10 Things I Think I Think on Bitcoin

I’m relatively late to Bitcoin. I’m probably more current than 99.9% of the general population but less informed than the hackers, hobbyists and investors who have been studying this since its inception in early 2009.

I’m no payment systems or cryptography expert. So I went back to first principles and studied the Khan Academy lectures here during this past summer. If you’re interested, I’m happy to send you my notes.

With that as a backdrop, here are 10 things I think I think; the format is one I’ve used before and a hat tip to Peter King, whose Monday morning column I read religiously.


  1. I think Bitcoin is just a bet that the world becomes more multipolar. In this world, there will be stages of heightened instability and chaos economically and politically. In this world, something like Bitcoin (or “Gold 2.0”) backed by no sovereign makes eminent sense.
  2. I think whether it is “legalized” or “outlawed” by the US is almost irrelevant. There can a flourishing Bitcoin economy because of this multipolar world described above. It may turn out to be something like online gambling in the early days.
  3. I think if you study Bitcoin, you realize that the currency is an application of the protocol. Bitcoin is actually a chain of digital signatures. Each “bitcoin” is just a ledger of all transactions of that “coin.” In other words, applications that have nothing to do with currency or payments (e.g., like Bitmessage) can exist.
  4. I think Bitcoin will survive and thrive because first mover protocols win so long as there are no major flaws. Examples: TCP/IP (i.e., the Internet) and SMTP (i.e., email).
  5. I think Bitcoin has many of the elements of modern “black swan” startups like Google and Facebook:
    • highly polarizing - even and especially among early adopters and ‘experts’;
    • dismissive or downright hostile attitude by incumbents, usually non-technologists;
    • incompatible with and/or pushing against current legal regimes or regulatory systems;
    • de-centralized thus involveing crowdsourced-based content or activity;
    • false conventional wisdom that the service is only used for illicit or unsavory activity (e.g., everyone thought apps like YouTube, Snapchat, Facebook were used just for porn, hooking up, etc.)
    • unclear business model or applications.
  6. I think that the FBI’s recent takedown of Silk Road, a black market whose primary currency was Bitcoin, was an inflection point. That the price of Bitcoin bounced back so quickly means that it’s being used for more than just illicit activity.
  7. I think the best community for and most interesting activity around Bitcoin locally is the Stanford Bitcoin Group, led by SV Angel advisor and Stanford lecturer Balaji Srinivasan and Stanford prof Vijay Pande. Special thanks to BSS for reading and commenting on this post.
  8. I think that people much smarter than I will be able to build applications, regimes and systems built on the Bitcoin architecture and that have nothing to do with payments. Getting back to point 3 above and Bitcoin first principles, there are a variety of applications and implications beyond payment systems.
  9. I think one of the most interesting companies in the entire SV Angel portfolio is Coinbase. They started as a Start Fund investment but we eventually invested more. They have a very crisp and clear mission (“making Bitcoin easy to use”). They have Stripe-like developer focus and support. They have founders with high horsepower (i.e., IQ) and unique insights into BTC.
  10. I think if I were in my early 20’s, looking for a startup idea and willing to do what the other person isn’t (e.g., move to a different part of the world), I’d spend all my time trying to understand this topic.

Now read this


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