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Crypto Currency Communities – an Interview

Intro: You are listening to the Crypto Core Podcast, exploring the fascinating world of cryptocurrency with your hosts Blake and Brandon De Shaw. Please visit us as www.cryptocorelabs.com.

Blake: Hello and welcome back to another episode of the Crypto Core Podcast with your hosts Blake.

Brandon: And I’m Brandon DeShaw.

Blake: And today, exciting day, we have Sye here.

Sye: How you guys doing?

Blake: So we invited Sye on the chat because he’s been trading in the market and in overall interest in cryptocurrency; introduced Brandon here to Crypto Cousins Podcast. And so yeah we’re excited to have him on as the first interview.

Sye: I really appreciate it. I really appreciate the opportunity. It’s always nice to kind of run into more people that are just talking about crypto, interested in the space, trying to support it. It’s good to have more brains out there.

Blake: So I guess we will begin Sye with what brought you to the initial interest in cryptocurrency?

Sye: Well back in the day, I think that was around 2010, 2011, I was actually looking into the whole dark web stuff. And that’s where I heard about Bitcoin. I thought about it. I almost bought some Bitcoin at that time and I really wish I did, but I let it go. About 8 months ago I started to get a little bit more money to just play with. And I’m like, “What can I do to work with in this space?” And so I started to look into more stuff like Ethereum and Litecoin, and obviously Bitcoin has gained huge traction. And yeah so I just started, got a CoinBase account, and started trading on there; not really trading just buying. And eventually that led into Binance which is a rat hole in itself. You find another 30, 40 different coins that you can work on.

Blake: And Binance is an exchange correct?

Sye: Yeah, Binance is an exchange.

Blake: And so are you able with Binance to put your money from your bank, US dollars, into that and invest in the currencies?

Sye: No. As far as I know there’s no fiat to cryptocurrency on Binance. You have to find an exchange that does fiat to crypto. Normally I’ll use CoinBase. It seems to be that Litecoin and Ethereum are going to be the better options if you want to transfer to Binance, just to due to their faster transactions and lower fees. I would not recommend buying Bitcoin off CoinBase and sort of that Bitcoin to Binance because you’re just going to be paying a heck of a lot until the lightning never kicks.

Blake: So you began with trading. Now have you entered the mining aspect of cryptocurrency?

Sye: I’ve come really close. I’ve just been doing a lot of research. I haven’t got a physical miner myself. The first time I saw a plug and play was with the Crypto Cousins and their Ether miner, which they do a pretty good job in just getting one of those as far as in the space, pretty value-driven miner that you can just it take home and potentially gain some passive revenue and support the space as far as network goes. But what I really like to do is get into building miners and I have been really interested in 12, 13 GPU setups. Those to be seem pretty efficient as far the return rate of those if you can get them. And worse case, you get a nice 12, 13 GPU miner potentially make back part of your investment, and then now you got a nice gaming computer.

Blake: Yeah definitely. We’ve been looking up building a 6 GPU RX580 which is Radeon I believe. And the turn up would be, without power, will be around $5000 with the price of Ethereum, and around a 30 hash rate that you get. So the next question here: do you want to talk about the importance of mining? I mean we’ve kind of explained it on this podcast. But what is your view on what you’re doing with mining and that helps support cryptocurrency?

Sye: So when you’re mining and you’re on the Blockchain you’re helping confirm the transactions that are happening in the Blockchain. You help complete that block and you’re on to the next block. And you get rewarded, the mine you get rewarded with the currency, the coin that you are mining. So you put more in the circulation that way. And that just having more in the circulation that helps increase the total volume and the Metcalfe’s law – more in circulation with more users helps increase the value. But the value is not necessarily what I want. It’s more of just helping the space. It’s the internet of things operate off the Metcalfe’s law on a processing. And so there’s more people that are using it, it becomes a more usable space and more efficiently. So the more people that are on to that, it can just definitely be a productive thing for the entire crypto space.

Blake: So supporting the network itself will allow the network to stay there, become stable, and grow.

Sye: Yeah, ultimately.

Brandon: Yeah. Better transaction rates.

Blake: So I think right before we start this, it’s how difficult researching is, because you fall these rabbit holes. So when you look at exchanges in coins like you mentioned, Ethereum, coins like that, what kind of research and how do you even begin taking those steps to a better understanding in each aspect?

Sye: Well yeah, it’s so hard to stay up to date, especially if you look like on CoinMarketCap, they’re adding hundreds of coins a week. You really got to find a way to decide, “Is this an actual coin or this is just a sh*t coin?” So you look at the team, you look at what they are trying to disrupt. Is this something that is going to be useful? Is it going to be something that has real life utilization to it? And then if you can get on grounds on that page, who the team is. Are they all reputable? Do they have a solid roadmap or they are just in it for the quick buck? You really look for the kind of teams that have a several year plan because you know that they’re not just here because they see, “Oh I can raise so many millions with an ICO.” They’re really trying to change the world for the better. And then read the white papers, follow them on Twitter whoever the page is, Telegram, Discord, those pages normally exist for new spaces as far as crypto coins and Blockchains and networks and stuff like that. And read as much as you can about it. And especially read as much as you can before you decide to throw some money in there, because that can always be a risky play.

Blake: Definitely. Are you part of any discussions or online communities that discuss crypto?

Sye: So I am part of, I’ve been a huge fan of the Crypto Cousins, and listening to them on podcast. I started listening to them on Spotify do a lot of driving with my job. And so I just take that time to get some information. And the great thing about them is they learn just like us. And so going through that process, as listening to them, I join their Facebook page, and I decided that I want a little bit more of a localized group. And so I followed their page, stay in communications and posts, but then I have the local Montana Crypto Cousins page, which has a few members, but it is more geared towards, here’s our thoughts, and get a local think tank, potentially meet up and talk. And then there’s the mastermind group for Bad Crypto. Bad Crypto is another group of guys that are doing a really good job of keeping everybody informed and staying transparent, the rising tide every ship rises, that kind of a process. So pretty much those are my main, and then I go on to Reddit and follow posts on Reddit. It’s actually a great resource of information. You can find that there’s sometimes people just get really emotional and say some things, “The future it’s going to go the moon,” when there’s no real basis of that. And then there’s still the FUD that’s in Reddit where people have baseless assumption that the coin is going to go nowhere. And so you got to try to decipher between that as well.

Brandon: What’s FUD stands for? I see it a lot.

Sye: I think it’s Fear, Uncertainty, and Doubt. And that’s just people do not necessarily know what’s going on but they don’t have a good feeling about it. And so they voice their not-a-good-feeling, and that turns into a tidal wave of terrible prices for the crypto market. But it’s crypto on discount when that happens and then you just wait for it to rise again.

Blake: And it’s kind of the Wild West that we’re living on.

Sye: Oh yeah. Oh yeah.

Blake: And so in terms of Crypto Cousins if you look at their podcasts, they always have these affiliate links along with YouTube videos that are describing any portion of crypto, whether it’s building miners. What do you know about affiliate links and how would we use them?

Sye: So I think there’s different types of affiliate links. There’s the affiliate links that are a little bit more of Ponzi scheme-ish. There are certain groups out there that if you use their affiliate link, you will get, based on the people that signed up beneath you, you’ll get a return. Those affiliate links I try to stay away from. It’s more so of verified accounts like CoinBase. Their affiliate link, if you have an account with CoinBase and then you share CoinBase with somebody else, once they spend $100 they will get $10 free of Bitcoin and then you will get $10. It’s just quick and super sustainable, there’s nothing ridiculous about that. And it’s an instant 10% on whoever you recommended. They got an instant 10% on $100 which is huge. And then Binance. Their affiliate link, which I think is pretty interesting, it helps keep a good ecosystem for the Binance token which I’ll talk about in a second. But Binance uses the affiliate link to where anybody that signs up beneath you get a return on their exchange fees. So you actually get a percentage of their exchange fees every time they trade. And then the cool thing about Binance and having the trade network in that ecosystem is that they have their own token, the BNB token, the Binance coin. And what that does is it allows to be 50% lower fees when exchanging. And that can be a win-lose as far as you’re concerned about making commissions, but in the sense of just trading, if you’re going to be a day trader with crypto markets using that Binance token is huge.

Blake: Okay. Now does the token relate back to exactly the coin itself in terms of value?

Sye: What do you mean?

Blake: So if I have a thought, so some coins will produce tokens correct?

Sye: Yes. Usually part of their IPO or something.

Blake: And that kind of credit is used internally then?

Sye: Some of them can use that token. I know there’s one that’s coming out right now where these guys, I forget the name of it but they’re to work on the infrastructure and building of, you guys have probably heard of it listening to Crypto Cousins. And so they’ll actually keep 70% of their tokens in house as far as there are mines, whatever’s mines 70% will go to them so that you can use that for internal investments. Other people don’t really like the idea of holding on to too many of those tokens because then it turns into a little bit more of a centralized system. I know Ripple is one of those that has a lot of their own tokens, their own coins in their supply which makes it a little bit more centralized. They can release or burn depending on how they want to play the market. So I don’t think all of them necessarily work on that basis but some of them do.

Blake: Okay. Okay. Interesting. So in some cases it’s almost like an internal stock.

Sye: Yeah.

Blake: Okay. From Brandon and I, what we’ve been doing with this podcast, what we’re trying to do with Crypto Core business itself. But in just building miners, what else can we do, and trading coins, what else can we do to support the space of crypto?

Sye: I think the best thing you can do to support the space is to one, stay positive, not to spread any FUD. Always try to have an actual information on your foundations, whether it be in argument or in support. I think that’s one thing that’s really important. I think it’s really important to potentially to have as many home miners as possible just to help spread the network. And that could also be just be a win-win – you might make a little money yourself. And then to constantly research and to huddle. I think there are some times where people will try to short the markets and day trading is not the most positive real long term career for crypto. People that are betting against it on futures, that kind of stuff is seemed a negative effect. I think futures have the potential to be a great thing for crypto and it turned out that a lot of people ended up shorting it. We’ll deal with that, those futures have been ended these couple of rounds anyways, so we’ll see how that goes. But mainly huddle coins that you think have a good roadmap. One that I’m super into right now is TRON (TRX). I know I’ve been huddling for a while now some of their tokens, and they hope to disrupt the entertainment space and a couple of other things. But Justin Sun, everybody calls them the next Jack Ma, the Alibaba guy.

Blake: Yeah. Well maybe for another episode we’ll look into, maybe Sye can help us. I was figuring out a few coins to kind of give an overview. I know people know Ethereum, Bitcoin obviously, but some of these new coins, Zcash, are very interesting.

Sye: Zcash is super interesting. I love Zcash.

Blake: In terms of Zcash my understanding, and we don’t want to go too far, is that Zcash is complete privacy. And that’s what kind of offers in terms of other coins that might doing similar things, but Zcash is the first to become completely private on both ends.

Sye: Yeah. People love the privacy aspect, and that’s what has driven Bitcoin to the point where it’s now. It’s helped you to remain pretty anonymous. But it’s not a perfect system, nothing’s a perfect system. So Zcash is just one of those ideas of how can we try to perfect the anonymity of these exchanges, whatever you’re doing. Some people say that if you want to buy monkey’s job, like if you said if you want to buy monkey’s use Minero.

Blake: That was a great interview. The Crypto Cousins interview with McAfee is awesome.

Sye: Yeah. So the Zcash is kind of like falls in that line, and that in definitely having that privacy and that security to it is going to add longevity to the coin. It’s going to be hard to break that one down.

Blake: Yeah. And then Ethereum itself, that’s added on the world of applications. Can you give just a quick overview what you think of applications?

Sye: What do you mean with the applications?

Blake: So I think the application point, see Bitcoin itself, Ethereum kind of allows for then these minor transactions that happen. We are kind of talking about the future, but eventually someday you can drive your car into a garage and that coins will be taking over and the application that’s built upon using that coin. I don’t know if you, I mean it’s kind of hard and it’s still so hypothetical right now, but I don’t know I’ve just, a thought I have set.

Sye: Well I know that people are trying to create technologies on top of Blockchain technology in a sense of its store value and the ability to have easy access and the transparency between it. I don’t know if I know it the car in the garage equation is, but I know people talk about the use of real estate, the use of medical records, the use of all that kind of stuff on the Blockchain network, and a lot of people are using Ethereum. Some people think that Ethereum is the MySpace and Stellar Lumens is the Facebook as far as that technology goes, but I think it’s a fantastic opportunity to put applications out in this meantime using Ethereum and Stellar Lumens. At least for the exchange rate in the efficiency it’s just if Vita can get sharding to happen and the scalability for Ethereum, and I think Ethereum will continue to be used for a lot of these ICOs and these kinds of applications.

Blake: Those applications I guess fall under kind of a contract right?

Sye: Yeah.

Blake: Okay. I mean in terms of the Blockchain technology itself do you have an opinion on that? I guess that you probably support it since we’re here talking about crypto. I think we all find it fascinating.

Sye: Yeah. I mean that’s kind of what I support the most out of everything. I mean Bitcoin being now or the future, any token can be now or the future is relatively, I don’t want to say it, irrelevant to me. But it’s more so that I’m focused on the store of information, the value that the Blockchain technology has. And you guys have talked about it before that nobody has an eraser that they can take to the Blockchain technology. The information is the information, and this is most key, this Blockchain is most key for developing countries because now there’s somebody that they don’t have access to a bank, they don’t have access to what have you. But now they have the Blockchain technology which can allow them to say, “Yeah, this is my property line,” “This is the property that I own,” or, “This is my car’s history,” or, “These are my medical records.” Some people want to get loans, they can use  ETHLend or SALT for loans on the Blockchain technology now just without needing banks. So without having that third party I think Blockchain is absolutely the future and it’s going to take over the way everything is operated in the world. If you hear this, if you listen to Crypto Cousins, if you listen to Bad Crypto, it seems to be that’s the way things are going to be going. It’s just hard to say which is going be that torch, which one is going to be the one that carry to victory. Nobody is quite sure yet.

Blake: Yeah. I mean it’s impossible not to believe once you really look at it to see that’s not where the future is going to be. Brandon, do you have any comments?

Brandon: Yeah. So one thing I thought of since we’ve had you here is your day job has you visiting restaurants and bars a lot. And as I think about the adoption of cryptocurrencies to pay for a drink or a sandwich or a coffee, which I think is coming, where it’s early; it’s early, we’ve talked about that it’s early but it is coming. Walk us through the picture how you see that, you’re going to have some restaurant or bar owners who are willing to try new things and put out that they accept cryptocurrency. But let’s walk maybe somebody, big picture, a restaurant, a bar owner, or shop owner through the next few years of adopting, the in-taking or cryptocurrencies as payment.

Sye: So this is really exciting. We are in the early stages, you’re absolutely right. But what’s cool about this is that we actually in Helena, Montana, we have the Lewis & Clark Brewery created the Bitcoin Bitter, which is a beer that they sell and its support is pretty cool. And you can actually buy that Bitcoin Bitter with Bitcoin cash. Why they chose Bitcoin cash over Bitcoin, Ethereum or any other currency? I’m not exactly sure, but the reality is that you can do that. You can go right now to a brewery and buy your beer with cryptocurrency.

Blake: In Montana of all places.

Sye: In Montana right? And so I think that is just fantastic. Of course you got to be in the business, you got to make sure that you’re up to date on how the taxes operate, and that you’re paying attention to; when you sell it to yourself, I mean when somebody buys a beer with the Bitcoin cash, do you instantly sell that Bitcoin cash? Or do you keep it as kind of a reserve just to fund projects that your business is doing? Either way you got to still maintain that for tax purpose with the US government being so stringent as it is. But so I think kind of the process it’s going to be, and I’ve to a few people about it, you’ll come into a couple locations that are fearful of the idea. They still don’t necessarily, well obviously they probably don’t understand the space, they don’t have the trust to know what’s like, “Well how do I know that they actually sent me the money?” Or, “This is a whole other step in the sense of taxes and potential income and I could lose it and it can be another risk.” But those are all things that are going to come in time as far as the securities and the understanding for everybody. And hopefully there’s eventually a consultancy around that can help lead them through the process. But to me, it’s just an easy step of just creating a wallet for that business. That’s their wallet, get them on the exchange, and then find out whatever their address is. And then I think the easiest process of probably just to put a QR code wherever you check out. And then have, I would probably say it would be best to have several currencies, to have like Bitcoin, Litecoin, Lumens, those kinds of tokens up there that you can QR and send to. And then you just want to make sure that you have something that’s following them, so like Blockfolio; it’s a great way to maintain the ins and the outs of your cryptocurrencies so you can submit that to your tax guy and he can take care of all that. A lot faster than using an Excel spreadsheet to track your buys and sells and at what point, because it gets pretty tricky with the taxes. That’s probably the biggest hurdle I see is the taxes for a lot of businesses. But yeah, we got one brewery staring already. Hopefully the next year we lock a few more places down that are at least willing to accept it. It may not be mainstream, but the more places that get it on their store front, that’s just going to be more conversation starters. More people are going to be like, “Oh, I didn’t know about that. I can buy this with cryptocurrency stuff.”

Brandon: Yeah. And really, when you think about it, those types of transactions that are happening every day. That’s going to be when the network really takes off. And when this adoption really takes off is you’re going to have a few risk takers out there, the Lewis & Clark Brewery in Montana is one of them. But you’re going to have some risk takers, they’re going to start accepting it, and then it’s going to spread. Just like when people started getting web pages on the Internet in the late 90s. All of a sudden everything starts spreading at that point and then it catches this critical mass. And so I think for these daring shopkeepers and bar and restaurant owners out there are willing to take a risk are going to do very well and help the overall adoption of it.

Sye: Which is a win-win-win.

Blake: Yeah. And as a customer, I mean once you have the currency itself from exchange out the wallet, all you need to do is just pull up on your phone and just scan. It’s super easy.

Sye: Yeah. It’s a supersede in this process. And even when it comes to the point of, so like let’s say I have Binance on my phone, that’s what I use I have an Android. Let’s say I go to whatever location Lewis & Clark and I don’t carry Bitcoin cash personally, but I wanted to buy a beer. And so I would have to do some quick computations myself which is a side step in the process that will hopefully eventually be worked on. Whether the business is like, we’ll take a daily average of it’s going to be this Bitcoin cash for February 1st 2018 for this week. Because it’s going to be tricky following the ups and downs of the daily market, unless you have a ticker. But let’s say I didn’t have Bitcoin cash, but I wanted to take some of my TRX that I’ve been huddling and then just trade it over. So I sell that to Bitcoin, and then buy Bitcoin cash with the Bitcoin which is a quick process if you sell at market value. And then you go to Sends on the Binance, and they will tell you to either answer the code or to have the QR code. And then you can just take a picture of whatever QR that you are sending it to. And then the transaction should happen depending on what you’re using. Pretty quickly, I know Lumens is almost instant and pretty close to fee-less which is nice.

Blake: And just right there you change three currencies. And once the business owner goes on then they can change it to the fourth, the US dollar.

Sye: Yup. They can sell that Bitcoin Cash back to USD or they could keep that Bitcoin Cash in the wallet hoping that eventually that price will rise. And they, so hypothetically let’s say Bitcoin Cash is under $2000, it’s probably around $1300, $1400 right now. Say they bought a beer for $4.50 and then Bitcoin Cash price surges up to $3000 again, so now that beer’s value went from $4.50 to $9. And so they made double profit on top of just selling the beer, they also made a profit on the coin itself.

Blake: And that’s part of it, for a business owner is that more and more people understand this then they might see the benefits of getting this currency rather than buying into it with the simple beer, whatever it is, and holding onto it.

Sye: Yup.

Brandon: And with more adoption the volatility ultimately drops, because you don’t have the fears and scares of people that sell on just the dropping of a pin.

Sye: And you won’t have the, there’s not much of a market influence by the whales. But there’s definitely some big holders that they hold and decide or like a big, several hundred million dollar sell or buy. And that will create a pretty large candlestick and then that psychologically can reflect on people, but we’re sitting at less than a percent of the world’s population is in this. And so once more people get into it, those whales they won’t have as much a lake to stand on as far as the total share in that pie.

Brandon: Yup. Yup. Very good. How, Sye, can people network with you?

Sye: Well they can, probably the best way would be to find me on the Montana Crypto Cousins Page. Other than that you can email me at syewhite@gmail.com. But I think I prefer it on the Montana Crypto Cousins page, just because it’s best to have everybody involved in that. I want all my friends and other cousins on that page to see the benefits of the communication with everybody that’s trying to talk about it.

Blake: And there’s no excuse for Brandon and I not to be a part of that page.

Sye: Oh no. Absolutely.

Blake: By the end of today we’re signing up for that page. Because it’s saying that thank you for doing that, because creating a community especially in a state of Montana where we’re kind of laid behind sometimes especially in something that is so techy and confusing as that. It’s really important to build that base up and for people who are looking into it to know that they’re not alone and there might be people in their city or the next city over. I think talking about supporting cryptocurrency space.

Brandon: Anything else, Sye, you want to add here at the end of the episode?

Sye: You know, I think we’ve covered pretty much everything. I’ll just look over my… Yeah I think everything is pretty much fine. I would say this that if you’re looking into mining and you kind of do these flat rate calculators. Let’s say I’m going to make, you’ll assume say you take, I don’t know, 30 hashes of Ethereum and now you’re going to be making maybe like that probably increases like $500 or $600 or so. You’re not going to be making that $500, $600 every month just due to the adoption and the competition of miners. It’s said to assume, I know there are two gentlemen, Amir, I’m going to ruin his last name, Kazali and Daniel Edwards of Revlocks. They say that normally every month, you are going to see about 25% to 30% increase in difficulty which mean there is going to be decrease to your net profits. And so you just kind of want to work off your first month, “I’m going to make 100%.” And second month, “I’m going to make 75% of that total.” And then the next month, “I’m going to make another 75% of whatever that was.” And so you may not make your investment back in 6-8 months, it might take closer to a year if you look at it in that regard. And sometimes people can get burnt thinking, “I’m going to spend $12,000, $13,000. I’m going to make that back in 6 months, and I’m going to do this, I’m going to do that.” It might take a little bit longer than you expect. So use that as a general guideline for mining so just you don’t go over your head.

Blake: Yeah. And then once you paid the machine off, then that is just revenue after that if you can get through the first year.

Sye: Just revenue, and then if you decide at that point, “I made my money back. I don’t know how to feel about this space,” you can sell the GPUs back and chances are those still are going to be worth a pretty penny. And like I said, if you want to keep it you’ll have a nice gaming computer too.

Blake: Yeah. And for anyone wanting to sell their used GPUs please contact us at cryptocorelabs@gmail.com. Sye, we want to thank you for coming on today.

Sye: Blake, Brandon, I appreciate you guys for inviting me. This has been fantastic.

Blake: And hopefully maybe down the road we can have on again. Thank you for listening, and this is the Crypto Core Podcast.

Outro: Thank you for listening to the Crypto Core Podcast. Please visit us at www.cryptocorelabs.com or email us suggestions and your feedback at cryptocorelabs@gmail.com.

 

Our Mining Rig

Intro: You are listening to the Crypto Core Podcast, exploring the fascinating world of cryptocurrency with your hosts Blake and Brandon De Shaw. Please visit us as www.cryptocorelabs.com.

Blake: Hello and welcome back to another episode of Crypto Core Podcast, with your hosts Blake…

Brandon: And I am Brandon De Shaw. Hello everybody.

Blake: So today we’re going to go over miners. If you haven’t checked out our other episodes, please go ahead and do that. We just went over the cryptocurrency apocalypse, which is a good episode to listen to. And we mentioned in that one that we built a miner. So yesterday, we got our parts and I built our first mining rig. So I guess we’ll start this episode off by just going over what’s in our miner. So kind of the nonessential parts are we’re just doing an Intel processor, an Asus motherboard, PSU at 750W of power, which is, if you do some of the mining calculators, that’s a good place to be around and it’s more than sufficient for a 2 GPU unit. And then we did plug in 8 GB of RAM. In terms of pricing of those, those we’re definitely affordable part of the mining rig. And the holy trinity comes together with the GPU units. So we purchased and built it using 2 NVIDIA 1070 TI Mini graphics cards. When those are running, mining kind of playing games at high speeds, they’ll be around 180W each. And so a total, that’s about 360W, and including the other components such as the processor, it is well under the 750W of power that we’re supplying. If you have any questions about those Brandon?

Brandon: Yeah. We should just make everybody aware that without mine building company, it’s very dependent on the supply chains. So I think a lot of you listening probably noticed, but the processing is done by high-end graphics cards. In fact, it really makes the gaming industry, the gamers really mad because it cause their graphics cards, the prices to shoot through the roof. But the supply chain on those, it is stretched so thin, it’s very hard to get capable graphics cards. And so our mining rigs will be built with whatever we can find that is a good unit. And it will have the description, every rig that we sell will have a complete description for what is in it of course. We’ll tell you exactly what’s in it. But the price will vary based on what equipment we use, and equipment’s going to vary some. Like we’d like the cases, at least for right know, we’d like the cases, the motherboards fine. Most of the components will probably stay the same, but definitely on the graphics cards, it’s going to really depend on what we’re able to procure and supply. Because our goal is to build and sell miners here, and then do mining ourselves, and we’re going to be dictated somewhat by the market. And that’s just the way it is. And so we’ll be very honest about what’s in the machines, and the pricing will adjust based on what we have to pay for the components. But just be aware, everybody, that the machines will not all be exactly the same.

Blake: And I’d like to challenge our audience actually that if you’re able to find 1070 TI cards that we’re using, please let us know. Because I think right now, we have two of the last ones that I was able to find through the typical Tom’s Hardware, Newegg, Amazon websites. So this machine is for sale, and I think if you want to take advantage of the high-end graphics card in the market where it’s hard to find, is that please go look at our unit. And it’s going to be on sale at www.cryptocorelabs.com/miningrigs. Well we’ll name it something and then, like Brandon said, we’ll be sure to specify all the parts. And probably throw Amazon links so you can go ahead, and if you want to use those then I think it gives us a little cash back. Right now we’re not going to set up a pay online. We’re just going to do a forum. In terms of if you want us to customize the operating system for your wallet, your email that way is truly plug and play, then we’ll talk to you, and over phone is much easier than to take care of your payment that way. So it will be kind of whoever gets to us first, and once we talked to you it will be solved. And we’ll keep on looking for graphics cards, we have a few more coming, and we’ll keep you informed on those. For anything mining rig just go to www.cryptocorelabs.com for more information. On to kind of finish off that, Brandon mentioned briefly the case. So we’re using Thermaltake Core V21 case. It’s a little cube, it’s nice because there’s plenty of room to support different units. But also it’s very customizable in terms of the fans. So you can kind of move the metal linings, and I think we have three fans in addition to the one that came with the case right now running. And it’s an extremely quiet machine. I set it up last night in Brandon’s office and I don’t even think he noticed it running when he came in to work.

Brandon: Well I noticed it not running, Blake, because the power went out. Uptown Butte, Montana, USA, and so the power was out. And so I looked at the mining machine, and it was off and I was like, “Oh no! Our mining rig is off!” Because we were doing a test and making sure that it was going to mine good for whoever buys it, or if no one buys it we’ll just keep mining with it. And so the power was on so I turned it back on and it hopped back on, right Blake? And it started mining again once we got it turned back on, and it just logs on by itself and then starts mining. But it was incredible quiet. I was blown away by how quiet it was. Sometimes your laptop will be sitting on your lap or you’ll have it on your table, and the fan will kick on and it’s pretty loud. Or your desktop computer will have white noise coming from it. This thing, it’s just shocking how much processing ability you’re doing and you’re literally mining crypto and making money as this thing is just very quietly working in the corner. So yeah, it’s really sweet. Great job Blake on putting it together.

Blake: And I think that’s a good segue. We covered the components, some of which as long as they work together that’s what’s important. You don’t need a big CPU unit or anything like that, just enough to run the GPUs. What operating system are we using? So rather than installing a hard drive and using something like Windows or even Linux, we’re actually using simple mining operating system. So if you bought the machine right now it just comes on a 32 GB flash drive. So I just flashed it using my Windows laptop. You configure it just simply by putting in your email, and then once you need to put that right into the machine it automatically updates and starts mining for you right away. What’s really nice about simple mining, before I forget it, it’s just $2 a month. I will be sure to test out some other ones, but this seem like the easiest possibility right now. You pull up the simple mining website, you enter the same email that you used to flash the disk, and you can see the rig running. You can see the cores just running on, it’s mining right you can even pull up the same screen that the console that’s actually running on the mining rig itself. And that allows you to then configure, and so you can configure to your wallet, and there’s ton of additional settings. You can also control which pools you join in, and for someone who’s just beginning in mining, it was a very easy and it was up and running in a minute. And so I think it’s a good solution to offer, especially if our customers want it to just plug and play, they were able to create that machine. And you can get a hold of us at www.cryptocorelabs.com/miningrigs, we can get your information from you and make that completely customized to your wallet and to your email.

Brandon: And what are we mining right now, Blake?

Blake: We are mining Ethereum.

Brandon: Okay. What can this miner mine?

Blake: So it’s mining right now just at standard settings, about 50MHz per second. So putting that into a calculator with sort of the price of power here in Butte, we’re looking at about $1500 a year at the current price. Now, as all mining machines there is a comfortable level that you can overclock and monitor the temperature, that’s kind of, as you mentioned earlier we’re kind of, in our lab, optimizing these machines for our customer. Once they plug and play they’ll know exactly what is the optimal mining rate that they can use while it’s still in the safe temperature and at the lowest wattage use.

Brandon: And then as far as the coins, this thing can mine a whole variety of coins.

Blake: Yeah, exactly. And so that kind of goes back to the simple operating system, and these pools. You can configure it to mine multiple coins. We’ll create another podcast on this more because it’s a very difficult to understand. So there’s even differences between Radeon cards and video cards in terms of what they can mine, because all goes off of these configurations that people have made. So as we continue in this Wild West, you see more and more configurations popping up that maybe, for example, some coin that wasn’t able to be mined by NVIDIA now can be supported by NVIDIA cards. So we’ll go into that more, I think I have some notes on that. But down the road in terms of mining episode, update on our bills. We can talk more about mining pools. So right now I’m in a pool called Dwarf Pool. It was just part of the configuration I configured to US servers. And basically you’re pooled with other machines and at some point you are able to get your coins out. Each pool kind of differentiates on at what point you can take them out, how much you needed, things like that. So I think it will be interesting for both of us and for our experience to dive into that a little further. Mining wallets, so that’s another thing. I have just a Jax wallet set up on my laptop. And I read online that you almost need better wallet that can handle microtransactions that you experience with mining. And so on our next mining episode, we’ll be sure to cover a few wallets and the advantages and disadvantages of those. Altcoins to mine and then dual mining capabilities, you’re able to mine multiple coins at one time if you set up the machine at a certain way.

Brandon: When do you think we’ll do that episode? Maybe next week? Maybe a week from now or something like that?

Blake: Yep. I think a week of mining and messing around with the different configurations on simple mining will let us learn quite a bit.

Brandon: Yeah. And I want to throw this out there, since we are enterprising entrepreneurs like you all are, if you like to put a contact form and get a hold of us at www.cryptocorelabs.com through the contact form. Email us at cryptocorelabs@gmail.com. And if you want, like if you don’t have the time to build a system or unit and you have an idea on what you want, then we will put our manpower to use here, we’ll give you an estimate. It might be a little bit of a loose estimate based on because the graphics processors, the prices run up and down so much. But if you want us to build you some sort of customized system, then let us know and we we’re very enterprising, we want to serve, so we can probably put something together for you.

Blake: Yeah. Most definitely, Brandon. And I think in the future, we’re building these small rigs right now, getting used to it. And we want to go down the line and start taking advantage of if the GPUs are coming out at cheaper prices again, doing an open, larger scale rig where you can deploy up to 12, even more GPUs at one time. And those I think, at a certain price point, would be great to have a little mining rig. So we’ll get back to you on that, hopefully in the future, here. But yeah, so we’re mining finally at Crypto Core Labs which is exciting.

Brandon: Okay. Is that about to wrap for this episode?

Blake: Yeah I think that is it. So thank you for listening, and please check out www.cryptocorelabs.com.

Outro: Thank you for listening to the Crypto Core Podcast. Please visit us at www.cryptocorelabs.com or email us suggestions and your feedback at podcast@cryptocorelabs.com.

 

Cryptocolypse!

Intro: You are listening to the Crypto Core Podcast, exploring the fascinating world of cryptocurrency with your hosts Blake and Brandon De Shaw. Please visit us as www.cryptocorelabs.com.

Blake: Hello and welcome back to another episode of the Crypto Core Podcast with your hosts Blake…

Brandon: Hey I’m Brandon De Shaw. Hello everybody.

Blake: And we are going to talk about the apocalypse of cryptocurrency. I’m kind of following the drops in prices with cryptocurrency the last week. Brandon if you want to start, maybe we can go over some new stories.

Brandon: Yes. So it’s been interesting as has happened many times since I’ve been involved and owned Bitcoin and other cryptocurrencies as there’s a massive, quick, fast, earth-shattering drop. And everyone declares that the end of Bitcoin is here, and the end of crypto is here.

Blake: Which is not the first time that’s happened.

Brandon: Right. Like you’ve seen it happened several times just through your experiences. And so then they go out, of course, the news, the journalists, many of whom do not… they do not understand the monumental shifts and changes coming due to the block chain and cryptocurrencies. And I agree with the premise that the monetary system may not move to Bitcoin necessarily, or may not move to Ethereum of Litecoin. There may be a coin that ends up gaining worldwide acceptance, but the fact is that this block chain technology and cryptocurrencies which are not controlled by a government which are limited in the amount that can be made, I truly believe that’s the monetary system of the future. It reduces the number of middlemen that have their hand in your pocket and get to take their fees for processing and doing whatever else, and it brings it down to a peer-to-peer level. Just like, Blake, the Lyft and Uber industry. Now instead of dealing with taxi and the taxi cab company taking its cut and all that, I’m dealing with a dude who may sell me insurance during the day, and then may give me a ride that night. So it’s down to the peer-to-peer level. And that’s why you see these news stories hit is because I don’t think that the journalists really understand; heck, these same journalists, Blake, the Internet totally disrupted and changed the news industry and yet they continue to cry about their low wages being journalists.

Blake: You can almost see why they would have some complaints about. I think with Uber and Lyft, I mean our kids won’t even, they won’t even imagine a taxi cab company where… I could still remember taxis. And our parents probably would never imagine there is an Uber and Lyft. So I think that’s a great example. Another would be just, even if it’s a silly example, but social media; and look at MySpace, how that’s gone. Some people won’t know MySpace ever existed. MSN Messenger, these early chats that were in the early 2000s. I wouldn’t be surprised if your kids have no idea that they even existed.

Brandon: Yet I had a… My first profile was on MySpace. And then you go out and befriend Tom, the famous guy who’s looking in the mirror whenever I’m looking back at you.

Blake: It’s probably still on there if you go search for yourself. You can see who your top 16 friends are.

Brandon: And he cashed out. He cashed out. He did okay. Alright. So one of the neat articles, neat as in fascinating because these are getting to be pretty standard template. But the headlines screams at you with some all caps: Bitcoin price warning. Nobel Prize winner warns cryptocurrency likely to totally collapse. And my thought is when you went in and did exactly the opposite of what Nobel Prize winners told you to do, he would probably end up just finding this world, if not very, very successful. So the Nobel prize winner, get on the horn, Robert Shiller, some sort of Nobel Prize winning economist and he says a half-truth theory, says, “It has no value at all unless there is some common consensus that it has value.” And I totally agree with that premise, but it’s kind of a half-truth because there is value because people do have a consensus that it does have value and they’re making investments, and in some cases, heavy risks. So Shiller goes on and then started calling blabs. Of course drawing parallels between the Bitcoin craze, and the tulip mania the world experienced. And said that it’s like cryptocurrency is likely to follow in the footsteps of its economic predecessor, which is the tulip. However, unfortunately for Mr. Schiller and his other Nobel Prize winners, is that there is value in a decentralized peer-to-peer, cutting out the middleman where the currency is limited in scope type of currency. Yes, he’s right – currency is an agreement, but there is an agreement here that it has at least some value, and the other cryptocurrencies also have some value here. So who will win in the cryptocurrency battles? We don’t yet, it’s the early on, it’s early on. But these guys are pretty typical of what the articles you’ll see whenever cryptocurrencies drop in value.

Blake: And people do want decentralized banking. We watched a documentary a few nights ago about how basically the financial crisis of 2008 was a huge moment in people’s interest in cryptocurrency and kind of want the first, big spice into it. So there’s a general consensus, and I think as we go on it’s easier for the average user, I think that consensus will only grow.

Brandon: Yeah. There’s another article here: Cryptocurrencies investors worry, wait after Bitcoin price dropped. So I’m one of the people that’s just kept their money in mostly Bitcoin at least in the last couple of years. And then just wrote this out assuming that if there’s value there, the price will recover. And many of us got in fairly early enough that we didn’t have… It wasn’t like we were trying to catch the last little rise before the drop. We were in fairly early before the steep pricing occurred. So there’s some NPR speculation on how low will it go, etc. And then one article that I like to is from an Australian newspaper, and it was a great, Aussie-style headline, and it was, “I actually don’t quite care.” Australian Bitcoin investors hang tough. And they were quoting, I thought it was really neat, they were quoting a 19 year old computer science student from Melbourne, and he said, “I actually don’t quite care about the volatility,” believe it or not. He and his mom invested in Bitcoin over a year ago, they made considerable profit, and they’re not too bothered by Wednesday’s drop. So that constitutes a big core of the holders of cryptocurrencies is that we truly believe in the earth-shattering, wealth shifting, paradigm changing to get really it right here, way that this is going to totally change things and disrupt the entire economic system.

Blake: There are going to be a few people that are in for just for those peaks and gains when they have a chance, quick trading.

Brandon: Oh yeah, yup. The traders, easy money. I remember this saying from traders in the investing world is that, “Money made really easily is money that gets scared really easily.” And so you see that where people are just yanking their money out because they made these quick profits and they thought that they were just in it for quick ride, and that they always make money. What they don’t have is the past historical knowledge of big up and down swings of cryptocurrencies due the last few years. And it’s like a buck and bronco, the people that are holding on tight and don’t understand what they’re doing, they get bucked off and get pretty muddy.

Blake: And if you’re in it for the long haul, some of these points where it get to a lower price are really when person that’s fondling would probably buy in.

Brandon: Yup. And I am fondling. I am fondling. Okay, that hits some of the news articles I wanted to read.

Blake: Perfect. Thanks for that. So next, I’m not sure what this is, but the NNT Antifragile Principle?

Brandon: Oh, yeah. So he’s reading off of this outline, and I put NNT. An NNT stands for ‘Nassim Nicholas Taleb’, and he is a deep thinker, former trader, actually is probably still trading. And he is the author of the book called ‘The Black Swan’, and he as also published some books recently on Antifragility. And I think one of his latest book is ‘The Bed of Procrustes’, and Nassim Nicholas Taleb is very interesting guy, gets quite controversial because he’s getting fights on Twitter with journalists and everybody. But one of the neat concepts that he described, and I’ve really been paying attention to it and like and I do believe, is a concept of Antifragility, or Antifragile. And what he means is something that is actually made stronger by disorder. And so for instance, a coffee cup, he makes this analogy; a coffee cup is something that naturally we think of as being fragile. So if I drop it and knock it over my desk, it’s probably okay. If it drops from a few inches, it’s probably okay. But if I dropped it from two and a half feet from my desk onto a tile floor, the handle might break off or the thing might break and it’s pretty much useless. So coffee mug is something that is fragile. And your body is Antifragile; if you go to the gym and you really wear yourself out and lift heavy weights, and maybe even your joints and muscles are sore for days, you are making your body stronger that way because you are adding stress to this, and you’re gaining from those stresses. In one of the examples that NNT, Nassim Nicholas Taleb, has is the restaurant industry as a whole. So an individual restaurant, that cafe in the corner that started up a year ago, is a pretty fragile thing. There could be some changes that cause that thing to under. They can have a construction project next door, and the restaurant goes under because no one thinks that it’s open still. So restaurants, individually, can be fragile things, but the overall restaurant industry as a whole, like the ability to go out to eat at any given night on your street or neighborhood, that is antifragile because they can see what mistakes are made from other restaurants, and the industry as a whole can stay strong at trial and error, really. And in business, if you’re out conducting trial and error and seeing what happens in the market before you spend a lot of money, that is an antifragile activity. And so I want to relate that now to these big drops and big corrections. I don’t know if I would call them a correction, because I don’t know what the actual price of Bitcoin should be. It could end the year at $100,000, who knows. It could end the year at $1,000, I don’t know. But the process is moving towards antifragility, because it’s through stresses the system and the people participating in the system become stronger. And so cryptocurrencies become stronger as a whole because for instance, you might shed some of the skittish people right now, but then gain some true believers or the true believers like me are going to put more money in and invest more money. So the system is made stronger by these stresses that are induced on the system, and it comes out better and stronger on the other side.

Blake: And I guess you can also relate that back to even specific coins right? With the Bitcoin, and then for example, Ethereum which has made some improvements on the coin itself, such as the smart contracts and faster processing. So even competition between coins has made it a more antifragile market.

Brandon: Oh heck yeah. And then can you talk about that? One gist was a Ponzi scheme. People were warning to us a Ponzi scheme, and finally this week I think, the Ponzi scheme finally came to light.

Blake: Yeah. And it’s important that we’re not investors by any means. We’re just two guys talking about cryptocurrency and wanting to explore it with our audience. But yes, so it’s BitConnect. And I haven’t really heard of it, but I noticed all the news articles, I think, I don’t know, Tuesday or Wednesday this week. So basically at some point, there was a way that you buy BitConnect coins, and once you’re in there you are promised a guaranteed interest throughout the year. Classic Ponzi scheme. And I think earlier this week, they say, “Well we’re actually discontinuing that lone portion of the coin, of our service.” And instantly, I believe, it dropped. It was around $200 and dropped to $30, $20 within the 24 hour period.

Brandon: Yeah. They called that The Elevator Ride. So it’s like an escalator going up, and then when the entire thing is exposed it’s an elevator ride dropping down to zero. And this is the Wild West, folks.

Blake: And it really shows you what good research does. You know, going to these forums and stuff. There’s quite a few posts previously saying that, “This is a Ponzi scheme. I would definitely do not put all your money into this.” And once again there’s still people unfortunately on that elevator ride down.

Brandon: Yup. If it’s too good to be true, especially in cryptocurrency, it probably is. And it pays to do thorough researching of the team of how exactly the thing is working. If it’s, “I will grant you that cryptocurrency and block chain,” in general is complicated. And Blake, we’re just kind of learning about it in participating in it, and learning by doing. But at the same time, you still have a great level of common sense and wisdom based on your experiences, and you have to apply that even when you are getting into these, and they are hard to understand.

Blake: Even though what makes that BitConnect situation more confusing that it’s still trading. It actually has gone up a little bit of $45 and it still being traded.

Brandon: Yes. Why won’t you try and just see if it’s making another buck or two off.

Blake: You know, the Wild West is fun, it’s dangerous, and so I guess let’s just learn from our mistakes. Well, luckily we did not make any mistakes with BitConnect, but a lot of people did.

Brandon: And sometimes you watch a dude get gunned down in the saloon, and it’s just an interesting experience because you won’t forget it.

Blake: Finish your whiskey and leave before you more guys come in. Yes, so I think we covered that. That’s a great principle in relation to Bitcoin. And so let’s see, even though currencies will vary greatly over time it will be a movement to this technology, a massive disruption is coming. We kind of discussed that first of all going off of just an outline here. So now, banking. So you heard some news involved in banking, and about crediting?

Brandon: Yeah. There was a very good podcast episode on Crypto Cousins, which is an excellent podcast, I recommend everyone check them out, they’re very, very good. They are learning, they are doing things in the space. They know a lot about it but they are also learning all the time, and they have great people on interviews. I think the interview with John McAfee is outstanding. And so I really recommend checking it out the Crypto Cousins, they’re very good. And they had this early adopter of block chain and crypto on, and he had an interesting concept about banking. And he said that, “Some of the names of the banks will be still around, but the industry is going to be absolutely, totally revolutionized and changed.” He said, “For instance, there’s going to be a lot more banks, but the bank is going to be the dude in your neighborhood who knows a lot about cryptocurrencies. And you go to him and he sets you up and helps you with your wallet and things like that.” I can see that; that’s kind of the Uber-ization of things, moving more to the individual, peer-to-peer level, people you know. You know some good fellas, you know some people who are good people and you can trust them, and you will bank with them. And then the question that this guy that they were interviewing in Crypto Cousins. He said, “Now that brings up the next question which is mortgage. How do you go borrow 250 grand to get a mortgage?” And he said that the concept of the ICOs or initial coin offerings, which is basically a way for a group of people that want to think that they can make some sort of profit, even if it’s a small profit or something, we’ll pitch in some of their money, a little bit of their money. And he predicted that that’s how the larger loans will be worked out at some point is that they’ll have their individual offerings for loan. I might invest in somebody getting a mortgage in Tallahassee, Florida, because I know Tallahassee is growing and I know who this dude is because he was in the Navy with one of my friends. And I’ve heard that he’s offering a loan on one of his new house that he wants to buy. Or somebody’s business wants a business loan to buy a new piece of steel manufacturing equipment, and I want to participate in that and make 8% a year or something. And I can definitely see that. I can definitely see banks being squeezed out because they are a very high priced middleman for sure. So check out Crypto Cousins. Check out that episode. I think the episode came out all within the last two days. So I want to say it was like the 18th or 17th of January 2018. So check that podcast out. Those guys are great. They actually inspired us a lot. So we have to give them props.

Blake: They call it self-proclaimed cousins, I believe they now…

Brandon: They call everybody their cousin that’s in the space. So they’re neat.

Blake: Yeah. It’s really cool to see other shows coming out. There’s a few other ones too that are great to listen to. And just on that note, if you’re listening and enjoying the show, please share it with your family and friends and anyone else you think would be interested.

Brandon: And rate us too, right?

Blake: Yeah, yeah. Please rate us. Leave a review. Even if that’s bad, that will be fine.

Brandon: It’s not fine. Only leave a review if it’s very, very good and give us five stars if you think that we deserve it. I’m not kidding around.

Blake: And you can voice your bad reviews in an email. That will be sure to read and share with the world.

Brandon: Yeah. And we have contact form at our website www.cryptocorelabs.com. And please give us feedback, good, bad, or ugly. We’re big boys, we can take it. We want to improve, and we want interesting topics to talk about. So hit us up on there, contact us at cryptocorelabs@gmail.com as well, as a decent way to get a hold of us.

Blake: Yep. That’s good. So I guess just to kind of go over. I think we covered the last podcast just an ending, is that here in Crypto Core Labs we want to be a kind of how-to business, and also with the Crypto Core Podcast, be a how-to show. That’s whether how to mine, how to build miners, and then maybe sell those miners, and where to buy those miners, building a web app. And I don’t know, do you want to talk about that at all?

Brandon: Yeah, sure. So the whole concept that we want to do is that we want to learn ourselves by doing interesting things, and the first thing is mining. We’re doing some mining ourselves. We have a miner that Blake actually finished building yesterday, and it’s mining right now, right next door. And we want to sell miners. So we have a basic model that we have for sale. And it’s just something that you can hopefully just plug and play. We should have it all set up. You’ll need to direct it to your own wallet, but we’re going to be selling these miners as well.

Blake: And the website for that is www.cryptocorelabs.com/miningrigs.

Brandon: And the other thing we want to do is I have this web application that we started. I actually hired some programmers to build some cloud-based app that is finding and comparing the current pricing for different currencies, and showing when there’s a disparity between the prices. And so I have I think, probably it’s at about 75% level. And I’ve got to get it onto a domain. So that ultimately what I want to do is I want to sell it as a business. I just want to sell the web app as a small business, and someone can take it to the next level. But it’s about 75% ready to get to the point to where I want to sell it. So I got to migrate that onto the website. And we’ll probably produce an episode totally, entirely on how on zero to ten on how exactly we went from coming up with the concept, hiring programmers to get it done, and then getting that out, and actually trying to just selling the asset itself. So, again we want to try and do ourselves and show you how we’re doing, participating in the cryptocurrencies based on a variety of ways. So that’s the, what I’m calling the Crypto Arbitrage 2.0. And then the third thing I have a concept, we have a concept for our own initial token offering, or initial coin offering, and it has to do with logistics industry. And so we’re fleshing that out, we’re on the early stages. I’d say we’re in the 15% to market stage of that. But we also want to build several episodes, or maybe build an entire program, education program on how we’re doing this and how we’re coming up with the idea, getting it developed, doing the initial offering, seeing if the market wants this thing. And so hopefully that will be developed in the white paper. We want to be consultants on building white papers for folks who are doing ICOs and ITOs. So we’re going to learn by doing. Like we said, we are going to create our white paper and white papers around this concept for our ICO or ITO, initial coin offering, initial token offering. And we’re just going to open the curtains up and let you see inside. And some of it is going to be kind of ugly, but we’re going to share that all with you so you can see what we did and then you can take that knowledge with your own idea and apply it, and participate in cryptocurrency. Because there are tons of opportunities here. Just tons, oodles.

Blake: We need some fellow gunslingers for the Wild West. So thank you for listening. Check out www.cryptocorelabs.com. The Crypto Core Podcast that you’re listening to now, please share. And we’ll talk to you soon.

Outro: Thank you for listening to the Crypto Core Podcast. Please visit us at www.cryptocorelabs.com or email us suggestions and your feedback at podcast@cryptocorelabs.com.

 

Intro: You are listening to the Crypto Core Podcast, exploring the fascinating world of cryptocurrency with your hosts Blake and Brandon De Shaw. Please visit us as www.cryptocorelabs.com.

Blake: Hello and welcome back to the show. So today’s episode, we’re going to be talking about kind of the needs right now in the crypto and the block chain industry. Kind of how we’re doing this podcast is answering our own questions, exploring the field, and kind of taking you the audience with us. Welcome, Brandon.

Brandon: Yeah, hey Blake. So we are, I would call us enterprising entrepreneurs in this space, cryptocurrency, block chain, etc. And we are focusing not just on doing some mining ourselves and maybe some trading off of coins and tokens to probably make some money doing that in investing. But we’re also kind of building the shop, if you will, to create our own picks and shovels, because as you know, it’s always said, “Hey in the Gold Rush, the guys that went to mine the gold made a little bit of money, but the guys who made and sold the picks and shovels they did really well.” And so we’re trying to build our own picks and shovels here in this industry as well, and we’re going to kind of open up the doors to the shop if you will. And let people in to come in, and take a look and see what we’re doing, and see what maybe you guys want to do with it in your own way so that everybody can do well in this big change that’s going on with cryptocurrency and block chain. Because we truly believe that this is going to be a massive transfer of wealth in the world. And I don’t know if it will be the biggest ever, but it sure could because everybody uses currency every single day. And if there’s a new way of doing currency exchange for things of value, then I think it could be an enormous transfer of wealth. And so we want to open the shop up, if you will, we want to talk shop with you, and we want to figure out some ways we can be of value and of service in this industry and be rewarded for that.

Blake: And looking back in history, the Roman used to change currencies almost every other decade, and we’ve been on the gold and US dollar standard for so long that I think with technology which will we see changes things, is that I think we’re going to witness an evolution in the currency industry. I guess we can start off maybe talking about miners.

Brandon: Yeah, Blake. Tell them what we think we’re going to do with build miners here.

Blake: So right now, the mining industry is quite, if what we’re seeing here on January 15th, I guarantee you there’s a lot of disappointed boys and girls who saved up their Christmas money to build a computer, and went to Amazon or NewWave.com, and every high-end GPU unit is sold out.

Brandon: What’s a GPU unit?

Blake: So it’s a Graphic Processing Unit. So right when cryptocurrencies, I understand it began, people were just using CPUs to mine. As more and more people begin mining, that became inefficient and people switched to Graphic Processing Units because they can process how many millions a second. And so now you’re seeing machines built rather than doing 4K gaming, high HD gaming is that they’re using 6 sometimes 12 GPU units to actually mine the currency itself.

Brandon: Yeah. There’s, if I can here, I’m going to draw parallel to old school mining and it just so happens that we’re recording this interview in one of the big mining, historical mining places in the world which is Butte, Montana. And when you start mining, the miners, the first come they find gold nuggets and silver nuggets basically just laying out in plain sight, so it’s really easy. You pick that up stuff, or get some of the dust out of the creek, and you build a little apparatus to go through the ore, and you collect the really easy-to-get stuff. And that’s what some of these miners are doing at the beginning of cryptocurrency boom as they had just regular old computers, and they could solve the math problems that let you get rewarded the coins. But later on, after some of all that low-hanging fruit and easy picking metal gets taken, then you have to go to bigger and bigger equipment, you have to send guys down into the earth to mine, and send big drills down and get the ore up and out. And eventually what ends up happening is you have to have really big operations with strip mining and huge ore trucks and big cranes and all that to get the ore out. So we’re kind of in the early stages, but we’re probably a little bit past the guys picking up nuggets off the ground, those guys, the Bitcoin billionaires are out there already and they were in it at the beginning. And they took a lot of risk to do it. A miner coming west from New York City and heading out to the West to go join in the Gold Rush, he’s taking a lot of risk. He’s got a family still there in the city, and he’s out in the Wild West mining and takes a lot of risk. And some of those guys died. Some of them lost money in the cryptocurrency boom at the beginning, too. So we’re not right at the beginning stage, but the experts were saying that we’re still early on, so there’s a lot of ways to be of service to others here, and that’s we’re trying to do. One of the ways is by building miners and so on.

Blake: It’s not quite an easy, I might think, what the average person would want is to able to just go online and buy a miner. Right now there’s a few options for that, and I think that’s something that we’re going to kind of try to create down the line here. Right now, as we were talking, right where I’m staring at our supplies to start building our own miners. Of course we’re waiting for our GPUs to arrive, but once those get here, we’re going to try eventually come up with a model for kind of a mill ground miner. And I think going back to what stage we’re at in this game, Bitcoin is at the days that it’s almost 80% mined. So right now mining Bitcoin with some of the bigger players already out there that, you can’t even imagine have millions of dollars that they have invested in their mining operations. We’re not going to build to put even a dent against them with a home built operation right now. So I think kind of aiming for a mining machine that not only can mine Ethereum and some of bigger ones, but also we can switch to some of the Altcoins and kind of play off that field. That kind of easier entrance to the market, and you can kind of do it with more middle ground and cheaper expenses in terms of GPUs and things like that. So part of this learning experience is for us; we forced ourselves to build our own mining machines, and hopefully we can provide you with some helpful information there. And eventually down the road, create a plug and play miner that they are able to purchase off the website, and basically just pay for us putting it together, and you can just plug it straight in in the operating system, and everything will be ready for you to plug and mine. Now in terms of mining, I guess, one of the biggest questions is what you are mining. And so from my understanding, it is basically these block chains that are for Bitcoin for example, is that we’re processing the ledger. We’re doing some of the work for them, and in return of that, then you get a share. They’re kind of paying us back for being part of the network. And so hopefully that kind of clears that. That was my first question in terms of cryptocurrency. And yeah, I don’t know. So we’ll see where it goes. I’m sure the GPU market will even itself out eventually down the road. We probably got in on it at probably the worst time, but we’re excited people so we couldn’t hold back. So we’ll see and hopefully we’ll provide you with updates on how that’s going, and we’d love to hear stories from you guys out there in terms of building your rig.

Brandon: So Razer is going to be for sale off of our website, which is www.cryptocorelabs.com, and we’re going to probably have in the next few weeks some built some in the inventory. But we expect to kind of a waiting list there if you want to have one. But we’ll have that all set up. So keep checking back for updates on our miner that you can buy.

Blake: Alright. So this second need of the crypto that you hear about, and I think if you back to the financial world we live in now, is IPOs. And so in the crypto world we have what is called the ICO. Brandon, if you want to talk more about that.

Brandon: Yeah. An initial coin offering is a way for a business to get off the ground and fund themselves, and in some cases they’re running into different securities laws which tend to be very complex. And since you’re dealing with cryptocurrencies which are complex to start with, and then you throw in all of the securities laws especially here in the US, you have quite a bit of complexity. It’s going to be, as an entrepreneur, beware to make sure you don’t violate any of the laws and everything’s done in an ethical and legal manner. But the ICOs just, very basically speaking, are a way for a cryptocurrency or block chain company to get off the ground and get funded. And one of the services that’s needed, and we plan on providing some of these service, but they’re certainly going to be a big demand for it, is analysis of these and people becoming experts and analysts in this area. And so we see that as a way for you to become an expert in the area and sell that as a consulting service.

Blake: And I think down the road part of these ICOs is kind of understanding from the team itself. And so hopefully we can line up some interviews with some possible ICOs, not as a way to promote because once again we are not financial experts, we’re not giving legal advice or anything like that. But just to hear from their mouths what they see their ICO offering and to help us better understand the ICO from the ground up.

Brandon: Yeah. Anyone doing an ICO is going to be an enterprising entrepreneur like you are, and so we’d like to hear from folks. So if you are doing a cryptocurrency or block chain startup, or if you have a new business, or you have something interesting to talk to us about, we’d love to interview you. So contact us through the website www.cryptocorelabs.com.

Blake: And we’ll put up together an email, probably podcast@cryptocorelabs.com, and I’ll add that at the end of the podcast. I guess just to skip ahead, in terms of white papers, if you want to talk about that, so an ICO just kind of leaped this back as ICO right now, if you go and look at the new coin that’s going to come out, is that they provide this white paper.

Brandon: Yeah. So one of the big needs that we see in this growing space, block chain and cryptocurrency, is marketing and advertising and coherent messages. Because the masses are going to be in this whether they like or not fairly soon, and there’s going to be, as the monetary system moves to cryptocurrency, and the masses get into it, they’re going to have to know some of these products. But it’s complex, and the space is very complex, and explaining it is quite difficult. And so what’s needed are experienced people, writers, copywriters, marketing people, advertising people to get into this space and learn it and be able to explain it. So just as how I was explaining it with the old school mining analogy, there needs to be an analogy built to explain this. And there’s been some of the great people in crypto, Nick Szabo has a great analogy that he explains on the Tim Ferriss Show for our workweek podcast, and the block chain can be described in an analogy is a fly trapped in amber. And as the contracts and things exchanged over the network on the block chain, the transaction is like a fly and amber. And there are several coats of amber that grow over it, and you cannot get that and change that fly after a little while. And that’s the same way with transactions in a block chain that it’s there for everybody to see. It doesn’t matter if one person has an eraser, the network shows that the transaction actually occurred officially. And so there are many, many analogies that need to get built. There’s lots of graphics explaining the need to get built. There are many white papers need to get written, and so we’re throwing our shingle out as a marketing, advertising, writing, copywriting company, Crypto Core Labs to help you if you have a business or startup. But we think that there’s a heck of a lot more work out there than just we can do. So if you have a knack for writing or creating analogies or marketing, you’re buying ad space, then this should be an area you’re seriously, seriously looking at right now.

Blake: Alright, thanks Brandon. So now we’ve kind of covered ICOs, the marketing that surrounds them including white papers, bringing this really tough… This is why I like cryptocurrencies so much is that it’s in the financial world that’s already not easy to understand mixed with technology which is so exciting, and kind of has to do with my background. And it’s not easy for grandma and grandpa, but in 10 years I believe that they’ll have to, and hopefully at that point be much easier and a lot of this knowledge be, not dumbed down to say that, but dumbed down to my level at least. Let’s see. What else should be talk about today, Brandon?

Brandon: One of the things that we hope to do and it’s in development right now is a newsletter, and you can go sign up for all sorts of email, digital newsletters. But what I really love is the old school newsletter. I’m talking something printed on paper that’s delivered to you monthly that goes in to areas that need further analysis, perhaps some coins are undervalued in the market, and we found that and we can talk about that an apply some of the investing filters to analyze those. So we’re developing right now, I call it old school newsletter, basically paper, pen and ink, printed out newsletter that’s actually delivered to you on a monthly basis. And the first issue is going to be free, and we’re working on that right now. The first issue will always be available for free download at www.cryptocorelabs.com. So the newsletter is going to be interesting, something on a neat project that we’re working on. We’re going to continue talking about different to make picks and shovels in the newsletter as well, and probably have some interviews that are only available in the newsletter. And one final thing that we’re working on as well is creating our own, since we are a laboratory, we call our business Crypto Core Labs, we want to do some block chain development as well. We were standing up a programming group now to do some of this development, and so we hope to have more info on that in the future. So that kind of wraps up most of the things we want to talk about here which is how you can make picks and shovels in the crypto and block chain industry, because we see an enormous transfer of wealth. I think one of the biggest in history, at least in my lifetime I missed out pretty much on the dotcom boom, I was just in college at that time. And so now when I see this one happening with many of same patterns that the Internet boom came with and changed how we do things day to day, I want to take part in that and I want to be of service to others and show them how they can take part as well.

Blake: That sounds good. Thanks, Brandon. Thank you all for listening. I think we’re going to wrap up the episode there. Once again please reach out with any suggestions, and we hope to talk to you soon.

 

Outro: Thank you for listening to the Crypto Core Podcast. Please visit us at www.cryptocorelabs.com or email us suggestions and your feedback at podcast@cryptocorelabs.com. 

Buffett, Dimon, and Munger on Cryptocurrencies

Intro: You are listening to the Crypto Core Podcast, exploring the fascinating world of cryptocurrency with your hosts Blake and Brandon De Shaw. Please visit us as www.cryptocorelabs.com.

Blake: Hello and welcome to today’s show. Today we are going to talk about the wizards of the investment industry, and discuss their thoughts, ideas, and predictions on cryptocurrencies.

Brandon: Yeah. Thanks Blake. We are going to delve a little bit in to some of the recent responses, and some of them have been pretty funny. From super investor Warren Buffett, his sidekick Charlie Munger at Berkshire Hathaway, and Jamie Dimon who is the head of JP Morgan and he has been kind of upfront on Bitcoin and cryptocurrency. And he has actually walked back some of his earlier comments which has kind of been hilarious to watch and listen to. Let’s start with Warren Buffet, Blake, and let’s queue up his recent response, I think he was on CNBC and he’s talking with Erin Burnett, I think is her name. And she’s kind of grilling him on Bitcoin and cryptocurrencies. Go ahead and let’s see what Warren has to say.

Warren (on audio): In terms of cryptocurrencies generally, I can say almost with certainty that that will come to a bad ending. Now, when it happens or how or anything else, I don’t know. But I know this – if I can buy long term puts, if I can buy a five-year put, every one of the cryptocurrencies, I’d be glad to do it. But I would never short a dime’s worth to it, you know, when you start talking…

Erin (on audio): Have you thought about trade in the futures? To take a negative position on Bitcoin?

Warren: No

Erin: You would not do that?

Warren: No. There no reason… I get into enough trouble with things I think I know something about. Why in the world should I take a long or short position to something I don’t know anything about? So we don’t have to know what Cocoa Beans are going to do or cryptocurrencies, we just have to focus on 8 or 10 stocks, businesses basically that we think are decent businesses. But I do think… I think what is going on definitely come to a bad ending. I mean, you’ve got virtually everyone. But I have a class… I have a lot in the school coming on Friday. The questions will be on Bitcoin. And I don’t know the answers.

Brandon: Okay. That’s kind of funny. He’s always said that he doesn’t really like technology and he stuffed Berkshire Hathaway with a lot of low-tech companies, companies that make boots and gloves and bricks and things like that. Berkshire-Hathaway actually started out as a textile company which is kind of funny. A very low tech and they had to shift into other things as a textile industry. Dropped dramatically. So he’s skeptical of course. Doesn’t quite understand it, which is fine. That’s how he has always been. And then his sidekick Charlie Munger, who’s a deep think but also not an extremely technically savvy guy, also had some commentary on Bitcoin and cryptocurrencies.

Becky (on audio): If you think private equity, I’m sorry, venture capital is potentially a place where you see bubbles.

Charlie (on audio): Well, Bitcoin and the other cryptocurrencies are also bubbles.

Becky: What tells you that? I mean, I’m just thinking of the millenials, the young investors who get so excited about something like this, what would you tell them? What would your message be?

Charlie: Well we’re excited because things are going up at the moment, and it sounds vaguely modern. I’m sure the computer science involved is difficult and interesting. So you can understand why they get excited. But I’m not excited… and go on somewhere else.

Brandon: Okay so there we have Charlie Munger calling Bitcoin a bubble and I respect of course. They are investing gravitas and their deep wisdom and knowledge about business, but they have said before and they always are saying now and they’re presented with Bitcoin and crypto that they just don’t invest in things they don’t understand. To a point they are right, Blake, you got to be very careful when you get in and play markets because you know that they’re rising and you’re going to play the rise in the market, not necessarily because you’re investing in very sound businesses. But that does not mean that right now we don’t have a whole flood of money coming into this space, and a rising tide lifts all boats. And if there’s a bunch of money coming into these businesses and there is a big, surging rise in prices, if you’ve got, I don’t want to say, if you’ve got, but I want to say is overall there can be profits and big fortunes made in that type of boat market that’s on the rise. However, you got to be careful not to hold out for top dollar. You have to cash out profits on a systematic basis.

Blake: And one thing that definitely helps out their argument is the number of old coins that are continually entering the market day in and out. If you look at some exchanges there are so many coins that probably end up either in a scam or will hold no value by the end of the year.

Brandon: Yeah, I mean, very much parallel to the Internet boom in the late 90s. I’ve heard some experts in the crypto space here. They say, I’ve heard anywhere from, “Hey we’re at 1993 in the Internet pre-boom,” or, “We’re at 1996,” I think somebody else said. So there’s this thought that it’s kind of a few years off until the masses really get into this and somewhat understand it. And the shifts of use of these currencies are more prevalent and widespread. And so we’re still in the early days, that’s what I’m hearing from the pros in the space. So if you are listening to this, you can count yourself fortunate that you’re in at least early on, if nothing else, just a fascinating time in business, because I truly believe that this is going to cause a big transfer of wealth. The changes in technology, time and time again through history, the people that are in using, making money and making fortunes off the old ways, they always say, “Hey be careful, be careful. This new technology, it’s dangerous and scary.” Well, the big transfers in wealth occur when these big technologies in business and in the world change. And the entire monetary system and everything that’s built around the monetary system I see being threatened in the current way of doing business. Banks, investment banking, contracts with blockchain – all these things are being threatened. And so you want to at least, if nothing else, at least be aware of what’s going on here, because I do see a massive transfer of wealth coming with this technology disrupting technology change of blockchain and cryptocurrencies and the main cryptocurrencies, the Bitcoin and Ethernet and Litecoin. So, the other big bad boy of finance that we have is Jamie Dimon from I believe JP Morgan, and he has come out and said that he’d fire anybody at the JP Morgan that was investing or even thinking about investing in Bitcoin and cryptocurrencies. But he has, well he softened his stance a little bit. He’s walked it back a little bit, but at the same time, he’s kind of bristly and bombastic about whenever someone brings up this subject. And it’s pretty clear that he’s I think kind of in denial, but also these guys, these big players realize that, “Hey if Goldman’s going to be the first one that get into it, but then we’d better be the second one, and figure out how we can make massive money.” Because these big bankers, they have smart people working around them and for them, and they know big transfers of wealth are coming.

Blake: Well I think what’s most interesting is I don’t know exactly when he said those statements, but in November now JP Morgan is considering through the future brokerage unit of CME group to provide its clients access to new Bitcoin products. So even now, some of these guys may have stances you can see them positioning themselves in the market to kind of take advantage of the cryptocurrency. And I think that’s an indicator that that is where the future is going.

Brandon: Yeah. Well one thing I want to go take a look at is that even though Warren Buffett and Charlie Munger, the super investors, aren’t going to be playing around in the crypto space, you can still in way, get their advice on investments in this space. And what they came up with to that underlying and underscores in their investment philosophy is what’s called the Four Investment Filters. And you can actually still apply this to cryptocurrencies, and ICOs and businesses that are springing up in this new industry, blockchain companies. And you can apply the Four Filters at least in an initial way to these things before you are in any way invest in them. So the Four Filters that they used for their investment philosophy. The number one filter is a business we understand. And so you can see why they’re automatically just throwing this out and saying, “We just don’t get it. We don’t understand it. This is something we’re not going to do.” So number one filter, business that we understand. Number two filter: favorable, long term economics. They call it sometimes ‘durable competitive advantage’, and so that’s like the, kind of for a long time Coca Cola had this name brand and attitude associated with it. And the red of Coca Cola, they had this some sort of favorable advantage and feature that gives them a long term edge, and any competitor would have to spend a lot of money to get into that. One of the things that comes to my mind is the name brand recognition of Bitcoin right now. And even though there are critics of it, and they say in theory there’s a much better cryptocurrency and backbone for everything, Bitcoin still has the name brand recognition. And that is tough to deny. Number three filter: able and trustworthy management, first-class management, and a lot of times on these I see a white papers another companies in the space, you can read about their management. And a lot of them there’s not going to be a lot of really well-known names, but in a lot of cases, you can see that these guys have at least been in the space maybe for a while, or a staff their team with people that they have been in a space for a while. Number four filter is a sensible price tag available at some sort of reasonable price. You’re not greatly, greatly overpaying for the coin or for the stock in the business, or what have you whatever might be invested in. And so it needs to be had for a reasonable price. So the Four Filters Warren Buffett and Charlie Munger came up with, you can still apply in this space even though they won’t be. Understandable business, enduring competitive advantage over a long term, good management, and then available at a reasonable price. So, Blake, what else do we want to talk about this episode? Any other news from the big wizards?

Blake: I think the biggest indicator, the biggest thing we should be looking for is, even though they’re saying these things, and that was great the Four Filters of Investing, it’s amazing how that works exactly with cryptocurrency. But it’s kind of keeping our eyes out for what these financial firms are doing. I can’t remember the name of the coin right now, but I know some of these. The banking industry wants in on this. I think right away they were trying to say that they will fail, they were hoping that it was going to fail, because they don’t want to lose control. And I think now they’re starting to have to accept cryptocurrency for what it is, and the next move is now to watch them to get into it themselves, by either kind of regulating the coin themselves or by not quite the decentralized regulation that Bitcoin and Ethereum run on. We’ll start seeing more centralized coins, maybe necessarily for-profit coins, and I think we’re already seeing coins pop up, and I think that’s important to keep our eyes out.

Brandon: Yeah, because we have to realize that this is a vastly growing market. There’s lots of money coming in and investment coming in from people who have been watching this space for a while, me included. And the masses are going to be brought in by mutual funds and things like that. The big, big groups of money were those people, the masses may not even be super aware of this. I still get questions from my friends on what Bitcoin is and cryptocurrency. But at some point, as these currencies become more and more adopted, the shift in attention will come. And you when these big, big players that manage the indexes and the mutual funds, then that’s going to be an interesting time.

Blake: Yup. And the free market right now seems to be sorting out its problems. For example, earlier off mic we were discussing exchanges, and I think naturally with any new industry there are hundreds of exchanges right now with very few on top. And I think they’re kind of growing through their growing pains and enduring kind of a struggle of too many trades happening laid with that. And so I think the banking industry will start kind of heading up its own cryptocurrencies, and I think the free market will sort out its problems and we’ll start to see exchanges come out with 100 percent, fool proof trading. It’s pretty exciting.

Brandon: Yeah, it’s exciting. And it’s definitely Wild West free market. We are not investment advisors, we are not accountants, and we are not attorneys. So please be aware that you’re operating at your own risk. In the Wild West, make sure you got a six shooter and a rifle and a good horse, and you are learning as much as you can and protecting yourself and obviously not risking your family’s livelihood on this. But it is exciting as much as the Wild West is exciting, and the Gold Rush was exciting back in the day, and we’re going to be talking in some upcoming episodes about what are some of the needs out there, some of the needs we’ve identified and other people have identified. Not necessarily exactly in the space, but maybe creating kind of some picks and shovels in the business. Maybe some creative ways to do that, and we’re actually just going to be kind of open about what we’re doing here with some of the ways that we’re trying to make, picks and shovels, so that you can learn and make your own picks and shovels and axes and milling machines, and all sorts of things that you can get on with this big transfer of wealth that’s happening.

Blake: And speaking of growing pains I think even with this podcast, we’re going to have some too. So our microphone situation, we’ll work on that. We’ll also put up an email so that listeners can send suggestions on what you’d like to hear about. Maybe we can answer your questions and hopefully we’ll get some interviews lined up. And yeah, I think that’s a good start to the podcast.

Brandon: Alright, let’s wrap it up.

Blake: Thank you for listening.

Outro: Thank you for listening to the Crypto Core Podcast. Please visit us at www.cryptocorelabs.com or email us suggestions and your feedback at podcast@cryptocorelabs.com.