a h uh it’s a free graphing calculator and I put the equation and then I will give you the link and people can play with it all right give me give me the price on uh give me the price on well let me let me put the thing on the chart here so I can actually have it that way it doesn’t move I’m going to my uh I don’t know if you see these but U um maybe no but uh I can yeah give me the date oh go on October 8 uh October 17th of 2018 okay so to do that actually need another app to tell me the days right because we want to know how many days give me the date I have this app tells me the date the number of days so yeah give me the give me the date is uh Wednesday October 17th of 2018 so it’ be 1017 2018 October 17 okay and I’m curious myself let’s see if this works okay so it’s basically so there are 3,574 days between uh and you’re saying 18 or 17 which which one 2018 right 2018 correct yep okay and Wednesday 17 October right yeah okay so I go to My Hub I put this number of days and the price uh the T get it’s 4,779 what was the price 4,7 79 yeah these be so it was 6,862 but here’s the kicker right watch this if I go forward 40 days you’re right on the freaking money dude within 40 days you were right on that price hold on I lost your hearing for some reason hold on I lost your uh it’s on is it on my side or your side oh hold on hold on it’s probably on my side let me go back to the other screen where you’re at okay how about now now i y that was my fault my bad so yeah if I put out day is what I get right and the idea is that uh um wow is a trend is a trend price because the price will be below or above according and this also that is another thing that many people get confused because sometime they say well you know but the uncertainty is so big it could be any anywhere we’re wearing B cycle are we close to a peak are we close to a bottom uh can you tell me by looking the chart because I can look it myself but you tell me by looking the chart because that is also beautiful thing because yeah you need uh you also put it together with the understanding of Cycles because it turns out for example that uh if we are close to the bottom and this thing is almost magical in getting the bottoms uh because when we are close to the bottom we are usually to like 50% below the trend so uh you can give me any bottom you like you know like a historical bottom like for example yep here’s one right here it was 31 or you want the date yeah you can give me the date and then usually is is like about 50% of the trend you know this where the bottoms turn out to be uh and the top you know they can be much higher because there is four more and sometime they can be like you know five times the uh General Trend and so on but you know you can always make a chart and there show you in a moment some of these charts where you can look at deviations and you can say okay if we are above this deviation let’s say 50% from the trend we are very very close to a top and I will show you in a moment why this is true but it’s a beautiful thing because to be such a simple silly formula and give us this Precision in the price it’s almost magical you know when people play with this thing they get like wow how is this is even possible you know like you did uh and I wanted to show you this slide where these power laws come up everywhere in nature and also in Social phenomena because that is the other thing I get a lot of push back many times you say okay fine maybe planets right because Planets For example there was this scientist called Kepler he found this Kepler law where uh you can look at the relationship between how far a planet is from the Sun and how long it takes for the planet to go around the sun right the Earth takes one year Jupiter takes about 12 years and so on so you know for the planets are closer to the Sun than Earth it takes less than a year I don’t remember Venus I think it’s seven month eight month something like that uh Mercury I think it’s like a very short like three months or something like that um but uh you see they follow a beautiful beautiful power law so power law is anytime I take the log of one quantity versus the log of the other quantity I get this nice beautiful straight line I know it’s a power low and uh and then remember measuring the slope I can tell that magical number that is the power that is almost like a fingerprint or whatever phenomena I’m studing and this is our beautiful Bitcoin with is the power LW with 5.8 being is spr print but one of my favorite is this one uh this is called the clavers slw so what are you seeing here is the relationship between the mass of an animal so you give me an animal but these are mostly ma mamals but you can see here there even birds and other kind of uh um animals uh and um you give me the weight of an animal and then I’m going to look at the energy of the animal and the energy how much energy the animal needs you know much energy per second the animal needs to survive right the metabolic rate what is called and is measur in r in water and notice for example human beings if you ever wonder how much energy we need to survive is the same energy of a bul 100 Watts this all what we need 100 watts of energy per second you know 100 Watts uh to uh to survive it’s a really interesting to see here in the in this graph right women need a little bit less and this you know whatever that means right because men probably need more energy we are more active whatever you know uh science is not you know it doesn’t care about these things it it tells us the truth about these kind of things but U the beauty is that you can see again if I do a a log log plot of something like this it’s a very very precise straight line right now notice when you’re dealing with things like biology versus planets you start to see like when we’re talking about noise you see start to see a little bit more noise noise means here that instead of falling perfectly every dot falling on this line there is a little bit of Randomness right you could call it noise probably because every animal is slightly different from another animal Maybe emphasize you know being a nbor versus a carnivore maybe you know there are birds like notice how big the deviation from Birds is right they given their weight they use much more energy than what he will expect if he was a mamal right because they are flying they use my energy but it takes energy to fly uh and so it tell us a lot of things by studying you could spend months or years right in fact there are some scientists that make almost a career in studying stuff like this uh and again by looking at the slope in this case the slope is three quter and it tells us a very beautiful story basically the story is this if uh the energy of an animal will be twice if I if I make the animal two times bigger uh most many animals like the elephants will not exist why because if by the time I go from the mouse to the elephant right the mouse it’s about like a fraction of a kilogram right the elephant is almost 10,000 kilogram well we are talking about almost 100,000 times bigger animal than a mouse right so that will mean 100 time thousand times more energy an elephant will eat everything around itself if it needed all that energy already eating almost all the time like many herbivores right he will not have enough energy to survive so we will not have this beautiful animal elephant right this so cool animal with this big trunk and big ears Etc it will be a Pity right but they do exist because of that three quter so by the time you take you go let’s say you go 100 times time up then you take the three quarter of that 100,000 and instead of getting 100,000 you get 10,000 you get a discount in energy because the number is smaller than one of almost 10 so the elephant needs to 10 times less energy than if uh energy went proportional like linearly proportional to the weight so nature somehow found a way of organizing itself where it saves energy as you became bigger and bigger and bigger it’s a kind of economy of scale if you wish so this see how beautiful things we can learn from these uh Power lws we can learn a lot about the phenomena that is going on and you know some scientists go deeper and say why 3/ quter no why not two over three why not one over half why is three quter what does it mean and then it turns out it has to do with the vessels inside the body how the energy transmitted because basically it turns out that one of the way that you can think about a lot of these systems it’s uh this word that is a network so if you have a network that means you have a lot of components and these components talk interact with each other they communicate they have energy transfer you know M matter transfer like cells for example in a body right in an organism you the cell communicate with each other they transfer I make this protein you make this other we exchange you know it’s all automated but there is a lot of interactions between these components right we call it in science we call it a network and scientists develop an entire Theory like there are big books say okay this is a property that you will expect by Network and the Beautiful Thing that it doesn’t matter if you’re dealing with a organism if you’re dealing with a city because a city is also Network right there a different components different parts of the city different people that interact with each other maybe different departments Etc uh it can be a city it can be a language because also languages uh when you build a language you know uh verbs interact with uh nouns and all kind of stuff like that you tend to have these power losss they come up like naturally from this type of interactions in networks so if you have networks uh you have this tendency of creating power losss and that is one of the reason why or the main reason why we have this power loss in Bitcoin because it it is a network and in the beginning was just an hypothesis and then in the last few months I made a bunch of discoveries where I can show it that actually is a network and it shows Network properties but before we go there I want to first of all I want to see if you have any particular question because this is just a monologue otherwise you want to ask me a question do you have anything that you want no man I’m totally I’m just taking it in I’m enjoying it so it’s so interesting to me I have so many questions but but I want you to keep going so you’re on a yeah so and in cities for example so there is a see this how what happened with the physics he started to study things like planets and Stones falling down you know because of gravity or whatever and then we started to study organism this is something that happened relatively recently this this scientist is named Jeffrey West is a very um popular you know he does also education he wants to tell people about this beautiful signs of the power lws another word for power LW is scaling phenomena because we’re talking about this scale right going up by a factor of 10 100 thousand it’s also called scaling scaling lws uh and so he has a book a beautiful book that I suggest everybody that is interested in understanding B coin to buy this book and read it but even the audio book uh it’s called scale and I will show you the ttle in a moment but one of the things that he did that I he started to work in biology and I heard some of the videos where he says I got a lot of resistance from the biology people they didn’t want to listen to us you know they they didn’t want to ask to use a physics methods in biology you know because it’s like this newcomer that comes and and brings in this New Perspective right same thing happened to me when I started study the brain using physics and I got some resistance from Neuroscience but you know I did also a lot of progress because it allows you to see things that people didn’t see before you know same thing when I started to use a physics method to understand Bitcoin I discover things that nobody else saw before and people study Bitcoin on chain data for years you know before I discovered these things so it sounded weird to me that it was the first one but you know maybe because I looked at it from using physics eyes so one of the things that happen even more recently is actually using this method of physics to study human phenomena you can study economies you can study cities cities almost perfect because they really Network and I love this because you know how saor for example he says butcoin is this uh uh City in the digital world this digital City that and we are moving into it right this shining City in the digital world so I don’t remember the exact words but he say something like that well cities behave exactly like power loads like you can look at the GDP of city as a function of the size of a city and it’s a beautiful power law you can look at the number of gas station so you will think oh you know sometime people say human beings are not rule by mathematics no they are rule when they actually are working as groups they became like little particles in a sense I know it sounds weird but it is true and so the number of gas station in a city it’s a power low um so there is a little simple fun function that says number of gas gas station in a city equal uh you know size of a city to some number like the power and you can calculate how many gas station you’re going to expect uh in a city exactly like we did with bcoin or the number of terrorist attack can you imagine something weird like terrorist attack that you think is completely random no it has to do with how big a city is bigger the city more likely is that there is a terrorist attack and it follows this power law so a many many many phenomena where we see Power laws everywhere and and so you know there is this book that I was telling you scale and look at what it’s called it’s called the universal Universal means it doesn’t matter if it happen in a city doesn’t matter if it happen in an organism in Planet it’s similar right of course our Works will be different in details and as a scientist maybe you want to dive in and say okay our city is different from an organ very be some different but also how similar it is right so this when we use this word Universal and laws because laws in physics or in science it means a pattern right uh it’s it’s different from below gravity right it’s a very strong pattern but even gravity is a pattern right is we don’t know if it continue to work tomorrow you know maybe not you know it’s just that we saw that you do these experiments where you drop a a stone it falls it falls you know we never see it floating in the air unless there is an hurricane right in that case when everything flies you know even houses or whatever but in general gravity makes things fall so this why we call it a law but law can mean also a very regular pattern right hold on a law of gravity I thought it was the theory of relativity well you know um yeah because there’s no ma prove gravity well yeah right in in science we never prove anything but you know we do say a low gra right low gravity is of one object multiply the other object divide by distance square of the object like Newtonian Theory right a Newtonian theory of gravity but most of the time we use it because it’s an approximation but it’s pretty good approximation unless you know you’re close to a black hole or you’re traveling very fast close to the speed of light we still use this low Gra that Newton gave us right so we call it the law of gravity but I’m trying to say there are some laws that are stronger because they are to do with physics you know like like objects and material stuff and then there are you know kind of you can put quote unquote lws of a city right you can say love a city like New York is this where I’m expecting as New York grows to have this number of gas station number of libraries GDP right it’s still a low but uh it there is much more noise right so you see how when we went to organism we had more noise when you go to people you get even more noise uh but it’s still a very regular pattern right and so this why I really suggest people to get a copy of this book is very beautiful done plus this Jeffrey West has also like TED talks and other nice talks that he gave he’s very entertaining he’s an English scientist and very very eloquent and uh it’s almost like poetry in a point because the other thing I wanted to tell everybody that uh if really turns out Bitcoin is a power law it has a lot of beautiful almost philosophical consequence because power laws have to do with like we saw with the animals economy of scale they have to do with the part of list resistance they have to do with some kind of intelligent principle right it’s not like you know there is some little being inside an elephant to say hey let’s organize ourselves like that it’s just how nature works right all the different interactions all the different laws of nature that makes us make the organism try to be optimizing right to optimize whatever process is doing so the fact that Bitcoin behaves like a power LW will what means that somehow this beautiful intelligent system that is this think that we are in love with behaves In This Very Organized fashion in and it’s trying to save it’s trying to optimize itself so it’s a beautiful beautiful idea you know it tell a lot of the things that U we associate with Bitcoin you know from an intuitive point of view like you know is this is better than any other asset that is U he knows you know in a certain sense you know bco knows better you know because he knows how to grow and what to do Etc all these things is a city uh are actually proven if the theory is correct we have now the physical mathematical evidence of it you know because it’s actually we can tell uh and so I’m trying to actually write a scientific article that I want to publish you know in a journal because a lot of my discoveries they do it in social media even when I started this thing is instead of publishing in a paper the problem with the paper is when then the people don’t read it and my goal was to share this with other bitcoiners this why I did in social media but you know you can do both right because it’s also important to have other scientists evaluate this Theory and say okay you’re Joan you’re right stupid things some of the people that follow me on Twitter or I am connected with TW with them in Twitter are I don’t know if you know this guy uh his name is Fred Krueger he’s a Stanford ma mathematician he very very clever guy he studied math in Stanford and then he went to work for Wall Street and he made a ton of money doing that so it’s not just some theoretical mat it’s also one of these quants that actually was very successful right some of the musle sexual fund like there is this Medallion fund by Sim Simons uh he like he’s a billionaire right it’s like a there was a point where this fund was making like 60% a year and it was it’s all mathematician physicist that you know he has interviews where he says I don’t hire economic people just hires you have a PhD in astrophysics hard you have a pre in economics I don’t want to talk with you and because no it is what he says and it’s the most successful F in history ever you and Fred is one of these crazy guy one of these Quant guys they are called like this in uh uh Wall Street and he looked at my power LW like because I was trying to get attention from him you I was posting in his in in his account and say hey look at me you know look at my power LW and he didn’t notice for some time and finally did and he said something like oh it’s a there is no doubt that Bitcoin is a an Unstoppable uh Power lad train this what he would say and another expression what he says is look for this thing to be due to Chance is the same thing you know of course he didn’t calculate but it’s a hyperbole he says like imagine to go on top of the Empire State Building and you are dropping a coin and you’re trying to get it inside uh Dixie cap is how it calls it like this Little Dixie cap the bottom of empire ST building and you drop it exactly that that is How likely is that this thing is due by chance because any guy any person that has a little bit of mat understanding he sees that beautiful straight line here and he says fat is not due by chance and so since I discovered this SN in 2018 first of all remember it’s 2018 so that means I am doing this thing for five years so I can show you my prediction five years ago versus today and you can see that Bitcoin did exactly what I said he did you know so this is called in in this field is called how of sample right because one thing is uh using already done data and other thing is say okay let’s see how it works in the future right and um and I have out of sample of five years it’s Unthinkable I don’t think there is anybody in history that ever predicted anything in the financial world five years ahead you know and tells you okay it’s oscillating but the general trajectory the general trend is what I predicted five years ago and not just that another person in the circle of Fred is this guy his name is sin is a finance professor and he actually DM me one time he say hey I understand where you come from because I work with physicist and actually I learn a lot of things from them and he did an analysis where he took Alpha the data and then he projected in the future and then he took the enti data and we saw how the stet line looks like and compare the two right it’s one of the tests that you can do how stable is this prediction and this word it was interviewed by Fred there is a video so I’m not making this up but this word this Finance Professor that does this as a job you know to analyze it analyze data from companies from stocks all kind of things he say in all my careers as a data analyst of financial data I never saw anything like this it literally says that and again it’s not me it’s Bitcoin you know what this what I’m trying to say how beautiful how amazing Bitcoin is and the new think I discover this why is a theory now it’s not anymore a model uh is H and the differ between a model and a theory is a model is like when you see a little pattern and you say maybe there is some regularity here maybe this regularity will continue to go but you don’t know what causes the regularity you don’t know uh what is behind the regularity and so for a long time I was beating my head you remember where I told you that 5.8 is almost like the fingerprint of the C right and I knew that other to be important because these how these power losss work if you understand what that number mean what the number is caused by or what you know what is what are the causes remember like in the cers row right the three quarter is due to all the interactions inside the body all the cells and so on this what scientists found out eventually if I understand where the six come from then maybe I can understand what drives Bitcoin what why Bitcoins behave like the way it does and I spend a lot of time I was uh walking I was taking showers I was uh doing all kind of things and at certain point they decide you know you had a break through when you drew uh the price as a function of time you know like a log a log of time why don’t you take everything you know about a blockchain and you do power laws of everything but you know the power law of a PR versus addresses the power law of addresses in time the power law of Ash rate in time the power law of price and Ash rate you know all these graphs of log of one quantity versus the log of the other and look at this this what I found this this graph is a chart shows all of them are power LS it’s crazy again I didn’t never see anything like that where a system shows power LW in all his important elements because you know the number of addresses is basically adoption you know it’s standard proportional we can use it as a proxy of adoption you can use the ash rate as a pro you know as a proxy for the energy that the system is using you know because of mining uh and then all these things happen in time so we can look at how addresses change over time we can look at how Ash rate changes over time and there are all power lws of time and power lws of them themselves so there is a very precise relationship between for example the number of addresses and the price you tell me the number of addresses I can tell you the price and it goes with the square and by the way this is a very famous relationship was this engineer his name is metcal and in the 80 is is the inventor of a uh ethernet cable and other invention he’s very famous guy got got all kind of prices and so on but uh he created this thing that is called medal flow so he was interested in giving a number that represented the value of a network and and in that case the value means how useful it is so imagine you have a a bunch of telephones and they are connecting with each other right and you want to see well what happen if I double the number of phones will the utility of these networks go up with two or something else what he found out it goes up with the square so for example if you num double the number of telephones in in a network right the value the utility of the uh of a network goes up with four if you triple it goes up with nine and so on and so on you quadruple it goes up with 16 with the square of it number that and it’s called the nodes the number of nodes in the network how many elements the network has so and because it turns out that has to do with the number of connections so if you have a uh you know 100 phone the number of connection will be the square that is 10,000 and so the value now it’s 10,000 not 100 so it depends on the number of connections the value well that is what happens with Bitcoin because if you look at at this graph where I have price it’s a little small but I can tell you this graph here that says price as power of addresses the price is on the xaxis is a log the log of price the log of addresses we use addresses here as a approxim because we don’t know exactly how many users there are but it’s going to be proportional to the number of addresses because you know it’s a rough proportion but you can see it’s a beautiful power LW and this not exactly to I’m rounding it up you know like is not exactly six for the power low in time is 5.8 but I’m running all this number to the closest number to make it simple so it’s close to two It’s A number close to two it is exactly what maal predicted in his theoretical calcul so this is actually a validation of this theoretical result that this guy did in the 80 now we have an example that actually it works you know from the mathematics from the data and so it’s beautiful and then you say okay what about the adoption how does it grow in time and many times people uh use this U what is called the S curve so they claim without any evidence because they don’t show the data I never saw anybody showing the data that the number of users so in this case b coiners grow grows up like a a s curve well it’s a good hypotheses because a lot of technologies have that kind of shape right you maybe saw this shape you can find it online if you say you it’s called the adoption curve right it basically shows that initially the adoption is very slow because very few people adopted right make kind of sense and then all of a sudden a lot of people join in and it goes very fast it goes exponential and then whenever every body starts to adopt it it kind of flatten out right because you get that kind of almost like a saturation point so it’s called the S curve because it looks like S curve well Bitcoin doesn’t follow an S curve it follows a power law where the adoption goes with the power of a cube so you double the number of time right so for example in the next 15 years we we double the time that beon existed we are going to have eight times more big Corners because it’s two to the cube is eight and so we are going we can calculate how many people we are going to have how many big Corners we are going to have in 15 years from now it’s going to be eight times more if this thing continues to behave in this way now I wonder about this thing can say why why a power law I was expecting a n curve and in fact for a long time I was fooling around with models like that where I was using some kind of a nurve and when I decided to do this thing of okay let me just what see see what the data says instead of making up stuff right and when I found this beautiful power L look how straight it is it’s amazing right how beautiful straight line you have and uh it turns out that a lot of viruslike phenomena uh and they wear a example like AIDS for example I know it it’s a bad analogy but instead of being a bad virus this is a good virus right it’s a virus of a mind right we are infecting other people with this idea the coin it turns out with a lot of virus like viruslike uh spread uh in in particular in networks he becames a power low instead of being an N curve or an exponential growth and in particular that happens uh in two conditions one if you have like a super spreader like you right that are impacting a lot of people you know you’re orange peeling a lot of people versus like the average guy with maybe Orange feel his own friend or whatever so if you have a situation like that where we have like super nodes or if you have like a something that uh kind of slows down a little bit the growth like for example in the case of AIDS people know that aids you can get AIDS by having sex or maybe you know they’re a little bit more cautious they take precautions like you know U you know different type of uh protections you know during sex so that slows down the spread and so it becames a power l and guess what AIDS in fact spread with the power of cube in time exactly like Bitcoin and so it’s and I found like dozens and dozens of paper explaining this thing you know like how you get a power law when you have this kind of virus where if there is some decision making involved and in this case you know it takes time and in fact it’s a good thing that people think about Bitcoin they want to learn about Bitcoin uh they don’t jump in right it’s not like a mime coin you need to be aware of what you’re doing and that slow down the process it’s still very fast because the cube of time is still a big Power right it goes very fast but it’s slower than an exponential growth and so look at this basically we have a formula when you combine these two things um and then you know I found out before I tell you the formula I found out also the ash rate is connected with a power law in this Cas is it turns out that price equal as rate to the one half and then you know also we can see that the ash rate is a power of 12 so Ash rate 12 is crazy it’s like it’s grow Ash rate is growing very very very very fast right so all of them are power lws and so I put it here I think this comes from the uh Bitcoin standard right it’s this diagram where basically have like a a loop so you know everything here is connected to one of these power law like for example uh you can think okay this when Satoshi started the network he didn’t have a lot of people in the network but they had some friends with likea and so uh you know uh the demand of a store of value or whatever it was you know this network started to grow up uh that makes the price in the beginning it was not a price it was mostly like a curiosity or maybe you know I want to try this thing you know but eventually it became the price so the price increases as there is adoption and then and you see how there is a power law for each step of this circle and then I the invented I just show that actually there is a real mat behind this beautiful feedback loop and then the price goes up more miners want to come in and so this how the ash rate goes up right and go is related to price see there is a very precise relationship between price and as rate so bigger the price most more R rates and then uh there is in m in the uh in the mining operations and this why there is this continuous growth of the ash rate there is more and more investment and that improves the security of the network because it’s more difficult to do a 51% attack there is more decentralization and so on and so this kind of close the loop here and so it’s a beautiful beautiful thing where this why is a theory because every single aspect of Bitcoin growth and behavior is explained by this Theory and in fact there is even why call it a corollary uh like an explanation of why bubbles happen that if we have time I can tell you but uh it’s kind of a side note because the real behavior is this General Trend and then there are the bubbles that are on top of the general Trend can I ask a question there what is the what is the can you go back to the previous chart the one that you just had up there um on the Bitcoin price uh Power law in time what is the farthest deviation like if your your Center Line Is Here percentage wise how far does the price fluctuate above that and what like what is your so if your chart saying like Okay by January 1st 2026 Bitcoin is going to be 150,000 what is the wiggle room there as far as percentage wise how far has it been off in the past and and you can see how the bubbles are became smaller right so this deviation became smaller as the time but pass by and and by the way the first bubble here is kind of like an anomaly because it doesn’t get us it’s not associated with any alving it happened before the alving it doesn’t have a regularity in time like the other bubbles um so I usually exclude it eventually I want to go back just for completeness and trying to understand where that bubble come from but I usually eliminate it because I’m trying to understand probably the Silk Road yeah exactly Silk Road or maybe mon go you know some some crazy stuff right that didn’t was not associated with the alving while the other bubbles are really very precisely Associated and I will surprise your audience saying that differently from you know Plan B with this s2f model they have nothing to do with Supply or lack of Supply or you know reduction in flow nothing in fact I have I can demonstrate that that is the case it’s formal it’s mostly formal people knowing about this event that is alving uh it’s very important for miners because it’s basically like an upgrade for the miners a way of keeping up with Mor slow and I have like an entire explanation in my article I wrote this very long article and I have an entire section about why bubble exist and fact my son that is a video maker he also made a video about this and and the listeners can go and watch this video we have a series we call it the physics of Bitcoin we have this 10 minutes very ey production video where you can watch them in a sequence and they introduce you with power law they tell you about this diagram then we have one about um the bubbles and then we have one about this think that I will tell you in a moment that is called scaling variance that is really the most powerful uh prediction about bcoin being a power law why we can use this idea of scaling variance to actually make prediction in the future but to answer your question so you can do it in different way one way is calculate the typical deviations that you get uh uh around this General Trend so it’s called the standard deviation so it’s an average deviation so it turns out with the bubbles are about two standard deviations they are you notice that is not symmetric right the bubbles are much bigger than the bottons and the bottons are about one standard deviation from the trend so it’s it’s relatively small deviation if you look them in these log log charts and the beauty of it also is that there are no random in the sense that uh you know that is a sometime I hear this criticism of this model and say well you know if there is so much deviation it can be anywhere no it cannot be because you follow a very precise pattern there is a very precise way of knowing where where we are in the cycle like we spend about two years in the bottom along the power LW we will show you in a moment you see how it seems like to follow this very very precise pattern at the bottom of that kind of parallel to the trend and it’s a bottom that we almost never go down is one of the strongest of this model and then we have a top that happen at very precise time it takes about one year to go up and it takes one year to go down so if you actually use your knowledge of the cycles and the trend then you can tell almost like with an uncanny Precision where we are relatively to the trend and so you can actually use it if you want to do DCA or maybe you want to take some gains and then Reby at the bottom you know depends on your style because see that is other the things that we trying to say that it’s not just science it’s also technology because you know science is beautiful and you can learn a lot of things but it’s even more beautiful when you can actually apply a sign so you can make airplane flight you know and do all kind of interesting things with the sign so it’s also technology this we have indicators I develop these trading view indicators based on the power and people are playing with it all the time and they almost have like 100% success rate and I know it sounds crazy but again it’s how beautiful precise Bitcoin is you know and uh and so um remember I was the you never told me what is the percentage what is the farthest that it’ll go off right so it’s two standard deviations you know for the tops and one standard deviation for the but what does that mean as far as like percentage wise what does that PR 100,000 how high could it go because you know so for example the first bubbles because there was so much variability to standard deviation was huge so that was basically almost like 10 a factor of 10 you know uh from from the bottom you know uh and uh but from the trend it was more like three like maybe a factor of three from the bottom right from 300% 300% from the trend right and uh and now because we are becaming smaller I also have a model for that of uh how um how big this uh um decay of the tops is I have actually a mathematical model for that I can tell you what will be the next stop so the next stop for example is going to be 250,000 is what we calculated but I will I will show you in a moment so here is one of the punch line one of the strongest punch line so do you remember I was just telling you how important that six is right that is like a fingerprint now we know where that six come from that was you know something that I was trying to I was breaking my head against for a long time time and then one night I was thinking thinking thinking I did this graph and I started to see the pattern and I was like shocked you know I was like oh wow I disco I cracked Bitcoin basically so it turns out remember when I told you that bitcoiners right the adoption goes with with the cube of time that is like similar to some of the virus like a aids for example so when you have a in in this case uh is like a I did something that I should not have done okay so basically it’s like a virus that is spreading like this ideas about Bitcoin that is spreading like a virus and then there is this metal FLW that says that uh um the price is proportional to the square of a bit coiners so when you combine this two thing you have the price equal be coin square but because this grows with the time Cube you take the square of a cube you get six and this is why the price goes with six and you see it has all to do with network properties so we go we go beyond being a model because now we have causative links right this when you really start to do real signs if I’m telling you this is not due to some kind of random process but there are very precise mechanism that describe how bcoin behaves we are in a completely different real you know we are telling you okay Bitcoin is more like a natural process than an asset and it’s predictable uh and one of the reason and by the way it’s so cool uh one question that you could have is well uh which kind of addresses you use I use every address that is not a noise in the sense that I took all the nonzero balance addresses so basically everybody but then you can ask a question what if I take addresses with 0.5 Bitcoin what if I take addresses with one Bitcoin so basically bigger and bigger like what you will call dolphins and whales and so on what go is going on with them well it’s a amazing kind of thing what happens is that bigger is the amount in that address bigger the impact where instead of being Square maybe it’s five then uh if you go to Dolphin instead of being square is Cube so it starts to go from very huge number all the way to relatively small number all the way to two that is kind of a limiting low number so everybody and then you look at how fast is the growth of these addresses and bigger they are slower they are growing that kind of makes sense right but look what happened when you multiply these two numbers remember how we got with six you take big impact slow growth we equal six middle Impact Middle growth six uh small impact very fast growth six so everybody no matter there are how big they are small fishes big fishes they all Impact Bitcoin in the same way it’s not amazing and again you can see that is not something that you will ever get by chance right something crazy going on with the coin where he becames in the he behaves In This Very uh organized fashion where everybody’s contribution is the same in the end in terms of how the price grows and the network knows somehow knows you know it knows because the interactions how people uh buy Bitcoin or sell Bitcoin is not like a normal asset it’s not like what happens in the market it’s all you know basically random and you cannot have an equation to describe right but with the co you can it’s so crazy I know it’s sounds crazy but if you look at the equations and the numbers it’s exactly like that and so you know and this is why I’m saying all these analogies that we have at Bitcoin is like a city and then I did this analogy of uroboros you know it’s like an ancient symbol of a dragon that hits his own tail because you know it’s basically this Loop that goes on and on and on these these beautiful iterations that we see because when you have something like that it’s very robust it’s very difficult to shake it right it’s very difficult to uh make it crash like for example uh you see this graph here this graph is where I emphasize that bottom line right the bottom line instead of drawing the line through the middle I’m eliminating the bubbles because I’m considering them like a a deviation so like a um noise in a sense right and say well maybe the signal is really the bottom right and look how amazingly the bottom lines up you will never have expected unless you have this a chart right these charts really highlights that something is going on there and what is going on there it turns out that that is basically the minor capitulation line so if you go below that the miners start to lose money so they their operation is not anymore um you know doesn’t make money for them and so the system protects itself from that somehow it knows and it doesn’t allow the price to go much more below from that it’s almost like and this is also can be used to identify very precisely the bottom I did call the bottoms many times like in the past I say in 2018 I say when we were here I say guys we are reaching the bottom when we were there at 16,000 I say we are reaching the bottom and look also here at again these are days from Genesis block look at at 4,250 you see that little deep there no it’s not little is actually pretty big uh you know what that is you have any clue of what oh that was the liquidity crisis in 2020 associated with what associated with the covid-19 pandemic correct correct that is the co that is covid yep and remember what happened to certain assets like oil they went all the way to minus numbers right B they were paying you to bring oil at home you know like get a barel of go of oil and we give you money if you do that right and with the co with with Bitcoin instead what happen it ride to that red line it flashes below that and it bounce back this is how wonderful this discovery of the power law is because actually tell us that it’s self-protecting there are all these mechanism because that is the other thing that happens with power law is associated with homeostasis like organism have homeostasis that are basically the organis tries to stay in the middle right because this is where it is good if you run too fast your heart goes up because it has to do a task but then he wants to go back to his normal rate right if I if you don’t go to that normal rate something is wrong with you that is all rulle by power losss all this mechanism of Regulation homeostasis and so on bitcoin has some kind of homeostasis going on with it and it’s probably d by the difficulty adjustment right because it’s almost like a some kind of Regulation mechanism like almost like a a thermostat right with difficulty adjustment works like thermostat all these things that make be coin a mix between human intelligence machine intelligence human energy physical energy all this interaction create this beautiful very regular uh system and and also the Cycles like I was telling you this blue dot we spend about two years in these blue dots and that is the other you know these memes that has three green bars and then one red bar right it’s actually true because if you think if everybody’s every bar is a year we spend one year along the red line and we are going up because of the power LW we going going up with this power of six with that little formula the to and then we spend another year there again with this power LW six and then we leave a power l so it’s a deviation and we go even higher right so we go up up more up and then we go home right we go back and you see how it’s crazy how it goes back to that straight line yeah I mean you think that something like this can be du by chance or it’s something random you know how can it be it cannot right it’s something very regular and so something wonderful about the coin so what would break like let’s say you pick a date in 2026 or when when are you saying the top is the 250,000 ballpark range go with the Pyle right and I have also other tools like uh like these I show you what they did I did I’m curious what what would what would what would cause you to admit that your your thesis is wrong what price you have hit would buy what date would you have to say for that to be not another anomaly this why I want other scientists to look at this thing and some of them already did and they all agree that is true right now the question is at this point at least is history so we need to at a minimum people need to recognize that bcoin did this for 15 years because I don’t think it’s D by chance I don’t think it’s Mirage and I think I did some mistake mathematically is true Bitcoin has behaved in this crazy way for 15 years could it be that uh is going to do something else in the future and this is where this idea of scaling variant come from and what scaling variant means scaling variant is another it’s like you know I don’t know it’s like U saying that uh dollars come with two phases you know coins come to with two faces it’s almost like you cannot have a coin unless you have two faces right okay you unless it’s Bitcoin and then you don’t have any phes at all but uh it’s this why is big coin and not a normal coin but I’m trying to say there is a very strong property like almost is almost like another way of describing power law that is the scaling variant what does it mean it means that you can also use this expression everything proportional you know when you have a triangle and you make it bigger right something that we learn in school Everything grows in proportion right every side of a triangle as I make the triangle bigger is proportional right the the bottom sign this uh the vertical side the hypotenuse everything will go proportional now you can use the same idea and look look how when you have a power by the way this you see this red line so this is where blue line is where our prediction in 2018 was and the red line is basically up to it’s not even like most recent data because it continues to go even more like along the power L but here it’s an update to January 16 and the red line is this do you see how it really went through this oscillation along this line that we predicted it this how it is we predicted five years ahead that it will continue to do this progression so you could have used this idea of scaling variance where you can say hey let me draw a triangle up to wherever we are imagine that we are in 2018 basically the blue dots right and then let’s say I wanted to make a projection and I stand the triangle I make it bigger so I make it all proportional up to some future date right that is whatever before well all what you have to do is to extend the triangle keep everything proportional so you’re keeping the changeing scale because it’s all this why it’s called scale invariant invariant means not changing non variant and scale means these changes in 10 100 and so on so if you change the scale in proportion with hundreds and thousands and you do the same thing in time so then instead of having 100 days now you have a thousand days instead of having thousand days you have 10,000 days so if you do the proportion in the same in the scale of price in the SC scale of time you get this behavior that is called scaling variant and the reason why it will not change with our the one of the strongest uh prediction because when you do a theory theories are always have always predictions because otherwise we are not Theory they need to predict something but prediction is that Bitcoin will continue to be a scaling variant system because this what scaling variant system do this why they’re called scaling VAR look at this what happened it continue to do the same thing when it was few cents when it was $1 when it was $10 when he was $10,000,000 so this scaling variant behavior is what characterize the system it’s almost like you know it’s part of his identity and so if we want to go another order of magnitude so how big was these changes of order of magnitude remember I told you we made this video so people can watch this video but another example I have it here so I did it with the animals right so if you look at the different sizes different scale of a of Bitcoin is like you know if you go all the way to 2010 uh and if you went up all the way to the first uh USD transactions U you know there was like one of the first transaction with USD uh was uh $1 for 10,000 Bitcoin can you imagine how incredible of a deal was if you go all the way to that you will actually have to think about the order of cells so things like that but if you stick with that when the changes started to open you go all the way from a mouse to something that is actually bigger than elepant my son in the video says some kind of a dinosaur I don’t remember which name of a huge bigger dinosaur that is even bigger than elephant so all this growth all this growth through all these scales all these type of animals he did it in this very regular fashion of being scaling variant he didn’t care it just the time became longer and longer because as you increase the price you need to increase the scale of time is simply you will continue to do that if you doesn’t then something crazy is happening with Bitcoin and we will have to look at and see what happens what is that thing and some people say what about ETFs are these one of the things that can change with nature of the coin no I actually went and calculated uh how big of a income inflow we need to continue on this path right because you can stand understand that is a prediction and I have some of the predictions here by the way in my app in that app all you can actually show how it looks like so if it is linear in a linear chart Bitcoin kind of looks like this with these bubbles uh and this General growth right but uh uh you can extend Bitcoin growth in the future like in this graph for example and here I’m comparing it with silver I’m comparing with Amazon with Microsoft so let’s say you want to go all the way to gold right to the market cap of gold uh basically $1 15 trillion doar Bitcoin will be about a million dollars and it’s going to take about 10 years to do that so it will happen more or less in 2032 something like 33 uh so this one Bitcoin will be like a million dollar uh and because you can use this equation to extrapolate it and and go to that date uh and the idea is you see this by by way here I’m comparing the growth of different assets you see how very different they are first of all look at magnificent B these are gains right gains that you made by investing coin versus anything else you know and look how amazing Bitcoin is wow like really a Godzilla in comparison with anything else right and they don’t behave they don’t look like power L they don’t look like straight line this beautiful regular amazing straight line that you see it’s not what the other stuff was and you know what most of this growth that you see from the other assets it’s inflation inflation is so big with these guys that it’s actually dominant that did some graph where I plotted inflation and like for example this SP 500 barely barely goes above inflation over you know this period of time so it doesn’t it does barely be to inflation but not even much you know can I throw question at you have you ever done this with political corruption and like the price of something versus how corrupt the government is because this is like that’s all I keep scratching my head I go can you predict how when our government’s going to like go full on Nazi Germany off this what’s the power law on a corrupt government right yeah yeah it would be cool to check something like that but you see look at look at this how beautiful is if you actually average the price because in this in this model see the straight line the green line is a power law a simple power law you know just the simple formula but then because I wanted to include the bubble I started to actually add a little bit because this how we do in science we started with a very simple model then we say okay let’s add you know some additional thing right uh I I don’t understand I want to understand how air is affecting the fall of an O I want to understand what happen if there is wind you know so I wanted to add the bubbles and so I have a model where I add the periodicity of the bubbles because they are very precise oscillations that are happening every four years I added this floor of the bottom so this are very precise deviation from the trend and then um I actually also added this decay of the Peaks because the peak seems to go down in a very precise fashion so I have even a formula for that and look at what I get it’s it’s Bitcoin right a very simplified drawing of Bitcoin but as a model goes it’s almost astonishing right and remember I don’t model the first bubble because uh it was like a kind of an anomaly but all the other bubbles are there and I can then extend the model in the future and say okay if everything stays the same if this bubbles continue to behave like they behave if the bottom do the same thing then we can extend in the future and I’m pretty confident that if Bitcoin continues to be a scaling Varian system that you know he did it for nine order of magnitude he did it for 15 years can you continue to do another over the mag because I know it sounds like 10 years is a big time but in terms if you’re thinking in terms of change of order of magnitude it’s just another change is that so I did nine can I do another one and continue to do it in the same way right my answer is yes this what the theory predicts and if H doesn’t happen then there is something wrong with the theory or maybe there is something wrong with Bitcoin maybe there is something different because I was telling you about ATF ATF is exactly what we need to continue this path so to go to a million dollar Bitcoin needs that kind of inflow like the one brought from the TF in fact you can almost put it on his head you can put the theor on is that and you can say every time Bitcoin needed something to go to the next step it kind of attracted it so when we were over there you know where Satoshi was kind of with his own little cryptography friends they come in and started to bring human capital they started to check the code findan bugs you know red on their machines that when they created a you know the coin talk and more people came in we started to do the first USD transactions you know we started to use started to appear B bcoin we started to have a m go and Silk Road Etc every time bcoin went to the next step something happened that like this feedback loop right anomaly yeah attract attracted these uh resources uh that feeds the loop you know in that beautiful Loop that I show the perfect timing perfect opport exactly and so ETFs are the exact thing that bcoin needs go to the next step it’s not an anomaly it’s a exactly what is needed and one day when be five million 10 million there be some big event like you were saying you know maybe the governments give up and say okay let’s get the Bitcoin standard you know and we win we win the battle you know and that at that point you will not have a power LW because everything is in Bitcoin you know and so but this is basically the part the Bitcoin choose because this I want to think about this Bitcoin is such an credible intelligence system basically it’s us right all of us that are putting human value the beautiful algorithm that satosi created the difficulty adjustment all these things interact together where and our desire to be free and be so Sovereign uh and you know independent and all these things all these things interact together and show the true beautiful knowledge of freedom and this Freedom it’s an equation it’s an equation that it’s a power law that is planets and organism and all the beautiful thing in nature use to find the optimal path to something so this is the optimal path of Bitcoin and it’s not going to be broken because this what Bitcoin is and if it is broken of course the theory needs to be falsifiable that means it can be proven wrong so you know if it is and wrong then we will have to reconsider you invite me to your show tell me joanni what what what do we learn something we learn something because it’s still an attempt to understand SCI I an idiot Etc still try to understand there is something there for sure and this allows us to try to understand this kind of things so it’s still a tool that will tell us something went wrong like you can see right now yeah for example this blue line is deating a lot from the red line why well probably because of f mod know sorry um you know there was a lot of excitement about ATF people don’t understand scaling variant so we got all excited and right now the price is going down you know kind of I don’t think go down all the way to Red that you know maybe something in between and then it will continue to go up and do this usual thing with the those but you know there was a little bit of form same thing when you know we had a CO that you know we were then there was this drop of a price it right to bottom and he bounce back but in general this is the general behavior of Bitcoin and the theory what the theory does because a good theory needs to make a very strong prediction otherwise it’s not a good theory the theory says no he will continue to do this and he will continue to bring on resources as needed to go all the way to where he needs to go is it a million is it 10 million I don’t know you know a set point of course it needs to break because you know it cannot be more wealth everything every single think in the planet right but there be a point where it deviates because you know we we get uh the coin standard you know the governments have a point not small government but government decide to adopt Bitcoin but this is what is supposed to happen in the future you know this let ask let me ask you this so taking a look at something like a like from a technology like I I assume you could apply this to a lot the the question I have is uh Bitcoin becomes like you you kind of said like an i IQ test like the smart people it’s attracting the it’s attracting people uh you have this you have the ability to track the wallet adoption and my C my curiosity goes at what point do we get to a point where like wallet adoption is similar to the internet like I mean we had this probably this same similar adoption curve on the internet but then you hit like an inflection point where like you said like the entire world starts to adopt it is there any way that this kind of predicts some type of model like like at some point you kind of get to a point where there’s going to be so many wallets that it makes up a percentage of the world and if a percentage of the world is using it then you got to you almost go into like a hyperbolic adoption mode is that it could happen and it’s a good U it’s a good hypothesis but my um my understanding right now by looking of the data is that if that was going to happen it will have already happened because I know sound we are very very early but this why uh you have this power law versus because you can recognize you know if you look at the mathematics of these uh curves that uh we mentioned before the S curve S curve works like that it’s very uh slow in the beginning and then it starts to go very fast but it doesn’t look like a power LW it doesn’t look like a power l so if you plot it you will get something that uh uh you can recognize it immediately in fact that is what I was trying to do in the beginning one of my first uh post on Reddit because you know instead of publishing on a paper Journal Journal paper I will publish on redit because I wanted to reach other bitcoiners I have a model where I use the S curve I take the addresses they say okay let’s try to fit it and it was like trying almost to take you know a square peg and fitting it in a round hole I couldn’t do it you know the I kind of was doing it but I was getting really bad fitting I my model didn’t seem to work very well it was like an attempt right because this is what you do as a scientist you play with stuff until you get it right and then I got this huge back through when I saw that beautiful adoption curve that is a power LW and then I struggle myself and not look at I want also to show you something else I went back and I created a a a little toy big coin and how did I do it I did it with I have like a basically I make a simulation of uh like almost like heat that is diffusing through a metal through like kind of almost like a chicken wire and the chicken wire represent the network of people so every intersection of a chicken wire is a Bitcoin right and then the heat represents the spread of this information about Bitcoin people getting orange build so you can do that like you can WR equation to describe this little toy model and then the beautiful thing about the computer you can run it right you can do it million time simulations you can go as sleep and wake up in the morning and this thing has done millions of time to try to see what happens in average right what happens in average is what you see on the left so my little model of the chicken bar with the heat that is diffusing representing you know the orange feeling of people is this okay look how the real data on the right looks like do it look similar and remember the spon that I told you the exponent it’s a like almost a fingerprint for the simulation was 2.85 for the real case that is addresses is 3.18 then you go down and you apply this medal flow basically I look at many connections we were many of these little wire were affected by the spread of this it and I get this second panel okay these are is the relationship between price and the number of biter if you think about these little nodes in the net representing the biter look on the right the real data do they look similar very similar I remember I don’t simulate the first bubble I ignore the first bubble all the bubbles are there right you see how crazy it is and this is just a fake Bitcoin I made it’s a bit cor that is in my computer you know and so look at look at this and then finally the price I reproduce the price from this combining these two things and you see how the price of course is much smoother and linear because it’s just a simulation and real life is more complicated but look how all the bubbles are there and the and it here it’s I got 5.71 when the computer runs it gives me all kind of crazy you know 5.8 5.9 I by almost like a a joke I put seven I got one that gave me exactly 5.71 they were like thousand and thousand of them but all around this number right but here I pick one just to make a point that I can get the exact Bitcoin Behavior right and wow you see how credibly so it means that there we are really crack the code you know that it it’s not stion there is like a process that works in a very precise manner that can reproduce the behavior Bitcoin so this is unique and incredible that uh you know it needs really to be understood so I don’t think it will go to that place it could be because maybe I’m missing something something I don’t understand and whatever but right now it looks like Bitcoin really settled on this thing he really likes remember he kind of tried to find like an optimal path and he says you know what I not I like to be adopted but I want also be coiner to be aware so the process is going to take its time you know people because even when we go to Crazy number I think people will still need to think about what they’re doing when they join now you know during the bubble it goes crazy some people jump in because of you know their uh friend does it or whatever but many of these people leave you know when the price crashes when they don’t come back to bitcoin the older the longtime olders are people that are you know they are really convinced there is some kind of conviction conviction there and that requires awareness and with awareness makes the process fast but a little bit curbed and Bitcoin for some reason the system for some reason says you know what that is really what I want because I have this very difficult task of becoming monetary system of re world I want to do it in my own way you know don’t joavan uh you know whatever other person don’t tell me what to do I’m going to do my way you know uh I’m be Co I know what I’m doing you know this how I’m seeing you know this how I understand it and so this why I’m I don’t exclude anything because as a scientist we need to be open to any possibility AB within reason you know but this why we want to collect more data we want to observe we want to continue to study I want to create in a certain point like an Institute you know to study beIN like a science you know and bring more talent and more people studying this thing uh like if it was like a real scientific topic uh well I think it’s the greatest technology in all of human history it’s one of the coolest and most technological advancements in all of mankind and having having the money and resources in a team behind it to study I think would be one of the most impactful things that you could do throughout human history probably be the most scientific study because it’s pure it’s truth it’s the first real thing the real raw honest no fudging the numbers it’s just math it’s just simple [ __ ] math exactly this why when I have debate with other people they say oh you know like for example there is this big debate that is a little bit controversial part of my talk right many people think that we’re running out of Bitcoin right there is this thing oh we’re running out of Bitcoin because they think that you know there is all this pressure I have many many slides but let’s see if I have a slide it has to do with what I’m trying to say right there is this big debate about is Supply an important thing right first of all let me uh say that of course the fact that Bitcoin is not dilutable and it has a fixed Supply it’s one of the most fantastic characteristic of bco it resolve the problem of printing more bcoin I’m making dilutable people fighting how much Bitcoin we need Satoshi decide we have this number this is what it is no debate right it cannot be changed and so I will never debate that validity and importance of that characteristic of be C but you know many times people started to say well you know um we are running out Bitcoin because uh uh more and more people are holding on bitcoin and then you know all the these ETFs are coming and so I I don’t like with narrative uh from a philosophy point of view because it reminds me all almost like Black Friday you know people fighting or toilet paper running out you know during covid and I don’t want bcoin uh I don’t want imagine Bitcoin like that you know people fighting over a finite resource to me Bitcoin is both finite in the sense it has a finite cap and infinite because it can be basically feeding the world right all what you have to do being an Italian like the pizza analogy right people say oh but it’s like you’re saying you can cut a pizza and uh you can uh feed award if you make more slices yes and you know how you can do that by making every slice more nashing right if you every small little size has more and more value one slice is million dollar now of course you can nourish everybody right this is how you can do this beautiful magical trick of being something that is finite but also he can do this task of feeding the world more value with less coins yeah exactly so you give more and more value so if I am a crazy scientist and I give you a small little slice of pizza and that pizza can feed you because has you know so much nourishing power then I solve a problem of angering world with one pizza you know I can do it uh and you know you have to do it in the right way but this what Bon is trying to do so you know when people tell me that that there is some kind of a supply uh crisis or Supply crash I go and look at the data because I can have whatever philosophy I like I don’t care what My Philosophy is as a scientist I have to throw it away if a data shows me otherwise and the data there is no one single piece of data where I see a supply shock there is not because what happened for example in this graph right the beauty is this you can go and look at things that are related to supply for example the number of long-term older that are you’re seeing here in this blue curve and you can see that what happens during the bubble they grow up you know we have more and more of them but then when at the moment when Bitcoin is supposed to be the scares or when everybody wants the coin they are starting to sell and they are going to be smaller less and less the long-term olders start to sell they sell all the like it turns out about 60% 60% of the long-term holder sell their coins or part of it and then what do they do they buy a they bought and this is good because we want Bitcoin to be also liquid and we want other people to share Bitcoin how can we have adoption if there is somebody that doesn’t sell Bitcoin if everybody holds Bitcoin how can we increase ad op option and I just show you the data tell us that the price goes up with adoption so it’s all positive in the sense that and adoption is very different from demand because demand is basically okay I need a this thing because it’s fashionable I need this grape because I’m angry or whatever you know but adoption it’s a different thing you need to adopt the technology you need to understand it you need to use it it’s a different type of mechanism and it’s beautiful because it’s not competitive more more people adopt something and the price goes up it doesn’t mean that I’m competing with these people in fact the reason why the other side of the question is okay adoption goes up with a cube but then you know bitcoiners uh Square gives the price and that square that advantage that we get by being more of us we get it because more of us can interact with each other and we are going to have more exchanges like this okay s you want Bitcoin I sell you a little bit of Bitcoin you know we have um interactions in the network that increase the value itself of the network so there is no competition it’s not about competition is about collaborating and working together at the same time you know the fact that we have a finite cap avoids delusion so you can have both it’s one of the S where Bitcoin has all characteristics of something that seems almost like opposite but it reconcile these things you know so I I don’t like a little bit with retoric with some of the data analyst I don’t know where they found it because I don’t see anywhere in the data where it shows that for some reason we have a some kind of a supply shock or reducing for example you see here this Orange Line it shows what happens with incentives they stay constant they stay constant this is due to the fact because uh maybe if you want to follow me for a second it turns out right that every four years the machines became more efficient because of mors law uh and so mors law says is what this empirical law that says that every two years the power of efficiency of computer goes by a factor of four of two so in four years they go up by a factor of four right now it turns out that the system the the coin system regulated itself where price and Ash rate are related by the uh is like ash rate equal price Square so or Price equal Ash rate to the square root so you lose a factor of two in this increment of the power of computers because of the price you know the ash rate that you need to increase the price right but what happens then there is the alving rate they cut that by another factor of two so basically the total result of the alving is that you’re not punishing the miners but you’re not also allowing allow them to to use this Advantage due to the more slw so basically it’s kind of like a balancing effect it’s like a thermostat and it’s I don’t know if Satoshi did it on purpose or like many Geniuses you do something you thinkering something you uh you put something there because you think that is important to have this controlling mechanism and then the system regulates itself where it creates this relationship between price and a rate where everything turns out to be stable and this where the Orange Line comes in basically it’s telling you just before the uh alving this where this vertical line is you’re getting a little bit more incentive because of this advantage of better machines and then the Alvin cuts that and brings it back to checks you right puts you right in right place right right okay you can do because basically it’s an Arbitrage kind of thing the miners can make a living a very good living but it’s never like a free lunch right and if it was if you allow a m low to go unchecked they will have a free lunch and this will have been broken long time ago and instead The Genius of Satoshi or the genius of Bitcoin it’s regulating itself is are like a thermostat yeah you see and so it doesn’t have anything to do with scarcity or having less Bitcoin because really this change in Supply in particular now is so small in comparison with the the general flow of the market and the volue of the market it doesn’t have really an impact it’s important for the manners but nobody else so really a bubble my theory and if you go in my you watch my song videos you know this a series we have but also my article I explain it’s like it’s almost like Christmas you know like you know it’s important it’s a ritual right uh in Christmas we celebrate the cycle of the year you know it’s the longest night of the year then there is a son is why they associated with Jesus you know and it was a pagan holiday then Christianity took it and made a connection with h Jesus you know because he the light of the world all these kind of things and it’s an important celebration because humans are also symbolic are also you know for us rituals are important so basically it’s like a a a Bitcoin Christmas in a certain sense and so people get excited and it’s useful it’s not like a stupid thing because all this excitement brings Innovation there are many new companies associated with Bitcoin they offer services new bitcoiners coming in some leave afterwards and don’t come back but a lot of them also stay so it’s an important process it’s almost like you’re seeing this I I we use this analogy in the video we say see you see this beautiful city being built and there are all this activity happening all these upgrade of machines and everything even if you don’t know you know that something is associated with this event and you see all this activity and say okay maybe I should go to that city is where everything else is happening we have new Bridges we are new houses we have a new schools let me go there you know and then you became a citizen of this new city that is growing and is having more value more activity more connections and so this is what is happening and it’s a beautiful story because you don’t need scarcity you know and again I’m not against the fixed Supply I’m saying scarcity like we’re running out of Bitcoin because it’s all about value it’s all about positive things like adoptions and more bitcoiners amplifying uh you know more of us a marrier you know uh it’s about collaboration and being a network yeah inter when you have scarcity and money you have abundance of everything else so so so even though there’s there’s fewer Bitcoin on exchanges it’s there’s the value of it’s worth more I it makes total sense I understand yeah yeah yeah exactly so it’s it’s all about um focusing on all the good things that are associated with Bitcoin like uh having more bitcoiners having this network proper that amplify because you know it’s not just going up with the number of Bitcoin it’s going up with the square of Bitcoin you know so you double you bring two friends you get four time the value you know you bring three friends you get nine times the value and so on it’s beautiful you know and this is why this Theory I think uh it gives much more than just being a model it gives you like an entire understanding about Bitcoin and if it is really true that is the scal inv Varian system it’s makes it similar to planets it makes it similar to how biology works you know it’s like wow you know when we go to people and tell okay why these assets is different well you I don’t know if you can make a story as simple as one sentence but you can tell them it’s different from everything else because it’s basically like a law of Nature and I know that may people will say what are you mean what do you mean yeah yeah there is this crazy scientist and other scientists we found out that it’s very regular and it bees like a planet he behaves like an organism it’s different from everything else you know it’s very predictable you know and there no this oscillations are also predictable you know and so you actually can plan ahead and say okay I’m going to buy here I’m going to sell there you know you can do all these kind of things it’s very powerful very very powerful it seems like how how many would you say different data points have you it seems like everything I’m asking you’ve you’ve had somebody ask you it and then you’ve went back and tried to use this or compare this like how many different inputs are you actually monitoring to come up with your overall thesis here well so there are all the days right and you could use hours Etc but it’s it’s not worthwhile so I’m using all the days uh I also try to go back to the first original transactions I found them like maybe six or seven I included even uh the first early transaction ever where uh one of um Satoshi friends sold one bit 10,000 Bitcoin for $1 you know and I put it there in the graph and it actually falls on this power law that early transaction you know it’s a very close to the power law it’s like almost crazy you know and then you have ashr and then you have addresses not just addresses of one type I showed you all these addresses I can take you know one 0.1 Bitcoin 0.2 Bitcoin 0.3 Bitcoin and they show you all there is this very regular pattern that I can actually Fred one time made a video where he took the value of these exponents and he put it in a log log graph and guess what even these exponents of all the different addresses they form another Power law that is again we call it multifractality when you have power lws of power lws it means that you’re really going downit it’s almost crazy right it’s like oh you know what there is an article from the scientist that is one of my favorite scientists he’s also physicist and he wrote three different articles about Bitcoin and he’s a physicist and he published in a real journal and one of the articles is about olding times of bitcoiners how long a bitcoiner holds in comparison with how much Bitcoin he has guess what that is also power LW it’s crazy right like okay so you know there is actually I found a shirt online uh that uh because we use so much power lws in physics that we have almost like an internal joke right and so this guy made a shirt that says I went to a um um physics conference and what all what I got was a lousy power LW and I modified it and I scratched physics and they put Bitcoin conference because I’m applying to go to the Bitcoin conference in Nashville I asked can you let me talk about all this because it’s so interesting and if I if I do I’m going to present with that shirt I’m going to get scratch all what I got from yeah from the bcoin conference was allous power no you actually get six of them you know or seven if you include the olding time you know and the power lws power lows and it’s all power lows you know but it’s beautiful because it tell us that really this asset is something different you know and now we have a math we have a physics we have a science and I want to publish because if I publish you know it’s not that scientists are these privileged people and Authority Etc it means some other clever people you know look at my data Maybe gave me some feedback maybe tell me go joh you know need need to do this better calculation you know like a push back right but it’s very encouraging that Fred likes it you know and he’s not a stupid guy you know he has you know he he has applied ma in the environment of Finance these scenes that I told you he did all these test of stability on with power law it’s a real think it’s a real think now I am a little bit more poetic than them and try to tell all this story about the planets and the organism Etc because really it’s not me that just makes it think if you read this B book The about scale that they told you that when you have chance please read it or listen to the Audi book when you know you you do something else Etc it’s really nice because it shows you how they come up with everything like uh different political uh situations you know like you can study how terrorist attacks are happening I I don’t know if they did it with corruption but we should try we should look at corruption in people you know all kind of things like that they they there are this very precise behaviors because maybe you know we do have free will I believe in free will but at the individual level right when we start to interact as members of a large community there are all these you know very precise uh laws that uh explain how we do interact with a lot of noise because we are still humans you know and there are unpredictable things like covid and so on but even in predictable things you saw how Bitcoin handled it because it has this ability of being self adjusting and self- protecting and so on so you know like almost like homostasis so it shows that really Bitcoin is something different it’s something unique it’s not like NASDAQ it’s not like gold it’s an intelligent system you know and if uh the mat is shown that is correct and we continue to see the data behaving in this way then you know it’s it’s really it’s beyond that like being an analogy or a nice metaphor it’s signs you know and it’s amazing I find it amazing and beautiful you know no I really do I think you could measure you could you could probably measure corruption based off the debasement of a currency yeah yeah you know what I’m saying I you could put is there any power laws out there on the debasement of Curr debasements of currencies so debasement of currencies usually they became like exponential because it’s really so see that is the other thing this Jeffrey West talks about he showed for example a lot of companies they behave like in an exponential fashion they grow very very fast and then what happened to them they die and he has this saying that he say he says cities are Eternal companies die and comp cities behave like power losss because power losss remember it’s about stability is about antifragility is about the protecting themselves so cities tend to behave like power LS companies that are useful but you know there is a lot of corruption in companies particular when they became very successful there is a lot of a political you know there are political gains that are happening inside companies different type of you know the administration takes over uh versus you know like they fire you know um the Steve Steve Jobs and you know that is the creative mind and some administrator comes and say you’re fir you know you know and then they hurrying back all these stupid political games they make it behave like exponential and so exponential like cancer is associated with death things that became exponential this why I don’t like Bitcoin to become exponential because to me will be being associated with something that looks like that things they grow exponentially they grow very fast and looks fun and exciting but if we care a long-term growth of Bitcoin we should not want Bitcoin to be an exponential we want it to be a power LW because it needs to be like a city city are Eternal look at my hom toown you know I’m not from Rome but the capital of my country Italy you know I’m Italian Rome Rome is there we call it in Italy we call Chai Etna that means Eternal City uh is there since 3,000 years you know uh and Jeffrey West the scientist that I mentioned he talks about nagazaki and Oshima they nuke these cities they still there you know you can go today in and and travel at inoshima it’s actually a lively City you can nuke a city and it will survive companies die F there are no many company that are older than 100 years old almost all of them died uh and so and Corruption Pro you know like if you are saying very good observation inflation right or de basement Etc uh it goes like an exponential because it’s something that basically goes out of control so when you have an outof Control process it becomes exponential and then you know this why goes bad very quickly you know and so that is one thing that um you can use the power law theory to say okay if it is not a a power law probably something bad like an exponential and this is why you can associate it with things like corruption or debasement or inflation inflation is an onal you look like the Argentinian Pesos it becomes like an exponential uh so it’s it’s beautiful that bcoin is a power low versus an exponential it’s actually tell us that Bitcoin is this stable growth beautiful growth because that 10 time to the six you know remember you’re just sitting you know you look very young you know for you 15 years is nothing right uh you wait six 15 years and now you get just by holding not even playing these games of selling at the top a rebind of the bottom just holding it will give you a 64 return you wait 30 years that is three times you know what is three to the six 720 so you will get 720 returns if you can wait 30 years instead of 15 15 gives you 64 30 gives you 720 times no percent times yeah there you know so 64 it’s a take Bitcoin 60,000 now times 64 that is about 3.6 million so in 15 years from now Bitcoin will be $3.6 million it’s amazing because compare it with anything else right ndaq or SP 500 whatever you know like you get 5% a year you know we’re talking about 64 times in 15 years it’s still that crazy you know because of course it would have been better to join in early because of the scaling means that it takes longer and longer time to go up by a factor of 10 but there is still so much room that we are in a sense still early because you know if if you told anybody in the history of man kind that you can make 64 your money 64 times your money by doing nothing just holding something for 15 years that is a relatively short amount of time you know even for a old guy with like me uh amazing you know it’s lifechanging money you know if you have a in 2050 do you have it do you have it out to 2050 so 2050 will be 30 years right more or less uh so uh so let’s round it to 30 yearsor 2070 20170 can you go to 2070 because I have some I I know the value of what a house will be in in 2077 so that is wet we can calculate I would not be able to do it in my head well give me give me 50 years yeah give me a second go to my nice little so I’ll just I’ll give you while you’re looking it up so in 2074 at the rate of inflation right now the average price of a single family home just like a basic three bedroom maybe a onecar garage on a basic half acre quarter acre lot you know just your basic average medium house in America will be uh $6.8 million the average automobile right your first car will be 800 like your basic Ford Focus with like roll manual windows no electronics just your basic average car um will be $892,000 so I’m just curious on like you know like right now dream is probably five bit crazy number right so uh if we’re talking about uh so 50 years from now that is a total history of 65 years right that will give us $290 million for one single Bitcoin no so that point that point and that know without that is without including inflation right so I mean yeah it will be whatever equivalent Bitcoin is whatever equivalent to $290 million will be a vet dat my my understanding about that is before we arrive to that value of Bitcoin we will adopt Bitcoin and you know we Bitcoin will be adopted as a standard but would that be so would you think that that would be I mean that seems I think it will take 20 years I think it will take 20 years 20 25 years but but it would still make your power law right if it went right to disappear will disappear because we don’t use dollars anymore right dollars doesn’t it’s not used anymore it will be Peg to the Bitcoin right so in that case $1 equal one Bitcoin you know people will not use a$ one1 anymore so what so you think they completely forget referencing it in dollar value at some point it has to be it has to be where basically how would that so what would we do right we Peg it where becomes like gold right you say uh this amount of dollar is equal to this amount of Bitcoin and and it will be stable right that is entia of a standard because this Bitcoin basically this a power law is the history of Bitcoin becoming the monetary standard once it BEC stand it’s like you know yeah there are you have some the graphs where I can show you you know like for example I have this graph in my slides where I I show you the power law of a growth of a tooth of a task of an elephant right well that power log goes okay here see this they grow this is the pink one is the female and the there is this entire article that is a beautiful article they found this power LS in horns in uh in the tooth of animals in torns of plants in all these processes and here that are all power laws and this is the power law of a growth of a elephant task uh you know the size versus time the age of the elephant and the the female has one power LS a little bit you know slower growth you know this why you see the slope a little bit little bit swallow right a little bit smaller slope and the Elephant because the male has bigger tasks it goes faster but this see you can almost like by the growth of the animal you could determine the sex uh you know okay I follow of this task okay this is a way of telling or maybe different species you know different species will have different rates so this how important these power lws are but you see on a certain point the task doesn’t grow anymore right so it stops growing because you know there is some mechanism say okay after this size it doesn’t go bigger than this uh like even humans right we grow and with a certain rate and then we stop right there are mechanism inside the bodies if you don’t stop there are some illnesses where you don’t stop and that is actually a problem is it’s part of having this kind gigantism or whatever it’s called this kind of illnesses you know this kind of um genetic defects right um so I think it will happen like that where in a certain point the growth is so big that uh basically uh there’ll be one of these events where uh a nation like United States will say well let’s Peg the dollar to bitcoin and when you do that then of course this growth will stop right because at that point there is no change in one quantity versus the other uh so this will be when Bitcoin finally did this task of growing up to this adult you know to this creature that is a monetary system of the world you know so that that is how I Envision it but you know it’s a long time so let’s take it 10 years time you know and see what happen still speculate and trying to understand because I’m actually writing a book it’s called the physics of Bitcoin and I have a final chapter where I’m trying to speculate what happens you know what how this process ends you know what is the end scenario it is the end game but it’s you know you go from science to science fiction you know like you can still try to do science fiction and trying to do you know kind of science based science fiction but it’s a little bit like science fiction you know because who knows what happens I mean differently from um from Bitcoin which is a power law technological progress is also exponential you know and is different also it’s very interesting because I told you that exponential die what happens with technology is that they don’t die they don’t die because it technology doesn’t die because there is always some kind of uh Paradigm Shift you know like for example we went from using um you know vacuum tubes to transistors and that allowed this exponential growth to continue so if you look at how technology works it works like this you see this oy stick that is of exponential growth then it stops and then there is another o stick that is the new technology that takes over and then there is another one that takes over you know multiple processors and you know you got up and up and up and up and that process it’s like super exponential and so you know in 20 30 years from now are we going to have ai that is going as clever as human beings what that AI is going to do you know I don’t know you know I have no idea um and so it’s like it’s uh this why I like to make a prediction that is something that I can stand by so I did it with you you know to play along of a projection of 50 years from now but I will not trust it you know like 10 years we can say okay it’s probably very very strong prediction because of this scaling variance it’s just one order of magnitude unless something catastrophic happens beon should continue to behave in this way 20 years we are stretching it by the time we go to 50 years we are going to science fiction territory you know so let’s see what happen let’s have this uh uh episodes with you every four years you know and yeah I can talk with you because by the way I really compliment you because you have been so patient and you ask so many beautiful question you know you have I really had fun you I say more things and more interesting things because of you than any other interviewer that I had so far so I really want to compliment you for be some patience and some listen I I can feel that you’re following along you know and uh I really thank you for that you know it’s great opportunity of U explaining the theory so I’m very grateful also because I am a night ows and my brain works better when I have interviews at this time ra rather than early in the morning you know well I guess it was uh it was meant to be my friend it was uh it was an honor to have you on and like we I didn’t tell anybody when we started but like last it was it was probably like three or four weeks ago you were going to come on and I had the show and I you thought it was at a different time so we missed each other and then this week I had it I didn’t have it scheduled out but I knew I had the interview and I got done with my show at 3:00 and I was like okay I’m going to edit some videos I’m going to do some stuff I got this show tonight and then I’m getting busy I’m editing next thing I know I’m look over I go I see a message from you you’re like hey man uh can we can we reschedule it looks like I missed her I’m not getting the link like I was supposed to and I’m like oh shoot so we threw it up real quick and uh I’m so glad we did man that was such a great stream so really thank you no but what I was thinking is if you get your if you get this published right and there are people that maybe add to it or they have something to you know cadi it you guys want to talk man I would love to have both of you on the show yeah and have you guys go back may know we can have with you know what we could do we can come together with we can have like a group talk with Fred and these other guys Fred has also an astrophysicist another astrophysicist he discovered the power law independently from me after me but he basically redid the same Discovery with is another good sign right because if there are more people that are discovering the same thing uh independently it means that there is really something there and so you know we are all agreeing that we are looking at something here that is really meaningful and significant so I think all of us will give you a different look at why this is interesting what are the applications how we can use it so we can have another meeting if you like you know absolutely as we are coming closer to because a prediction so basically if people want to know because now think at the end show and maybe we can up I have this beautiful clock I made this clock this Bitcoin clock so basically yeah what I did I didn’t invent this where is this other analyst his name is rational root uh he came up with this idea and again is like I didn’t invent yeah I didn’t invent the power law so uh I use it to understand Bitcoin he didn’t invent this chart it’s called a polar chart it’s something that he use often in in in science but he had a very beautiful idea again one of these things they say oh why I didn’t think myself to do that right because until somebody does it you know that person needs to get the credit he was the first one so I want to give credit to him but my contribution to this is actually to plot the power law because he didn’t have a power law I have a power law and the right spiral with so the blue is the price so rational root only with price and nothing else and you know the different markers for the price for the time and so on what I added was to add the power LW and look how beautiful the power LW is it’s this beautiful spiral it looks like a like maybe three rings or a shell of a you know like a beautiful sea shell you know when you cut it like a nilus shell or something like that so it’s again it shows you how regular and how precise this pattern is it’s really a good representation because you can see how the spiral hugs the price of Bitcoin sometime almost like unbelievably crazy precise right and if I average like I have a graph where I average this price it’s almost like falling on top of the Spiral so the spiral it’s just an equation you know you know you’re looking at an equation it’s like a simple equation that describe the behavior of Bitcoin and when you put it in this circular map it becames a spiral instead of being a straight line it becames a spiral you understand what is going on there maybe yeah walk us through it though I just so I make sure that I understand it walk us through like10 how you go how do you go from the straight line to the spiral well basically what you do is this you take the time remember we say and I have written here I say row so row is price in this case row represents the radius so uh how do you go from um something that is like straight to something that is circle well you you for a circle there are two important things right one is the radius and the other one is the angle right and so some people think well it’s so basically the angle represents time here and so people can think well it’s weird to think about an angle being time no it’s not real weird it’s think about a clock right a clock when you like an analog clock right uh when you have a every 90 degree represents three hours right so you have a a three 90 degree is a 3 o’cl then you have a 180 degree it’s a um six o’clock uh 270 is 9 o’l and with full circle is 12 o’clock right then you repeat with cycle but basically if you transform you say well I I’m going from a time to an angle and in this case because of the periodicity of the coin is for here every 90 degree represents a here so you see how I go from the top of a cycle to the bottom of a cycle this is one single here and this is represented by a 90 degree angle and so and then the other 90 degree angle so if I go from the bottom of cycle to when the bare market ends so I call it the transition from bear to Bull it is kind of like what happened around the January of you know last January is when we transition from the bear to the bull market um and then you have a and that will be you know if you think about time this will be 12 o’ it will be 3 o’ the botom recycle uh this will be six o’clock uh so right now for example this was done few days ago right now it’s 6:54 if you’re thinking about time it’s a Bitcoin time 6 654 when we reach 9 that is when the real bull market starts and that is is supposed to be kind of about one year from now you know a little bit less than one year uh so it’s going to be like the end of 2024 so beginning 2025 when we are going to have a full bull market and then is another year of bull market you know very franzy book market and we reach the top so it’s very very precise every 90 degree that is basically every year we have some something very particular that is happening to this cycle and so the way I get the spiral is that I use the same formula that we had before price equal time to the six here I write it as 41 over 7 it is kind of close to Six but you know we can put six there so it’s basically row that is the radius so in this case the radius represents the price this is why you have a a spiral because if a price like for example I did it with gold right I have a picture like this with gold with gold you see a circle and you know why you get a circle because basically the price of gold doesn’t change it does not change in the last 15 years right U it didn’t didn’t change much so it became a circle with be coin right the radius is very small in the beginning and then it becomes bigger and bigger and bigger and bigger and this why you have a spiral right so I have movies of these if you go in my website I have like a little animation of this where okay you see this end of the clock right the end of the clock shows the current time uh that becomes bigger and bigger and bigger so the spiral is nothing else in this very simple equation where basically now time is the angle and the radius is the price and so if you do that then all of a sudden this beautiful straight line that we saw in the linear chart it becames this amazing spiral that you’re seeing here and you can see how the price really follow that Sparrow right sometimes above sometimes below but in general they follow the trend of sparrow and now you can actually project the sparrow to the Future in fact you could go you know 10 years 20 years or whatever and you can see what the price will do so you know this what we try to do here uh I need to correct this say top 195 is because I’m actually calculating the last point and uh it it should actually calculate it at the top I’m going to fix it but top the top is supposed to be $220,000 you know and you see how they all happen in the same region so for example about it’s a you can say it’s around maybe like one hour before midnight or midday whatever you want whatever you want to think so it’s about 11 so when you are close to 11 Bitcoin time you’re going to be close to the top and sometime it happens 11:20 sometimes it happen 11:30 but around that region and then the bottom all the bottoms are happening around 3:00 uh and and so it’s a beautiful beautiful if you combine these two things czy of this the overall trajectory and this very Clic nature and this when actually scientists can make prediction in in these two cases if you have something that is very periodic like the orbit of the planets this is why you know you know now after one year we come back to the same place where we started right this what happens with periodic phenomena uh that is very predictable and the other one is when you have the scaling variance because we use scaling variance all the time I show you with the elephant tooth right I can look at what elephant tooth growth was after five years and then I say okay scaling variant I make this little triangle bigger you know everything is proportional I scale up the time and they scale up of the uh size of the right and they can kind of predict what the size of the elephant tooth will be when the elephant is 20 years 30 years you know and if fact if it doesn’t follow that power law then something is wrong with the elephant maybe there is some illness in the elephant maybe some genetic defect or whatever you know and actually could be used almost like a diagnostic tool this is why with our power law here if it doesn’t follow the power law in the future you know something is wrong you know hopefully something wrong in the good sense that maybe there is something that makes it go faster because it could you know let’s say that it follows the power law but maybe now adoption goes even faster maybe goes up with the the fourth power or the fifth power and so I want to be a power law because power law has all this beautiful property but you know if you want to hurry up maybe uh you know they are called phase transitions you know when let’s say you go from being a liquid to a gas right the system has this very AB R change that we call phase transition in physics so we could have a phase transition hopefully is a good phase transition like in the sense that something positive for Bitcoin and it’s not like a catastrophic event you know where actually Bitcoin goes down you know instead of going up but to be honest you know power to the six is good you know it’s fast you know like in the Bitcoin standard we talk about you know preference time uh you know fast preference time and uh low preference time you know uh so if you Bitcoin is almost like teaching us that it’s good to be a little bit patient you know so instead of wanting be to became mil millionaire in one year from now like some of these crazy models predict this model is much more it’s still crazy because you know when you say price went parabolic par Parabola is two this is six so it’s a super Parabola you know it’s a super parabolic move but it’s not exponential and exponential we say are usually bad things you know so it’s it’s what Bitcoin wants to do so I don’t have a problem you know whatever Bitcoins wants to do I’m I’m trying to listen to bitcoin you know I don’t want to POS my own ideas to bitcoin you know whatever Bitcoins decides to do right now has done this for 15 years it has done it since it was like a little small little mouse you know fact even smaller than that all the way to this big dinosaur and it’s going to be Godzilla you know and he’s going to do it his own way you know whatever Bitcoin thinks is the best part you know this resistance SP you know so let let’s see let’s collect more data let’s see what happens but right now I’m very happy with all what we are learning from Bitcoin because like I say seems that there is something magnificent something look at this you know look how incredibly regular and precise this behavior is you know and uh if he continues to do this and we get a uh Bitcoin to3 million $4 million in 15 years yeah I’m happy you know I don’t know you I’m happy well you know I like the way that you’re saying it because you’re you know I had this Outlook from just like seeing people’s tweets and comments on Twitter that it it almost looked like it it made it sound like that this was some crazy wacko Theory and it wasn’t it like you you you presented in a guys like I’m collecting information and I’m sharing the information I’m showing you all the correlations between the information and how you can use it to predict future price and I’m not trying to tell you that this is guaranteed where this is going you’re completely open to the idea that this being wrong and you just want more information and you want to share this information with everybody and I think it’s a it’s really powerful and I think important that somebody does information like this so you know what happened uh Ryan uh there was one of the other influencers and he has a channel and I understand it because you know I have my YouTube channel too I don’t like it too much but some people like to make clickbaits right so they take a little snippet for the interview where maybe I was too enthusiastic and they say Hey you know I can tell you exactly when this happened and what I meant is that the equation tells you yeah an exact date Etc now the like we did it with $1 or $10 I can tell you the date but you know Bitcoin maybe the real Bitcoin is going to do that 10 days later 20 days later right so it’s going it’s there some Randomness there right it’s not that incredibly precise where and some people you know even took a like a I made like a little joke like a self deprecating joke on my website I took a picture of one of these clickbait says astrophysicist predict exact date and I thought it was like almost like people understood it was making fun of myself and people took that as oh he’s selling classes where he teaches people the EXA and I thought how how crazy people can be you know sometime I don’t understand it it’s human nature you know sometime people you know see the first thing and they try to misinterpret what you’re saying and so on but you understand right it’s all exactly I’m trying to be like a scientist I’m fascina by this phenomena I see this irregularity I understand as a scientist that needs to be something real there some precise mechanism I point out what this mechanism can be uh and and making a theory and the theory says well you know if all these things connect then this is the conclusion you know and we can verify because this our s Theory work that if there is more data and it comes in you never see scientists always correct people to say oh this theory has been proven right you never prove right any Theory like even gravity like all what we can say is well we know made billions and billion of observations during human history and every time we drop a stone seems to fall instead of levitating but you know it’s possible that we miss something about a nature of reality where there is some weird situation where maybe the stones start to levitate you know uh and this why we need to be open and try to uh accept whatever reality tell us you know like being a scientist is like exactly like with Bitcoin you don’t want to uh trust you want to verify this is why for example I G I made this calculator that people I can give I can send you a link so you can maybe put it in people can play you know I love when some of the people that know a little bit how to use a uh you know like some coding go and get the data and reproduce these charts like Fred Point had a context they say okay I’m going to put you like you know uh people that do stuff instead of talking least if you do this chart with joanni did you know go and get the data use your uh you know skills you can train AI right to read data is that what saying like you can get really Advanced models that do really crazy stuff right even easier than that like for example if you have chat gbt and you uh give it some data because our days you can actually load up um Excel spreadsheet and and there is like for example I use b.org you know you can get the price and then you say hey chbt can you feed this data with a power LW and look at what you get you know I’m actually asking people to because that that will be a really cool way for people to actually see the power L being made in front of their eyes instead of you know me telling you that it is like this ask chbt and maybe ask you I don’t know some people know maybe in your audience know to do python you know that is a open- source uh coding language uh ask chbt to give you the code to do that you know uh it’s not very difficult actually you know if you have like a some like maybe college level you know maybe first year college level high school level yeah maybe good high school level you can do it because it’s really not that difficult we’re not talking about you know quantum mechanics or anything sophisticated it’s relatively simple mat and and that is the beauty because in physics we like simple things you know um simpler it is easier it is because it means that there is some very precise regularity there that uh it’s something about the nature of the phenomena that you’re studing you know and this why you don’t want to make it too complicated um and so it’s it’s you know that is my attitude and if this stuff is true and it’s continues to be true you know and you’re adding more data point and you see it actually continue to follow that red line it’s magnificent you know it’s something like we never had anything like that in human history you know where an asset can be predicted years in advance and is behaving like how how people will react many people even now after I tell them look at I’m doing this for five years you know it’s not that I’m making it up they still don’t believe me you know so okay fine you know there be some people they use it and they can use this knowledge to their advantage you know because you could have both with bottoms you could have sold of the top you know if you follow this model because you can use all the skills you know we we are developing all the technology like I show you this graph for example right so I look at all the deviations from the trend so here I subtract the general Trend right so you’re seeing the percentage difference of the price of Bitcoin relatively to that General Trend and then I color coded the different deviations right so for example 50% is red 40% is minus 40% is green and so you can see even if you you don’t have to be perfectly precise even if you just add a rule you know and you can do better than this just as an example that says well okay when I’m red I sell when oh you know if I do theca maybe I’m going to wait to buy I don’t not going to buy in the red area I’m going to buy on in the green area uh or you know if you want to sell a little bit let’s say you sell 20% of your holding and with the intention of buying back because we always want to be coin you sell there you know it doesn’t have to be that precise where you get perfectly the top but you can see that just by even something very simple like this you could multiply your Bitcoin buy a lot in fact I kind of they made a calculation do you remember when I told you between year and 10 years you will get a million dollar in Bitcoin so that is about what a factor of 20 something like that uh yeah well if you actually play this little game that they told you uh and it depends on how how precise you are how close you get to the bottom or the top you can get all the way to 300 times in 10 years uh and so if if you can use this knowledge where you can play a lot a little bit with this know and again maybe 300 is too much because it will be that you really get the top you get the bottom so you know cutting in Al that performance you know maybe 100 times so maybe 40 times you know so maybe you do two times better than what you will do just by holding your Bitcoin so because you want to be you know more moderate you know maybe instead of selling all your Bitcoin and then buy them back you know know sell like 10% you know and then if if you’re wrong you didn’t do too bad but if you’re right you’re going to multiply your Bitcoin you know so we do things in a moderate fashion with awareness maybe make a plan but you see the entire idea is that I don’t know if is an appropriate or PR I don’t know if your show is PR hopefully it’s not but it’s like making to a woman right or a woman making love to a man you know you need to understand things you know you need understand what you’re doing you know and uh and understand the it’s like here we are kind of almost making love to bitcoin right we’re trying to understand coin works we are trying to understand the Cycles the curves of Bitcoin we are doing it at the right time you know this is the peak this so if you study Bitcoin when I say study Bitcoin stud there is a component where we study the technology we study the functionality all the different property Bitcoin but what about studying also how Bitcoin works right in terms of the price in terms recycles it gives you power that nobody else has and and you can use it for your own Advantage you know to multiply your Holdings and you know be yeah more free more earlier you know earlier free than other people you know earlier you had talked about frequencies right you were into studying the frequencies do you think exactly do you think Bitcoin has a frequency to it yeah yeah so fact I did that I what it’s called Spectrum I don’t I don’t have it here but you can actually do something more here of course the more evident frequencies this four years cycle right but there are more there are more in fact I have a chart I don’t know if I have it here somewhere where I can start to yeah let’s see if I have it here I have like tons of charts but um let’s see if I find it uh I don’t I don’t I don’t have it here but uh I I posted a few days ago well I found a way of predicting like actually weekly Cycles so there are there our periodicity of the is not exactly a week but it’s in the range of a week where I see these very very precise frequencies of Bitcoin and I can use that if I wanted to actually sell uh you know if I wanted to trade but it’s never too much of a good idea because one thing is to do this long-term Trend oscillations and other things daily but it’s interesting where if one wanted to push it a little bit you know where okay don’t do too much maybe few thousand dollars and play a little bit with these oscillations you could do it like I I can indicate you know okay I have a graph I just posted like I got a lot of likes it looks like almost magic like you know I found these oscillations yeah and there are oscillation around the power LW so it looks like some time price even locally follow the power laws when it dips so you can use it maybe to buy the deeps for example so there are this kind of like around a week uh uh type of oscillations and people that get paid once a month or buy once a month they could time their buys based off of exactly exactly in fact what we are developing so by the way I want to tell everybody I’m not trying to pitch myself but you know do it uh I’m creating a community that is a a Discord channel so we have about 400 people right now and more and more people are join so you’re more than welcome to join us and being part of a community first of all remember I said and creating this institute so you know you supporting it’s very cheap we do it because I’m trying to do it as transparent and as open and as clean as possible because I want to be a responsible bitcoiner I want to be respected in the community even some people push back or you know they misunderstand what I’m doing but you know with $ five support you know you’re supporting this project my son is making this video and he working fulltime and I’m bringing other talents and you know yeah these are people from Italy that are developing a DCA tool that is going to be automated at a certain point so we are creating value and we are adding all these things with the Discord Channel and if you come in you get the indicators I I built this beautiful trading view indicator you see here you see this one where I T the you know the right line which is the full model the general Trend you know that’s sick and those are those aren’t cheap to build guys I know that look at this bottom you know this is a bottom Top This is top bottom another bottom here you know look at the chart look how close and precise it is you know and I have all this and you can go all the way to when Bitcoin was born you know not first exchanges all the way to 10 to 10 and you can use uh replay you know and you can actually pretend that to be back in 2017 so we like have sold we have a boat you know using this CH it’s really amazing uh and my son just made a video like today about how to use it and people are really excited about this but even tells you you know when we left the uh bull market when we left the be Market you know year and then uh you know when we are going to the full bull market and so on it’s really cool and look at you know the co this is again the co here around you know 2020 and you see how it it was a week it was just like one of these weeks right uh it was not even like a full bar it was like a like a just for a moment went down that barrier there almost like a iron barrier that you don’t cross and then it bounce back and look at what happened in 2023 bottom there and you see how it it follows that bottom you know almost perfectly and right now the general Trend it’s almost like a resistant level you know it doesn’t want to cross that uh place yet because we are far away we just left the bear Market you know this why it’s too early for the price to go above the trend uh it’s going to happen during the full bull market you see how it happened before yeah when he went across when it was the transition to full bull market so you know if he continues to do the same thing it’s too early we got a little too excited because of ATF and it’s going to wait you and then is going to repeat so we have these we give it to everybody that comes in this course we have classes we read this book scale We have basically four four meetings a week you know where I’m I’m there we discuss as a group um and uh where is the uh where is that white line at right now if it came back down like it did in 2020 and touch that white line how low are we looking at uh we at 30,000 close to 30,000 okay cool yeah uh so that is like the minimum like if and I think it will take something like Co to go there because you see even the last cycle we kind of left that white line that is like in the previous cycle I don’t have it here but if I could show you uh in the previous Cycles it really follow it white line almost like it was almost like scary it was following that what line but in the last cycle something happened maybe they know some kind of exciting news and the price you know kind of tended to be close to that wad line when he left and he started to stay like that and then covid kind of you know cooled down the market right say okay okay I need to go back to where I should be and he went there to the white line you know but it didn’t go below yeah didn’t it didn’t cross that line uh like if something happens where where he says you know I don’t like to go below it and then he jump back and he continue on you know the triangle there is the alving where the alving was supposed to be and then you know the transition to full Bowl Market happen and it went crazy same that like we did like a double top right we had a double top because historical uh top if you look at this very precise periodicity supposed to be there usually is around the end of a year so you know the C is where we are it was probably November instead of in December and so but you know the white line tells you more or less where the top is you know uh when when the price crosses that white line it’s time to sell and also the deviations right the deviation helps you to so it’s more than one single signal you look in at two or three different signal the price needs to be Crossing that red deviation that is a very large deviation from the trend uh then you have a this uh cyclic kind of uh indicators that tells you okay we are close to 11 know it’s not quite 12 but it’s 11 you know it’s kind of very close to where we are supposed to reach the top and then you have a white line that if you one way that you could do it could be okay it’s Crossing up then when it comes back and crosses again with the white line it’s time to sell you know time to sell maybe you can sell a little bit maybe you can do the ca down uh you know it depends how aggressive you are some people want to maybe even Too Short you know whatever depends on your uh style as a investor you know if you want to be a little bit more conservative some people even if you are if you were a odler uh you know if you are saving money save it save it save it when you cross the Blue Line don’t buying Bitcoin you know don’t buy Bitcoin anymore buy or maybe buy a little bit because we could always be wrong and maybe Bitcoin start to go crazy and goes only up and it doesn’t do this oscillation I think it’s very unlikely but you want to kind of ADD your bets right so don’t buy 50% you know and then as we come closer to the top don’t buy almost at all you know and then save your money don’t be tempted to spend it and wait until we reach the bottom because this uh model is very very strong for the bottom we almost never miss the bottoms because we have so many different signal converging and the bottoms are much stronger in terms so it’s very good because when you know when you reach bottom sell your chairs s you know make a mortgage on your house you know whatever and buy the coin because that is the best time to do it you know go don’t go 100% go 200% you know uh and it’s one of the most precise things of this model and this helps you to tell you where to find these bottons and then then you can continue to do theca because you know it’s good and we are trying to do it automated where on a certain point you put maybe your keys you know from your coinbase or whatever is you know you don’t want to keep too much money in this exchange but you know as you get paid maybe you can put $200 $300 and then the app will will do that and and plus uh we can use also these deeps where maybe we find okay it’s we got a deep right because we are a see how sometime these uh deviation lines work like look at some of them different places you know here for example chos like support support and resistance even locally it follows the power LW and uh and then uh you find you get the deep and say okay went down the trend uh you know let’s buy you know yeah it’s a good deal you know so better than just buying like an randomly and doing DCA uh you can do we call it weighted we we call it power DCA you know because you use the power law behind I like that man I really like that that’s you should coin right right and so we are really working hard and we are we are almost faere we have like a channel in the Discord Channel where we give a right now our best suggestions you know every day we give okay 50% weight 30% weight and eventually we are doing a lot of back testing you know trying over and over again to find like a kind of optimal strategy and we are almost there and then eventually we’re going to make it automated so people don’t have to worry about sweet that’s awesome well I’m going to sign up and now I want to leave that link for everybody down in the video so will you will you send me to where they can sign up um and I’m going to put it I’m going to pin it in the comments at the very bottom of the video for everybody absolutely and you know for you um I everybody that interviews me gets a um like a you know your owner guest in our Discord community so I will send you a free invite to the indicators to you don’t have to join and pay just just be a member of our community that is uh is good enough for us you know because you’re are good uh um no it’s a cup of coffee my friend it’s five dollar I I greatly appreciate but I would like to support I would like to support my friend I hope everybody does too that’s I think you’re adding a lot of value to the community and it’s the the least I could do I’m trying to you know to make this my full-time job because look you know I could and believe me I did have people contact me from Big firms okay and I could do this with a big firm I could have absolutely good I know you know I could have published somewhere and maybe even just contacted some big firm do a peach you know and I’m sure somebody will have seen value and get give me like a little uh trading desk uh you know doing this in secret and not sharing with the community and that is not my style because I love the Bitcoin Community I want to share this and that is the other thing that people tell me what if everybody starts to do that first of all I’m going to tell you not many people will do it because there are like with the adoption of point where it takes awareness it takes awareness to understand all this stuff you know so we are going to still be a minority and then my idea is that if more and more people start to do this it’s actually one of these self-reinforcing Loops it’s going to make stronger in being being weaker and and really look at this look at you can almost think about Co like something that tried to break this trend right he tried to break it it started to go there and then Bitcoin autocorrected itself self corrected you know so you cannot fool Bitcoin you cannot play you cannot play games with Bitcoin Bitcoin will play games with you you know so if you’re there is some silly person that is trying to push Bitcoin in a certain direction and make it do something different uh you know Bitcoin will teach a lesson to this person think about that he had the full backing of the United States government the CIA as as many powerful players he was the number one funer to the Democratic party and this man had all that power and did everything he could to destroy Bitcoin and Bitcoin put him in prison Bitcoin broke him yeah absolutely you don’t [ __ ] around I mean it is this is the m behind that this is you have this cell this basically like a a ter a cosmic thermostat where you go to out you know too cold or too hot and Bitcoin say no [ __ ] you I’m going to bring it back you know other things like the numeros right when people started to push the system and started to make it crazy thing well there is the self adjusting mechanism or difficulty adjustment where they get all these crazy fees and and at certain point people stop you know because they will lose a lot of money they can do it temporarily but Bitcoin is going to self heal itself you know and it’s not going to allow any uh bank fredman or any other guy or even even sailor when sailor say oh what if you know 10 of us are going to buy Bitcoin well okay you will make the price jump then Bitcoin will go back to his original Trend it’s more the other way around that as Bitcoin became stronger and more powerful and is ready to take in more billionaire than know Sor you know think about seller right there was a time when Bitcoin was not ready for saor and saor was not ready for Bitcoin what happened at that time saor was making fun of Bitcoin till it was right he was making you know about that he was actually saying oh Bitcoin is going the way of uh online gambling you know it was very critical and then Bitcoin turning over you know and so Bitcoin was ready for seller seller was ready for Bitcoin and they joined together right and and that will happen will happen right now same thing with the ATF ATF the people that now are praising Bitcoin you know the CEO of Black Rock he was talking bad about Bitcoin few years ago now it’s all converted so it’s this continous this the M behind that if you play stupid with Bitcoin Bitcoin will punish you if you resist Bitcoin because you are not ready or maybe Bitcoin is not ready for you because you’re too big you’re an ETF Etc it will take time and if you are clever you know like seller or even uh the CEO of Black Rock you will join you will become a bigcoin you know you will join maybe late get like seller says everybody gets the price you know gets the B coin that they deserve price deserve you know and uh and and so that is what is is happening that Bitcoin is this black hole you know that is becom bigger and bigger absorbing more and more stuff and everything happens at the right time at the right place it’s beautiful it’s beautiful I don’t know why people don’t like there are some people that resist this you know I don’t understand I can’t figure it out man you it’s like it represents so much freedom and so much prosperity and sovereignty for the human race as a whole even if you don’t want to ever own any like you should still wanted to win because it’s such a net positive for the entire world exactly exactly right and uh and so you know even if you think okay maybe you can go to the power of eight instead of six wh why why you know it’s good enough you know come on you know 64 times uh in in 15 years so we never had an asset like that in all the history of mankind you know that gives you 64 times and secure being solid being system uhoh I think they I think they nuked us Javan I don’t know if you can hear me it looks like we’re uh you’re froze up there on my end I don’t know if you can hear me I don’t think you can hear me my friend well I guess that means we’re going to wrap things up I was getting kind of kind of tired there towards the end we’ve been going for 3 hours what a great conversation folks if you guys get time please swing over and follow javanni over on X where did I put his Twitter at I know I had here it is there it is folks I’ll give him a second to come back all right swing over there that isgo V Ann 350 84111 swing over there and follow him BTC power law _ BTC powercore law and he goes slpl I like it thank you guys for uh joining us this was a great episode do me a huge favor smash that like button please share this content with your friends and tell them to go stack some STS and help us save Humanity God bless you guys God bless America we’ll catch you guys in the next one peace run
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Episode 57 | Bitcoin Power Laws. Welcome to The Ryan Matta Show, a podcast where we dive deep into the world of cryptocurrencies, blockchain technology, and the future of finance. In the rapidly evolving world of cryptocurrencies, navigating the myriad of options available to investors can be challenging. This podcast is designed to provide a clear and concise guide for those looking to understand the key differences between Bitcoin and other cryptocurrencies, often referred to as “$hitcoins.”
Hosted by industry experts and featuring interviews with leading figures in the Bitcoin space, this podcast will explore the unique features and benefits of Bitcoin that make it the top choice for investors. From its decentralized nature and limited supply to its robust security and widespread adoption, Bitcoin stands out as the gold standard in the cryptocurrency world.
In each episode, we will delve into the fundamental reasons why Bitcoin should be the cornerstone of any cryptocurrency investment strategy. We will also discuss the risks and pitfalls associated with investing in “shitcoins,” and why these alternative cryptocurrencies often fail to deliver the same level of long-term value and stability as Bitcoin.
Whether you’re a seasoned investor or just starting to explore the world of cryptocurrencies, this podcast will provide valuable insights and actionable advice to help you make informed decisions and maximize your returns. So join us as we uncover the truth about Bitcoin and why it is the smart choice for investors in the ever-changing crypto landscape.
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5 Comments
Does anyone know who created / owns Bitcoin?!
I would never own any! It too can be controlled or taken away any time.
Sign up to Giovanni's Patreon https://www.patreon.com/ScaleInvariant
What about kda?
Yea good point about Kadena?
Don't even know why I'm subscribed to this channel but this is fascinating ❤ what he shows resembles the golden ratio where fib comes from but I'm no astro physicist…