Jack Dorsey on Bitcoin After AGI and Bitcoin Payments Falling Behind

Jack Dorsey swung by, uh, yesterday and we did a AMA with him, with members of Pacific Brick Point. And I thought it went really well. Good, good vibe. It wasn't, I mean, he was asking questions of, of people here and I thought it was good. It was, I mean, it was more of a dialogue. It was. But is there, I wasn't there, is there anything you can share about like interesting topics that maybe you hadn't? I think a couple of things that stuck out to me, one, it's interesting to hear Jack thinking about AI and AGI, it was like, uh, we knew he was already a fan of Demis and Google. He's a big Demis guy, which I thought was cool. And I don't think that's a surprise. He's retweeted him and stuff. Um, I think it was interesting, you know, he was very open and candid about, frankly, like I, as, as all in, you know, and excited as I am about Bitcoin, you know, I do think it's important to recognize kind of, and I don't say this necessarily all in a negative way, but the black swan risk, cause it's not necessarily bad cause there's no white swan risk here too. But like, you know, apparently Demis's position on Bitcoin has kind of been, um, it's not necessary post AGI. And I don't fully agree with that. It sounds like Jack doesn't fully agree with that. We all think that there's probably going to be market of intelligence and lots of different kinds of intelligences that emerge. But I also am open to this idea that like, I don't know, like, I think it's, it's good to keep a certain amount of humility and open mindedness. Like we could be wrong on certain things and there are changes that happen in the world. And like, you know, if in the future, you know, if you're super AGI pilled, um, and by the way, I am only more and more AGI pilled as the time goes on. And the reason is because everyone's like, Oh, you know, is it a bubble? It ain't no bubble. We've, we haven't even seen the gigawatt cluster runs yet, bro. Like we're still at the hundreds of megawatt cluster runs. Everyone's like, well, you know, and like, even if there is a little bubble, like, you know, it's going to be a blip, like a blip. And so if, if you're really scaling law pilled and all this improvement we've seen, you know, two or three years, whatever it's been is without the base model runs at the gigawatt cluster run. I don't think people get that. Like we've seen all of this improvement with post-training stuff, with reasoning, inference time compute, it's without going from the a hundred megawatt scale to the gigawatt scale clusters. But we still might, it might once energy is no longer, we might find that it's no longer the bottleneck. Yes. And I have no idea, but like it doesn't necessarily keep scaling with as energy scales. It doesn't necessarily, but when this is like it meaning like the current techniques, sure. We might have to find new, new techniques, which might take another 10 or 20 years. We might, but my, my kind of take on this, and if people want to see my little talk from the type one summit, I gave a 12 minute talk with a meme that I need to refund that meme. I'm very proud. This is one of the memes. And by the way, if I ever get into around a replica and like doing vibe coding and Nick and Matt one day, I want the meme generator. But the meme is basically, you know, the, the, the curve, the bell curve, where it's like the dude on the left is like, just trust the curve. The dude on the right is like, just trust the curve. And then the dude in the middle is like, no, this won't work. It's like, I'm probably the dude on the left, but I'm like, look, man, like zoom out even beyond you know, the current architectures like transformers. If you go back to Hans Moravec in the seventies, Hans Moravec is just like, like the, the energy and compute theory of everything. And like, yes, there were many breakthroughs that happened, you know, since he made his observations in the seventies, like we had to figure out LLNs. We had to figure out transformers, but this is where I guess I get a little woo woo. And like, I don't mind being woo woo. It's like, I just think that's God, the universe, whatever you want to call it. And like, that's how it manifests. The breakthroughs will happen. And a lot of like pure materialist rationales, but that's impossible. I'm like, cool. I mean, you can express that thesis as you wish. I'm going to express my thesis based on my woo woo views, but like the breakthroughs keep happening. It's the same with Moore's law. Like why did Moore's law curve keep, it just kept happening. And I was like, well, but we may not get the engineer, but they kept it anyways. So my point is that's a much longer conversation, but the broader point is something I'm having more humility about as much as I think that Bitcoin matters as energy backed currency for these agents is, you know, many orders of magnitude beyond where we are in terms of compute. That's the singularity. And, you know, beyond that, like there is a world where these intelligences, maybe they don't even use our old protocols. Maybe they don't use TCP IP. Maybe they don't need the web. Maybe they don't need any of the stuff that we, it's like, we're like caveman swinging sticks and we're trying to guess what it's going to look like. I think given the information we have on the ground today and given, you know, sort of we have not figured out ways to break the fundamental laws of thermodynamics. So as long as we have that, I think Bitcoin is going to be really relevant for these agents. That's clearly where I would put my money metaphorically and realistically. However, I also don't rule out the possibility that these guys might find new laws of physics and stuff that we just, yeah. I mean, we were like little monkeys and we didn't know. Anyway, so it was interesting to me to hear Jack be certainly not bearish on Bitcoin, but at least also open this idea of like, yeah, I mean, at that point, once we get to the singularity, it's like, we don't know. Yeah, I think the time frame matters, really. So like if you know that AGI is guaranteed happening in 18 months, then I could be more agreeable that let's not waste our time with Bitcoin if it's 10 or 20 years and there's a bit of a slow takeoff or other big technological changes that need to happen before we get there. Then like you kind of want to be able to marshal resources and effectively money is just like the allocation of resources, right? It's like a ledger to allocate resources. Yes. Whether it's energy backed or I mean, the only real one is the energy backed one. But like what we're trying to do whenever we create fiat monies even is we're trying to allocate resources better and critically scarce resources. Yeah, yeah. If the resource is not scarce, too cheap to meter, it doesn't matter. Yeah, yeah. So I think the the the negative, the sort of bear case on Bitcoin would be that all resources and all energy and needs become too cheap to matter. And I think there's like a reasonable shot that that happens at some point. But it's probably not like in 18 months. Right. Steve disagrees. I don't agree because like human like human nature is to they'll be artificial scarcity in the sense that like part of like your identity, like whether it's through fashion or the type of car you drive or you're always looking for some kind of unique edge to like demonstrate your personality. So if literally everything is infinite, I mean, even like the friends you have, like social groups or your girlfriend or wife or spouse or whatever, like that's scarce. So I don't see I mean, I definitely see a world where things that have been costly before become effectively no cost and abundant, for sure, but not everything. Yeah, it's a good point. I mean, as long as we're in this finite dimension, I tend to agree. But I guess what I'm saying is like my like whatever, 99 percent cases, I agree with you. And that's probably what's going to happen. But I increasingly leave open the possibility of just being shocked. One more thing that we talked about at the AMA was, you know, the digital gold store value narrative just being the dominant narrative we talked about in the show a lot. But I mean, this isn't like a shocking statement, but, you know, Jack did say that he feels like Bitcoin as everyday money payments is is headed in the wrong direction over time. Like it's not it's not getting better over time. It's getting worse over time. Worse in terms of how is it getting worse into narrative mindshare. I mean, I mean, it's small and early, but like that kind of stuff seems to be. I mean, and we're going to talk about MDK. I mean, yes, the three of us are advocates, but like not as advocates. What do you want? Oh, yeah, David, how much money in the world is allocated towards Bitcoin and store of value versus MDK? How many people in the world? Wait, so are you know, are people are using store of value now? No, it's just progress. That's just a form of progress. No, this is not a hate on the store of value narrative. It's just that the store of value narrative is the dominant narrative and continues to grow in dominance over time. Even today, I would yeah, I would maybe frame it as for the people that even give a ---- about Bitcoin over time. The narrative has grown more and more in the early days. It was purely this is going to be what Satoshi said. Peer to peer cash over time. It has grown more and more to this is a store of value of the people that care. Doesn't mean that's not going to change over time. I think that's mostly because way more people care now. That's the huge frontier of new people who care and they only care for store of value and they only care for a number go up. But the absolute number of humans who are engaged in payments today, that must be higher than it was 10 years ago. Yeah, I'm actually not sure because it's still six to eight. Is that true? I mean, I'm serious. Like that might be true. And even if it is true, it's tiny numbers. Yeah, it's tiny regardless of the payment era of Bitcoin payments. So and I think I think that's going to bridge us soon to two very well already and I guess I think it's going to bridge us very soon to talking about both MDK and this kind of like the new sailor back stable coin stuff, which I've been thinking a lot about. But another maybe way I would frame this is of people that care at all in like technology circles, I would say probably in the 2011, 2012, 2013 year, I was not around. But my understanding is VCs were backing things like BitPay and they were thinking this is a peer to peer payment technology today if you serve it. And I would assume that a lot of like call it normie VCs were at least open this idea of like, oh, yeah, Bitcoin, it's that Internet payment thing, whereas all those companies effectively, you know, have been duds or, you know, zeros are pretty, pretty small. And now companies in the traditional tech circles that are seen as peer to peer or like the Internet payments with companies like Bridge, which get acquired by Stripe for a billion dollars. And so I would say in sort of mainstream tech circles, Bitcoin maybe had a moment where people saw it as payment technology that transitioned to stable coins, which the volume for that is real. And yeah, at least in the quote unquote, you know, Silicon Valley talk, that's I would sort of I would severely diminish the importance of like, yeah, I agree what's worth investing in or whatever. It's more like what are people actually using? Sure. And like and people are using stable coins at a much larger rate for payments. Oh, yeah. Yeah. I'm not saying that Bitcoin payments is beating stable coins. I'm saying that Bitcoin payments, we may be at the dawn of Bitcoin payments. And one piece of evidence I would bring is I think it was at the Vegas conference, wasn't miles up on stage saying that block generate 10 percent return on liquidity from lightning channels. I mean, that's what that's usage. Right. But again, what I'm saying, what Max is saying, and I think I mean, it's not like Jack turned bearish. I mean, he's he is he is a very much bullish and an advocate for Bitcoin payments. Sure. And and and also, yeah, we're we talk about all kinds of things on the show. We're going to talk about more things today on the show about reasons to be optimistic and we are at the dawn. But I think it's undebatable that to date it's losing. No, I'm losing stable coins. It's losing to the growing narrative relative to what it was 10 years ago. Are there more Bitcoin payments made today than there were 10 years ago? I think you're both right. It's true. Like, yes, it is certainly. Well, again, the Silk Road thing, we'd have to go check those numbers. Hold on. Like if let's just simplify it. Let's say there's, you know, stable coins and Bitcoin payments. And 10 years ago, Bitcoin payments was at five and stable going to zero. And today, Bitcoin payments are at six and stable coin payments are at a billion. Well, did Bitcoin bands grow? Yes. But I mean. Yeah, but I don't even see the argument here. I wouldn't claim that stable coins are not used. They're used way many, many orders of magnitude more than Bitcoin payments. So I think we're all on the same page with that. My point is, I think the Bitcoin payments is the long term way that the payment stuff is going to work. And there's going to be some maybe, you know, multiyear transitional period where people try to do stuff with stable coins. They get kind of borked in one way or another. And then they probably come around or maybe there's new technologies that come around that enable people to use Bitcoin payments like stable coins. Yeah, I mean, I don't think any of us are disagreeing at our core. I mean, I think I think a lot of it just comes down to expectation reality. Like if you came into the Bitcoin project with the idea that we're going to get Bitcoin peer to peer payments from day zero, you're probably very disappointed, right? If you came into the Bitcoin project saying money has to go through, you know, collectibles, store of value, medium of exchange, unit of account. And you can maybe on the margins push things a little bit faster or slower. But like ultimately, nature is going to nature. And like it just it is what it is. And like we're going through the progression. And like here we are. I mean, I will say from my perspective as a VC who has bet heavily on the Lightning Network for payments, there's no question it's been disappointing that it's gone slower than I thought it was going to go in 2017 or 2021. No question. Or or our 20, 25 predictions. Yeah, or 25 predictions, which were just like like miss after miss. So so there's no question my expectation was incorrect and how quickly it would happen. Am I less confident that it's going to happen today? No. I mean, I still think more than ever in the long run. There's so many reasons. Bitcoin is permissionless. It's energy back. It has all of these properties. And in fact, you know, I've been thinking a lot more about something else. I want to discuss this compute marketplace idea and agents using it like ultimately without doxing because he doesn't want to come out yet. But like someone very smart said something just stuck in my head. It's like it's not that agents or people prefer Bitcoin. They're going to choose Bitcoin for payments because like, oh, yes, I've done a long, careful analysis, and this is better than that. It's going to be like what's going to happen is stable. Coins are going to win until they don't. And they're not. And when do they not win? Whenever there's like a big reason they stop working, it's like it works until someone does it. This is my point yourself. This is why if the Bitcoin payments is a five today and there was a five, 10 years ago, and it's a six today. But stable coins is what you say, a thousand or a billion or whatever. Like that's great because stable coins are a transitional technology that will help people, you know, use digital technologies and somewhat cryptographic, the somewhat secured, debatably secured. Now, I do think the spirit of what Jack was saying, though, is is also important, which is something I've also thought about. He mentioned that a movie he likes a lot, which I actually now want to rewatch, was Wall-E. And I think that's important, too, because I think that, you know, to go back to one of our mutual favorite thinkers, Kevin Kelly, like there are certain technological things that are inevitable. And I think in a long enough time horizon, there are even like characteristics of those technologies that are inevitable. However, there are flavors of those technologies that can be birthed at different moments. For example, a hive mind is inevitable. That's why my fund is called Hive Mind. There is a bottoms up version, which I think Bitcoin and technologies like Nostra represent. And there is a top down version, which is more of like what we see in countries like China. They're both hive minds, but they're different characters of hive mind. I have my beliefs on what ultimately will win. But like, as I've learned, and one thing I need to be more, I think, humble about is I've just been really wrong on time frames. And that's OK. Like it is what it is. As long as you're patient enough, like, you know, everything eventually happens. Yeah, exactly. Exactly. Literally everything. But that's a different conversation. But but I think what he was kind of getting at, which is which is fair, is like it does appear that we are and not just on Bitcoin payments, but like, you know, as we discussed with the X and the attention thievery, that whatever you want to call it, sadly, it appears that society is from his perspective. And I would tend to agree with this moving more towards a Wall-E world where people are sitting there fat, slurping their whatever glued into a seat and not. And I think his point was like these freedom technologies, even if, you know, eventually they win, it would kind of suck if we go through a generation of that, if there was the possibility that some people could break away and tap people on the shoulder to remind them, like, hey, you don't have to strap in. You could go live. Yeah. Yeah. And I just wanted to bring. So my takeaway from Jack saying that wasn't like, oh, I'm going to stop working on Bitcoin payments we've lost. It was more like, well, Spiral is all about Bitcoin payments and and Presidio Bitcoin, a big thrust within Presidio Bitcoin in the show and what we know is Bitcoin payments. So it's not like the things I've been affiliated with and work on haven't been trying to move the needle here. But my takeaway is like we need to double down. And not only on the software development and product development and things like that, but also just the message and double down on the message and and fight the the narrative. And to me, that doesn't mean like ---- on the store value narrative. I totally believe in the store value narrative. So it's not like it has to be. And I think it's an attractive step one for a lot of people, especially today. Yeah. So, you know, I'm fully on board to store value, fully on board with the the what you mentioned, Max, about, you know, collectible, the store value to media exchange account over a long period of time. And also a lot of it being just a timeline we can't influence greatly. But I do think we can influence it. Yeah, we can accelerate it. Yeah. Otherwise, I wouldn't I wouldn't do what I'm doing because it would be a complete waste of time. So maybe it is. I don't know. But I, I, I tend to think I tend to think it's optimizing it. But I do think we need to, like, double down even more. And and things that we can control, you know, we we can we can move the needle and also be very strategic, not just work harder, but also be very strategic about thinking like, where does Bitcoin payments solve a problem?