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Why Bitcoin Now: Andreas Antonopoulos and Dan Held on Bitcoin’s Monetary Policy - Ep.192

Sep 29, 2020

Guest

Dan Held

Guest

Andreas M. Antonopoulos

In this discussion, Andreas M. Antonopoulos, a renowned Bitcoin educator, and Dan Held, growth lead at Kraken, delve into Bitcoin's unique monetary policy. They explore its differences from traditional systems and the implications of its hard cap of 21 million coins. The duo also examines Bitcoin's relationship with gold and the stock market, while pondering if it can truly democratize finance. They discuss how global events like the pandemic might influence Bitcoin’s adoption and stability in the evolving financial landscape, especially with the rise of crypto banks.

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INSIGHT

Monetary vs. Fiscal Policy

Monetary policy involves a government or central bank's issuance schedule of currency and inflation targets.
It differs from fiscal policy, which concerns government spending on programs.

insights

INSIGHT

Mechanics of Monetary Policy

Central banks adjust money supply to influence the velocity of money, using tools like balance sheets and interest rates.
These adjustments often have delayed effects, making precise control challenging.

question_answer

ANECDOTE

The Fed's Rearview Mirror

Dan Held uses a car analogy: the Fed steers the economy using a rearview mirror (historical data).
This illustrates the difficulty of real-time economic management.

Get the Snipd Podcast app to discover more snips from this episode

Understanding Monetary Policy: Mechanics and Analogies

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Exploring Bitcoin's Unique Monetary Policy and Its Implications

06:11 • 4min

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Bitcoin vs. Gold: The New Age Store of Value

10:40 • 29min

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Crypto Insights and Break

40:03 • 6min

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Scaling Bitcoin: Layer One vs. Layer Two

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The Limits of Cheap Transactions in Finance Democratization

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Bitcoin's Evolving Role: Exchange or Store of Value?

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Revolutionizing Banking: Bitcoin and Crypto Banks

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Andreas M. Antonopoulos, speaker, educator, and the author of Mastering Bitcoin, Mastering Ethereum, and The Internet of Money, Volumes 1, 2, and 3, and Dan Held, growth lead at Kraken Digital Asset Exchange, discuss the core features of Bitcoin's monetary policy, including how it differs from traditional central bank monetary policy, what gives it value and yet how it seems to have derived value from thin air. Plus, we talk about how the coronavirus pandemic will affect Bitcoin. In this episode, we cover:

how monetary policy in general is defined
the core feature of Bitcoin’s monetary policy, and how it differs from previous forms of money
the similarities and differences between Bitcoin and gold
why the hard cap on Bitcoin is unique and so important
the difficulties in analyzing and classifying Bitcoin
whether or not transaction fees alone can sustain the network once all 21 million Bitcoin have been minted
if Bitcoin will be able to fulfill its original vision of democratizing finance and serving as an everyday medium of exchange
why they think Bitcoin has recently been more correlated with the stock market
their thoughts on the stock to flow model and whether it works for Bitcoin
how they think the coronavirus, unprecedented quantitative easing, and increasing inflation will impact Bitcoin’s adoption and price
how crypto banks that don’t conduct fractional reserve banking or lending might change the economy

Thank you to our sponsors!

Crypto.com: http://crypto.com

Gods Unchained: https://playgu.co/unchainedpod

Episode links:

Andreas Antonopoulos: https://aantonop.com

On Twitter: https://twitter.com/aantonop

YouTube: https://www.youtube.com/c/aantonop/

Dan Held: https://www.danheld.com

On Twitter: https://twitter.com/danheld

Dan Held on Bitcoin's monetary policy: https://medium.com/the-bitcoin-times/information-theory-of-money-36247aebdfe1

Dan Held on Bitcoin's security model: https://www.danheld.com/blog/2019/6/16/bitcoins-security-is-fine

Unchained interview with Saifedeam Ammous: https://unchainedpodcast.com/why-bitcoin-now-saifedean-ammous-on-why-bitcoin-is-the-most-advanced-form-of-money/

Mises’ Regression Theorem: https://mises.org/library/bitcoin-regression-theorem-and-emergence-new-medium-exchange

Stock to flow model: https://medium.com/@100trillionUSD/modeling-bitcoins-value-with-scarcity-91fa0fc03e25

https://medium.com/@100trillionUSD/bitcoin-stock-to-flow-cross-asset-model-50d260feed12

Why the stock-to-flow model is wrong: https://www.coindesk.com/why-the-stock-to-flow-bitcoin-valuation-model-is-wrong

Federal Reserve announcement about letting inflation run higher than normal to achieve a 2% target rate of inflation: https://www.federalreserve.gov/newsevents/pressreleases/monetary20200827a.htm

Kraken launching the first crypto bank: https://unchainedpodcast.com/the-first-crypto-bank-what-kraken-financial-will-do-and-how/

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