Samson Mow, former chief strategy officer of Blockstream and founder of JAN3, considers himself a “common-sense Bitcoin maximalist.” He’s not particularly bothered by the current bear market, which he considers a “great buying opportunity.”
“Everybody buying right now is going to look like a genius in two to three years.”
I remark that this comment makes me feel much better about myself. (The current market certainly does no favors for my self-esteem.)
“We (Bitcoin maximalists) have a pretty good track record. We've rejected all the shit coins, which are destroying themselves right now."
Mow greets me with stereotypically Canadian politeness when I meet him in a privately booked meeting room at The Shilla, one of Seoul’s most prestigious hotels, on a rainy day. The air is muggy with mid-July heat and the city streets are drowning in monsoon downpours. Mow landed in Seoul the night before. He mentions he’s jet-lagged but shows no signs of fatigue or irritation.
Mow is in town to participate in the Asian Leadership Conference as part of a blockchain-related panelist. He mentions he’d also like to speak with local politicians about the importance of Bitcoin adoption.
Mow started off as a game developer, working at Ubisoft and Relic before starting Pixelmatic, a development studio that’s been building the massively multiplayer online (MMO) game “Infinite Fleet” for the past several years. Mow still runs Pixelmatic in addition to running JAN3. Mow says the foundational vision behind JAN3 is “accelerating hyper Bitcoinization.” He envisions a world where people don't need to change back to fiat. They could save in Bitcoin, store value in Bitcoin, and transact in Bitcoin.
Mow says many MMOs have their own economies, which can get so massive and complex that some platforms even hire economists to manage them. This is when his interest in Bitcoin first arose. He realized that there was no company or single person behind a completely open network, where anyone can join or leave at will. Nothing like it had existed before.
“From there, I just went further and further down the rabbit hole. And now I love Bitcoin.”
Bitcoin and “crypto” are different things
Mow doesn’t like people conflating Bitcoin and crypto. Many people use those two terms interchangeably, but he distinguishes Bitcoin from the rest of the crypto space.
He divides "crypto" into three categories. The first comprises stablecoins that facilitate the trading of digital assets. These are largely centralized and run by companies.
The second is "shitcoins, altcoins, tokens, NFTs, and all the rest." These encompass over 20,000 projects. Mow says this is what most people mean when they say "crypto."
"Crypto often implodes or explodes spectacularly, and while that entire space is separate from Bitcoin, every fiasco drags Bitcoin down with it, both in price and reputation.
The third category is, obviously, Bitcoin. Mow says that while "crypto" is largely DINO, or "decentralized in name only," Bitcoin offers real decentralization, immutability, and permissionlessness.
"If you examine a lot of the protocols out there, such as Ethereum, you'll find that many of the exchanges rely on Infura, which runs on Amazon. So whenever Amazon goes down, all the reliant exchanges stop Ethereum deposits and withdrawals. If everything runs on Amazon, that's not decentralized."
Mow adds that running on a node on a network like Solana usually costs tens of thousands of dollars, which bars ordinary people from participation.
“You basically have all these VC-backed projects that exclude most people. They set up a foundation in Switzerland somewhere and say, 'We're decentralized.'"
To Mow, "decentralized" is often just a buzzword used to market projects.
"Conversely, anyone with a laptop or Raspberry Pi can run a node, enforce the rules of the network, and participate in the Bitcoin network without the need for any outside intervention. That's what makes Bitcoin unique."
Why do most projects build on Ethereum or other chains?
If that's the case, why do most "utility-focused" projects choose to build on Ethereum over Bitcoin? Mow says most of these projects want to print their own currency or issue their own token to make money, which is difficult to do on the Bitcoin network.
"Ethereum basically facilitates the sale of illegal securities. There's a collaborative effort to make money off a project."
Mow says the craze for minting tokens and trying to profit off them has proliferated beyond Ethereum. Now there are several chains competing for Ethereum's market share, trying to become the place for minting tokens to sell to retail.
Mow thinks Bitcoin will eventually become a global reserve currency. He sees it as a tool for banking the unbanked and for implementing financial equity around the world. He grants that realizing this vision will take time, and laments that incidents like the LUNA/UST fiasco set back Bitcoin reputationally because of the common Bitcoin-crypto conflation discussed earlier. This is why he constantly emphasizes educating regulators, enterprises, and ordinary people about Bitcoin and its surrounding infrastructure.
"It's important for people to mentally distinguish Bitcoin and crypto, because crypto projects will continue to proliferate, implode and cause damage."
Why should nations adopt Bitcoin?
Part of JAN3’s mission is helping national and local governments adopt Bitcoin. But why should they? He says that countries don't necessarily need to adopt Bitcoin, but that they should be backed by assets. This asset used to be gold, which is difficult to store, transport and secure. Mow says Bitcoin solves all of these "legacy problems of gold."
"Russia's foreign reserves were obliterated or seized this past February. The lesson there is that countries should have assets they legitimately own. Venezuela had gold with the Bank of England. When Venezuela asked for this gold, the Bank of England refused."
You know never when conflict will arise. Your trading partners and allies now may be your enemies in the future. Mow says it'd be wise for nations to allocate a certain percentage of their budget to accumulating Bitcoin every year as a hedge against the future.
"In times of conflict, you need apolitical money that you can store yourself and transact without third-party intermediaries."
Obviously, the dollar isn't going anywhere anytime soon. Mow thinks the best way to transition to a new monetary system is to have both the dollar and Bitcoin operate in parallel for a certain time. Much like how El Salvador still uses the US dollar while it gets Bitcoin into the hands of its citizens.
Pointing to the lessons of global history, Mow says that fiat currencies usually last a few hundred years, at the most, before failing. Whereas assets like gold have been used for millennia.
"Fiat currencies ultimately fail because it's difficult for governments and central banks to maintain a good monetary policy. The temptation to print, to inflate the supply, to debase the value, is ever present. And most politicians are in it for the short term."
But hasn't the "digital gold" narrative shattered? I press Mow about Bitcoin's recent price dips despite the current inflation cycle. I also mention its tendency to follow the movements of tech stocks.
Mow says people, particularly the media, focus too much on the short-term horizon. He says there's no point in focusing on this week or this month. The view should be towards Bitcoin's development over the past several years.
Lending platforms like Three Arrows Capital, he says, have “blown up” and Bitcoin is being massively oversold, which drags the price down. Mow views Bitcoin's volatility as a characteristic of a global, permissionless system that never stops running.
“Bitcoin is being oversold right now, but that can't be sustained. There's too much demand and need for Bitcoin in the world right now. Countries are imploding. We're seeing record levels of inflation.”
Mow says we’ll eventually see a decoupling, where Bitcoin moves away from the “shit coins as well as all the tech stocks.” He thinks Bitcoin is tracking tech stocks right now because HODlers (long-term holders) don't impact the price. HODlers accumulate Bitcoin and keep them in cold-storage wallets, which don't show up in on-chain data. It's Wall Street finance and traders, who currently view Bitcoin as a tech stock, who are moving the price right now.
“Bitcoin is designed to decouple from everything. And if you look at it from the perspective of the last 13 years, it has decoupled from everything.”
JAN3 and El Salvador
As part of its mission, JAN3 recently signed an MOU with the government of El Salvador to work on digital infrastructure for the country and for Bitcoin City, the country's project for attracting Bitcoin investors. El Salvador President Nayib Bukele announced the project in November 2021, claiming the city will be built at the base of a dormant volcano and be powered by geothermal energy.
JAN3 has agreed to help build the nation's immigration platform. The idea is to attract Bitcoiners to the country through a modernized, secure platform where people can apply for residency and citizenship.
"I view it as a special economic region that has amazing incentives for businesses to domicile there. There are no taxes on anything other than a VAT (value added tax.) Once their congress passes the law that President Bukele has proposed to establish that region, I think companies will start to domicile in El Salvador."
Mow envisions a full-fledged city with an airport and the works, but he acknowledges that realizing this immense vision will take several years.
"For the record, JAN3 is already headquartered in El Salvador, and we plan to redomicile to Bitcoin City once the laws are passed."
JAN3 is also helping El Salvador build its "volcano bond," the world's first cryptocurrency sovereign-debt product. Mow says it's a billion dollar bond with a 6.5% coupon over 10 years. Half of the proceeds will go into buying Bitcoin, while the other half will be invested in energy and Bitcoin mining infrastructure.
I mention that some people view Bukele’s Bitcoin campaign as authoritarian. Mow retorts by saying that if Bukele truly wanted to exercise authoritarian power, he wouldn't want all citizens to have Bitcoin. Giving all citizens access to Bitcoin actually empowers them and enables them to fund opposition movements more easily.
Responding to common criticisms of Bitcoin
I ask Mow for his thoughts on the common criticisms against Bitcoin: It’s too slow. There’s not enough utility. It takes too much energy.
Mow thinks most energy-related criticisms of Bitcoin are logically flawed. Taking the aggregate energy use of Bitcoin and saying it amounts to the energy used by a small country, he says, is an argument that could be used for literally any technology.
"You could say the same thing about – let’s say – dishwashers. You take the aggregated energy used by a specific technology all across the world and lots of things will consume as much energy as nation states."
Mow points out that Bitcoin uses about 110 terawatt hours (TWh) per year. The energy used to mine gold every year is about 130TWh.
"Always-on devices like Amazon Echoes consume about 200TWh per year. Not to mention the fiat financial system consumes around 200TWh a year."
Regarding Bitcoin’s slowness and functionality, Mow points to Layer 2 solutions.
At the base layer, he explains, Bitcoin is a settlement network. There are blocks every 10 minutes. You can't use it for payments because the fees would be too expensive, especially for smaller transactions. Layer 2 networks like Liquid and Lightning, however, extend Bitcoin's functionality.
"Lightning is designed for micro-payments. You can pay someone a penny and transact for a fraction of a penny. Liquid is a sidechain meant for traders. It allows them to move large sums of Bitcoin with one-minute block times between transactions. There are lots of things you can do to build on top of Bitcoin and extend its functionality."
Key to the future
Before saying goodbye, I ask Mow to address our Korean readers.
He hopes that Korea will eventually adopt Bitcoin in some form, whether it's mining, putting Bitcoin on the central bank balance sheet, or making it legal tender.
"Korean politicians should really try to understand Bitcoin and learn to separate it from the shit coins. Regulate the shit coins. They're illegal securities. Bitcoin is actually decentralized, and it's not a security. I think it's the key to the future."
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