World renowned Crypto expert Stephan Livera and I hang out in Sydney to discuss Crypto, Bitcoin, FI/RE and what the hell an NFT is! Listen in if you want to learn how to ‘Stack Satoshi’s’ like Stephan!
Podcast – Stacking Satoshi’s with Stephan
On board today is Stephan Livera, one of Australia’s top Cryptocurrency and Bitcoin experts. Stephan has had an interest in economics and tech from a young age and professionally this led him into a career as a chartered accountant. Stephan has worked in financial services including in Deloitte, Commonwealth Bank, and Macquarie bank. But when he discovered Bitcoin, it changed his life.
Stephan is the cofounder of the Ministry of Nodes which is focused on educational content about the economics and technology of Bitcoin, and also hosts the Stephan Livera Bitcoin Podcast (SLP) – one of the worlds leading bitcoin podcasts where he is regularly ranked in the top 10.
Stephan has interviewed many high profile Bitcoin, Libertarian, Austrian economics and Macro guests, and Stephan is one of (if not THE) leading crypto expert in Australia – the Stephan Livera Podcast (SLP) is recognised in the industry as one of the world’s leading Bitcoin podcasts with a 4.9 star average across 556 ratings globally and over 2M downloads, and ranked in the top 0.5% of podcasts globally!
“Stephan Livera consistently delivers the greatest bitcoin podcast on the planet. He walks you through complicated and in depth ideas in an easy to understand manner. This podcast repeatedly has the best people in the btc space. Highly recommend to all, whether your curious to find out what bitcoin is or if your trying to take your knowledge to near expert level, there is something for all!”Review of the Stephan Livera Podcast
Other than hosting the SLP, These days Stephan is focused on educational interviews about the economics and technology of Bitcoin. Stephan is a well known crypto economics presenter, and regularly presents talks and moderated panel discussions in conferences, such as the;
- Friedman Conference (Sydney) 2013, 2014, 2018
- Inside Bitcoins Melbourne 2014
- Bitcoin 2019 San Francisco
- Baltic Honeybadger, Riga Latvia, 2019
- MC of The Lightning Conference, Berlin October 2019
- Gold and Alternative Investments Conference Sydney October 2019
- MC of Advancing Bitcoin, London, February 2020
- Value Of Bitcoin, online (EU + US time focused available) link
- Crypto Asia Summit (link)
- LaBitConf 2020
Stephan is ranked by Hive.one as one of the top trusted names in bitcoin, and loves nothing more than calling out the ‘shitcoin shills’ (as he puts it) and other predatory behaviour in the industry! Go Stephan!
- Check out the Stephan Livera Bitcoin Podcast
- Stephan has founded the Ministry of Nodes which is an Australian Bitcoin education venture providing educational material and delivering bitcoin education consulting
- You can get started on Crypto using Coinspot – check out CaptainFI’s Coinspot Review here
- MUUN Wallet – a software ‘Cold wallet’ and way to store your bitcoin more securely than just leaving it on the exchange
- Hardware wallet – Cold Card is a physical way to store bitcoin off line
- Multisignature wallets – The highest level and most secure way to secure your capital – Unchained Capital can facilitate this.
Stephan Livera’s top financial tips
- Play the offense – Increase your income, try and get promoted and start a side-hustle! Try to add more value to people
- Don’t forget to play defence – Decrease your spending and keep your living expenses low (carefully consider your Accommodation, Education and Transport needs)
- ‘Stack Satoshi’s’ – Buy bitcoin regularly – think of it like a future savings plan benefiting from its growth phase (eventually it will be more commonplace as a currency once it stabilises). The average annualised rate of return of bitcoin is over 200% per annum!
Stephan Livera’s favourite reads and influences
- JL Collins
- Mr Money Mustache
- Ludwig von Mises
- Murray Rothbard
- Guido Hulsmann
- Joseph Salerno
- Pierre Rochard
- Saifedean Ammous
- Michael Goldstein
- Vijay Boyapati
- JL collins the simple path to wealth
- Bogleheads – Jack Bogle
Vicki Robins Your Money or your life
No products found.
No products found.
Captain FI: [00:00:00] Ladies and gentlemen, this is your captain speaking. Welcome aboard captain fi the financial independence podcast.
Welcome to an episode of captain FI the financial independence podcast, where I open the cockpit to some of the best and brightest in personal finance, as well as those who’ve reached or are on their way to financial independence.
On board today is stephan Lavera. One of Australia’s top cryptocurrency and Bitcoin experts. Stefan had an interest in economics and tech from a very young age and professionally. This led him to start his career as a chartered accountant. Stephan has worked in a number of top tier financial firms, including Deloitte Commonwealth bank and Macquarie bank.
But when he discovered Bitcoin, he changed his life. He co-founded the ministry of nodes, which is a business that focuses on educational content and training on the economics and technology of Bitcoin, where he also contracts. He also hosts the Stefan Lavera. Or a Bitcoin podcast, which is one of the world’s leading Bitcoin podcast, and has over 2 million downloads. Stephan has interviewed many high profile Bitcoin, libertarian, Austrian, and macro economics experts.
Steven is now recognized as pretty much the leading crypto expert in Australia. Other than hosting the SLP. These days, Stefan is focused on educational interviews about the economics and technology of Bitcoin. He’s a well-known crypto economics, presenter, and regularly attends talks, presents, talks, and participates in moderated panel discussions in conferences. Steven is now ranked by hive.one as one of the top trusted names in Bitcoin. And he loves nothing more . Then calling out as he puts it, the shitcoin shills which are people that behave in predatory behavior in the industry. Go Stephan.
Captain FI: [00:01:54] Stephan Thanks so much for making time to come on the captain fire podcast before we get cracking would you be able to tell us a little bit about yourself ?
Stephan Livera: [00:02:01] yeah, so in terms of my background, I was interested in Austrian economics from a young age. And that I think was part of my interest in Bitcoin. And so I was always more of a tech savvy tech enthusiast kind of guy. So professionally I am a chartered accountant and I was working in Deloitte and then later went on to work in financial services companies like Commonwealth bank of Australia, Macquarie bank.
And. For me, the interest with Bitcoin was more just the possibility of creating this alternative financial system and a system that allowed people to save for the longterm. And that there were, in some sense, Bitcoin gives us assurances that the normal Fiat or government banking system cannot possibly give us.
So that was my main interest in Bitcoin in the earlier days when I was first getting into all of this.
Captain FI: [00:02:56] What exactly is a cryptocurrency and why should people care about it?
Stephan Livera: [00:03:00] So I view it more like it’s about Bitcoin, right? It’s Bitcoin. And so not as much about cryptocurrency generally, but yeah, I guess the general idea, if you will, is that people are essentially creating a money that exists outside of normal Fiat’s banking systems. So Bitcoin can be thought of like a digital monetary network.
So you can join this monetary network by downloading the software, and you can essentially send money around the world at vastly lower cost than what it would otherwise cost to have final settlement of gold or of Fiat money. And it allows you to have more control over it. So think of it, like it’s a monetary network that you can join.
And then there are tokens that you send over that network. And so the. I guess the confusing thing about Bitcoin is we refer to Bitcoin as the overall network, but then also the token that travels on that network is also referred to as Bitcoin. But I guess the other point to clarify there is that one, although one Bitcoin, as we speak today, it’s what is it like 54,000 USD or something like that, but you can buy a fraction of that and that’s called a Satoshi or a SAT. So there are 100 million sets. So Satoshi is in one Bitcoin.
Captain FI: [00:04:18] So it’s almost like a dollars and cents type.
Stephan Livera: [00:04:21] Exactly. Yeah.
Captain FI: [00:04:23] So do you see crypto as a whole because there are other types of crypto, not just Bitcoin. But do you see this new asset class of digital currency tokens disrupting the current fee monetary system?
Stephan Livera: [00:04:39] Eventually. Yes, but for me, I would, I I would change the framing there a little bit. I would say it’s more like Bitcoin, not digital assets as a class, if you will. Yes, there are other tokens. I just don’t see any of those, having the same kind of impact that Bitcoin will have.
And the reason for that is that we have to look and we have to think back to why do we choose money and why is there such a strong tendency towards the best one? So yes, there might be other tokens out there and they might have some kind of utility, but in terms of which one is going to be a money.
We would think it’s the one that has the best monetary characteristics and that there is overall this very high opportunity cost of holding your wealth in one thing versus another right. If I hold more Australian dollars, that’s less us dollars that I can hold as an example. And so there’s this tendency then towards using the best one, there’s a tendency towards the one that is actually scarce, that actually is, has a credible level of monetary.
Qualities around it. Like it’s got this kind of scarcity, it’s got this level of accessibility and availability to use that network. So I think of it like this, we are progressing through stages in terms of Bitcoin adoption. So in the early years, it was much more of a kind of wild, crazy thing that we didn’t really know what it was.
And over time people were so slowly starting to learn and appreciate what it is best used for. So I think the pathway that it will evolve along is something closer to, and this is historically how money has evolved also as it moves in these stages. So it starts as a collectible. Then it’s a store of value.
Then it’s widely used as a medium of exchange, and then it becomes a unit of account. So I think while Bitcoin can mean different things to different people, and sometimes people use it for, let’s say, spending under conditions of. Adversarial conditions, if you will, like under, living under some kind of tyrannical dictatorship or some kind of condition where you have been banned or blocked by the normal Fiat money banking system.
I think the use case for most people, at least in these early years is think of it like long-term savings. So it’s like a digital savings technology that exists outside of government and protects you from inflation in that sense.
Captain FI: [00:06:55] You’ve actually answered my next two questions. Because I was gonna say how could Bitcoin realistically be used for transactions when people are hoarding them as a store of wealth causing that price volatility.
But as you’ve said, it’s progressing through stages. And so you can see that we’re in that. Hoarding stage now where people are collecting them. And so realistically, when do you think Bitcoin might be used for transactions?
Stephan Livera: [00:07:25] So the way to think through this is over time, as Bitcoin gets more adopted, as more people start to use it as their savings technology, then it will make sense for some people to start spending it more, more people to start spending it directly.
Now, of course, let me be clear. There are people who live on Bitcoin today, 100%, they own Bitcoin. They spend Bitcoin. They, they fully, for all intensive purposes, they use it as there it’s everything for them. It’s their store of value. It’s the medium of exchange. And it is the unit of account. In many cases they did nominate their net worth in Bitcoin terms.
But in terms of when that happens for the masses, that is a different question. And the way to think through that is that when you. More likely to spend Bitcoin. What kind of conditions would have to be true for that to take place? And one way to think of that is if the other person, if lots of people already have a savings pool of Bitcoin, then they’re more inclined to actually start taking it.
So for now, we’re still distributing this thing out to the world. And so think of it like Bitcoin as a network started in 2009, and a lot of the coins were if you will, front loaded in terms of the issue of them. So the current supply as we speak today 24th of March, 2021, it’s something like 18.6, five or 18.7 million of the 21 million coins.
Now that’s a very important piece of the puzzle here because Bitcoin has a strict. 21 million coin limit. There will never be more than 21 million coins and they’re being issued over time. But think of it like they had to be distributed out and, in the early years, people didn’t understand what it was and maybe some people who had it, they didn’t realize the value of what they had.
So in another analogy might be imagined thousands of years ago, before gold had become money. And you are just a random villager and you come across this gold rock and it looks so cool. And it’s like really nice looking. And if you didn’t realize that this could eventually become money and therefore able to purchase a lot of things for you, you might’ve thrown it away or you might have maybe sold it.
Too cheap because you didn’t recognize the value of it. And that is a sense in essence, what some people did in the early years of Bitcoin, they didn’t realize that this thing is going to undergo a massive adoption curve, just like technology and the internet had its adoption curve. Bitcoin is going to go through its own adoption curve.
It’s just that we are very early in the grand scheme of things. If the global population, as we speak today is call it 7.9 billion people. The actual numbers of people in the world who holds Bitcoin and are exposed to Bitcoin. If we had to estimate it, we’re talking maybe one or 2%, we’re talking maybe a hundred million or 150 million who have some exposure to Bitcoin.
So we are extremely early in the game in Bitcoin’s adoption.
Captain FI: [00:10:17] I did read a headline about some bloke who pay for his pizzas in Bitcoin and. They turned out to be a hundred million dollar pizzas or something.
Stephan Livera: [00:10:25] it’s more than that. It’s actually about half a billion in today’s terms.
Captain FI: [00:10:28] Gee, so the different types of cryptocurrencies so most people obviously will know of Bitcoin. Another big one is Ethereum, but there seem to be a myriad of these altcoins coming out. As you said with Bitcoin early on in the release, people had no idea of the value of the Bitcoin.
What do you think about these old coins? And are we similarly just passing by opportunities with some of these other coins?
Stephan Livera: [00:10:57] So this might sound really toxic, but I basically think all of the alt coins are shit coins. And let me explain that. So basically the problem here is that a lot of these coins market themselves in a certain way, As though they are now, obviously it varies depending on which shitcoin, we’re talking about.
But some of them basically say, Oh, look, see where the next Bitcoin, we can do cheap and fast transactions. And they essentially, a lot of them basically misrepresent the trade-offs involved with doing these kinds of things. And in other cases, they’re not actually decentralized or in most cases in almost all of them, all clients are not decentralized like Bitcoin is they have some kind of founder or they have some kind of benevolent dictator.
They have some kind of centralized foundation that can coordinate forks and changes in the protocol. They can roll back things. They can change the rules or they are in other cases, the actual running of the nodes of those old coins is not decentralized. It’s not easy for an average everyday retail individual to run a, the software that enables people to run that.
Coin, if you will. And the other thing as well is that some of them essentially try to confuse people with utilities, right? So the way to think of that is it’s not necessarily about having more utility for something it’s about considering why is something money and why would it be useful? What makes something a better money than others?
And one way to think of that is to think about exactly how scarce Bitcoin is and from a, what we call stock to flow perspective. So I would say that for people looking at things from like a utility point of view, remember also that having utility doesn’t necessarily mean value will accrue to that token.
So people, as an example, people might just use that token merely in a pass through sense. They won’t be there trying to hold it. So in economic parlance, we have to think of it. What is the reservation demand for these coins? And ultimately Bitcoin has a reservation demand, and it’s growing steadily over time because people do want to hold it for the longterm.
There’s actually a reason to do that. But because of, thinking in utility parlance, people think of it wrong. And maybe another way to think of it would be like, okay, so imagine you’ve got your bank fees that you’re going to have. Would you prepay your bank fees or would you merely just pay them as, and when they come due and imagine if I said, Oh, Hey man, this is coin.
And it’s called bank coin fees or bank fees coin. Would you hold that coin? No. You would hold the thing that’s going up the most. Or you would hold your thing. Hold the thing that at least stores your value for the long-term I E in this case, Bitcoin. And then periodically, when you needed to pay your bank fees, you would just pay a little bit of that Bitcoin as your bank fee.
That’s really the way I would navigate some of these things. And that’s why in this space, I basically Bitcoin only I encourage other people who are learning just to go a Bitcoin only. And don’t. Waste time learning about and getting involved in these shit coins, because a lot of there’s a, there’s this whole industry around scamming retail, people into buying the issued coins.
There’s a whole kind of inside a game where basically the creators of that coin work with maybe fund quote, unquote crypto fund managers of that coin. They try to get that kind of listed on some shitcoin casino exchange because they know that will be a real big, massive liquidity event. And then they dump onto the junior unsuspecting retail that has unfortunately been the phenomenon that we’ve seen in 2016, 2017.
And to some extent, we are now seeing history rhyming with some of the coins now with like defy coins and things like that. So that for me is why I’m very. Strong on that terminology. I think people just are getting misled and thinking that these old coins are something like Bitcoin, when really they’re nothing like Bitcoin.
Now some of the exceptions, I would say here though, I things like let’s see stable coins, right? So these are intended to represent Fiat, right? So as an example, USD, T like tether, which represents a U S dollar, right? So I can see a case for people using some of those more in a, I need to get my money out of the country sort of thing, or where they need to maneuver around the system and having a crypto version of Fiat might be handy.
But in terms of. Actual cryptocurrencies. The only one I actually use is Bitcoin. The only one I really talk about is Bitcoin. Obviously out in, out there in the space, you’ll see other people talking about them, but I would say, think of it this way. Bitcoin is actually a decentralized protocol and community of people or communities of people.
And they don’t have a necessarily a marketing budget. The reason why people might’ve heard of many of these shit coins is they actually do have a marketing budget. They have, whatever it is like dash and whatever, they have a foundation and they might have what’s called a pre mine where basically they issue themselves a lot of the coin.
And for example, with Ethereum, Ethereum was pre-med. I think it’s 70%. If I recall correctly, 70% of Ethereum was pre mind and given to early investors or co-founders and creators and all sorts of things like that. Whereas Bitcoin was actually a failed launch. There was no pre mine. It was totally just a here’s the protocol.
You can mine on it if you wish. And yes, Satoshi was one of the early miners on the protocol, of course, but it wasn’t open and fair launch. The protocol, the white paper was listed or launched in 2008. People had noticed before the network was actually started in January, 2009. So that’s how I would distinguish that between Bitcoin and shit coins.
Captain FI: [00:16:37] Wow. So the old coins or shit coins, actually, I quite liked that term, Stefan. That’s great. They’re like penny stocks. If we’re going to equate this to traditional financial independence, people are probably more familiar with the stock market. And Bitcoin is almost like your blue chip or your blue coin, so to
Stephan Livera: [00:16:55] Yeah. I know I used to follow some of the FII fire, financial independence, retire, early material myself. And so I guess to analogize, you know how a lot of people in the, in that community are talking about, maybe they’re Bogle heads and they’re very into Vanguard global stock ETFs.
Bitcoin is like that Vanguard global stock ETF. It’s the low cost solid option that you just buy this thing. And it just goes up over time. That’s Bitcoin, whereas like gambling on these random pink sheet stocks and things. Those are shit coins.
Captain FI: [00:17:25] Yeah. That makes a lot of sense. If if we’re going to think of a Bitcoin as a blue chip stock, a lot of people have got very different ways to value stocks.
That leads to the question, Stefan, how do you value Bitcoin or any
Stephan Livera: [00:17:42] Very good question. And this is a tough one for people coming from a traditional investor mindset, because most of us are thinking in terms of stocks, bonds, or property, and stocks have, they have dividends and they have capital gains and property has rental returns and capital gains, and bonds have a coupon and face value that you receive at the end.
Whereas Bitcoin does not have that. We have to think of Bitcoin more like it’s a monetary adoption. And so that’s why it’s hard to value Bitcoin in that way. It’s not, you can’t think of it. Like it’s going to have dividends that it is throwing off or bond coupon yield, or it’s not like that. It should be thought of as a monetary adoption thing.
And so if we were to think of relative market sizes, so as we speak today, Bitcoin’s market in USD terms is something around 1 trillion. The global market for money is something like 90 trillion. The global market for wealth storage is something around 300 or $400 trillion in USD terms. Now, if we were to think of Bitcoin as, okay, what if it just did digital gold will then gold today is something like nine or $10 trillion in terms of the total market.
So that means Bitcoin would go roughly 10 X if Bitcoin merely supplanted gold. And we think gold Bitcoin is actually not just gold. It’s actually a hundred or even a thousand times better than gold. It does what gold does only better. And so we think it’s going much higher than that. So what I would say is think of it, like there are potential valuation cases or theses that we would consider.
One example would be to think, the gold case, which is, call it 10 X from here. So basically that’s if even if Bitcoin only does what gold does. We’re talking something like $500,000 a Bitcoin. And then if Bitcoin actually goes after some of the other global store of value market, then we’re considering things here, like property stocks, bonds.
We are talking in the hundreds of trillions as a potential market. And so funnily one, each one of the early Bitcoin pioneers, and he wrote some of the actual pre predecessor work and contributed to predecessor work, help Finney in the early days of Bitcoin actually force or some of this as well. And he was saying, look, if we were to just back of the envelope, numbers calculated out based on global wealth, Bitcoin might someday go to $10 million in us dollar terms, purchasing power terms.
And so the way I’m looking at it is if you were to think of it, like the bear case for Bitcoin, if you will, is to go 10 X or me about 500 K. And in us dollar terms and the bull case then is I, and I think most of us hardcore Bitcoin people are thinking of it in these terms is that it is literally going to millions of dollars per coin.
We’re talking $10 million a coin. And we don’t know when, of course, but it might be 10, 15, 20 years from now that it it approaches that more lofty vision.
Captain FI: [00:20:40] It almost seems like you’d be really, I miss not to have a small holding of Bitcoin. I’ll look up step in. I was pretty skeptical about all this.
And I’ve put a small investment in Bitcoin and I’m considering raising that in terms of your investments. What percentage would you have invested in Bitcoin versus traditional stores?
Stephan Livera: [00:21:03] I’m not really comfortable with disclosing the exact percentage, but let’s just say very high percentage, like extremely high percentage.
Because essentially. I understand that there are different levels of people who are into Bitcoin, right? So some people might be, let’s say, toe dipping, 1% something. And then over time, what happens because of the sheer out-performance of Bitcoin relative to everything else on average, historically for the last 10 years or so, it’s been doing 200% per year that’s category, accumulative annualized growth rate is something like 200% per year.
And so essentially what happens is yes, it’s volatile, but if you basically hold for four years, plus you end up very high in the positive. So even people who let’s say they took a 5% position after a few years, that might end up being a 20%. Position. And then after another cycle that might take them to 80 or 90% and yes I guess people who are being very financially prudent, they end up rebalancing.
But the hard reality is for a lot of people in the Bitcoin world, they don’t rebalance or they maybe they take a little bit off, but they essentially keep holding it because as I’ve gone further and further down the Bitcoin rabbit hole and learning about the history of money and why things are so screwed up in the way they are right now, in terms of the crazy bubbles that we are living through and seeing in terms of stocks, property, bonds, everything that people are looking at Bitcoin as an Answer, it’s an exit, it’s all sorts of things, but fundamentally it represents the fastest running horse as Paul Tudor Jones would say,
Captain FI: [00:22:34] now that’s quite prudent because I’ve just seen the headlines here in Sydney.
A I think it was a Bondai property. Went up and just sold for 900,000 above reserve. So I think there’s definitely a, something weird going on with assets. And I think it’s probably related to record low interest rates. So it’s interesting to see people using Bitcoin as I guess, a hedge against those traditional stores of wealth and fear currencies.
Stephan Livera: [00:23:02] And so I would say, what is driving a lot of this crazy bubble is cheap credit. And so it comes down to looking at the underlying root cause of what’s going on. And so in my view, that is central banking, legal, tender laws, and various other government interventions into the market for money that have created this bubble, if you will.
And so what happened call it? So I’m a millennial and I think essentially for many people. In my generation and perhaps zoomers as well, they feel like they’re locked out of the property market because they either have to go leave her to the hilt, to even get a property where let’s say the generations above us.
So gen above my generation, gen X and baby boomers generally they had it a lot easier in terms of getting a property now. Yes, the interest rates were higher at the time they were buying property, but from a multiple, in terms of their income versus the amount of the house they had to buy, let’s say it might’ve been in the range of three to four X, their income, to buy a house at that time for the boomers. And then what’s happening now is that caused, if you will, a generational crazy run to property and it changed the culture. So I view it like Fiat money was like this ultimate root cause. That then drove a change in economics, which then drove a change in the culture and drove a change in the politics.
And so that is why, if you look at a lot of countries around the world, and obviously Australia is one of them that has this huge property Cult it’s all about you go to the barbecues and everyone talks about their property that they bought, and it’s all been driven by cheap debt. So we’ve been going through this multi-decade huge bull run for 30 or 40 years, or even more, maybe 50 years that boomers and gen X.
And maybe to some extent, the older millennials have had a massive leg up in that regard. They have simply been able to just buy property or buy stocks, go to the beach and that’s it, right? Like you just do that. And after 30 or 40 years, you’re a multimillionaire, but the reality is what’s going on is we’ve seen a massive devaluation in Fiat money and it’s just driven these huge bubbles. So because of all this kind of credit slushing around out there. It creates this kind of scenario where people end up being priced out or at least younger generations end up being priced out.
So I see it like Bitcoin in some ways is what stocks and property were for their gen X and baby boomer parents all those years ago.
Captain FI: [00:25:32] This kind of links to the defy movement, which is something that I’ve only recently heard about or decentralized finance which is supposedly a way to. Overcome that whole issue with theater and credit. My understanding is it’s a way that you can earn a yield on your cryptocurrency. Do you know much about DeFi and is that something we can get into using bitcoins?
Stephan Livera: [00:25:56] Yeah. So defy is an interesting one. I see it like Bitcoin can actually do defy.
Bitcoin is a kind of decentralized finance in that sense. There are platforms where you can borrow against your Bitcoin. And there are platforms that allow people to earn stable coins there’s interest, right? And so some of these are actually sponsors of my show. But there are others out there in the Bitcoin world, but there are also a lot of shitcoin defy and I would be very careful with some of these shitcoin defy because a lot of these things end up basically things like rug Paul’s end up happening, where someone changes a smart contract or something, some condition changes. And the reality is it ends up just being this. Poker game where only the top 1% of either insiders or extreme high intellect individuals end up basically ponying or earning the wealth of other people. Yeah. Unless you, I think you, unless you rate yourself as being one of those defy shitcoin insiders, or you are maybe an extremely skilled player of that game, maybe you can read the actual smart contracts going on in shitcoin defy land, then you’re very likely to lose money there.
And so my perspective is Bitcoin defy is what people could be looking at if they were, let’s say they’re sitting on a decent amount of Bitcoin and they want to be able to try. And in some sense, unlock the value of it and be able to use some of it without necessarily taking a capital gains event when you sell Bitcoin.
So instead of selling, they might borrow against their Bitcoin. And so there are some multisignature platforms. So I guess I don’t want to get too technical, but I guess the high level way to think of that is you might put some Bitcoin into a locked up. A multisignature. So that might be a two of three where you’ve got three different parties and you need two of them to agree before you can spend that Bitcoin.
And so you might have a lending company, or you might have a facilitation company that is essentially acting as one of the keys in that scenario acting between you, the borrower and the lender. And then you can get some USD, T let’s say, or some USD stable coins that allow you to spend now while, and then obviously you have to pay interest.
There are, it’s not without risk though, so you can get liquidated if the price moves against you. But that’s part of a phenomenon that is growing quite rapidly now. So that is something that we are starting to see. And there are other providers in the Bitcoin space who are doing like interest on Bitcoin.
Although personally, I think that is a very high risk strategy and I think really people have to be extremely careful with these things because we’re so early in this. And from my point of view, I see it like Bitcoin is growing in purchasing power on average 200% per year. Like why do you need to go and chase even more interest on top of that?
If you just literally learn the right way of holding Bitcoin, which is to hold your own private keys, meaning you can use, for example, a smartphone Bitcoin wallet, when you’re just getting started. And then as you move up, you might get a hardware wallet, and then moving on from there, you might use a multisignature security setup for your Bitcoins once you have a big enough value in them.
So I would, Say it’s one of those things where you might want to learn about it and get, try to understand what’s going on in the Bitcoin defy world. But for the most part, people should be looking to accumulate and they should just be thinking of it. Like it’s a savings plan and savings technology.
And that is why I’m a big fan of some companies in the space. And I support some of them I’m involved with some of them as an investor or an advisor or just a promoter of them. It like, even if they’re not paying me that there are companies out there promoting DCA dollar cost averaging or what is also known as auto buying or stacking SATs.
Right? Satoshis so the idea is that they are helping people to just regularly accumulate Bitcoin and store them in their own Bitcoin wallet. So I’d say those are a few of the things to think about in terms of defy and how that applies to Bitcoin.
Captain FI: [00:29:45] We mentioned the cheap credit. So there’s money flooding into Bitcoin markets and a lot of options, traders some bears, some bulls and I’ve heard that there’s a lot, nearly $6 billion worth of options set to expire at the end of this week. Do you think that’s going to have an effect on the price of Bitcoin at all?
Stephan Livera: [00:30:09] I think it, I don’t follow the options market, like really closely in terms of Bitcoin options.
But I think it’s one of those things where it’s just a growing thing over time. And if you think through who the natural users of some of these markets are the reason some of those financial markets started is for example, farmers who needed to have a more complicated and financial products to do things like.
Setting a set price for which they could sell their commodities, whether it was weight or corn or soy or oil or whatever. So in the Bitcoin world, it’s minors, they are using mining equipment and they might be looking at trying to hedge out a certain exposure and just lock in a certain price rate.
But then on the other hand, there are speculators and traders who are taking the other side of that trade. So that’s one way to think of that. There, there is also as a, on my show, I’ve interviewed a gentleman known as plan B. He’s very well-known in the Bitcoin world. And he has been speaking about this whole cash and carry trade.
So that is also a trade that some people are applying. And I think you need a certain level of capital to be able to do this kind of play. It’s not necessarily available to the retail user, let’s say, but essentially they are able to. Capture a premium and it’s like a, almost like a risk-free rate. And now it’s not exactly risk-free, there is still like a platform risk with that, but essentially by selling these options selling a forward.
Selling a future, rather, I think they are able to capture something like 15 or 20% of gen of a return. Now they are giving up the upside of Bitcoin though. So basically they’re buying Bitcoin and selling it forward and capturing that premium by giving up any upside beyond that.
And in the Bitcoin market, things can move very quickly. So that is one of the risks to consider with that sort of strategy. But for people who are in the more Fiat institutional world, they would look at that and think, wow, that’s a huge return compared to what I’m getting here, because yields are really bad in the normal markets.
So that’s one element there, but I would say the underlying aspect. Why is that happening is because people are just fundamentally bullish on Bitcoin. There are these big corporations and individuals and even small businesses who are out there stacking sets. So that’s, what’s essentially driving this overall upwards trend.
It’s monetary adoption.
Captain FI: [00:32:28] Okay. So it’s a, it’s more of a consequence of the momentum of the growth of of Bitcoin. Exactly. Yeah. Okay. So it’s somewhat, probably increasing the volatility or the increasing the growth.
Stephan Livera: [00:32:41] Yeah. So I would say it’s just a part and parcel of Bitcoin growing up. So in the early days that, it was hard enough, there weren’t even exchanges.
And then over time exchanges were growing up and now there’s like solid exchange infrastructure. And then maybe there wasn’t really great institutional custody, but now that’s changing as well. And now we’re starting to see big companies coming in to do it. And now we’re starting to see the markets around Bitcoin growing up also.
So there are spot exchanges and derivative exchanges for Bitcoin and the volume of which is growing quite rapidly, obviously this year. And so I just view this all as part of the network effects of Bitcoin strengthening and growing stronger, deeper, more people who want to hold Bitcoin and more and more people who are trading Bitcoin.
And it’s all just part of the overall growth story.
Captain FI: [00:33:27] . So you mentioned earlier that there were some fiat backed coins. Now my question is, are those feedback coins, are they backed by sovereign States? Are they regulating their own crypto? And would it be possible, say, could the U S government, could they ban Bitcoin and then launch their own fear currency?
Coin on the blockchain. And what
effects do you think that would have on
Stephan Livera: [00:33:54] the economy? So I guess there’s a lot to unpack there. So firstly with most of the stable coins, like the U S dollar stable coin, for example, there’s many of them USDA is probably the elephant in the room, the big one.
And so they are theoretically meant to be backed by us dollars in a bank account, but there are, that has been a point of contention around various like kind of drama in the space, sometimes lawsuits and stuff going on, but essentially the recent round of that, I think it seems that tether settled.
So in this case, the big one they settled with, I think one of the U S government departments on that point. And so personally I’m not that concerned by that, but I guess to your other question around, would governments set up their own where they try to ban Bitcoin and set up their own. And I think from an Australian context, I think the Australian government is more.
If anything, the Australian government is more concerned about stable coins than they are about Bitcoin. And I think in terms of internationally, it seems to me that most governments are not, they’re not as, fundamentally bullish about Bitcoin as I am. So they are seeing it more, just Oh, it’s like a digital store of value.
It’s just like a goal, like a digital gold kind of thing. That’s how they are viewing it. And so they are more interested in terms of regulating from an AML and sanctions and some of these other like banking, typical banking regulations that are applying to businesses who are interacting in the Bitcoin space.
Now, do I think it’s likely that some of the central banks around the world try to come out with their own stable coins? Yes. I think that is a likely possibility, but we might be a couple of years off before we see that become a real mainstream possibility. So for example, Christine, the God of the ECB, the European central bank has mentioned.
Publicly, I think three to four years off before they have a Euro government backed stable coin. Now these will represent a very big angle of a panopticon if you will, because it allows all the surveillance that they’d can’t have with normal cash. And because cash is going away, I see that a lot of countries will try to launch their own stable coin and then it’ll just be like a government Fiat crypto coin basically.
And so it’ll allow them to control the inflation. It’ll allow them to control what you can spend on it, allow them to see, what people are doing. Whereas in the Bitcoin world, people can trade into that. And most importantly, the monetary policy, right? So Bitcoin has a set limit of 21 million.
It’ll be never more than 21 million, or it will never be more than 21 million. And so fundamentally people who just look at a price chart, we’ll just see Bitcoin going up and the stable coin going down. And yeah. I see this it would just be another angle for people to get comfortable with the idea of digital money, even though most of our money already is digital.
But they’ll just get comfortable with that idea. And then some of them will start buying and using and transacting with Bitcoin. So that’s, I think the likely outcome over the next few years there is that we just see more and more people come into the Bitcoin world and they might swap out of a stable coin into Bitcoin.
Captain FI: [00:37:00] That’s a really interesting point you make about most of the money is digital anyway, because I can’t really think about the last time I actually paid for something using cash. . So it makes sense that these Sovereign listed stable coins are probably exactly, as you said, just an extension of the fit currency.
. I know you mentioned that obviously you’re quite bullish on the growth of Bitcoin as the sort of a capital growth phase. Now with that you often see, I’ve seen cycles of things go up in value and they correct.
We saw Bitcoin, correct. In 2017. Do you think there could be something similar to the 2017 correction within the, five
Stephan Livera: [00:37:42] Yeah. This is a big debate in the community, so Bitcoin has moved historically. In these four year cycles. So it started in 2009 and we see that it has traditionally gone around the having cycles.
So the hard thing for people who aren’t familiar the way Bitcoin is issued is in the early years, it used to be 50 coins, every block. So every 10 minutes on average being issued or mind into existence, and then after four years it ha it happened a little bit ahead of schedule that Harv’s. So every four years on average, that we’ll have.
So in 2012, that block subsidy went down from 50 to 25 coins. And then in 2016, that went down to 12 and a half. And then in 2020, it went down to 6.2, five coins. And interestingly, what we have seen is after that, having of, the having of incoming supply, so it’s not a having of the overall supply, it’s the having of the newly created coins.
We have seen a bull run happen, something like nine months or so after that Harvey. So in 2012, the having happened and then 2013 was a crazy bull red bull run year. And similarly in 2016, there was a having, and then in 2017, there was a crazy bull run year topping out around 20,000 in December of 2017.
And then from then til about December, 2018, it grinded down and it was something like an 80% drop because it went from 20 K down to maybe three or four K at the bottom . And then it hung around the kind of eight, nine, 10,000 range for a little while. And then we had the having again in 2020, and now as we speak, we’re around 54, 55,000 USD.
So it’s funny because. People could have bought Bitcoin at something like 5,000 or 4,000 in March of 2020. And now we are, a solid 10, 11, maybe 12 times that, yeah, it’s incredible in that. Yeah. So in terms of the cycle, I think we are likely to have at least one or two more of these. So for all I know, and again, this is one of those things where nobody has a crystal ball, but a lot of people in the community are anticipating the cycle top this time around, it might be anywhere from, 250,300,000 range.
And then who knows where we drop, maybe it drops to 50 K from there. We really don’t know there are others out there who say, it’s actually going way higher. Am I go to a million or something? This cycle we don’t, we really don’t know. And then there are some in the community who think.
Now the whole four year cycle thing is over, and this is the final one. For me, I don’t think this is the final one. I think we’re probably going to have a few more of these on the way up. I think we are just not there yet in terms of global adoption, but the counterpoint would also be, look, the macro environment has also changed March 20, 20, changed a lot of things for people.
And that was what spurred many other people along on their own journey, such as Michael Saylor of micro strategy to start going and buying Bitcoin and using it literally as his corporate treasury reserve asset. And then Tesla bought in and now all these other companies are buying in and all these billionaires and investors and insurance firms are even buying in.
So it’s tough to say where this all goes in terms of later this year, but my. Call it, my base expectation is that we will have a huge, crazy bull run over the next call it three to six months. We, and then it’ll probably start a little bit of a down cycle because we, if in some sense, got ahead of ourselves.
So we overextended somehow and then we’ll have a little bit of a down cycle. And then maybe in a couple of years, it’ll be rinse and repeat, but just at another level up.
Captain FI: [00:41:32] It sounds very similar to , the S and P 500 chart. If you go back, you see it does that, it gets up peaks has a correction goes down and then it keeps coming up.
But over time you see a general upwards trend in the market. So maybe that’s what we’re going to see with,
Stephan Livera: [00:41:49] Exactly. And that’s why I, when I talk about Bitcoin, I think of it like a longterm holder and, just like Warren buffet says his favorite holding period is forever.
Just like with Bitcoin where you need to think of it like that. And so I would suggest for people who are getting into Bitcoin, they should be really trying to learn about the philosophy, the history, the economics, the technology, learn about all these aspects of Bitcoin and think of it like it’s a minimum absolute minimum four year hold.
And historically now of course, we don’t know if the future what the future holds, but historically. So even if you timed it at the worst possible time, if you held for four years, you still ended up five X or six X something in that range. And then if you timed it you people were getting 30 or 40 X on that money.
So really think of it like a long-term thing that you need to spend the time learning. And that’s where people can listen to my show, the Stefan Lavera podcast, and they can find all sorts of Bitcoin education from an economics and technical point of view, but really that’s what it takes in terms of building up your knowledge and your conviction over time to understand why you should be holding this and playing this as a longterm.
Strategy, as opposed to trying to time in a short term, buy and sell and trying to time the market, because the reality is people who end up doing that and are losing a lot of money because they end up paying, capital gains tax. They end up paying trading fees. Then they don’t call the top and bottoms correctly.
The reality is they end up losing a lot of money, trying to trade in and out and they sit there thinking, Oh, wait, I’m waiting for the next day. Oh, I’m interested, but I’m waiting for a dip. And then the dip doesn’t come for a long time. It’s just basically the easy, the best way I would suggest is just start with a small amount, like by whatever amount you’re comfortable and to start learning.
And then as you become more comfortable, then slowly increase that and set up some kind of auto DCA or dollar cost averaging kind of plan. That’s probably the way to think about it, but just think of it like this money you’re putting in it’s minimum four years before you’re even thinking about it.
Captain FI: [00:43:48] With those bigger companies, like Tesla and micro, micro strategy investing in crypto and even with, as you said, some of the larger insurance companies following suite, it would seem that if a traditional investor is holding an index fund or indeed stocks of those companies, did they not now have an indirect exposure to crypto just by virtue of holding that stock?
Stephan Livera: [00:44:16] Of course, you’re right. They do have an indirect exposure, but what I would suggest is you want direct exposure and the reason being you don’t like Bitcoin is a special thing and you have to treat it with that respect. So I would say for people coming in the traditional investor world, don’t treat this, like it’s a stock just on your stockbroking interface and you just buy it and you leave it there on that exchange.
No, you have to learn to actually. Like actually use it for yourself. And that means holding it on keys. You control meaning on a hardware wallet that you control or a smartphone wallet, and ideally over time learning about how to run your own Bitcoin note because Bitcoin works by what we call decentralized validation.
So I’m not expecting people to do this on day one, it’s a learning journey, but I would think of it like when you saw it, you start buying some, and then you learn to withdraw that to your own. Custody. And then you learn to actually validate for yourself and learn to use Bitcoin in a way that you are minimizing the trust in other parties.
So don’t think of it. Like it’s a stock that you leave on the chess sponsored brokerage and they hold it for, you’re going to something you hold. And that’s probably a big mental shift that people have to make when they’re first learning about Bitcoin. But that’s essentially what I’m trying to guide and warn people about that, that you want to learn to do it for yourself because the whole point is you can spend and save in a way that you are not beholden to what other people do.
Because for example, if you leave your coins on a platform on an exchange somewhere, or we’re still, if you use a platform that doesn’t even let you withdraw your Bitcoins, then you might be beholden to what happens. There, there might be exchange hacks. They might change the requirements or change something.
Whereas when you hold the Bitcoin yourself and you are running your own Bitcoin node, You are not trusting any of these people and you can send it and save it and do exactly as you please. And not just that, I think you will get more of the gain because I think if you try to rely on indirect exposure by holding Tesla or holding micro strategy, fundamentally you won’t get the same kind of gains that were possible by just holding Bitcoin natively a more directly.
Captain FI: [00:46:32] Okay. And so for those reasons it sounds like it’s probably not a good idea to look at crypto ETFs or listed funds for crypto exposure
Stephan Livera: [00:46:41] So I guess that’s a complicated question because for some people I can understand where maybe. If they are not even willing to do that work, maybe like you could argue, okay, maybe it’s net better that they at least buy a Bitcoin fund.
And maybe if they, if there’s work being done on things like having Bitcoin funds that super funds can invest in just to get exposure I guess it would help them on the margin that individual. But really, I would say if you’re the kind of person listening to the show, if you’re actually thinking about these things, you are probably smart enough and motivated enough that you can get a much better, you can do better than that.
You don’t need to just buy the ticker on a Bloomberg terminal or somewhere. You can actually go and set up with an exchange and buy some Bitcoin or go to an ATC and buy some Bitcoin or go to a local Bitcoin meetup and buy some Bitcoin and withdraw that two keys that you control and you will get it’s.
It’s obviously it’s a little bit more work, but it’s so much more reward
Captain FI: [00:47:39] and it’s the safety and the control, which is. Yeah. And that’s basically like everyone who’s in this financial independence movement. It’s all about building up enough assets and passive income to actually buy your time back and have control of your life again.
So yeah, it does seem interesting that someone would then. Give that control out to someone
Stephan Livera: [00:48:01] Oh, a hundred percent. I think you’ve put it very well there. And I think this is a funny thing. I think I see a lot of similarities between the Bitcoin community and the fire community. Because it really is about thinking through your time. I know a very well known book in the fire world is your money or your life by Vicky. I can’t remember her last name, but I’m sure it’s a one Vicky Robin fantastic book. Yeah. I remember reading that years ago and are very much aligned with that.
And I think a lot of Bitcoin people do see it like that, that there are very few things on this earth that are truly scarce because as humans, our ingenuity is incredible. We can go and make more things. We can economize on them. We can find substitutes as Julian Simon said in his book that the ultimate resource, but fundamentally, what are the only things on this earth that are SKUs?
It’s your time? And it’s Bitcoin. Fundamentally people who stack Bitcoins. Because of the incredible returns that Bitcoin has had 200% per year on average, historically they have freed their time up. And so there were many people who have, once they’ve been holding for a couple cycles of this.
Yes. It was volatile. Yes. It wasn’t easy along the way. There was bad news and Oh no, the government’s going to regulate it. Or it got banned in certain countries, but then other countries supported it. And so fundamentally people were able to free themselves and put their time into projects that they really love and adore, or it spend more time with their family or work on jobs that they actually really want to do.
So in the fire world, and I know it’s one of those things where people in the firewall talk about how, it’s not necessarily true, that the best thing is to be rich and just live on the beach, drinking pina coladas. Actually real. Fire is about finding what you are passionate about and finding something to retire to.
As opposed to just coming at that mindset of, Oh, I hate my job. I want to get out of the no, you want to have something that you’re retiring to, and you’re not necessarily retiring to sit on the beach and look maybe for some people that’s enough for them. That’s what they want. But ultimately, It’s about finding what you’re passionate about.
And I think many people in the Bitcoin world they’ve found, they’re passionate about building this parallel financial system. And that might mean they might be developing some software and the system they might be working in a Bitcoin company, helping in sales for that company or customer support, or they might be somebody contributing in an source project and documenting, or they might be somebody who is maybe they don’t have the skills themselves, but they’ve got a lot of money or they’ve got a lot of Bitcoin and they want to fund the kinds of development work that they would like to see whether that is additional privacy technology or scalability or resilience and allowing more and more people to use Bitcoin in the way it was intended.
So I think there is a real alignment and a synergy there between, the typical fire person and a typical Bitcoin person. It’s just, they don’t know it. And they don’t necessarily know a lot about each other’s worlds.
Captain FI: [00:50:55] Now, Stephan, this is new. There’s a new acronym. All right. On the internet. And I don’t. I don’t really understand it. And it’s an NF T I think that stands for non fungible token or non frangible token. Non-factor it’s something to do with cryptocurrency. Can you give us like a quick five on what that is and is it worth
getting into look?
Stephan Livera: [00:51:20] We were talking about shit coins, Ellia. I would basically put them mostly in that category, but look, that’s it. I can appreciate that. It’s like a thing where there are artists out there and they want to put a stamp of their work. But what I would say is think of it, like it’s something closer to an autograph than it is.
You are actually owning that artwork. Because, and you are in essence trusting that artist or whoever created that token is not just going to go and turn around and then go create more of that same type on that specific artwork. Or on that song or whatever it is. And now the thing is, yeah, it’s people conflate the, if you will, the Bitcoin world or the crypto and the shitcoin world along with the NFT world.
But I really think they’re just not that related. They’re just people just see it like this crazy thing where, some artists is selling an NFT for $69 million or whatever, and then they immediately, they might want to flip that over into Bitcoin to save it for the long-term.
But the reality is I like, unless you think that somehow you are some kind of special art collector or whatever, I would S I would stay very clear of this whole NFT phenomenon. I just, I, unless you, for whatever reason you want to get into that particular culture of. I don’t know, buying something off an artist for me, I see it there’s a very loose connection with the, they might say, Oh, see, you have this kind of certificate on the blockchain of this particular artwork or whatever that you have some kind of claim to it.
But the reality is a lot of these, some of these NFTs are really being done on shitcoin chains that we don’t know if they will actually be around in the future for the long-term. So I would be very careful before getting into any of those kinds of NFT things and just, I would say there’s really, to be honest, not much relevance as well from a fire perspective.
It’s really more just, stacking Bitcoins that has a fire relevance,
Captain FI: [00:53:11] Roger, that I’ll steer clear of NFTs and shit coins and I’ll keep. Oh, keep whining about how to stack SATs. Cause I think that’s a cool, that’s a cool term. Stephan made, it’s been awesome to go through all of this stuff.
Thanks so much for unpacking this pretty complex industry. What I would love to do now is ask you a couple of questions that I get everyone who comes on the show today. And it’s more just towards your personal financial independence journey if that’s okay.
Sure. Yeah. Awesome. So I guess the first one, and you touched on it before but your personal investing preferences and styles and how, where do you store your crypto and how is the safest way to
Stephan Livera: [00:53:50] do gotcha. Yeah, so I use multisignature for my Bitcoin. I would say once you get to a certain level. You do need to start thinking about multisignature, which is a more advanced security technique, but in terms of tips for newbies out there, I would say when you’re just getting started, just start small and basic go on your phone.
There’s this wallet called moon wallet, M U N wallet. That’s a good, easy one. Just for a smaller values. If you’re just getting started with Bitcoin, that’s an easy one. It’ll get you started. It’s a good choice then going up from there, I would say, look at what’s called a hardware wallet. So my favorite choice, there is the cold card.
So now disclosure, they are a sponsor of my show. They’re are coin kite.com, but I was promoting them even before they sponsored me. I genuinely think it is the best a hardware wallet. And you can use that with some other software. I’ve done episodes as well on that, but I would say, yeah, look into the cold card as a hardware wallet, and you can use that with.
Kind of other software on your PC, like specter, desktop, or Sparrow wallet and some of these other ones, but that will take a bit of time to learn. Go and look at some of the guides on how to use the cold card, which I which I have, and there’s other guides out there and then advancing up from that, there’s this technology called multisignature where you use multiple hardware wallets and put them in multiple locations and make it even more difficult for somebody to steal your Bitcoins and so on.
So I would say that’s the high level kind of progression guide. And there are companies out there that will help you to get to use multisignature like Y so one example is Unchained capital. Now they’re another sponsor of my show. Another one is called Casa, so they’re not a sponsor of our show, but they’re also a, well-known like multisignature provider in the space.
You can use one of those or it’s possible if you’re more advanced to actually do it yourself. So those are some tips around securing your Bitcoins.
Captain FI: [00:55:42] Awesome. And for yourself personally, are you still investing in traditional other asset classes such as property or stock index funds or are you just focused on Bitcoin?
Stephan Livera: [00:55:56] Yeah, I’m actually just focused on Bitcoin because I see it I would rather hold the thing that’s going up the fastest and I don’t yes, of course it can be volatile up and down, but I think you want to be holding, you want to be riding the fastest horse. And so for me, I treated it, like I keep a Fiat buffer, like in the finance world, they talk about a six month emergency fund .
I keep, basically a Fiat cash buffer, but then basically I just continually buy a Bitcoin. So I treat it just like that. I live on a personal Bitcoin standard and so I pay my living expenses, bills, rent, whatever. And then the rest I stacks out, that’s essentially my strategy. But I understand, for some people that might be, Whoa, that’s like too much, that’s too crazy.
That’s way out there. I could, everyone has to pick their own allocation for themselves in terms of what they would do. I just don’t see much value out there in terms of bonds. They’re negative yield yielding. You’re not even winning against inflation there. Maybe, you could have like it depending on property or kind of stocks, but I just sense my sense of it is that stocks and property a way of valued.
And so that’s why I’m avoiding that, but that’s it, if you were to think of property, not for investment purposes, but more for consumption, let’s say you wanted the security of a property that you own to raise your family. That kind of thing. I can understand that’s totally fine. So I guess those are a few of my high level thoughts around.
Bitcoin versus other potential assets. Love it.
Captain FI: [00:57:27] And you seem very well versed in the financial independence space. And I know we were chatting before and you mentioned that you’re a big part of that community. What would be your top three tips for someone who’s on their path to financial independence?
Stephan Livera: [00:57:42] I think, step one is really, try to look at ways to grow your income, whether that means, you’re yeah. If you can try to work hard at your job and get promoted there or have a side hustle, step two is, keep your living expenses low. That’s really so it’s like playing good offense and playing good defense probably steps one and two, and then step three is stacking sets.
For me, I would say, yeah. So I basically look at ways to, eh, add more value to people, whether that’s in your current job or having a side hustle business that you can earn more money, play good offense. And then step two is play good defense. And keep your think of what your big expenses are.
And so in the fire world, the most common ones people talk about is stuff like, okay, how much is your housing? How much is your education? And do you have a car? So if you have a car and whatever try to. Keep it cheap, or maybe if you live in a city or some kind of area with good public transport, you can just go without a car.
That’s, I guess those are some tips that people can do, obviously, depending on your net worth and your income and so on. It’s really, I think those are that’s the simple way to do it is earn more, spend less stacks that, and that is probably the fire away. Love it.
Captain FI: [00:58:51] Last question here, Stephen. You obviously didn’t get to the level where you are today without learning from people before you. What, or who has been the most influential people, experiences or books on your path to financial independence?
Stephan Livera: [00:59:08] Yeah, good one. I would say from the fire world that I remember reading guys like JL Collins and I remember reading some of the other bloggers out there, like Mr. Money, mustache, and some of those guys, I would say from the fire world, those guys were influential on my thought, obviously from a Bitcoin perspective, they weren’t, but I would say also this guy, roommates say to you, who’s well known in the personal finance world as well.
I would say those are some of the people who I guess influenced my thought also the Bogleheads kind of community, obviously Jack Bogle and the Vanguard, that kind of product suite, was influential on my thinking from the fire perspective from a. Bitcoin perspective. It was more of the Austrian school of economics.
So that’s, people like Ludvig Von Masis, Murray Roth, bod Gedo Holzman, Joseph Salerno, my friends, safety and immerse, who I’ve interviewed on my show. Pierre Rashad, Michael Goldstein, VJ boy party. Some of those guys from the Bitcoin world have been influential on my own thought in, in terms of how I think about Bitcoin.
And so for me, I’ve honestly, I’ve thought of it like a meshing of those approaches. It’s just that I see Bitcoin as the way to actually save and, consider that as my savings technology for the longterm. And so that has essentially been my path to how I think about fire.
Captain FI: [01:00:27] Stephan finally, where can people get in touch with you and where can they listen to
Stephan Livera: [01:00:33] Yeah. So thanks for having me on the show. My show can be [email protected] You can find me on basically any podcatcher platforms Spotify and all the rest of it on YouTube and the Bitcoin Twitter. The Bitcoin community hangs out a lot on Twitter. So you can find me there on Twitter at Stefan Rivera.
And then for those of you who are interested in things like Bitcoin guides and how do you use it for yourself? I also have a business called ministry of nodes. So you can find [email protected] Those are probably the main places, but basically if you just search Stefan Rivera, you’ll find me online.
And I, my DMS are open. I’m happy to help people. If they’ve got questions on Bitcoin. Awesome.
Captain FI: [01:01:10] That’s very generous of you to put that offer out there. Stefan for anyone who’s interested check out the show notes. I’ll have links to all of those down at the bottom, as well as the the transcript.
So again, Stephen, thanks so much for making time out of your busy schedule to have a chat today. I really appreciate it. I’ve learned a lot myself and I’m sure everyone who’s listened to her, taken away a heap of great tips.
Stephan Livera: [01:01:33] Excellent. Thanks for having me.
Captain FI: [01:01:35] Thanks for listening to another episode of the captain fi financial independence podcast. So read the transcripts or check out the show notes, head over to www captain fire.com for all the details. If you have a question for the captain, make sure to get in touch, you might even make it on the airwaves.
You can reach me online through the captain FI contact. Get in touch through the socials. I’m active on Facebook and Instagram as well as a number of online finance and investing forums. And finally remember the information presented on the show and the links provided, Oh, for general information purposes only they should not be taken as constituting professional financial advice.
You should always do your own research when making any financial decisions and make sure it’s appropriate for your personal circumstance.
Captain FI is a Retired Pilot who lives in Adelaide, South Australia. He is passionate about Financial Independence and writes about Personal Finance and his journey to reach FI at 29, allowing him to retire at 30.