Excerpt
I explore how owning Bitcoin can give you control over your financial future, something most people don’t realize. See how Bitcoin helps protect your money from inflation, allows you to send and receive money easily, and ensures your financial privacy. Watch now to learn why owning Bitcoin is a powerful tool for achieving self-sovereignty and financial freedom!
Transcript
Hello everyone, hello hello hello, good morning Cape Town. It’s a great honor for me to be here. One question, who is here for the first time at the Bitcoin-only conference? Oh wow, cool, congratulations. It’s a great day for you to learn more about this great technology, and today I want to appeal to you to own your future by self-custodying and using Bitcoin. So, this was me in 2011. I read about Bitcoin for the first time but I dismissed it because I thought it’s just another PayPal and who really needs another PayPal? That’s not innovation. But how did I miss that Bitcoin is such a great tool for self-sovereignty and all the other properties I’m going to show you in these 20 minutes? At the moment, of course, in a way for many many million people, cash is great. Why is cash great? Because it gives us ownership. We can hide or stash it at home, we don’t need an ID or KYC yourself and give up our privacy to use it, and you can spend it on anything you want and no one knows about it which gives you your human right to privacy, financial privacy. Okay, not in all countries or generally actually globally, fiat cash might also not be so great. Just as an example, that’s a typical bread in Zimbabwe, which costs 1 US dollar in 2019 when the government decided to reissue the Zimbabwean dollar. And the first time when I went to Zimbabwe in 2020, the exchange rate was suddenly 1 to 28, and no one really believed that the value will stay the same. So, in the following years, 2022, 2023, and as of now, I’ve been to Zimbabwe, the exchange rate is 1 to 12,000 now. So now you pay $12,000 Zimbabwean dollars for a bread that cost you one Zimbabwean dollar in 2019. That’s what hyperinflation and inflation means, and it’s not a phenomenon that’s only happening in African countries. 100 years ago, I’m from Austria, we had hyperinflation in Germany and Austria where people made dresses from banknotes and children played with stashes of cash. So, the downside of cash is you have, of course, national inflation. It’s analog, you can’t send and receive it globally, it’s also difficult to have it at home for longer periods of time, it rots, there are rats eating it, these are things that are happening in rural areas and wherever, yeah. And also the monopolistic institutions around us are failing us more and more. How is it possible that here in South Africa, also in Zimbabwe, we have load shedding all the time? How is it possible that banking fees in South Africa are higher than in Germany? How is it possible that we still have central banks and centralized institutions who believe they can control the economy by inflating the amount of currency we have? It’s simply not possible to control complex systems and that’s why we see high inflation rates all over the world and especially also in African countries. And as you can see, that’s the purchasing power of a US dollar. From 1971 until only 2018 it has lost so much value and that was before the pandemic, before the Fed inflated the US dollar currency in circulation with trillions of US dollars. And the red line is how the currency went up and the blue is how the purchasing power went down. So it’s correlated. And it’s only a matter of time. I mean civilization, people, we have kicked the can down the road for many many years now and it’s also just a matter of time, we don’t know when this fiat bubble will burst. And Bitcoin gives us opportunities. Just look at the purchasing power of Bitcoin. In 2011, you needed 162 Bitcoin to buy a state-of-the-art iPhone. Now, last year, you needed 0.031 Bitcoin. You have no inflation in Bitcoin, there is no national inflation, no one can in a centralized manner change the 21 million of Bitcoin that will ever exist. It’s a digital tool, you can easily send it in and out of the country globally, it’s resistant because it’s digital and it can’t rot and it’s easy to store in that sense compared to stashes of cash. It gives you ownership which is unique, it also includes anyone who wants to use it because it’s also permissionless, you don’t need an ID for it and it gives you much more privacy than the current financial system. Bitcoin is a lifeline as my friend and teacher Andreas Antonopoulos said. It’s a ripcord because it’s revolutionary, immutable, public, collaborative, open, resistant to censorship, and decentralized where I believe that open is a very very important property because it gives us all a seat, anyone can join, use Bitcoin and also be a part of the development community because it’s open source. It’s resistant to censorship, that’s especially important in enforcing the human right to freedom of speech and freedom of association and other human rights like the right to own property. For women, especially interesting. So you only get those perks when you own your bitcoin. That means if you self-custody them. People might say that’s complicated, well as a matter of fact, it’s only 12 English words in the correct order that you need to take care of. So now after you heard all these great things about Bitcoin, is it not too late now? I mean the price is at I don’t know what $37,000 or something at the moment. I might not be able to afford that, I’m too late. No, you’re not because I believe the moment to empower yourself to own your future, every day you have the chance to start to learn about Bitcoin. Okay, but then we might have a problem if 8 billion people in the world want to use Bitcoin. We can’t manage at the moment. Why? Because the Bitcoin blockchain can only handle around 570,000 transactions per day. And how can we make sure that the young generation, that anyone who wants to use Bitcoin can do so in the future? Well, we will need a lot of work and research and development done there, but at the moment I see three opportunities for people even when the transaction fees on the Bitcoin blockchain on-chain are rising like they’ve done in the last couple of months. So one is the Lightning Network which enables us to do hundreds of thousands of payments with only one to three opening and closing transactions on the Bitcoin blockchain. Another opportunity is the Liquid sidechain. It’s basically also a blockchain but you need to have trust, you need to trust the Liquid Federation. You can pack in your bitcoin and you get the same amount of value in the Liquid Network and the great thing about it is that the transaction fees at the moment are much lower and it has confidential transactions which makes your transactions much more private than on the Bitcoin blockchain. And the third thing which is upcoming right now, there’s a lot of work to be done, it’s eCash, it’s anonymous digital money. There are two protocols that I know of at the moment that’s Fedimint and Cashu and it’s working based on the Lightning Network. So you can put in your bitcoin into the mint and they issue a digital token eCash for you and the great thing is you can use it offline as well and also send it globally to other Federation like Fedimint wallets. I also heard that Fedi is going live this year and Mutiny also included Fedimint now in their new wallet. So I’m here to appeal to you also get yourself involved. Like for instance, I mean South Africa is a pioneering country in Bitcoin. You’ve got circular economies, everyone knows Bitcoin Ekasi, Bitcoin Witsand. You can remit easily bitcoin also to Zimbabwe by just buying a voucher, sending the code to someone in Zimbabwe and this person can redeem it. Involvement fosters inclusion. Please involve yourself. There’s THNDR Games, a great app to stack your first sats by gaming, but then you have to use Google, you have to use Twitter to be able to use it. I recently had a young guy in a workshop in Zimbabwe, he could not use he because he doesn’t have a Google account or a Twitter account. Build your own systems like KG has done with Machankura8333. Involve yourself, you guys here, you are fostering innovation. For instance, yesterday I was at PicknPay, I said the word, and paid my groceries with Lightning. It’s easy, it’s secure and fast. So thanks to Carel for that. Or you can spend your bitcoin on electricity here. Well, Carel told me yesterday the real innovation is that if a payment fails for any reason, the Lightning payment comes back to you, which is something that’s not possible on Bitcoin at the moment. We have Sparrow, Craig Raw is here as well, one of the best desktop Bitcoin on-chain wallets in the world. So you’re in a good way. And I asked myself in Zimbabwe, I did that last year already, is bitcoin ownership possible also in rural areas where you might not have the best internet connection. And that’s why I set out to do a self-custody Lightning wallet test 40 km from the capital. And I tested Blixt, Green, Mutiny, Phoenix, Zeus, and for the fun of it, Wallet of Satoshi. I have to add that Green and Mutiny say they are still in the experimental phase. So first you need to open a channel and there are several ways you can do it. And I tried all those three that I know of. It’s like you can open a transaction directly from the blockchain, you can send Lightning from your custodial or non-custodial Lightning wallet to the wallet to open my channel, or you also can swap your Liquid bitcoin via an exchange called Boltz.Exchange and open a channel. So I tried that with different wallets in different ways. With the Blixt wallet, I had to use on-chain, they didn’t have another option than just buying liquidity and I didn’t want to do that. With Mutiny, I used directly Lightning from another Phoenix wallet I already had. With Green, I used Liquid via Boltz to Lightning. With Phoenix, I used Phoenix. And with Zeus, I also tried to use Liquid. And the results are very interesting. So the Green wallet actually was the cheapest. I opened a channel for 100,000 satoshis for every wallet and I had 97,500 satoshis in my wallet then that I could spend. So the cost to open the channel was 3.5% but Zeus, for instance, cost me almost 50% of the funds I sent in to my channel. Okay, now I had this open channel and I did that in Harare, not out there because I thought that won’t be possible to open the channels there. So this is how I sat for about two hours and I had a protocol like I started with sending and receiving Lightning. I sent 50,000 satoshis to Phoenix and then I tried to receive 30,000 back. And the interesting thing is that the fully custodial Wallet of Satoshi took 9 seconds to complete the payment whereas Phoenix used 3 seconds and it’s fully sovereign. Then I tried to send to a Lightning address because I thought for any reason it might give different results and it did. Green was able to send to the Lightning address, it took 40 seconds but still it did and Mutiny, Phoenix, and of course Wallet of Satoshi did it very well. Then because I’m speaking now of Liquid because I think that if people can’t afford high transaction fees, we should give them the opportunity to own something like bitcoin as well in cold storage also. And that’s why I sent 20,000 satoshis to swap it into Liquid and Phoenix did well as before. So then I thought okay I give those three wallets who didn’t complete any payment out there a second chance and tried the same in town with LTE and sadly they failed again. So my results, my recommendation at the moment for self-custody on the Lightning network is Mutiny and Phoenix. And as I said before, Mutiny is interesting from the fact that they also now integrate Fedimints. So self-custody even in the test trumps custody because it gives you ownership and also because Wallet of Satoshi recently ceased its operations in the US because for regulatory reasons. I believe the US authorities told them you must KYC your users because you are a custodian, you hold custody for their bitcoin and they didn’t want to do that. But this can happen anytime in any country, so always be aware if you’re using a custodial wallet, only have small amounts in it. For my belief, self-custody is priceless. With the Phoenix wallet and other wallets, it might have a little bit of an add-on in terms of payment fees because Phoenix asks 0.4% for every payment you do but it gives you ownership, it gives you the possibilities to be independent and self-sovereign, to go anywhere in the world with your money. You can cross borders only having those 12 words in your heads and you can move your wealth with you if you have to or want to. You can’t do that with your house or your car or whatever, also definitely not with your money in your bank account. And it can be done and it has to be done in the future in steps because as I said before, not everyone will be able in the future in 10-20 years to own a UTXO basically bitcoin on-chain. So there will be shades of gray or shades of orange in custody but self-sovereignty is the prime goal and it has to stay that way. Also, I hope for the development community that this is our first focus. Now, my recommendation for someone who says okay I can’t afford let’s say $10 of transaction fees on-chain, what do I do? Yeah, start with a custodial wallet. I never thought I would say that in my life but now I have to say it. Paco knows what I’m talking about, start with Wallet of Satoshi or Alby but be aware you could be rug pulled. Stack around 100,000 satoshis in that custodial wallet and then open a channel on Phoenix or Mutiny. Then you might say but that’s too much for me, I don’t want to have that on Lightning, that’s too insecure for me. Then I would say I trust the Liquid Federation. Swap 80,000 to Liquid or maybe if you can afford swap it to bitcoin on-chain and then the result is you have a payment channel in your wallet where you can receive 80,000 satoshis and you can send 20,000. And if your goal is to earn Lightning for gaming or whatever then you whenever it’s full you put it in cold storage, you put it either on Liquid or on the Bitcoin blockchain. And as I said, I have been doing this kind of education for almost seven years now, the last four years very intensively in African countries because I want to share as much knowledge to as many people as possible. And I can’t do all of that alone and I found that being there is great to build trust with all the scams we have around and things like that but there are more and more initiatives in African countries which I applaud. I’m so happy to see you all coming up and I want to support with Bitcoin for Fairness aspiring Bitcoin educators and community builders. So maybe it’s you the next time here on stage. We’ve got one guy from Zambia, Humphrey, he’s from our Bitcoin for Fairness community there, he’s now going to be the teacher in Bitcoin Vic Falls, a new Bitcoin circular economy project in Zambia and I’m so happy that he’s here. Where is he? Yeah, here’s Humphrey and he will be a speaker today or tomorrow. And if you know anyone who also wants to do that you can apply for a train the trainer scholarship on my, on our online learning platform and you only have to apply at anita.link/apply, fill out a short form, tell us your story, tell us your plans, what your goal is with that education. And I also have something for you if you don’t want to be an educator, if you just want to use Bitcoin and learn more about it then you can subscribe to my free newsletter. Once a week I’m sending out new tutorials, videos, information about Bitcoin, it’s anita.link/weekly. You can also buy my book online or maybe on Amazon and I would be very happy to see you in one of my online courses or memberships at Crack the Orange. So thank you very much.
