Join me today for Episode 1036 of Bitcoin And . . .
Circle P:
Peony Lane Vinyards
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The Forest Is The Teacher
- https://www.cnbc.com/futures-and-commodities/
- https://dashboard.clarkmoody.com/
- https://mempool.space/
- https://value4value.info/
- https://fountain.fm/show/eK5XaSb3UaLRavU3lYrI
- https://geyser.fund/project/thebitcoinandpodcast
https://decrypt.co/305502/meme-coins-solana-trump-not-under-sec-jurisdiction
https://www.coindesk.com/markets/2025/02/12/goldman-sachs-disclosed-ownership-of-bitcoin-etfs-here-s-why-it-doesn-t-mean-much
https://www.theblock.co/post/340317/bitwise-crypto-retail-institutional-sentiment
https://cointelegraph.com/news/bitcoin-price-94k-dip-crypto-us-cpi-overshoot
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[00:00:02]
Unknown:
It is 09:14AM Pacific Standard Time. It is the February 2025, and this is episode ten thirty six of Bitcoin. And, well, you know, Valentine's Day is coming up. It is coming up. It's like the fourteenth, so it's what? It's gonna be like Friday or something like that? So make sure that if you haven't already, you know, make sure you get your, significant other some small gift because I used to think that this was a b s, holiday or day of remembrance. And after I screwed up with my wife on several occasions by not actually doing anything for Valentine's Day, I've I've learned my lesson. So it doesn't really matter what I think it is. It matters what other people think it is, and I refuse to get in trouble anymore.
So what you may wanna do is you may wanna cruise on over to the circle p. Circle p is open for business, and that's where I bring plebs like you with goods and services to other plebs like you, and you gotta sell your goods and services for Bitcoin. If you don't sell it for Bitcoin, you're not in the circle p. I'm gonna put PNE Lane Vineyard on the circle p again today that you can buy with Bitcoin at pandelanewine.com/Bitcoin. He's got a couple of prepped packs. Now if you order today, I'm not sure if you're gonna be able to he's gonna be able to ship it to you in time for Valentine's Day depending on where you live, but, you know, you never know. Maybe you could if you get in enough trouble by not doing something or being the or dumbassing around or whatever, maybe you can make amends the day after or the day after that. But he's got a couple of packs here.
It's, one is called the lightning pack, and it's got two bottles of Hyre, two bottles of Malbec, and two bottles of Cabernet Franc. The whale has four bottles of Hyre and two bottles of the Estate Pinot Noir. If you buy the six bottle packs, you get free shipping. So you might want to do that. But you also need to make sure that you tell Ben Justman, who is the proprietor of Peony Lane Wine, that you heard about him and his wine here on the Circle p on the Bitcoin Dan podcast, and he may give me a slice of that little sale through Satoshis because that's the deal that we've got worked out. No sale, no Satoshis.
Alright. So I kinda wanted to bring the Circle P up and, Peony Lane Vineyards up because I kinda want to use it to introduce what's gonna be a little bit of a different show. We're still gonna do some news, but that's gonna be in the back half of the show this, this time. The first part of the show, I'm gonna be talking about the Forrest being a mentor and why that is actually the case. And there's a lot of stuff in the forest that you can go learn if you allow the forest to actually speak to you. Alright? But then after we do that and and, honestly, this will make sense in a second. But I do wanna make sure that you understand that, yes, we will be having a little bit of news because, we're gonna under try to understand what happened with the CPI today and why it collapsed the Bitcoin price a little bit, which is seems to already have made a full recovery.
There's gonna be some issues with Trump's meme coins and other meme coin. I want to talk a little bit about Obscura VPN because they just released their stuff yesterday. And, well, Bitwise, chief investment officer says that he smells opportunity when it comes to Bitcoin, and it appears that Goldman Sachs holds more holds more Bitcoin than what we previously believed, but a writer over at CoinDesk thinks that's just all a bunch of hooey as to how important it is. But going back over here to the forest, well, I wanted to do something different today that kinda showcased what I can do with Obsidian, which is the note taking application that I use. I've talked about it on several occasions.
And I got the idea, because I was listening to, the survival podcast yesterday and the day before, and he's he's done two shows that he and he's he's not, you know, Jack Spierko's not making any bones about it. He straight up used AI to generate outlines and then go through and refine the outline because he wanted to talk about the matrix, the movie, and how it applies to what we see in today's world. And like I said, the the man makes no bones about what you know, using AI, and neither do I. Honestly, I I don't have anything against using AI, but I wanted to present something in a to design a show in a different way. And I got I had already written a speech for Toastmasters, which is called The Forest is the Teacher.
And I put it together actually before I heard Jack Spierko's first Matrix show, which was a couple of days ago. And it was actually on yeah. It was on Monday. And then I yeah. He dropped his first Matrix episode that afternoon, which I started listening to, and I go, hey. I was using a a tool to actually design a whole speech, but it wasn't AI. It was this Obsidian note taking app. If you have been on Nostr, you've been seeing some of the notes that I've been putting out about fungus and trees and trees association with mycorrhizal fungi and that that whole thing. Well, I'm I'm just gonna go ahead and do the whole thing is I don't have to do it in five to seven minutes. I've got all the time in the world, which is what I wish I had with that had with that speech that I made at Toastmasters, but it was pretty good. People actually the the club wants me to, they actually liked it so much. They had a couple of people that are begging me to try to do the Toastmasters contest because it's contest seasons for Toastmasters, and I'm like, I just don't wanna do it. I would rather spend my time bringing this information to you. But since they thought it was pretty good and I did win the, that there's always a daily competition. And since I did win that competition on Monday, I figured it was good enough to bring to you.
So why did I start with PNE Lane? If the if I'm gonna be talking about a forest, then why the hell am I starting by introducing PNE Lane vineyards? Well, because there's this stuff called arbuscular mycorrhiza fungi. There's all manner, but this is there's all manner of mycorrhiza that all they all basically associate with grasses and plants and trees, and we're gonna get into that. But grapevines associate with a specific kind of mycorrhizae, and this one is called arbuscular mycorrhizal fungi. That is what's also known as an endo mycorrhizal fungi. So it not only associates with plant roots, which all of them do, it actually goes into the root, penetrates root cells, and basically sets up a little market and essentially sells its good and services like the circle p, but it sells it for carbon.
Right? It sells phosphorus and nitrogen and, I don't know, manganese and whatever else the fungi is able to scavenge out in the soil. It sells sells it in a stall that it hand builds inside of a plant cell. It doesn't kill the plant cell to do it, by the way. The plant cells just fine. It just has to make some room for this mycorrhizal fungi to enter, set up its shop, and basically set up the trading functionality. And we'll we'll get into a little bit more about that. But without the arbuscular mycorrhizal fungi, you're not going to have wine from Peony Lane wine.
Because I guarantee you that all of Ben Jessman's wine vines that are up there at high altitude are directly associated with a huge web of mycorrhizal fungi. And those fungi are out there generating organic acids, dissolving minerals out of rocks, piping those minerals that are now liberated from the rock into their little stall that they have set up in all these plant roots that are the plant roots for the grapevine. And they're getting copper, they're getting iron, they're getting all kinds of stuff. And in return the grapevine is basically using its its universal currency that is sugar.
Technically, I always associate the universal currency of plants being carbon, but sugar is just a bunch of carbons. And that's what it pay. It pays for phosphorus with carbon. Where does it get the sugar? It makes it out of photosynthesis. This is the way the forest works. So I'm going to go back to the entire first part of this speech that I gave on Monday because the title that I gave it was the forest is the teacher. But it's not the mentor. And that may be confusing at first, but let's let's just begin with what is a forest in the first damn place? When I go into the forest, I see a cathedral of learning if you will allow the forest to be your teacher.
It will teach you all kinds of stuff. In fact, the four points that I'm going to talk about today are the four things that I talked about in my speech on Monday. It is not the only things that the forest has taught me, but these four are pretty good. So the first thing it taught me was resilience through networking. The second thing it taught me and continues to teach me is economics. The third thing is problem solving. Through persistence, I might add. It's not just solving problems. It's solving problems, being patient, having a very, very long time horizon. And where have we all heard that before?
And the fourth is farming. Farming. Yes. Farming. I I know it's it's it's it's odd, but trust me, we'll get into in into exactly why, but I need to write something down. My before I forget, I needed to make sure that I had something down here. So as I said, the forest is a teacher, but it's it's a university of mentors. It's not the only mentor. Right? Some people will say that. Some people say the forest is the mentor. Well, no. It's there's a bunch of mentors that actually live in the forest. But there's one mentor that's probably the most important one because without it, you don't have a forest.
Hell, you don't even have trees. Furthermore, you don't have plants. You don't have grass. You don't have flowers. What you will end up with without this particular mentor is a pool of green algae. There will not even be the form you won't you wouldn't even see a tree. You wouldn't recognize it. It it wouldn't it trees only exist because of this mentor. They are stitched together by this mentor. You don't get grass without this mentor's existence. So when I walk into a forest, generally speaking, the first mentor I see is the fungus.
So let's talk about a forest and what let let's let's start here with forest and the fungus that runs the whole show. So there is a guy named Kevin Bealer or Beiler. I'm not exactly sure how to pronounce his name. He made a spatial map of a 30 meter by 30 meter plot of forest. And I think it was in Canada somewhere. And what he did is he used he used genetic what's called genetic barcoding, and, no, I'm not gonna get into that, and a whole bunch of other molecular biology techniques to determine individuals and be able to differentiate those individuals from other individuals in that 30 meter by 30 meter plot. And that includes not only the trees and what kinds they are and which roots belong to which tree, but also the mycorrhizal fungi that is attached to all these roots that's connecting the forest together because that is what a forest is.
All the trees that you see in a forest, they don't stand there by themselves. They are all connected, physically connected, through this webbing of fungus. And those fungal webbings are all hollow. They're all tubes. Every we call them hypha. Those are the individual threads that you see in, mycelium. Like, if you pick up a a a log in the forest and you see a white patch of of of funk growing on the bottom of it, you'll notice that it has a thread like structure. Well, those threads are called mycelium or well, it's the the whole thing is mycelium, but those threads are called hypha, individual threads. They're one cell thick, and the mic for the mycorrhizal type of fungus, those hyphae are one cell thick, but they're tubes, very long tubes, like one cell and another cell and another cell and another cell all in a line.
But the way those cells are connected together allows huge massive things to travel up and down like they're running down a highway. And that's gonna come in that's gonna come in big time here in a minute. Well, this guy, this Kevin Bealer, after he made this map and he identified which trees were which, and he he drew a map, you know, and and this is, like, this is not Bob's backyard biochemistry. He published this in a peer reviewed journal. Well, I know some of y'all might be, like, going, oh, yeah. What is it? Whatever that means. He published this at a time when it actually mattered and people actually did review the work. So it's this it's like I said, this isn't just some hobbyist. This is a guy that is a well recognized in his field for how forests are stitched together with mycorrhizal fungi. So he draws this map. It places all the trees where there's where they're placed and and places them exactly the distance that they're placed from, and it's like just it's a map.
But then he goes so far as to go underground and start identifying, like, which mycorrhizal fungi groups are connecting which of these trees. And this took a long time. This wasn't something that he did overnight. This probably took him months to do, to get all the samples collected, figure out which thing was going to which, but what he discovered was that at least one tree was connected to 47 other trees in this 30 meter by 30 meter plot. Now think about that. That's a network, and each tree or bush or whatever is in this in this plot is acting sort of as a node on the network. And the wires between are the mycorrhizal fungi.
So it turns out that the most amount of, quote, unquote, hops, that information, which we'll get to in a minute, took to get from one tree to another, the maximum amount of hops it took for any information from one point a to any point b was three. Only three hops. So, like, a tree sends out a chemical signal, it goes to another tree, and and it can get to any other tree in in in that plot with just one more hop after that or, well, two more hops after that, which is kind of amazing. Three hops in a network like that is actually pretty amazing. So this pattern of connectivity, you'll find in the the whole of the World Wide Web.
There the older the tree in the forest, the more connections it has. The younger the tree in the forest, the less connections it has. In the World Wide Web, Only a very few pages have the like, this this insane amount of connections to all the rest of the web pages. And only all the and that's just a very few. I mean, it's not just the oldest oldest pages on the web, but the biggest, the grand like the Amazon, the Google, that that kind of thing. Whereas, you know, some dude like Bob's Backyard Biochemistry blog only has very few connections to the rest of the web.
So we've kind of without even knowing it, we've kind of already copied the way the forest is actually built. Right? Because as with, you know, as with people, it's not what you know. It's who you know, and this works just the same way in a forest. Because all of these trees are transporting goods and services underneath the ground, and the mycorrhizal fungi is facilitating the entire trading platform. It is the market. It's the one that sets the price. It's the one that transmits the price of one goods and service to another. Trees will actually send carbon to other trees. Like, for instance, there's another study that was not done by this guy, but there was another study that was done in a Canadian forest, lo and behold, of birch trees and fir trees.
And they sectioned off a little plot. And what they discovered was that in the winter and in the springtime, the carbon that is manufactured in, well, the fir trees, and what I mean by that is the sugars that are manufactured through photosynthesis in the fir trees through radio labeling cart using radio labeled carbon, they discovered that the fir tree was sending its carbon compounds in the form of sugars to the birch tree. But that flow of carbon reversed in the summertime. The birch started sending carbon back to the fir tree. Well, why?
I mean, like, what what good does that do? Well, think about the difference between a birch tree and a fir tree. A fir tree is evergreen. It produces as long as it's got sunlight shining on it, it produces sugar all year round. The birch tree is not like that. The birch tree loses its leaves in the fall and is no longer able to photosynthesize from late fall all the way to early to mid spring until it can leaf out again. So during those winter months in the early the late fall, all through the winter, and into the early spring, you got the fir tree essentially given the birch tree food.
Without it, the birch tree would most likely die. Now in the summertime, this is the funny part, in the summertime, the birch tree leafs out, and when it does that, it shades a lot of the sections of the fir trees in the forest, and they are unable to produce as much sugar as they were in full sun when the birch trees didn't have any leaves on them. So the birch tree says, hey. We're connected in the network. I'll send you the carbon back, and we'll just trade that way. You give me the sugar when I need it. I'll give you the sugar when you need it. And they come to an agreement. This is the resilience that you find through networking.
If you can plug in to a network rather than have to build your own network, you're going to grow taller and faster and stronger than those around you. And we find this actually being 100% true with what I call plug and play trees. So here's the example. You got a a seedling, and I take that seedling of a tree, and it doesn't matter what tree it is, because they all have to associate with mycorrhizal fungi at one point or another. If I take that tree and I dig a hole in the middle of a field that is just like a blown out hay field and it's been horribly mismanaged and has been tilled. And there's just hardly any, you know, mycorrhizal fungi that's able to survive there at all. And if if there is, it's probably in the form of a mycorrhizal spore that's just waiting for a tree root to attach to and start growing as as a mycorrhizal network. So I plant this tree in there, and lo and behold, after a while, it starts to associate with whatever mycorrhizal was down there.
But it has to spend the tree, and I'm I'm talking about the tree right now. The tree has to actually spend an exorbitant amount of time and energy in its early life to produce enough sugar so that it can send quite a bit of those sugars down to the mycorrhizal fungi because they cannot produce their own sugar. They have to eat. And sugar is a great energy source. So mycorrhizal fungi eat it, but they can't make it. So they have to depend on trees to give them the carbon that they need to be able to not only live, but survive and make all the acids that they need to basically mine minerals out of rocks. Okay.
So if I take that same tree, though, and instead of planting it in a blown out hayfield in the middle of Iowa or something like that, if I take that tree and I plug it into an already existing forest, that mycorrhizal network is already there. Not only is it already there, it's fully formed. And it will almost immediately associate with the roots of the seedling that I put in, which means that that tree no longer has to spend so much damn time trying to figure out how it's gonna make enough sugar to build this mycorrhizal network all on its own. It doesn't. It doesn't need that because the network is already there, and we've already just discovered what benefits being plugged into a network of that size actually has.
So how does that what what what does all this do for us, Dave? Well, if think about it this way. Think about if you're a logging company. You have two choices. You can clear cut a logging site. Big trees, small trees, doesn't matter. You don't care. As long as you get a whole shit ton of trees on a logging truck to go sell, you're fine. And then what do you do? Well, Weyerhaeuser or however you Weyerhaeuser, I can't pronounce the name. It's one of the biggest logging or pay like, they they produce a lot of lumber. I think they all Weyerhaeuser also makes, like, a lot of paper. But what they really own that's really valuable is the land that they have their tree farms on.
So they go clear cut a forest, and then they come back and they plant thousands and thousands tens of thousands of seedlings. And then they move on to the next plot. And over the next fifteen years, the plot that they had just clear cut is growing. But what does that clear cut patch not have anymore? Because when you cut all those trees down, not only did you kill everything above the ground, you laid waste to everything below the ground. The mycorrhizae, they have no ability to get sugar anymore, so they die. And any of the bacteria and any of the other critters down there that are associating with the mycorrhizal fungi to get goods and services from the mycorrhizal fungi network, they die or they find new they they go away. They find somewhere else to go live that doesn't suck.
Right? So when you clear cut a forest, you not only damage what's above, you pretty much destroy what's below. So when they went back and planted tens of thousands of seedlings, well, that's a great photo op. Whoop whoop de doo. Because all of those seedlings now have to actually spend an inordinate amount of time and energy to spin back up that which was already destroyed. Now there's another choice that a logging company has. They can go through and they can selectively thin a forest, take the lumber out of it, leave a few of the great big trees, and that will feed the mycorrhizal network below so that when they go back and they plant a whole bunch of new seedlings, those seedlings are already plugged into a network, so therefore, they will grow taller. They will grow faster. They will grow stronger.
You will get a better crop of wood. So this is the first thing that the mentor that is the fungus that resides and works for, but is responsible for the construction of the forest being the teacher, this is the first thing that I was able to learn. Which, if you were to think about the economics of that, it's just good economics for the lumber company to leave a few of the big trees so that they have a much better growth rate for the trees that they want to farm. It just makes economic sense. And that, speaking of, is the second thing that the forest or well, the the mentor the main mentor of the forest is the fungi. Because, again, without the fungi, you don't have a forest. You don't even have the structure that would be known as a tree. And, again, we'll get to that here in a second. But let's say and I didn't need that one right there. I need this one. Yes. Fungal arbitrage.
We hear in Bitcoin all the time about arbitrage. You take, you know, Bitcoin and sell it on one exchange at a really high price, and then you take that cash, plug it into another exchange where you can buy Bitcoin really low, and boom, you've got an arbitrage. Well, fungus seem to do that as well. So check it out. So let's say that you got a single mycelial network that spans different concentrations of phosphorus in soils. Let's actually let's just say there's two trees. One tree sits in soil that's got a high amount of phosphorus, and another tree sits in soils that's got very low amount of phosphorus.
But both those trees are physically connected by the same mycelial network. Okay. The plants or the trees that are in areas of low concentrations of phosphorus pay a higher carbon price to receive that phosphorus. Why not? I mean, it's harder for the, for the mycelium to mine with organic acids because there's not that much phosphorus there. Conversely, the plants that are in areas of really high concentrations of phosphorus pay a much lower carbon price because the mycelium that's over there, even though they're they're connected, even though it's the same network, there's basically local markets and then there's long distance markets. And it's and they're all connected by the physical physically connected by the same network.
But the ones that are in the higher concentrations of phosphorus pay a much, much lower price for carbon. Turns out fungi are not idiots. In fact, they're savage, savage business people. Right? So what they learned how to do, and God only knows when they learned how to do it, they will take phosphorus from the areas of high concentrations of phosphorus. And instead of selling that phosphorus to the tree that happens to be right there at a shit ass price, no. They'll package it up, and they will actively using real energy real energy sources it takes to do this. They will move that phosphorus physically from the area of high concentration to the areas of low concentration where they know they're going to get a better price for carbon.
This is not me telling you a lie. This is not wishful thinking. This is not me conjecturing. We know this. We know this to be true through extensive experimentation. We know that this is happening. And it's honestly amazing. But but check this out. Not only have the fungus figured out how to do arbitrage, They provide credit markets. That's right. They they actually issue credit cards and loans because there's this thing in in biology called mycoheterotrophy. Myco means fungal. Heterotrophic means to eat something other with something you didn't produce.
You are like, for instance, humans are what's called obligate heterotrophs. Plants are autotrophs. Plants can make their own food source just by walking out in the sun. If you try to do that and you say, well, I'm just gonna absorb some sun and I'm gonna make some sugar and I'll be alright, you'll be dead. That's what you will be. Right? So you have to eat things that other things produced. Right? So that's what heterotrophy is. You put myco in front of it, and basically, it means fungus provide the food that this that this other thing eats. That's all it means.
But there's this plant, and, well, actually, it's an entire plant family, and it is the most successful plant family on the planet. More successful than any of the tree species or families. Any you know, like, even more, even more than, your other, like, grasses and and weeds. It's the most successful plant family on Earth, and it's called the orchid. In that family, there are 25,000 different species of orchid, and none of them can produce their own food at the early part of their life. They cannot photosynthesize. They do not have they haven't been able to produce the equipment yet. That's that's part of their life cycle.
All 25,000 orchids, none of them none of them are able to produce their own food. Well, then how do they not die? Well, they're connected to each other and to the trees and the bushes and anything else through the very same mycorrhizal fungi in the forest or, you know, rainforest or jungle or whatever you wanted. Like, just, you know, a whole shit ton of photosynthesize synthesizing organisms, whatever wherever that is. You can think of it that way too. But so now you've got the fungus that's essentially just providing them carbon and water and nutrients and all kinds of other stuff. All manner of goods and services are just being provided for free.
But later on, see, the orchids finally start developing at different stages depending on the species, finally starts developing the ability to photosynthesize and therefore be able to produce their own carbon compounds that we know and love as sugars. Then they start paying the network back. They start paying the network back. They took first and paid later. What is that? That's a credit card. That's a loan. And these guys figured this shit out a 50,000,000 years ago or whatever. You know? It's like it's hundreds of millions of years ago. I mean, how now when we're looking at our own markets, our own credit markets, you know, like, if we start gauging and and really dig into the literature and the the research of just how this take now pay later system works for the orchids, and then we compare the structure and function of that to the credit markets that us humans have designed, what we're probably gonna find out is that we have horribly fucked it all up and that that's why we are having the problems.
We're what we're not doing is we're not simply providing, you know, some cash so that you can float your business until it can get on its own feet. We've made all this instrumentation that just muddles the water and and and makes it so that people like, you know, mister Krugman can tell you that because you don't have a PhD in economics, you will never understand this shit. And I say bullshit. There's always a problem to solve. And in this particular case, this take now, pay later, this extension of credit in the fungal world as it pertains to its association with plants is an old game.
But there's another game. And this is the problem solving. We're getting into the problem solving through persistence with a long time horizon. Right? So what's the problem? Coal. Not exactly. I like don't get me wrong. I like coal. It's I I don't hate coal. What I'm saying though is that you gotta ask yourself the question, how did we even get coal? And a lot of people don't know. Like, for instance, a lot of people don't know that that the Earth is incapable of producing coal ever again, except maybe possibly in in peat bogs, but not it's not like the coal like the anthracite coal that we can get out of, you know, North Carolina, Pennsylvania, and stuff like that. It's it's shitty coal. I it's because it's not really coal the way that this coal is coal. I'm talking about the prehistoric coal that we use and burn all the time. We will never be the Earth will never be in a position to make that again, and here's why.
White rot fungi. You see, back about 200 and between something like two hundred and ninety and three hundred and sixty million years ago, we had what's known as the Carboniferous period. And we call it Carboniferous period because a whole shit ton of carbon was laid down. How? Well, because trees would grow up. They would live for a couple of hundred years, maybe seven hundred, maybe even fifteen hundred years. They'd be huge, immense affairs, and then they would die because all living things naturally come to the end of the road. And then eventually, they would fall over.
And what would you think would happen? Oh, it's gonna decompose. Uh-uh. No. There was no such thing as a as anything that could decompose a damn thing on the face of the planet between the years two hundred and ninety and three hundred and sixty million years ago. Bacteria couldn't do it. Fungus was there, but they didn't have the mechanisms to be able to grind up wood because wood's made out of cellulose, hemicellulose, and something called lignin. Cellulose is kinda easy. Even bacteria have enzymes that can work on that stuff. And hemicellulose, not exactly terribly much harder, but it is harder to break down into simple sugars because that's what that's what all trees are made out of. When you look at lignin and, cellulose and hemicellulose, it's just it's just well, the hemicellulose and the cellulose are essentially sugar, glucose molecules that are linked in a polymer. That's all it is. And they're pretty easy to bust apart and get the sugar out of and break up the carbon skeletons to harvest the energy that resides there. That's what a lot of stuff was able to do.
But it couldn't get lignin because lignin is rings of carbon in this just brutally three-dimensional matrix that there's there was no enzyme that could actually recognize a site to latch onto to where it can start cleaving the carbons off of each other. And they certainly even if they could, they weren't in the format of sugar. There's a completely different form of of carbon skeletons. It took white rot fungi, like, another hundred million years after the Carboniferous period to figure out that it could use what's called a peroxidase enzyme that uses peroxide to essentially burn through these carbon bonds because no other enzyme that it had would actually work.
So you so it finally accidentally maybe stumbled upon this thing called a peroxidase that it started manufacturing itself, maybe through mutation. Who knows? It doesn't matter. But finally, one day, a white rot fungi was able to get onto a piece of wood, get through the cellulose, get through the hemicellulose, and then start digesting lignin. And you can get through the cellulose and the hemicellulose, and you're still gonna have the great guts and feathers of the wood left over that does not rot. Now think about what happened in the Carboniferous period. You've got all these trees that are dying, falling over, and none of them can decompose. So what happens? Well, the four I mean, if if there's any space in between these dead logs, the tree is going to start growing until all of a sudden, there's no space for any other tree to grow except at the fringes of this forest, and it just starts marching on because some people theorize that there was a kilometer deep stack of logs as big as houses, like, big as big around as a house laying on its side a kilometer deep.
And over time, dust blew on it. It got buried. Maybe some floods happened. Some mud got deposited on it, squeezed out all the oxygen. And as it baked in the earth, as it got deeper and deeper, you ended up with, ta ta, coal. That's how we got coal. But now, because white rot fungi solved the problem through persistence of being able to get rid of lignin, we will never be able to have coal produced on this planet, especially not in the abundance that it was able to be produced in the Carboniferous period. So it was the befuddlement of the decomposers that allowed all the coal that's on this planet to actually come to fruition.
And because white rot fungi solved that with a peroxidase using hydrogen peroxide as a main component in that enzyme, it was able to completely destroy lignin. And now you will never ever find a log on the forest floor that's more than a hundred years old because it will eventually be chewed up and spit out. Now farming is the last portion of this that I wanna talk about as far as what does the mentor that is fungi actually teach me? Well, like I've I've alluded to it before, the reason that the forest is the teacher but not the mentor is because when I walk into into my university, like the head of the university is the the like the forest, right?
That that's my whole university. When I walk in there, the the first teacher that I see is the fungus. And as I alluded to, there would not be a forest for me to walk into if it wasn't for the fungus. In fact, and I'll reiterate it again, you wouldn't be able to see a tree or an angiosperm, also known as a flower, or an orchid, or a piece of grass, or a weed, or a cattail, nothing. You wouldn't recognize any of it if it wasn't for fungi. What the hell am I talking about? Okay. We all know that plants have roots. There was a time when plants could not form roots, and they 100% depended upon mycorrhizal fungi or, you know, way back in the day, and we're talking well before the Carboniferous period. We're talking 500,000,000 years ago.
Some people say 600,000,000 years ago. Let's cut it down the middle. We'll say 550,000,000 years ago, fungi were were in existence. And the very first plants were starting to come up, but they were just algae. Just pools of green goo that was able to photosynthesize, but they weren't stitched together. Like, if you pick up a leaf, you look at it under the microscope, you see all these plant cells that are basically stitched together, and they form the structures that you see. The leaf, the flower, the the seed, the the stems, the the bark, the roots, the the trunk.
Everything about that tree is plant cells that are basically being able to stick together. Right? But in the early days, it was just green goo. So what what happened was that fungus was already there. Now remember, fungus can't make their own food. They were having to scavenge for any kind of any kind of sugar that they could find, any kind of carbon skeleton that they would be able to cleave and and harvest the energy from. They were essentially dumpster divers until they hooked up with their green friend algae. And everything changed because the algae was able to make sugar all by itself, but couldn't do much more. It depended on a completely different mechanism of getting any kind of minerals that it needed as cofactors that would allow it to continue to photosynthesize.
Carbon was easy to get in the atmosphere. Sunlight was easy to get. Manganese, not so much, especially if you ain't got roots and especially if you're just a single cell of jelly that's colored green sitting in a pool on top of a rock. At that point, you depend on water's chemistry with the rock or the soil that you're on to do its bit and you are also dumpster diving. So they were both dumpster divers. Except already, mycorrhizal fungi or fungi in general was really good at being able to break apart minerals with its oxidative, or what's called organic acids, but they couldn't make their own food. Algae could make their own food, but they couldn't do much else. So they hooked up, and they hooked up in a way where think about it this way. Think about a puddle of goo.
You know, this algae, and you've got mycorrhizal fungi that go, hey. We've discovered a sugar source. Well, almost immediately, fungus started essentially stitching these algal cells together to where they had structure, and they weren't just piles of green goo. And over a period of millions of years, that stitching together, that building of the first plants, the constructor was the mycorrhizal fungi. It didn't happen all by itself. And it happened because it wasn't fungus at that time and and to this day is an opportunist. It's, well, a capitalist.
And it started using these basic building blocks that would you know, that gave it something and said, we sun later in the day and earlier in the morning. All of a sudden, you start getting grasses and plants and leaves and structures that we can start identifying as, oh, yeah. I recognize that that's a plant. But that all came about because fungi were physically stitching these things together. Like I said, it did not happen it did not happen on its own. So we get into this situation where we have fifty million years of this association between the earliest of plants and mycorrhizal fungi, and the plants were not able to make their own roots. They depended 100% on the fungus keeping them connected to the soil and being able to get water and bring it to them, get nutrients and bring it to them. And in return for all those goods and services, the plant provided carbon in the form of sugar.
Until the plant learned to put down its own roots, it's almost as if it learned from its fungal partner how to bury itself into the soil, and then it could get even taller. Because back in the day, the only as as this profusion of plants started to explode And it did. It started to explode. And, I mean, the whole planet started becoming populated with plants really, really fast. The only way to get more light was to grow up so that you weren't shaded out. So here comes the competition. That's where we get lignin. That's where we got hemicellulose. That's where we got cellulose because these critters started figuring out a way to put these sugars together so that it would have structure.
And the battle was on to get higher and higher and higher, and that's why you have the forest. But the mycorrhizal fungi does not look at it like that. The mycorrhizal fungi is in every single plant and grass that you see all the way up to the tip top, all the way down through its root structure, and all the way out into the soil for God knows how many feet outside of the ring of, you know, the drip line that that plant actually represents. It's not just in the roots, guys. It's it's in every it's it is fungi is permeated every square nanometer of plants. It is everywhere. It's like it is a like a second circulatory system to a plant, and it became evident immediately that the tree or the grass or the flower or or whatever, whatever plant you're talking about is not a plant to the fungus.
It's a farm, and it's a farm that they built. It's a farm that they built. Now I think that this is probably the most exciting thing because let's go back and look at at the forest and what I said earlier. You don't have a forest without fungi. When I see a forest, I see a massive farm and all of the farmers are the mycorrhizal fungi. And it is an extensive, extensive farming operation. And if we can pull apart how mycorrhizal fungi do it and have done it over millions and millions of years, we might learn a thing or two about how we're farming. And that is pretty much the last thing that I have to say about this entire thing, except that it's winter, it's February, it's cold unless you're, you know, South Of The Equator, Then, you know, if you're up here with the northern guys, we're all cold and it's snowy and we'll have to wait until the temperatures warm up and the snow melts off the mountainside.
But go into the forest. At your earliest chance, go into the forest and start looking at the trees and plants as farms. Realize that you wouldn't see those critters there if it hadn't have been for fungus stitching together algae cells 550,000,000 ago. And also understand that even though they had always had an intimate relationship with each other, it took a hundred million years for white rot fungi to figure out how to decompose wood, and it only did it through persistence in a very long time horizon. So resilience through networking. Harvest your network.
Understand economics. Figure out that you can solve any problem as long as you have time enough and gumption enough to actually solve that problem. Then we can all learn how to farm. We can farm for ourselves. We can farm for each other. But all of this, I got out of the forest. I can't stop thinking about that. Let's run the numbers. CNBC features the commodities oil on its ass down 2.1% to $71.78. Brent North Seed down 1.94% to $75.50. Natural gas is up two thirds of a point. Gasoline down two points to $2.10 a gallon.
Gold is moving sideways at $2,931 per ounce. Silver is up 1.6%. Platinum is up 1.15. Copper is up two and a quarter, but palladium is on its butt by a quarter of a point into the red. Ag, the biggest winner today looks to be coffee at 3.46% to the upside. Biggest loser is chocolate, 1.37 to the downside. We got live cattle. It's moving sideways, but still in the green. Lean hogs are up a buck. No. Not a dollar. 1 point 5 percent, but feeder cattle are up a quarter of a point. The Dow, however, struggling, it's down a third of a point. S and P is down point 17%, but Nasdaq is in the green point one three.
S and P Mini is down a half a point. And what's our good friend Bitcoin doing? Well, it's at $97,010. That is a $1,920,000,000,000 market cap, and we can get 33 ounces of shiny metal rocks with our one Bitcoin of which there are 19,823,085 and a half of an average fees per block are low again. There are oh, wow. There's a whole seventeen, eighteen blocks carrying 15,000 unconfirmed transactions waiting to clear at high priority rates of 5 Satoshis per vbyte. Low priority is gonna get you in at 7 Satoshis per vbyte. Hash rate is at 802.5 exahashes per second.
And it looks like in the next eleven days, we have an estimated difficulty adjustment to the downside of 7.17%. Woohoo. Whoop de doo, man. I guess we've been solving blocks a little too fast. Now from Polish joke, yesterday's episode of Bitcoin and I got Psyduck with $4.20 says nothing. Pies with a hundred says thank you, sir. No thank you. That was it. That was all I got, man. Come on, guys. This is value for value. If you're not if you're not getting the value, I understand. But if you think for a second that I'm bringing you any kind of value at all, be reciprocal about it, and throw me some satoshis through a boost and say something.
I don't know why Psyduck didn't say nothing. He said nothing. He gave me a whole 420 satoshis, didn't say dick. I don't know, man. Psyduck, we get we we got we gotta talk me and you. That's the weather report. Welcome to part two of Bitcoin, and I got the news you can use. Bitcoin price sees a dip to 94,000 as crypto retreats on The United States CPI overshoot. William Sueberg gonna tell us what happened out of Cointelegraph? Data from Cointelegraph Markets Pro and TradingView shows that local lows of Bitcoin was 94,091 on Bitstamp.
The January print of the Consumer Price Index or the CPI was higher than expected on both monthly and yearly timeframes. Data from US Bureau of Labor Statistics or the BLS confirmed that the CPI rose half a percent last month, a conspicuous point 2% more of a move than anticipated. The year on year increase was 3% versus a forecast of 2.9%, quote. Headline CPI inflation is up for four straight months, and core CPI is officially back on the rise again. Inflation in The United States is running hot, trading resource, the Kobesi letter, wrote in a part of a response on Twitter, quote, this officially marks the highest CPI inflation reading since June of twenty twenty four.
Even more concerning, headline CPI inflation rose by half a percent month over month, a massive jump. Rate cuts will be delayed even further, and that's what happened. That's exactly what happened. We got this print. We got this print coming out of Bureau of Labor Statistics. Says inflation's running hot, which means Jerome Powell is not, not, not going to be in any hurry to relax the Federal Reserve rate lending rate. So we're stuck at what? 4.25 to 4.5% right now? There were supposed to be four, count them, four Federal Reserve rate cuts this year.
Before we even began the new year, people started saying, well, given the, you know, this we're not getting inflation under control and employment is is is good even though it's all a lie. I I understand it's all a lie. All the numbers look so, you know, so good except for inflation, which means that we our economy is really kinda running hot. And if we lower interest rates, a whole bunch of people are gonna start borrowing. And guess what? The inflation or the, economy is gonna start running even more hot. And this can't happen. We need to cool this stuff off. And the only way they can do that is either two ways.
Raise rates or keep rates the same. They are not going to lower rates. So we went from four cuts projected to three cuts. And then as of, like, four months ago, it was, not four months ago. As of like January, we were looking at two cuts. And then as of last week, people started saying, well, there's only going to be one cut. And now even if we get that cut, that might not even be until the third or fourth quarter of this year. Unless something changes, we might not get any cuts, and that always affects what people look at as risk assets.
And even though you and I both know Bitcoin is not risky like that, it doesn't matter to Joe Blow on the street. He sees risk. His fund manager sees risk. His banker sees risk. And, no. You're not buying no Bitcoin. And people are just fleeing into the dollar. That's what's going on. You're just gonna have to live with it. So Hester Pierce said the following. Meme coins like Solanus Trump are probably not probably not under the jurisdiction of the Securities and Exchange Commission. Oh, joy. This is, by the way, decryp.co written by Matt DeSalvo.
The head of the SEC Commission's new crisp crypto task force has said that meme coins are unlikely to fall under the watchdog jurisdiction. In an interview with Bloomberg on Tuesday, commissioner Hester Pierce was asked about president Donald Trump and his wife's official meme coins Trump and Melania and whether such cryptocurrencies would fall under the agency's jurisdiction. The newly appointed boss of the SEC's crypto task force said that such assets probably don't. President Donald Trump launched his own Solana based meme coin, Trump, ahead of his January 20 inauguration with Melania Trump following suit with her own coin very soon after, quote, there's lots of people introducing meme coins right now, Pierce said, but many of the meme coins out there probably do not have a home in the SEC under our current set of regulations, end quote.
I I I there's really nothing else to this. She's just saying that it probably doesn't fall under the jurisdiction of the SEC. What does that mean? Does that mean that we can just spin up meme coins at will and it's not an unregistered security? I I I feel that something fishy is going on. I sorry. I do. I can't I I can't put that back in the bottle, so just understand. I'm not making you know, I like Hester Pierce. You know, I'm not an orange man hater per se, but that just seems a little too, I don't know, easygoing of a position because I think all these meme coins are unregistered securities, therefore, they're illegal under our laws.
I'm just saying, and it's like if I get that there's people out there going, we should be able to do whatever the hell we want. I get it until it's your grandmother that loses all of her ass on, like, you know, Melania coin. And then at that point, you're going, gee, I wish somebody had said that that shit's not allowed because it's clearly it's clearly crap. I don't know, man. Something something that is not sitting right with me on this SEC saying that meme coins are just free and clear. May does that make it Treasury's problem or the judiciary? I don't see how the judiciary will be able to do anything about it, but I don't know. We'll have we'll have to wait and see.
Obscura VPN. Obscura VPN is now available on Mac OS. Obscura is the first provably private VPN that can't log, cannot, it cannot log your network activity by design and outsmarts network filters for enhanced censorship resistance. It is currently only available on Mac OS with support for other platforms coming sometime soon. Quote, today is the day. Obscura VPN is now available, announced Carl Dang. Obscura is designed to never see user traffic, making tracking impossible. It blends with regular Internet traffic to avoid network filters, ensuring unrestricted access.
Obscura's servers relay the WireGuard tunnel between a user's device and Mullvad's servers to protect user information, and that setup ensures the following. One, Obscura's servers cannot decrypt Wireguard's packets as they are encrypted with Mullvad servers Wireguard public key. Mullvad servers can't see the users connecting IP because Obscura's servers perform something called NAT. A user's device connects to Obscura's servers over QUIC, making the connections harder to detect or block as they resemble just plain old regular Internet traffic through HTTP three, which uses QUIC, q u I c, for transport.
Furthermore, Obscura avoids the TCP over TCP meltdown problem by using QUIC's unreliable datagram extension. This makes it a suitable option for bypassing firewalls and Internet censorship. Quote, Obscura users can verify that their traffic is sent encrypted to a MoleVanc server by comparing their server's WireGuard public key shown on the Obscura's app's location page against those published on our server page, said Mullvad VPN in a blog post. At launch, Obscura VPN is $6 a month. Users can pay via the lightning network and the service does not require emails for authentication, and you can check it out here. And, of course, here is a, link, a little linky poo.
This is really nice. I I like the way that they're doing this because they're they've got a a they've got a relationship with Molvad. So it's like a VPN that has two completely separate parts, like, I don't know, mycorrhizal fungi in a tree. I'm saying, man, networking is the thing. But Dong or Carl Dong, he did he formed a relationship with, Molvad a long time ago. I think it was like that was how Mullvad was able to take, Bitcoin payments for Mullvad services, which is a VPN that I have used, and it's a very good VPN. And it looks like that relationship has blossomed into something where they have a more permanent more permanent relationship where MoleVAD servers are being used for one aspect of of securing your privacy and Obscura is providing the rest of it.
So not neither one of them has access to any or all of the information, which I think is an incredible development in VPNs because nobody does that. As far as I know, Obscura is the only one that has two completely separate entities working together for the same outcome, and that would be your privacy. I smell opportunity is a quote directly from Bitwise chief investment officer, and he says this amid retail and institutional crypto sentiment dichotomy. We'll pick that headline apart. It's written by the block and James Hunt. Bitwise chief investment officer, Matt Hogan, said that the current bad retail sentiment in the crypto market signaled an opportunity amid the contrast with institutional demand.
Quote, there's a fascinating dichotomy in crypto right now between institutional and retail investors. On the one hand, institutional sent sentiment towards crypto is the most bullish I've ever seen, but retail investors are wallowing in despair, end quote. The Bitwise CIO said investment professionals now look at crypto as a space institutional capital is applicate or allocating to hold on. This is a bad sentence. The Bitwise CIO said investment professionals now look at crypto as a space institutional capital is allocating into in record amounts via exchange traded funds.
Washington has gone from being one of the industry's biggest threats to one of its biggest champions under the Trump administration and further nation state adoption could be in the cards. However, for retail investors, quote, it's almost as if they are living in an alternate reality, Hogan added pointing towards Bitwise's proprietary on chain sentiment score currently registering one of the lowest readings of all time. Hogan believes that the index aligns with other sentiment indicators and the general vibe of crypto Twitter with retail sad because their overweight altcoin investments are doing poorly this time around compared to Bitcoin with very few exceptions.
However, Hogan said every bone in his body is telling him that the institutions are right. And while it is very easy to be bullish on Bitcoin right now with ETFs and corporations already scooping up more than 100,000 Bitcoin so far this year compared to 18,000 Bitcoin actually mined. Long term, the setup for altcoins is stronger than at any point in history. Oh, for god's sakes. The altcoin don't. Just don't. It's just Bitcoin. That's the only thing that matters. But he conceded that the altcoin picture was far more complex with no major new application driving the interest that DeFi and ICOs did in prior cycles outside of the short term meme coin casino boom.
However, with regulatory clarity on the agenda, The US making stablecoins a national priority and growing institutional confidence, the industry will bring DeFi applications to the masses, Hogan claimed, quote, retail sentiment in crypto is terrible even though the fundamentals are great and I smell opportunity. In a year or two, my guess is that you're not going to have to squint to see the transformation in altcoins. The impact will be self evident and overwhelming. Yeah. He's a little heavy on the altcoin side of this particular, argument, but I tend to agree with them in general.
That's what I that's one of the things that confuses me about the price action right now. You you've got institutions buying more Bitcoin than is being mined. You've got more and more states of The United States, putting legislation forth for a strategic Bitcoin fund or something like it, but most are actually saying Bitcoin generally or or rather specifically. But more generally, you've got a lot of states that when they don't say Bitcoin, put these strictures on it that is like, well, it has to be we can only invest in a digital asset that has $750,000,000,000 of market capitalization on average over a period of five years. The only one that fits that bill is Bitcoin. I I mean and there's, like, three of them like that.
So they either say Bitcoin specifically or they make sure that their structure is such that the only thing that they can get into is Bitcoin, and then they don't actually say the word Bitcoin. I see all this, and then I see, like, $2,000, you know, red candles. And I'm going, I don't understand. At least I'm not alone because this chief investment officer, this Matt Hogan, he sees the exact same thing. Retail is fucking terrified. Institutions are like, la la la la la, and there you go. That's that's the way that shit has been working for centuries and centuries and centuries and centuries. Now last up on the list, Goldman Sachs has disclosed ownership of Bitcoin ETFs, and here's why it doesn't mean very much.
This is Steven Alfer and James Van Stratten writing for CoinDesk. Bitcoin Twitter is having a moment after a 13 f filing by Goldman Sachs disclosed higher stakes in a handful of spot Bitcoin exchange traded funds, but the facts are less than meets the eye. First and foremost, ownership of the ETF isn't exactly a bet by the Goldman trading floor on the price of Bitcoin. The stakes are almost surely held by the bank's asset management arm, Goldman Sachs asset management, for its clientele. Secondly, while the filing, which is a snapshot of ownership as of 12/31/2024, shows a $288,000,000 stake in Fidelity's ETF Bitcoin and $1,300,000,000 stake in BlackRock's Bitcoin ETF called the iBit.
It also shows put options positions with nominal value of more than 600,000,000 along with a small call option position. As put options gives the holder the right but not the obligation to sell the asset at a predetermined price, it can be seen as protection against a price drop representing a bearish stance. Quote, the position by Goldman Sachs similar to many other banks and hedge funds is not a net long position, said CoinDesk senior analyst James Van Stratten. This is a strategy that reflects the basis trade, also known as the cash and carry trade, balancing potential profits and risks for Bitcoin price fluctuations.
The ETF recently had options approved on them, so this is most likely directional hedging. With the deadline for the fourth quarter thirteen f disclosures fast approaching, similar filings along with misleading headlines are surely on the way for JPMorgan, Morgan Stanley, and other large wealth management operations. So I don't know. I mean, James and and James Van Straten probably has a, this is probably a good take. Is that yeah. Because I saw it yesterday. Hell, I even saw it on Noster. It was like, oh my god. Goldman Sachs has this huge position. They bottled, you know, they they bought a lot of this bullshit. Yeah. Yeah. Yeah. Yeah. As you just heard, probably shouldn't put all of our eggs in that particular basket.
Just saying. Maybe we should just cool our jets a little bit and take the ride. So that is actually it for the show. I I hope you enjoyed the first part of the show as well as the second part of the show. Tried to balance it with, something different with the usual, smattering of Bitcoin news. Let me know. Let me know if you liked it, if you hated it, if you didn't understand it, if you want me to do more of it, give me a boostagram because remember, guys, this is value for value, man. That's the only way this works. And until next time, I'll see you on the other side.
This has been Bitcoin and and I'm your host, David Bennett. I hope you enjoyed today's episode and hope to see you again real soon. Have a great day.
It is 09:14AM Pacific Standard Time. It is the February 2025, and this is episode ten thirty six of Bitcoin. And, well, you know, Valentine's Day is coming up. It is coming up. It's like the fourteenth, so it's what? It's gonna be like Friday or something like that? So make sure that if you haven't already, you know, make sure you get your, significant other some small gift because I used to think that this was a b s, holiday or day of remembrance. And after I screwed up with my wife on several occasions by not actually doing anything for Valentine's Day, I've I've learned my lesson. So it doesn't really matter what I think it is. It matters what other people think it is, and I refuse to get in trouble anymore.
So what you may wanna do is you may wanna cruise on over to the circle p. Circle p is open for business, and that's where I bring plebs like you with goods and services to other plebs like you, and you gotta sell your goods and services for Bitcoin. If you don't sell it for Bitcoin, you're not in the circle p. I'm gonna put PNE Lane Vineyard on the circle p again today that you can buy with Bitcoin at pandelanewine.com/Bitcoin. He's got a couple of prepped packs. Now if you order today, I'm not sure if you're gonna be able to he's gonna be able to ship it to you in time for Valentine's Day depending on where you live, but, you know, you never know. Maybe you could if you get in enough trouble by not doing something or being the or dumbassing around or whatever, maybe you can make amends the day after or the day after that. But he's got a couple of packs here.
It's, one is called the lightning pack, and it's got two bottles of Hyre, two bottles of Malbec, and two bottles of Cabernet Franc. The whale has four bottles of Hyre and two bottles of the Estate Pinot Noir. If you buy the six bottle packs, you get free shipping. So you might want to do that. But you also need to make sure that you tell Ben Justman, who is the proprietor of Peony Lane Wine, that you heard about him and his wine here on the Circle p on the Bitcoin Dan podcast, and he may give me a slice of that little sale through Satoshis because that's the deal that we've got worked out. No sale, no Satoshis.
Alright. So I kinda wanted to bring the Circle P up and, Peony Lane Vineyards up because I kinda want to use it to introduce what's gonna be a little bit of a different show. We're still gonna do some news, but that's gonna be in the back half of the show this, this time. The first part of the show, I'm gonna be talking about the Forrest being a mentor and why that is actually the case. And there's a lot of stuff in the forest that you can go learn if you allow the forest to actually speak to you. Alright? But then after we do that and and, honestly, this will make sense in a second. But I do wanna make sure that you understand that, yes, we will be having a little bit of news because, we're gonna under try to understand what happened with the CPI today and why it collapsed the Bitcoin price a little bit, which is seems to already have made a full recovery.
There's gonna be some issues with Trump's meme coins and other meme coin. I want to talk a little bit about Obscura VPN because they just released their stuff yesterday. And, well, Bitwise, chief investment officer says that he smells opportunity when it comes to Bitcoin, and it appears that Goldman Sachs holds more holds more Bitcoin than what we previously believed, but a writer over at CoinDesk thinks that's just all a bunch of hooey as to how important it is. But going back over here to the forest, well, I wanted to do something different today that kinda showcased what I can do with Obsidian, which is the note taking application that I use. I've talked about it on several occasions.
And I got the idea, because I was listening to, the survival podcast yesterday and the day before, and he's he's done two shows that he and he's he's not, you know, Jack Spierko's not making any bones about it. He straight up used AI to generate outlines and then go through and refine the outline because he wanted to talk about the matrix, the movie, and how it applies to what we see in today's world. And like I said, the the man makes no bones about what you know, using AI, and neither do I. Honestly, I I don't have anything against using AI, but I wanted to present something in a to design a show in a different way. And I got I had already written a speech for Toastmasters, which is called The Forest is the Teacher.
And I put it together actually before I heard Jack Spierko's first Matrix show, which was a couple of days ago. And it was actually on yeah. It was on Monday. And then I yeah. He dropped his first Matrix episode that afternoon, which I started listening to, and I go, hey. I was using a a tool to actually design a whole speech, but it wasn't AI. It was this Obsidian note taking app. If you have been on Nostr, you've been seeing some of the notes that I've been putting out about fungus and trees and trees association with mycorrhizal fungi and that that whole thing. Well, I'm I'm just gonna go ahead and do the whole thing is I don't have to do it in five to seven minutes. I've got all the time in the world, which is what I wish I had with that had with that speech that I made at Toastmasters, but it was pretty good. People actually the the club wants me to, they actually liked it so much. They had a couple of people that are begging me to try to do the Toastmasters contest because it's contest seasons for Toastmasters, and I'm like, I just don't wanna do it. I would rather spend my time bringing this information to you. But since they thought it was pretty good and I did win the, that there's always a daily competition. And since I did win that competition on Monday, I figured it was good enough to bring to you.
So why did I start with PNE Lane? If the if I'm gonna be talking about a forest, then why the hell am I starting by introducing PNE Lane vineyards? Well, because there's this stuff called arbuscular mycorrhiza fungi. There's all manner, but this is there's all manner of mycorrhiza that all they all basically associate with grasses and plants and trees, and we're gonna get into that. But grapevines associate with a specific kind of mycorrhizae, and this one is called arbuscular mycorrhizal fungi. That is what's also known as an endo mycorrhizal fungi. So it not only associates with plant roots, which all of them do, it actually goes into the root, penetrates root cells, and basically sets up a little market and essentially sells its good and services like the circle p, but it sells it for carbon.
Right? It sells phosphorus and nitrogen and, I don't know, manganese and whatever else the fungi is able to scavenge out in the soil. It sells sells it in a stall that it hand builds inside of a plant cell. It doesn't kill the plant cell to do it, by the way. The plant cells just fine. It just has to make some room for this mycorrhizal fungi to enter, set up its shop, and basically set up the trading functionality. And we'll we'll get into a little bit more about that. But without the arbuscular mycorrhizal fungi, you're not going to have wine from Peony Lane wine.
Because I guarantee you that all of Ben Jessman's wine vines that are up there at high altitude are directly associated with a huge web of mycorrhizal fungi. And those fungi are out there generating organic acids, dissolving minerals out of rocks, piping those minerals that are now liberated from the rock into their little stall that they have set up in all these plant roots that are the plant roots for the grapevine. And they're getting copper, they're getting iron, they're getting all kinds of stuff. And in return the grapevine is basically using its its universal currency that is sugar.
Technically, I always associate the universal currency of plants being carbon, but sugar is just a bunch of carbons. And that's what it pay. It pays for phosphorus with carbon. Where does it get the sugar? It makes it out of photosynthesis. This is the way the forest works. So I'm going to go back to the entire first part of this speech that I gave on Monday because the title that I gave it was the forest is the teacher. But it's not the mentor. And that may be confusing at first, but let's let's just begin with what is a forest in the first damn place? When I go into the forest, I see a cathedral of learning if you will allow the forest to be your teacher.
It will teach you all kinds of stuff. In fact, the four points that I'm going to talk about today are the four things that I talked about in my speech on Monday. It is not the only things that the forest has taught me, but these four are pretty good. So the first thing it taught me was resilience through networking. The second thing it taught me and continues to teach me is economics. The third thing is problem solving. Through persistence, I might add. It's not just solving problems. It's solving problems, being patient, having a very, very long time horizon. And where have we all heard that before?
And the fourth is farming. Farming. Yes. Farming. I I know it's it's it's it's odd, but trust me, we'll get into in into exactly why, but I need to write something down. My before I forget, I needed to make sure that I had something down here. So as I said, the forest is a teacher, but it's it's a university of mentors. It's not the only mentor. Right? Some people will say that. Some people say the forest is the mentor. Well, no. It's there's a bunch of mentors that actually live in the forest. But there's one mentor that's probably the most important one because without it, you don't have a forest.
Hell, you don't even have trees. Furthermore, you don't have plants. You don't have grass. You don't have flowers. What you will end up with without this particular mentor is a pool of green algae. There will not even be the form you won't you wouldn't even see a tree. You wouldn't recognize it. It it wouldn't it trees only exist because of this mentor. They are stitched together by this mentor. You don't get grass without this mentor's existence. So when I walk into a forest, generally speaking, the first mentor I see is the fungus.
So let's talk about a forest and what let let's let's start here with forest and the fungus that runs the whole show. So there is a guy named Kevin Bealer or Beiler. I'm not exactly sure how to pronounce his name. He made a spatial map of a 30 meter by 30 meter plot of forest. And I think it was in Canada somewhere. And what he did is he used he used genetic what's called genetic barcoding, and, no, I'm not gonna get into that, and a whole bunch of other molecular biology techniques to determine individuals and be able to differentiate those individuals from other individuals in that 30 meter by 30 meter plot. And that includes not only the trees and what kinds they are and which roots belong to which tree, but also the mycorrhizal fungi that is attached to all these roots that's connecting the forest together because that is what a forest is.
All the trees that you see in a forest, they don't stand there by themselves. They are all connected, physically connected, through this webbing of fungus. And those fungal webbings are all hollow. They're all tubes. Every we call them hypha. Those are the individual threads that you see in, mycelium. Like, if you pick up a a a log in the forest and you see a white patch of of of funk growing on the bottom of it, you'll notice that it has a thread like structure. Well, those threads are called mycelium or well, it's the the whole thing is mycelium, but those threads are called hypha, individual threads. They're one cell thick, and the mic for the mycorrhizal type of fungus, those hyphae are one cell thick, but they're tubes, very long tubes, like one cell and another cell and another cell and another cell all in a line.
But the way those cells are connected together allows huge massive things to travel up and down like they're running down a highway. And that's gonna come in that's gonna come in big time here in a minute. Well, this guy, this Kevin Bealer, after he made this map and he identified which trees were which, and he he drew a map, you know, and and this is, like, this is not Bob's backyard biochemistry. He published this in a peer reviewed journal. Well, I know some of y'all might be, like, going, oh, yeah. What is it? Whatever that means. He published this at a time when it actually mattered and people actually did review the work. So it's this it's like I said, this isn't just some hobbyist. This is a guy that is a well recognized in his field for how forests are stitched together with mycorrhizal fungi. So he draws this map. It places all the trees where there's where they're placed and and places them exactly the distance that they're placed from, and it's like just it's a map.
But then he goes so far as to go underground and start identifying, like, which mycorrhizal fungi groups are connecting which of these trees. And this took a long time. This wasn't something that he did overnight. This probably took him months to do, to get all the samples collected, figure out which thing was going to which, but what he discovered was that at least one tree was connected to 47 other trees in this 30 meter by 30 meter plot. Now think about that. That's a network, and each tree or bush or whatever is in this in this plot is acting sort of as a node on the network. And the wires between are the mycorrhizal fungi.
So it turns out that the most amount of, quote, unquote, hops, that information, which we'll get to in a minute, took to get from one tree to another, the maximum amount of hops it took for any information from one point a to any point b was three. Only three hops. So, like, a tree sends out a chemical signal, it goes to another tree, and and it can get to any other tree in in in that plot with just one more hop after that or, well, two more hops after that, which is kind of amazing. Three hops in a network like that is actually pretty amazing. So this pattern of connectivity, you'll find in the the whole of the World Wide Web.
There the older the tree in the forest, the more connections it has. The younger the tree in the forest, the less connections it has. In the World Wide Web, Only a very few pages have the like, this this insane amount of connections to all the rest of the web pages. And only all the and that's just a very few. I mean, it's not just the oldest oldest pages on the web, but the biggest, the grand like the Amazon, the Google, that that kind of thing. Whereas, you know, some dude like Bob's Backyard Biochemistry blog only has very few connections to the rest of the web.
So we've kind of without even knowing it, we've kind of already copied the way the forest is actually built. Right? Because as with, you know, as with people, it's not what you know. It's who you know, and this works just the same way in a forest. Because all of these trees are transporting goods and services underneath the ground, and the mycorrhizal fungi is facilitating the entire trading platform. It is the market. It's the one that sets the price. It's the one that transmits the price of one goods and service to another. Trees will actually send carbon to other trees. Like, for instance, there's another study that was not done by this guy, but there was another study that was done in a Canadian forest, lo and behold, of birch trees and fir trees.
And they sectioned off a little plot. And what they discovered was that in the winter and in the springtime, the carbon that is manufactured in, well, the fir trees, and what I mean by that is the sugars that are manufactured through photosynthesis in the fir trees through radio labeling cart using radio labeled carbon, they discovered that the fir tree was sending its carbon compounds in the form of sugars to the birch tree. But that flow of carbon reversed in the summertime. The birch started sending carbon back to the fir tree. Well, why?
I mean, like, what what good does that do? Well, think about the difference between a birch tree and a fir tree. A fir tree is evergreen. It produces as long as it's got sunlight shining on it, it produces sugar all year round. The birch tree is not like that. The birch tree loses its leaves in the fall and is no longer able to photosynthesize from late fall all the way to early to mid spring until it can leaf out again. So during those winter months in the early the late fall, all through the winter, and into the early spring, you got the fir tree essentially given the birch tree food.
Without it, the birch tree would most likely die. Now in the summertime, this is the funny part, in the summertime, the birch tree leafs out, and when it does that, it shades a lot of the sections of the fir trees in the forest, and they are unable to produce as much sugar as they were in full sun when the birch trees didn't have any leaves on them. So the birch tree says, hey. We're connected in the network. I'll send you the carbon back, and we'll just trade that way. You give me the sugar when I need it. I'll give you the sugar when you need it. And they come to an agreement. This is the resilience that you find through networking.
If you can plug in to a network rather than have to build your own network, you're going to grow taller and faster and stronger than those around you. And we find this actually being 100% true with what I call plug and play trees. So here's the example. You got a a seedling, and I take that seedling of a tree, and it doesn't matter what tree it is, because they all have to associate with mycorrhizal fungi at one point or another. If I take that tree and I dig a hole in the middle of a field that is just like a blown out hay field and it's been horribly mismanaged and has been tilled. And there's just hardly any, you know, mycorrhizal fungi that's able to survive there at all. And if if there is, it's probably in the form of a mycorrhizal spore that's just waiting for a tree root to attach to and start growing as as a mycorrhizal network. So I plant this tree in there, and lo and behold, after a while, it starts to associate with whatever mycorrhizal was down there.
But it has to spend the tree, and I'm I'm talking about the tree right now. The tree has to actually spend an exorbitant amount of time and energy in its early life to produce enough sugar so that it can send quite a bit of those sugars down to the mycorrhizal fungi because they cannot produce their own sugar. They have to eat. And sugar is a great energy source. So mycorrhizal fungi eat it, but they can't make it. So they have to depend on trees to give them the carbon that they need to be able to not only live, but survive and make all the acids that they need to basically mine minerals out of rocks. Okay.
So if I take that same tree, though, and instead of planting it in a blown out hayfield in the middle of Iowa or something like that, if I take that tree and I plug it into an already existing forest, that mycorrhizal network is already there. Not only is it already there, it's fully formed. And it will almost immediately associate with the roots of the seedling that I put in, which means that that tree no longer has to spend so much damn time trying to figure out how it's gonna make enough sugar to build this mycorrhizal network all on its own. It doesn't. It doesn't need that because the network is already there, and we've already just discovered what benefits being plugged into a network of that size actually has.
So how does that what what what does all this do for us, Dave? Well, if think about it this way. Think about if you're a logging company. You have two choices. You can clear cut a logging site. Big trees, small trees, doesn't matter. You don't care. As long as you get a whole shit ton of trees on a logging truck to go sell, you're fine. And then what do you do? Well, Weyerhaeuser or however you Weyerhaeuser, I can't pronounce the name. It's one of the biggest logging or pay like, they they produce a lot of lumber. I think they all Weyerhaeuser also makes, like, a lot of paper. But what they really own that's really valuable is the land that they have their tree farms on.
So they go clear cut a forest, and then they come back and they plant thousands and thousands tens of thousands of seedlings. And then they move on to the next plot. And over the next fifteen years, the plot that they had just clear cut is growing. But what does that clear cut patch not have anymore? Because when you cut all those trees down, not only did you kill everything above the ground, you laid waste to everything below the ground. The mycorrhizae, they have no ability to get sugar anymore, so they die. And any of the bacteria and any of the other critters down there that are associating with the mycorrhizal fungi to get goods and services from the mycorrhizal fungi network, they die or they find new they they go away. They find somewhere else to go live that doesn't suck.
Right? So when you clear cut a forest, you not only damage what's above, you pretty much destroy what's below. So when they went back and planted tens of thousands of seedlings, well, that's a great photo op. Whoop whoop de doo. Because all of those seedlings now have to actually spend an inordinate amount of time and energy to spin back up that which was already destroyed. Now there's another choice that a logging company has. They can go through and they can selectively thin a forest, take the lumber out of it, leave a few of the great big trees, and that will feed the mycorrhizal network below so that when they go back and they plant a whole bunch of new seedlings, those seedlings are already plugged into a network, so therefore, they will grow taller. They will grow faster. They will grow stronger.
You will get a better crop of wood. So this is the first thing that the mentor that is the fungus that resides and works for, but is responsible for the construction of the forest being the teacher, this is the first thing that I was able to learn. Which, if you were to think about the economics of that, it's just good economics for the lumber company to leave a few of the big trees so that they have a much better growth rate for the trees that they want to farm. It just makes economic sense. And that, speaking of, is the second thing that the forest or well, the the mentor the main mentor of the forest is the fungi. Because, again, without the fungi, you don't have a forest. You don't even have the structure that would be known as a tree. And, again, we'll get to that here in a second. But let's say and I didn't need that one right there. I need this one. Yes. Fungal arbitrage.
We hear in Bitcoin all the time about arbitrage. You take, you know, Bitcoin and sell it on one exchange at a really high price, and then you take that cash, plug it into another exchange where you can buy Bitcoin really low, and boom, you've got an arbitrage. Well, fungus seem to do that as well. So check it out. So let's say that you got a single mycelial network that spans different concentrations of phosphorus in soils. Let's actually let's just say there's two trees. One tree sits in soil that's got a high amount of phosphorus, and another tree sits in soils that's got very low amount of phosphorus.
But both those trees are physically connected by the same mycelial network. Okay. The plants or the trees that are in areas of low concentrations of phosphorus pay a higher carbon price to receive that phosphorus. Why not? I mean, it's harder for the, for the mycelium to mine with organic acids because there's not that much phosphorus there. Conversely, the plants that are in areas of really high concentrations of phosphorus pay a much lower carbon price because the mycelium that's over there, even though they're they're connected, even though it's the same network, there's basically local markets and then there's long distance markets. And it's and they're all connected by the physical physically connected by the same network.
But the ones that are in the higher concentrations of phosphorus pay a much, much lower price for carbon. Turns out fungi are not idiots. In fact, they're savage, savage business people. Right? So what they learned how to do, and God only knows when they learned how to do it, they will take phosphorus from the areas of high concentrations of phosphorus. And instead of selling that phosphorus to the tree that happens to be right there at a shit ass price, no. They'll package it up, and they will actively using real energy real energy sources it takes to do this. They will move that phosphorus physically from the area of high concentration to the areas of low concentration where they know they're going to get a better price for carbon.
This is not me telling you a lie. This is not wishful thinking. This is not me conjecturing. We know this. We know this to be true through extensive experimentation. We know that this is happening. And it's honestly amazing. But but check this out. Not only have the fungus figured out how to do arbitrage, They provide credit markets. That's right. They they actually issue credit cards and loans because there's this thing in in biology called mycoheterotrophy. Myco means fungal. Heterotrophic means to eat something other with something you didn't produce.
You are like, for instance, humans are what's called obligate heterotrophs. Plants are autotrophs. Plants can make their own food source just by walking out in the sun. If you try to do that and you say, well, I'm just gonna absorb some sun and I'm gonna make some sugar and I'll be alright, you'll be dead. That's what you will be. Right? So you have to eat things that other things produced. Right? So that's what heterotrophy is. You put myco in front of it, and basically, it means fungus provide the food that this that this other thing eats. That's all it means.
But there's this plant, and, well, actually, it's an entire plant family, and it is the most successful plant family on the planet. More successful than any of the tree species or families. Any you know, like, even more, even more than, your other, like, grasses and and weeds. It's the most successful plant family on Earth, and it's called the orchid. In that family, there are 25,000 different species of orchid, and none of them can produce their own food at the early part of their life. They cannot photosynthesize. They do not have they haven't been able to produce the equipment yet. That's that's part of their life cycle.
All 25,000 orchids, none of them none of them are able to produce their own food. Well, then how do they not die? Well, they're connected to each other and to the trees and the bushes and anything else through the very same mycorrhizal fungi in the forest or, you know, rainforest or jungle or whatever you wanted. Like, just, you know, a whole shit ton of photosynthesize synthesizing organisms, whatever wherever that is. You can think of it that way too. But so now you've got the fungus that's essentially just providing them carbon and water and nutrients and all kinds of other stuff. All manner of goods and services are just being provided for free.
But later on, see, the orchids finally start developing at different stages depending on the species, finally starts developing the ability to photosynthesize and therefore be able to produce their own carbon compounds that we know and love as sugars. Then they start paying the network back. They start paying the network back. They took first and paid later. What is that? That's a credit card. That's a loan. And these guys figured this shit out a 50,000,000 years ago or whatever. You know? It's like it's hundreds of millions of years ago. I mean, how now when we're looking at our own markets, our own credit markets, you know, like, if we start gauging and and really dig into the literature and the the research of just how this take now pay later system works for the orchids, and then we compare the structure and function of that to the credit markets that us humans have designed, what we're probably gonna find out is that we have horribly fucked it all up and that that's why we are having the problems.
We're what we're not doing is we're not simply providing, you know, some cash so that you can float your business until it can get on its own feet. We've made all this instrumentation that just muddles the water and and and makes it so that people like, you know, mister Krugman can tell you that because you don't have a PhD in economics, you will never understand this shit. And I say bullshit. There's always a problem to solve. And in this particular case, this take now, pay later, this extension of credit in the fungal world as it pertains to its association with plants is an old game.
But there's another game. And this is the problem solving. We're getting into the problem solving through persistence with a long time horizon. Right? So what's the problem? Coal. Not exactly. I like don't get me wrong. I like coal. It's I I don't hate coal. What I'm saying though is that you gotta ask yourself the question, how did we even get coal? And a lot of people don't know. Like, for instance, a lot of people don't know that that the Earth is incapable of producing coal ever again, except maybe possibly in in peat bogs, but not it's not like the coal like the anthracite coal that we can get out of, you know, North Carolina, Pennsylvania, and stuff like that. It's it's shitty coal. I it's because it's not really coal the way that this coal is coal. I'm talking about the prehistoric coal that we use and burn all the time. We will never be the Earth will never be in a position to make that again, and here's why.
White rot fungi. You see, back about 200 and between something like two hundred and ninety and three hundred and sixty million years ago, we had what's known as the Carboniferous period. And we call it Carboniferous period because a whole shit ton of carbon was laid down. How? Well, because trees would grow up. They would live for a couple of hundred years, maybe seven hundred, maybe even fifteen hundred years. They'd be huge, immense affairs, and then they would die because all living things naturally come to the end of the road. And then eventually, they would fall over.
And what would you think would happen? Oh, it's gonna decompose. Uh-uh. No. There was no such thing as a as anything that could decompose a damn thing on the face of the planet between the years two hundred and ninety and three hundred and sixty million years ago. Bacteria couldn't do it. Fungus was there, but they didn't have the mechanisms to be able to grind up wood because wood's made out of cellulose, hemicellulose, and something called lignin. Cellulose is kinda easy. Even bacteria have enzymes that can work on that stuff. And hemicellulose, not exactly terribly much harder, but it is harder to break down into simple sugars because that's what that's what all trees are made out of. When you look at lignin and, cellulose and hemicellulose, it's just it's just well, the hemicellulose and the cellulose are essentially sugar, glucose molecules that are linked in a polymer. That's all it is. And they're pretty easy to bust apart and get the sugar out of and break up the carbon skeletons to harvest the energy that resides there. That's what a lot of stuff was able to do.
But it couldn't get lignin because lignin is rings of carbon in this just brutally three-dimensional matrix that there's there was no enzyme that could actually recognize a site to latch onto to where it can start cleaving the carbons off of each other. And they certainly even if they could, they weren't in the format of sugar. There's a completely different form of of carbon skeletons. It took white rot fungi, like, another hundred million years after the Carboniferous period to figure out that it could use what's called a peroxidase enzyme that uses peroxide to essentially burn through these carbon bonds because no other enzyme that it had would actually work.
So you so it finally accidentally maybe stumbled upon this thing called a peroxidase that it started manufacturing itself, maybe through mutation. Who knows? It doesn't matter. But finally, one day, a white rot fungi was able to get onto a piece of wood, get through the cellulose, get through the hemicellulose, and then start digesting lignin. And you can get through the cellulose and the hemicellulose, and you're still gonna have the great guts and feathers of the wood left over that does not rot. Now think about what happened in the Carboniferous period. You've got all these trees that are dying, falling over, and none of them can decompose. So what happens? Well, the four I mean, if if there's any space in between these dead logs, the tree is going to start growing until all of a sudden, there's no space for any other tree to grow except at the fringes of this forest, and it just starts marching on because some people theorize that there was a kilometer deep stack of logs as big as houses, like, big as big around as a house laying on its side a kilometer deep.
And over time, dust blew on it. It got buried. Maybe some floods happened. Some mud got deposited on it, squeezed out all the oxygen. And as it baked in the earth, as it got deeper and deeper, you ended up with, ta ta, coal. That's how we got coal. But now, because white rot fungi solved the problem through persistence of being able to get rid of lignin, we will never be able to have coal produced on this planet, especially not in the abundance that it was able to be produced in the Carboniferous period. So it was the befuddlement of the decomposers that allowed all the coal that's on this planet to actually come to fruition.
And because white rot fungi solved that with a peroxidase using hydrogen peroxide as a main component in that enzyme, it was able to completely destroy lignin. And now you will never ever find a log on the forest floor that's more than a hundred years old because it will eventually be chewed up and spit out. Now farming is the last portion of this that I wanna talk about as far as what does the mentor that is fungi actually teach me? Well, like I've I've alluded to it before, the reason that the forest is the teacher but not the mentor is because when I walk into into my university, like the head of the university is the the like the forest, right?
That that's my whole university. When I walk in there, the the first teacher that I see is the fungus. And as I alluded to, there would not be a forest for me to walk into if it wasn't for the fungus. In fact, and I'll reiterate it again, you wouldn't be able to see a tree or an angiosperm, also known as a flower, or an orchid, or a piece of grass, or a weed, or a cattail, nothing. You wouldn't recognize any of it if it wasn't for fungi. What the hell am I talking about? Okay. We all know that plants have roots. There was a time when plants could not form roots, and they 100% depended upon mycorrhizal fungi or, you know, way back in the day, and we're talking well before the Carboniferous period. We're talking 500,000,000 years ago.
Some people say 600,000,000 years ago. Let's cut it down the middle. We'll say 550,000,000 years ago, fungi were were in existence. And the very first plants were starting to come up, but they were just algae. Just pools of green goo that was able to photosynthesize, but they weren't stitched together. Like, if you pick up a leaf, you look at it under the microscope, you see all these plant cells that are basically stitched together, and they form the structures that you see. The leaf, the flower, the the seed, the the stems, the the bark, the roots, the the trunk.
Everything about that tree is plant cells that are basically being able to stick together. Right? But in the early days, it was just green goo. So what what happened was that fungus was already there. Now remember, fungus can't make their own food. They were having to scavenge for any kind of any kind of sugar that they could find, any kind of carbon skeleton that they would be able to cleave and and harvest the energy from. They were essentially dumpster divers until they hooked up with their green friend algae. And everything changed because the algae was able to make sugar all by itself, but couldn't do much more. It depended on a completely different mechanism of getting any kind of minerals that it needed as cofactors that would allow it to continue to photosynthesize.
Carbon was easy to get in the atmosphere. Sunlight was easy to get. Manganese, not so much, especially if you ain't got roots and especially if you're just a single cell of jelly that's colored green sitting in a pool on top of a rock. At that point, you depend on water's chemistry with the rock or the soil that you're on to do its bit and you are also dumpster diving. So they were both dumpster divers. Except already, mycorrhizal fungi or fungi in general was really good at being able to break apart minerals with its oxidative, or what's called organic acids, but they couldn't make their own food. Algae could make their own food, but they couldn't do much else. So they hooked up, and they hooked up in a way where think about it this way. Think about a puddle of goo.
You know, this algae, and you've got mycorrhizal fungi that go, hey. We've discovered a sugar source. Well, almost immediately, fungus started essentially stitching these algal cells together to where they had structure, and they weren't just piles of green goo. And over a period of millions of years, that stitching together, that building of the first plants, the constructor was the mycorrhizal fungi. It didn't happen all by itself. And it happened because it wasn't fungus at that time and and to this day is an opportunist. It's, well, a capitalist.
And it started using these basic building blocks that would you know, that gave it something and said, we sun later in the day and earlier in the morning. All of a sudden, you start getting grasses and plants and leaves and structures that we can start identifying as, oh, yeah. I recognize that that's a plant. But that all came about because fungi were physically stitching these things together. Like I said, it did not happen it did not happen on its own. So we get into this situation where we have fifty million years of this association between the earliest of plants and mycorrhizal fungi, and the plants were not able to make their own roots. They depended 100% on the fungus keeping them connected to the soil and being able to get water and bring it to them, get nutrients and bring it to them. And in return for all those goods and services, the plant provided carbon in the form of sugar.
Until the plant learned to put down its own roots, it's almost as if it learned from its fungal partner how to bury itself into the soil, and then it could get even taller. Because back in the day, the only as as this profusion of plants started to explode And it did. It started to explode. And, I mean, the whole planet started becoming populated with plants really, really fast. The only way to get more light was to grow up so that you weren't shaded out. So here comes the competition. That's where we get lignin. That's where we got hemicellulose. That's where we got cellulose because these critters started figuring out a way to put these sugars together so that it would have structure.
And the battle was on to get higher and higher and higher, and that's why you have the forest. But the mycorrhizal fungi does not look at it like that. The mycorrhizal fungi is in every single plant and grass that you see all the way up to the tip top, all the way down through its root structure, and all the way out into the soil for God knows how many feet outside of the ring of, you know, the drip line that that plant actually represents. It's not just in the roots, guys. It's it's in every it's it is fungi is permeated every square nanometer of plants. It is everywhere. It's like it is a like a second circulatory system to a plant, and it became evident immediately that the tree or the grass or the flower or or whatever, whatever plant you're talking about is not a plant to the fungus.
It's a farm, and it's a farm that they built. It's a farm that they built. Now I think that this is probably the most exciting thing because let's go back and look at at the forest and what I said earlier. You don't have a forest without fungi. When I see a forest, I see a massive farm and all of the farmers are the mycorrhizal fungi. And it is an extensive, extensive farming operation. And if we can pull apart how mycorrhizal fungi do it and have done it over millions and millions of years, we might learn a thing or two about how we're farming. And that is pretty much the last thing that I have to say about this entire thing, except that it's winter, it's February, it's cold unless you're, you know, South Of The Equator, Then, you know, if you're up here with the northern guys, we're all cold and it's snowy and we'll have to wait until the temperatures warm up and the snow melts off the mountainside.
But go into the forest. At your earliest chance, go into the forest and start looking at the trees and plants as farms. Realize that you wouldn't see those critters there if it hadn't have been for fungus stitching together algae cells 550,000,000 ago. And also understand that even though they had always had an intimate relationship with each other, it took a hundred million years for white rot fungi to figure out how to decompose wood, and it only did it through persistence in a very long time horizon. So resilience through networking. Harvest your network.
Understand economics. Figure out that you can solve any problem as long as you have time enough and gumption enough to actually solve that problem. Then we can all learn how to farm. We can farm for ourselves. We can farm for each other. But all of this, I got out of the forest. I can't stop thinking about that. Let's run the numbers. CNBC features the commodities oil on its ass down 2.1% to $71.78. Brent North Seed down 1.94% to $75.50. Natural gas is up two thirds of a point. Gasoline down two points to $2.10 a gallon.
Gold is moving sideways at $2,931 per ounce. Silver is up 1.6%. Platinum is up 1.15. Copper is up two and a quarter, but palladium is on its butt by a quarter of a point into the red. Ag, the biggest winner today looks to be coffee at 3.46% to the upside. Biggest loser is chocolate, 1.37 to the downside. We got live cattle. It's moving sideways, but still in the green. Lean hogs are up a buck. No. Not a dollar. 1 point 5 percent, but feeder cattle are up a quarter of a point. The Dow, however, struggling, it's down a third of a point. S and P is down point 17%, but Nasdaq is in the green point one three.
S and P Mini is down a half a point. And what's our good friend Bitcoin doing? Well, it's at $97,010. That is a $1,920,000,000,000 market cap, and we can get 33 ounces of shiny metal rocks with our one Bitcoin of which there are 19,823,085 and a half of an average fees per block are low again. There are oh, wow. There's a whole seventeen, eighteen blocks carrying 15,000 unconfirmed transactions waiting to clear at high priority rates of 5 Satoshis per vbyte. Low priority is gonna get you in at 7 Satoshis per vbyte. Hash rate is at 802.5 exahashes per second.
And it looks like in the next eleven days, we have an estimated difficulty adjustment to the downside of 7.17%. Woohoo. Whoop de doo, man. I guess we've been solving blocks a little too fast. Now from Polish joke, yesterday's episode of Bitcoin and I got Psyduck with $4.20 says nothing. Pies with a hundred says thank you, sir. No thank you. That was it. That was all I got, man. Come on, guys. This is value for value. If you're not if you're not getting the value, I understand. But if you think for a second that I'm bringing you any kind of value at all, be reciprocal about it, and throw me some satoshis through a boost and say something.
I don't know why Psyduck didn't say nothing. He said nothing. He gave me a whole 420 satoshis, didn't say dick. I don't know, man. Psyduck, we get we we got we gotta talk me and you. That's the weather report. Welcome to part two of Bitcoin, and I got the news you can use. Bitcoin price sees a dip to 94,000 as crypto retreats on The United States CPI overshoot. William Sueberg gonna tell us what happened out of Cointelegraph? Data from Cointelegraph Markets Pro and TradingView shows that local lows of Bitcoin was 94,091 on Bitstamp.
The January print of the Consumer Price Index or the CPI was higher than expected on both monthly and yearly timeframes. Data from US Bureau of Labor Statistics or the BLS confirmed that the CPI rose half a percent last month, a conspicuous point 2% more of a move than anticipated. The year on year increase was 3% versus a forecast of 2.9%, quote. Headline CPI inflation is up for four straight months, and core CPI is officially back on the rise again. Inflation in The United States is running hot, trading resource, the Kobesi letter, wrote in a part of a response on Twitter, quote, this officially marks the highest CPI inflation reading since June of twenty twenty four.
Even more concerning, headline CPI inflation rose by half a percent month over month, a massive jump. Rate cuts will be delayed even further, and that's what happened. That's exactly what happened. We got this print. We got this print coming out of Bureau of Labor Statistics. Says inflation's running hot, which means Jerome Powell is not, not, not going to be in any hurry to relax the Federal Reserve rate lending rate. So we're stuck at what? 4.25 to 4.5% right now? There were supposed to be four, count them, four Federal Reserve rate cuts this year.
Before we even began the new year, people started saying, well, given the, you know, this we're not getting inflation under control and employment is is is good even though it's all a lie. I I understand it's all a lie. All the numbers look so, you know, so good except for inflation, which means that we our economy is really kinda running hot. And if we lower interest rates, a whole bunch of people are gonna start borrowing. And guess what? The inflation or the, economy is gonna start running even more hot. And this can't happen. We need to cool this stuff off. And the only way they can do that is either two ways.
Raise rates or keep rates the same. They are not going to lower rates. So we went from four cuts projected to three cuts. And then as of, like, four months ago, it was, not four months ago. As of like January, we were looking at two cuts. And then as of last week, people started saying, well, there's only going to be one cut. And now even if we get that cut, that might not even be until the third or fourth quarter of this year. Unless something changes, we might not get any cuts, and that always affects what people look at as risk assets.
And even though you and I both know Bitcoin is not risky like that, it doesn't matter to Joe Blow on the street. He sees risk. His fund manager sees risk. His banker sees risk. And, no. You're not buying no Bitcoin. And people are just fleeing into the dollar. That's what's going on. You're just gonna have to live with it. So Hester Pierce said the following. Meme coins like Solanus Trump are probably not probably not under the jurisdiction of the Securities and Exchange Commission. Oh, joy. This is, by the way, decryp.co written by Matt DeSalvo.
The head of the SEC Commission's new crisp crypto task force has said that meme coins are unlikely to fall under the watchdog jurisdiction. In an interview with Bloomberg on Tuesday, commissioner Hester Pierce was asked about president Donald Trump and his wife's official meme coins Trump and Melania and whether such cryptocurrencies would fall under the agency's jurisdiction. The newly appointed boss of the SEC's crypto task force said that such assets probably don't. President Donald Trump launched his own Solana based meme coin, Trump, ahead of his January 20 inauguration with Melania Trump following suit with her own coin very soon after, quote, there's lots of people introducing meme coins right now, Pierce said, but many of the meme coins out there probably do not have a home in the SEC under our current set of regulations, end quote.
I I I there's really nothing else to this. She's just saying that it probably doesn't fall under the jurisdiction of the SEC. What does that mean? Does that mean that we can just spin up meme coins at will and it's not an unregistered security? I I I feel that something fishy is going on. I sorry. I do. I can't I I can't put that back in the bottle, so just understand. I'm not making you know, I like Hester Pierce. You know, I'm not an orange man hater per se, but that just seems a little too, I don't know, easygoing of a position because I think all these meme coins are unregistered securities, therefore, they're illegal under our laws.
I'm just saying, and it's like if I get that there's people out there going, we should be able to do whatever the hell we want. I get it until it's your grandmother that loses all of her ass on, like, you know, Melania coin. And then at that point, you're going, gee, I wish somebody had said that that shit's not allowed because it's clearly it's clearly crap. I don't know, man. Something something that is not sitting right with me on this SEC saying that meme coins are just free and clear. May does that make it Treasury's problem or the judiciary? I don't see how the judiciary will be able to do anything about it, but I don't know. We'll have we'll have to wait and see.
Obscura VPN. Obscura VPN is now available on Mac OS. Obscura is the first provably private VPN that can't log, cannot, it cannot log your network activity by design and outsmarts network filters for enhanced censorship resistance. It is currently only available on Mac OS with support for other platforms coming sometime soon. Quote, today is the day. Obscura VPN is now available, announced Carl Dang. Obscura is designed to never see user traffic, making tracking impossible. It blends with regular Internet traffic to avoid network filters, ensuring unrestricted access.
Obscura's servers relay the WireGuard tunnel between a user's device and Mullvad's servers to protect user information, and that setup ensures the following. One, Obscura's servers cannot decrypt Wireguard's packets as they are encrypted with Mullvad servers Wireguard public key. Mullvad servers can't see the users connecting IP because Obscura's servers perform something called NAT. A user's device connects to Obscura's servers over QUIC, making the connections harder to detect or block as they resemble just plain old regular Internet traffic through HTTP three, which uses QUIC, q u I c, for transport.
Furthermore, Obscura avoids the TCP over TCP meltdown problem by using QUIC's unreliable datagram extension. This makes it a suitable option for bypassing firewalls and Internet censorship. Quote, Obscura users can verify that their traffic is sent encrypted to a MoleVanc server by comparing their server's WireGuard public key shown on the Obscura's app's location page against those published on our server page, said Mullvad VPN in a blog post. At launch, Obscura VPN is $6 a month. Users can pay via the lightning network and the service does not require emails for authentication, and you can check it out here. And, of course, here is a, link, a little linky poo.
This is really nice. I I like the way that they're doing this because they're they've got a a they've got a relationship with Molvad. So it's like a VPN that has two completely separate parts, like, I don't know, mycorrhizal fungi in a tree. I'm saying, man, networking is the thing. But Dong or Carl Dong, he did he formed a relationship with, Molvad a long time ago. I think it was like that was how Mullvad was able to take, Bitcoin payments for Mullvad services, which is a VPN that I have used, and it's a very good VPN. And it looks like that relationship has blossomed into something where they have a more permanent more permanent relationship where MoleVAD servers are being used for one aspect of of securing your privacy and Obscura is providing the rest of it.
So not neither one of them has access to any or all of the information, which I think is an incredible development in VPNs because nobody does that. As far as I know, Obscura is the only one that has two completely separate entities working together for the same outcome, and that would be your privacy. I smell opportunity is a quote directly from Bitwise chief investment officer, and he says this amid retail and institutional crypto sentiment dichotomy. We'll pick that headline apart. It's written by the block and James Hunt. Bitwise chief investment officer, Matt Hogan, said that the current bad retail sentiment in the crypto market signaled an opportunity amid the contrast with institutional demand.
Quote, there's a fascinating dichotomy in crypto right now between institutional and retail investors. On the one hand, institutional sent sentiment towards crypto is the most bullish I've ever seen, but retail investors are wallowing in despair, end quote. The Bitwise CIO said investment professionals now look at crypto as a space institutional capital is applicate or allocating to hold on. This is a bad sentence. The Bitwise CIO said investment professionals now look at crypto as a space institutional capital is allocating into in record amounts via exchange traded funds.
Washington has gone from being one of the industry's biggest threats to one of its biggest champions under the Trump administration and further nation state adoption could be in the cards. However, for retail investors, quote, it's almost as if they are living in an alternate reality, Hogan added pointing towards Bitwise's proprietary on chain sentiment score currently registering one of the lowest readings of all time. Hogan believes that the index aligns with other sentiment indicators and the general vibe of crypto Twitter with retail sad because their overweight altcoin investments are doing poorly this time around compared to Bitcoin with very few exceptions.
However, Hogan said every bone in his body is telling him that the institutions are right. And while it is very easy to be bullish on Bitcoin right now with ETFs and corporations already scooping up more than 100,000 Bitcoin so far this year compared to 18,000 Bitcoin actually mined. Long term, the setup for altcoins is stronger than at any point in history. Oh, for god's sakes. The altcoin don't. Just don't. It's just Bitcoin. That's the only thing that matters. But he conceded that the altcoin picture was far more complex with no major new application driving the interest that DeFi and ICOs did in prior cycles outside of the short term meme coin casino boom.
However, with regulatory clarity on the agenda, The US making stablecoins a national priority and growing institutional confidence, the industry will bring DeFi applications to the masses, Hogan claimed, quote, retail sentiment in crypto is terrible even though the fundamentals are great and I smell opportunity. In a year or two, my guess is that you're not going to have to squint to see the transformation in altcoins. The impact will be self evident and overwhelming. Yeah. He's a little heavy on the altcoin side of this particular, argument, but I tend to agree with them in general.
That's what I that's one of the things that confuses me about the price action right now. You you've got institutions buying more Bitcoin than is being mined. You've got more and more states of The United States, putting legislation forth for a strategic Bitcoin fund or something like it, but most are actually saying Bitcoin generally or or rather specifically. But more generally, you've got a lot of states that when they don't say Bitcoin, put these strictures on it that is like, well, it has to be we can only invest in a digital asset that has $750,000,000,000 of market capitalization on average over a period of five years. The only one that fits that bill is Bitcoin. I I mean and there's, like, three of them like that.
So they either say Bitcoin specifically or they make sure that their structure is such that the only thing that they can get into is Bitcoin, and then they don't actually say the word Bitcoin. I see all this, and then I see, like, $2,000, you know, red candles. And I'm going, I don't understand. At least I'm not alone because this chief investment officer, this Matt Hogan, he sees the exact same thing. Retail is fucking terrified. Institutions are like, la la la la la, and there you go. That's that's the way that shit has been working for centuries and centuries and centuries and centuries. Now last up on the list, Goldman Sachs has disclosed ownership of Bitcoin ETFs, and here's why it doesn't mean very much.
This is Steven Alfer and James Van Stratten writing for CoinDesk. Bitcoin Twitter is having a moment after a 13 f filing by Goldman Sachs disclosed higher stakes in a handful of spot Bitcoin exchange traded funds, but the facts are less than meets the eye. First and foremost, ownership of the ETF isn't exactly a bet by the Goldman trading floor on the price of Bitcoin. The stakes are almost surely held by the bank's asset management arm, Goldman Sachs asset management, for its clientele. Secondly, while the filing, which is a snapshot of ownership as of 12/31/2024, shows a $288,000,000 stake in Fidelity's ETF Bitcoin and $1,300,000,000 stake in BlackRock's Bitcoin ETF called the iBit.
It also shows put options positions with nominal value of more than 600,000,000 along with a small call option position. As put options gives the holder the right but not the obligation to sell the asset at a predetermined price, it can be seen as protection against a price drop representing a bearish stance. Quote, the position by Goldman Sachs similar to many other banks and hedge funds is not a net long position, said CoinDesk senior analyst James Van Stratten. This is a strategy that reflects the basis trade, also known as the cash and carry trade, balancing potential profits and risks for Bitcoin price fluctuations.
The ETF recently had options approved on them, so this is most likely directional hedging. With the deadline for the fourth quarter thirteen f disclosures fast approaching, similar filings along with misleading headlines are surely on the way for JPMorgan, Morgan Stanley, and other large wealth management operations. So I don't know. I mean, James and and James Van Straten probably has a, this is probably a good take. Is that yeah. Because I saw it yesterday. Hell, I even saw it on Noster. It was like, oh my god. Goldman Sachs has this huge position. They bottled, you know, they they bought a lot of this bullshit. Yeah. Yeah. Yeah. Yeah. As you just heard, probably shouldn't put all of our eggs in that particular basket.
Just saying. Maybe we should just cool our jets a little bit and take the ride. So that is actually it for the show. I I hope you enjoyed the first part of the show as well as the second part of the show. Tried to balance it with, something different with the usual, smattering of Bitcoin news. Let me know. Let me know if you liked it, if you hated it, if you didn't understand it, if you want me to do more of it, give me a boostagram because remember, guys, this is value for value, man. That's the only way this works. And until next time, I'll see you on the other side.
This has been Bitcoin and and I'm your host, David Bennett. I hope you enjoyed today's episode and hope to see you again real soon. Have a great day.
Introduction and Valentine's Day Advice
The Forest as a Mentor
Lessons from the Forest
Fungal Economics and Arbitrage
Fungal Credit Markets and Problem Solving
The Role of Fungi in Farming
Conclusion: Lessons from the Forest
Market Updates and Bitcoin News
Institutional vs Retail Sentiment in Crypto
