Earlier last week, Space X’s Elon Musk, Twitter Founder Jack Dorsey, and ARK Invest Founder/CEO Cathie Wood took to YouTube to discuss the current narrative surrounding Bitcoin — including its main issues and applications.
In the talk, a number of intriguing points were made by all parties involved, which can help demystify Bitcoin and shed some light on how its shortcomings may be resolved in the near future and how Bitcoin fits into the future financial landscape.
Here, we briefly recap some of the key points made in the talk and include the analyses made by Master Ventures Founder and CEO Kyle Chasse in his recent YouTube reaction video. With this, we hope to provide an insider perspective on these major points to help you read between the lines and get a clearer understanding of their significance.
Elon Musk and rule-based digital currencies:
Elon Musk was an early pioneer in the digital payments space, having founded PayPal in 1998 alongside Peter Thiel and several other key players. Therefore he knows a thing or two about the limitations of legacy financial networks.
“I think he wanted to do it in a way that was less centralized and regulated, but he got shut down. […] The only reason Bitcoin was able to do what it did was because it didn’t ask for permission before launching,” said Kyle.
On the security and speed of legacy systems:
Elon Musk openly stated that the vast majority of legacy payments systems use batch processing for transactions that can take ~1–5 business days to clear, whereas the ACH (Automated Clearing House) system and credit cards are not secure. He goes on to argue that there is definitely room for an alternative that improves efficiency and minimizes sources of error (including fraud and government interference).
Kyle’s take: “What he’s saying is, right now Bitcoin is a more efficient and trusted version of a (financial) data transfer (system).
Bitcoin solves some, not all legacy problems:
Being decentralized and transparent, Bitcoin eliminates the problem of coercion, “since there’s no throat to choke” — as Musk puts it. “But transaction volume is low, transaction cost is high, and usability for the average person is not yet very good. But it has potential,” elaborates Musk. He ends the point by stating that he is a supporter of Bitcoin and cryptocurrency in general.
Kyle’s perspective: Elon has previously talked about the energy issues that surround Bitcoin and recently made the statement that Tesla would stop accepting Bitcoin payments until it becomes more energy efficient. Kyle recently covered why Elon made this statement in a previous video but it has a lot to do with the fact that Tesla makes a lot of its money as a renewable energy company that benefits from carbon credits.
Bitcoin’s environmental impact and Dogecoin:
Expanding on his views about Bitcoin’s energy consumption, Musk noted that while he is a supporter of the technology we do need to watch out for how much energy its proof-of-work (POW)-based mining system uses. He also dropped that he personally owns Bitcoin and a “little bit of Ethereum and Dogecoin, of course,” and that both Tesla and SpaceX own Bitcoin.
Reacting to Musk downplaying his DOGE holdings, Kyle had the following to say: “It sounds to me like Elon doesn’t really believe that Dogecoin will be the currency we end up spending around the world,” comments Kyle. This, despite his known Dogecoin-related Twitter antics.
Jack Dorsey on Bitcoin:
Dorsey opened by discussing the “slow and obtuse” financial system he faced while building Twitter and quickly touched on the “predatory nature” of the financial industry before moving on to his perspective on Bitcoin. “When I saw Bitcoin in 2009, you see a chance to replace the whole foundation. And everything that Elon was talking about in terms of ACH and the credit card networks were built with very different agendas,” said Dorsey. “It’s crazy that they still exist.”
‘His morale seems quite low and disappointed. I’m sure he’s been so restricted by censorship and being told what to do. You can tell he’s disappointed in what he built (Twitter) has been forced to become,” said Kyle. This restriction is likely a big part of why he has a keen interest in building a fully decentralized social media platform.
What Bitcoin Can/Can’t Do:
When asked to expand on a previous statement made on the capabilities of the Bitcoin blockchain, where the Twitter CEO reportedly indicated that Bitcoin can do everything, Dorsey responded by arguing that a lot of today’s monetary policies and systems “cause so much distraction and so much cost.” This, before stating that had Bitcoin existed pre-Twitter, YouTube, etc., that they certainly wouldn’t be using the same business models as today. But that Bitcoin “really just opens the aperture” for what’s possible.
“There’s a lot of issues with the Bitcoin blockchain as a base layer protocol. […] Ethereum just isn’t cutting it either,” said Kyle. That’s why Polkadot, Cardano, and other smart contract-capable chains exist.
Note: This content was adapted from a YouTube video recently made by Master Ventures Founder and CEO Kyle Chasse. Want to watch the original video? Click here for part 1 or click here for part 2.
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About Master Ventures
Master Ventures is a blockchain-focused venture studio helping to build the next generation of blockchain-based Web 3.0 system innovations within the crypto industry. Launched in 2018 by Founder and CEO Kyle Chassé, the company’s ethos can best be summarized in the acronym #BeBOLD: Benevolent, Open, Love, Decentralized.
Master Ventures co-creates with entrepreneurs and businesses worldwide to turn the best ideas into innovative and disruptive products. They do this by investing as strategic partners through offering advisory services to the projects they believe in. To date, Master Ventures has invested in over 40 crypto projects, including the likes of Kraken, Coinbase, Bitfinex, Reef, DAO Maker, Mantra DAO, Thorchain, and Elrond.
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