Inside the Mind of a Bitcoin Maximalist: Anonymous Interview with an Early BTC Investor

1. When and how did you first discover Bitcoin?

I first discovered Bitcoin in 2010-2011. I came across an article on a website called ZeroHedge, which was quite popular at the time. We were just coming out of the depths of the great financial crisis and a lot of us were looking at the financial system and recognising that it was clearly on an unsustainable path and thinking about ways out or alternative monetary systems. Bitcoin seemed an interesting possibility. I mean, I’ll admit, I read the white paper, Satoshi’s white paper, sort of understood it and then put it down because, although it was an interesting idea, it was a long way from what I thought money was. Decentralized money really is that innovative. Then, as the months passed, I decided to go and revisit it and I spent more time analysing how the code worked and thinking about the mechanics of blockchains. The more time I spent understanding Bitcoin and the deeper my understanding of it, the more I realised  this could actually be quite a powerful new form of money.

2. What convinced you to invest, and to do it in such a maximalist way?

Well, as I just said, we’d come out of the great financial crisis when I came across Bitcoin, and it was pretty clear to me that the policy making solutions being implemented, which is to say aggressive budget deficit financing, and very low interest rates meant the fiat money system was on an unsustainable trajectory. The question that naturally arose from this is what were the alternatives. Gold was obviously one possibility, and the gold bugs have long pushed for a return to the gold standard. The problem with gold is although it’s a good store of value, it’s not very easy to transact with. I mean, you could use gold coins, but there’s a problem with divisibility. The really big problem with gold though is that it’s not very suitable for the increasingly digital world in which we live. Bitcoin seemed to be the solution to that problem. 

As I’m sure you know, one of the most popular narratives about Bitcoin is that it is a form of digital gold. This is not by accident, it was quite deliberate. What I mean by that is when Satoshi was designing Bitcoin, he was clearly trying to borrow some of gold’s features. He wanted to lean on gold’s historical record as a reliable store of value. That’s why the 21 million supply cap was implemented. He was trying to effectively replace historical precedent with logic. So that’s really when I decided to invest in it, which was sometime in 2013. 

Why did I do it in a maximalist way? Very simply, my valuation models, which were based on Bitcoin becoming a fairly serious competitor to money or gold, meant its valuation was extremely high. We’re talking, you know, seven figure digits, and at the time, we were trading in three digits. It’s not very often as an investor one can see such huge returns, and certainly not with a probability of achieving those returns, which is pretty high. We’re not talking here about lottery ticket type investing. It seemed to be a much more sure thing than that, and that’s why I did it in a maximalist way. If you think you are on to a winner, then you go for it.

3. Have you ever doubted that Bitcoin might fail? If so, when and why?

No, I never really thought Bitcoin might fail. I always believed it was always going to do well. Obviously you never say never in this world, but the greatest risk of failure for Bitcoin was very early on because the one thing money needs is to be widely accepted. If Bitcoin had not taken off and not been embraced by the cypherpunk community and tech nerds, it would have been dead in the water. But I didn’t really see that that was much of a risk, given the path fiat money was on and the lack of credible alternatives. So, for me there was always a very low probability of failure. At this point in time, that risk has diminished to effectively zero. People have adopted it. Large finance institutions, who – importantly – have political clout, have now backed it. Governments can’t ban it and some, like the US, are creating strategic reserves to hold Bitcoin.

4. Do you have any regret of not buying enough BTC?

Yeah, absolutely. There’s a famous saying in investing circles that when a trade is going your way, you never have enough and when your trade is losing money, you always have too much of a position. Given how its price has risen over the past decade or so, yes, absolutely, I didn’t buy enough Bitcoin. But that’s the problem with hindsight trading. 

Actually, the people I feel sorry for are those who have never invested in Bitcoin, because they thought it was just a big scam. They must be looking at the price now and going, OMG, we’ve gone from effectively zero to above $100,000. To not own any, and to have missed one of the best investment opportunities of the past two decades must be really painful.

5. Why do you believe Bitcoin is fundamentally different from everything else in crypto?

I think the obvious fundamental difference between Bitcoin and everything else in crypto is that it doesn’t have a person or entity behind it. Ethereum has Vitalik and all the other coins have the founding teams. Bitcoin is different. Satoshi embraced anonymity wholeheartedly and no one has been able to dox them, and I hope they never do for rather obvious reasons. 

It’s almost like a gift to humanity. I mean, this person, or people, took the time to create, develop, including writing the code, and then publicized a project that fundamentally changes the way that we all think about money. Until Bitcoin, in fact, I don’t think we’ve ever had a very good decentralized form of money – at least not in the modern world. It means the state is no longer required in the process of creating money. 

I know there are some issues. Bitcoin mining for example is not as decentralized as many of us would like, and we could always do with more nodes on the network. But compared to the way the fiat money system works, it is radically different. Of course, it has some limitations, most obviously the problem of scalability, as per the famous blockchain trilemma, which other cryptos are attempting to overcome but that improvement always comes at a cost. In terms of how Bitcoin operates, and ruling out a shift to large blocks, Bitcoin natively will never have large transaction bandwidth, but perhaps that is not a bug but a feature that shapes how Bitcoin evolves, reinforcing the idea that it is unique in the world of crypto.  

6. What role should Bitcoin play in the global economy — store of value, currency, or something else?

That’s an interesting question because clearly Bitcoin works very well as a store of value and because it’s digitally native, it can be exported around the world much more efficiently than it’s possible to transact money in a traditional finance world, especially cross border. So it does have a role as currency, but as I alluded to in, my previous answer, the question of scalability is definitely an issue when it comes to Bitcoin fully replacing fiat money. Doing that would require very high performance in terms of transaction bandwidth… we’re talking, you know, tens of thousands of transactions per second not seven, which is what Bitcoin can do. 

The question is how do we scale Bitcoin? We had the famous block size wars back in the mid-10s, which was won by the small blockers. Arguably that was good for decentralization, but it means we can’t do much in terms of Bitcoin’s transactional bandwidth. The solution is obviously to go to layer 2s, like Lightning and Liquid. By permitting off-chain transactions they boost transaction bandwidth but it comes at a cost of introducing some centralization. You have to trust the people who are locking up the coins on layer 1 and, you know, reproducing them on layer 2. You have to trust them not to run off with your Bitcoin, which is far from ideal. Alternatively, maybe Bitcoin is not going to be a full replacement for fiat money. Maybe it should just be used to settle low-frequency, high-value transactions, especially cross-border, rather like the role gold played when the gold standard was operating. We can have other types of cryptocurrencies sitting alongside that, which can be used for more transactional purposes. 

7. What do you think about people focusing mainly on altcoins?

I can understand why people focus on altcoins. Historically, every bull market has started off with Bitcoin leading the way, and as it becomes more established and investor risk appetite rises, people buy the higher beta alt-coins, which because of their smaller mark caps means they are more levered plays. I’m thinking about the ICO boom in the 2017/2018 bubble, NFT in the 2021 bubble. 

One thing that’s interesting about the current cycle is Bitcoin has not seen its dominance ratio go down, which is what tends to happen during altcoin season. This cycle Bitcoin dominance has actually been steadily creeping up. Obviously that means that if you focused just on altcoins, or mainly focused on altcoins, versus Bitcoin, you’ve actually lost out. One possibility is that the absence of alt-coin season means the bull market is still very much in its infancy, in which case, people who are just focused on these particular coins will do much better later on in the cycle. But the other possibility is that maybe the dynamic has changed. Maybe the creation of spot Bitcoin ETFs and the attraction of institutional money has sort of concentrated people in the major tokens. 

One other thing I would add, in terms of a money analogy, is if we look to fiat money because money has a network effect, there tends to be a very few or small number of currencies that dominate. So in the fiat money world for example, the top 10 currencies, the dollar obviously being the pre-eminent one, account for the bulk of the transactions, even though there’s probably 100 plus different fiat currencies. I believe crypto will experience the same type of dynamic. The 10 crypto currencies that are most successful, and who knows which 10 they will be, will be big winners. It’s not quite a winner take all market, but it’s a winners take all market, with a small subset that will do very well and a larger majority of alt-coins that will fall by the wayside. 

8. Have you ever sold Bitcoin? If yes, under what circumstances?

Easy to answer this one – no! The reason is quite simple. I still think it’s extremely undervalued based on fundamentals – it should be seven figures. And on that basis, if I was to sell Bitcoin anywhere near the current price I’m giving away a huge amount of upside. The only circumstances where I would sell is if I needed the cash say for an emergency. That’s why, you know, if we ever do have a big liquidation event, not just in crypto, but in the broader economy,  say a deep recession, Bitcoin will go down for sure because people scramble for liquidity. It’s natural. The one thing I’m sure of, though, is that even in such an event, the policy response will be exactly the same as we saw back in the great financial crisis. You know, fiscal policy will become even looser, interest rates will go back down to zero, and the central banks will hit the print button. This is the perfect macro set-up that will drive Bitcoin to new all-time highs.

9. What’s your opinion on current monetary policies? Are we close to a fiat endgame?

I think I’ve hinted at that already, I think current monetary policy is… actually I don’t think the problem is with monetary policy, I think the problem is with fiscal policy. The problem with fiscal policy is that the governments are still running pretty sizable budget deficits, so they’re spending more than they raise in taxes every single year. There seems to be an inevitability to that trend. As people often say in crypto, nothing stops this train! What they’re talking about is that governments seem unable to rein in budget deficits. Taxes are already fairly high by historical standards, and in economics there is such a thing as the Laffer curve, where tax revenues go up as tax rates increase up to a certain point, an optimal point, and then any further tax increases actually leads to lower tax revenue collection. I really think we’re on the right hand side of that curve, because as I say, historically tax revenues as a percentage of GDP are pretty high. So fiscal consolidation has to be tackled by public spending cuts, and that is politically unpopular. We’ve seen that just recently with Donald Trump and Dodge. Elon Musk is clearly a capable person, but even he’s been unable to do much in the way of trimming the budget and Trump is now introducing his big, beautiful tax bill, which is going to add even more to the deficit. And it’s not just the US where this is an issue, it affects pretty much every single major economy, including China. 

If you want to look at a really dire situation, go look at Japan, where government debt levels are over two times the size of the economy and the central bank owns half the bond market. That’s just an absolute disaster area. Now combine that with Japan’s very poor demographic profile, they’re aging rapidly so the number of employees that constitutes the tax base is dwindling while the number of retirees is rising. This situation is unstable because it creates tension for monetary policy. People think that central banks are supposed to keep inflation low but that is not their primary purpose. Their primary purpose is to ensure the solvency of the government, that’s why they were created in the first place; to help finance wars and keep the government from going bankrupt. The idea that they’re supposed to protect the value of money is a much more modern interpretation. Historically, no matter how independent the central bank is, if the government is in trouble in terms of its finances, then guess what? The central bank’s mandate will change. Governments will either replace the heads of central banks and get someone more pliable, or they’ll just nationalize them. They did that with the Bank of England during the second world war. 

How close are we to the end-game? It’s difficult to say. Anyone who’s familiar with Japan can see the fiscal trajectory is unsustainable but that has been the case for the past 10-20 years. All I will say is this, when the end game does come it will be fast. As Ernest Hemingway famously said “How did you go bankrupt?” Two ways. Gradually, then suddenly.”

10. Do you think your BTC maxi philosophy can be considered as a Hayek modernized theory? 

That’s a deep question. I mean, if we think about Hayek, he basically, you know, he was an advocate of sound money. He was also definitely in favour of markets and against central planners because he believed government intervention was not a positive thing. So, you can see that there’s a lot of obvious areas of overlap between Bitcoin and Hayekian thinking, particularly the fixed supply of Bitcoin and its resistance to government manipulation, making it trust-minimizing and censorship resistant. Where it is a little bit problematic from a maxi point of view in particular, is that Hayek was very much in favour of currencies competing with each other so that the superior form of money wins. If you’re in a Bitcoin maxi world, there’s only one winner and it’s Bitcoin. So, that goes against the idea of competition between currencies. That said, overall, certainly compared to all of the other currencies out there, Bitcoin is probably the closest to a Hayekian form of money.

11. Was there a personal or macro event that triggered your “aha!” moment?

No, I don’t think there was a personal macro event that triggered, like, an aha moment. It was more just a slow realization that the current fiat money system was unsustainable. As I mentioned above, you know, I read the Bitcoin white paper and thought it was interesting but then put it aside for several months. So it wasn’t like an epiphany or anything.

12. Are you concerned that some corporations and individual investors already hold a significant slice of Bitcoin supply? Do you consider it “fair” and sustainable over the long term?

Yeah, this development is interesting. There is clearly a centralization tendency in Bitcoin. And the Michael Saylor’s and the BlackRock’s of this world are accumulating fairly sizable pools of Bitcoin. That creates a little bit of an issue. Also, there is certainly a problem with paper Bitcoin, which is what these products represent. They hold the Bitcoin on your behalf, which means you have to trust these players. This is contrary to Bitcoin’s ethos to be a trustless, or trust minimizing, form of money. The problem though, as I’ve said, for Bitcoin in its current format, is it’s unsuitable to be used for regular daily transactions. If Bitcoin is ever to be used in this way, then layer 2 scaling solutions are required and that inevitably also  means centralization. I don’t see any way round it at this stage, it’s something that we need to work out.

As to the question of being fair. Bitcoin in a sense is perfectly equitable. There was no pre-mining; no seed  investors who got given a slice; no allocation to the founding team. It was literally bootstrapped up by Satoshi and Hal Finney and their ability to onboard people. In that sense, it was absolutely fair. You know, if you took the time to do your own research, as we like to say, then you were rewarded, if you didn’t, well, that’s your problem.

13. How do you view the coming wave of CBDCs—competitors, Trojan horses, or irrelevant?

Well, the first thing to say about CBDCs or central bank digital currencies is I think they’re pretty much inevitable. They are programmable money that allows governments the ability to maintain their control over the population, especially when it gets combined with digital IDs, which many governments across the world are pushing for. Initially, you might consider them to be a bit of a competition in the sense that they are also a digitally native form of money. But actually, I think that rather than competition CBDCs could turn out to be an extremely valuable recruiting tool, bringing people into private crypto projects that are decentralized and which allows them to avoid government scrutiny over how they spend or transfer their money. With CBDCs  governments will be able to put a limit on what items you are able to buy. Say for instance you have already bought two packs of cigarettes this month, they will be able to stop you buying more. It may be better for your health, but it removes personal choice. And once people realize the potentially intrusive nature of CBDCs, I think more will come on board to Bitcoin. 

Another important point is this: CBDCs will likely run on very similar infrastructure to private crypto. So people will get familiar with digital wallets, blockchains, public and private keys and all the rest of it.  This new tech has probably put quite a few people off in cryptocurrencies, including Bitcoin, because it is new and therefore scary. Increased familiarity with crypto infrastructure which comes with CBDCs will therefore encourage even greater public adoption of Bitcoin and other crypto tokens.

14. If the world moved to a “Bitcoin Standard,” how would that reshape inequality and the business cycle?

That’s a difficult one because capitalist societies are societies where you have inequality. You get rewarded for work or, you know, for being smarter than other people in proportion to how much perceived value you add. This may not be ideal, but it’s certainly superior to a socialist system. Bitcoin shouldn’t change that at all. There will still be winners and losers, just different winners and losers.  

As to what happens to the business cycle? That’s interesting because it would mean we are in a world where the money supply is fixed. Even though we’re still a century or so away from the last Bitcoin ever being mined, the vast majority of the supply already exists. In such a world productivity gains would translate into lower prices because there would be more “stuff” but the same amount of money with which to purchase this “stuff”. Now, people, especially policymakers, take the view that deflation is very bad. I don’t agree with that. Deflation is only bad if you have a heavily indebted society, which admittedly we currently have. But if we want to move to a better, more sustainable system, removing the ability of policymakers to backstop failure – which is what happens now that recessions are seen as things to be avoided rather than a necessary part of the creative destruction process – is a good thing. It will likely mean higher short-term volatility, but lower long-term volatility. Why? Because stopping the creative destruction process simply pushes the economy further and further away from intertemporal equilibrium and economic gravity cannot be avoided indefinitely. Ultimately, balance must be restored. It is as if policymakers by trying to thwart the business cycle are just storing up much bigger problems – probably resulting in a crash – in the future.  

Think about the world over the past 20, 30 years, there has been a decline in terms of macroeconomic volatility. But the cost of that is we’ve had to run fiscal and monetary policies, which are extreme, and certainly a long way from what we would previously have considered normal. To me this is a signal that we’ve got a very large amount of volatility that’s hidden under the surface. And when that volatility explodes, it will be economically devastating for pretty much everyone. A Bitcoin standard world should remove the threat of such large corrections. 

15. Privacy tools (CoinJoin, PayJoin): Are they essential or a narrative liability?

Privacy, if I’m not wrong, is a human right, according to the UN, and certainly, you can’t have privacy without financial privacy. So, I do believe there is definitely a role to play for privacy. I’m just not sure that you need to have coin mixers to ensure privacy. Even without such tools Bitcoin can be used fairly anonymously. 

16. Would you support any protocol-level changes to reduce energy use, or would that be a betrayal?

I don’t think it’s necessary because there is a role Bitcoin mining can play in helping support the electricity grid in terms of load balancing, which is going to be critical if governments continue to push towards renewable energies which are inherently intermittent. As we saw recently in Spain, when there is a lot of intermittent renewables in the electricity generation mix, maintaining the required 50 hertz frequency on the grid is a big challenge. The one good thing about Bitcoin mining operations is they can be turned on and off instantly, which is something that not a lot of other industries can do. This makes them ideal to be used for demand supply response. 

The other thing that I would say longer term is that AI is going to produce a lot of demand for electricity. There’s no question about that. I do think there may be a way to combine, or shift, Bitcoin slightly such that rather than just doing hash functions, which really don’t serve humanity very well, this compute power can be used to drive AI inference or model training. The reason why I think this is feasible is because Bitcoin only needs validators to provide proof of expenditure. This is really what the hash function is all about and if they can do that in an economically meaningful way then it could be even better than what we have now. It would require a tweak to the underlying protocol but I have fleshed out a way in which I think it could be done, without sacrificing Bitcoin’s ideals. Admittedly though it would be extremely difficult to get that accepted by the Bitcoin community because they’re pretty fixed on the current set-up. 

17. How concerned are you about quantum computing and Bitcoin’s long-term security?

I’m not concerned about quantum computing and Bitcoin’s long-term security. The simple fact is you’re not going to take a $1 trillion+  asset class and wipe it out to zero when all you need to do is move from SHA-256 to a quantum-resistant hashing function no matter how dogmatic Bitcoiners can be. The one problem that quantum computing could throw up, though, is for old coins because these coins would still be secured using SHA256 which would be crackable. Bad news for Satoshi I guess. 

18. Would you support a hard fork to implement post-quantum cryptography if needed?

Yes absolutely and if the threat is perceived as serious enough the consensus would favour it too. My only concern is how long it would take for the change to get agreed relative to the speed with which quantum computers arrive. To be clear I’m not an expert in terms of quantum computing by any stretch of imagination, but my suspicion is that this is quite valuable tech and it must be the case that governments are researching this on the quiet to the extent that it’s possible. Given this, perhaps we could just wake up one day and all find out that quantum computing has suddenly arrived. That would be a bit of a “Oh Shit” moment, but given all the other things that would be instantly accessible – think bank accounts, emails etc I think Bitcoin would not be at the top of everyone’s worries. 

19. What’s the biggest mistake retail investors make in crypto, in your view?

I think the biggest mistake retail investors make is focusing too much on the short-term price movements and not having sufficient conviction to ignore them. I understand that when the prices move around a lot, the temptation to trade aggressively and often is obvious, but we’re talking about the birth of a new asset class and the winners will likely be worth a whole lot more than they are currently. Do you really want to risk missing out on a 10X move because the price dropped 20% or 30% in a couple of hours? That’s the problem. 

I think it’s much better to scale your position down and focus on the long term. Or alternatively have two different baskets, have a long-term, bottom-draw type trade to represent your core view that you believe crypto is the future. And then have a separate trading account where you do more of the high frequency stuff. One thing I would add here, is that if I am right and crypto is going to be the future payment rails then those people who don’t own any crypto at the moment are actually taking a position even if they don’t think they are. In effect, they are short the world’s newest asset class. Personally, I consider that a rather brave stance, and certainly one I would not be happy with. 

20. Can Bitcoin ever be replaced or surpassed?

Yes, sure, of course Bitcoin can be replaced. It could probably even be surpassed. Technology continues to move forward, always. Look at the development in terms of AI. It’s extraordinary the progress that has been made in such a short space of time. This is not taking anything away from Bitcoin, it was a huge technological innovation. It was a zero-to-one type technology jump. But is this the end-state? Probably not. As I’ve mentioned before, I see some potential for Bitcoin mining to be  overlapped with AI inference and model training. That said, it is also important to recognize that for anything to replace Bitcoin or for Bitcoin to be redesigned, you have to have the whole community agree to it and that’s potentially quite a big ask. I mean, don’t forget, I can’t tell you what Bitcoin is, you can’t tell me what Bitcoin is. The only way we know what Bitcoin is, is when everyone collectively agrees that this version of the Bitcoin blockchain is Bitcoin. 

21. If you could give one message to a young investor today, what would it be — in one sentence?

Very simple. Don’t rush. Haste is always a bad idea when it comes to investing, whether it be crypto or any other asset class. I think it was Warren Buffett or someone like that, who basically said, look, the investment process should be boring. And the hardest thing to do in the world of investing is not to do something because the timing isn’t right. Having the patience and ability to do nothing is very difficult to master, but it can really make a huge difference in the long term. So that would be it.