To Crypto or Not to Crypto… Is It a Good Investment for Me?

Maddy: [00:00:19] Hello and welcome to your income and investing podcast striving to disrupt the norms in the finance industry. I'm Maddy, and as always, I was in very good company with my co-host

Sophie: [00:00:30] Sophie. We have our second episode on cryptocurrencies and we are going to be talking about the use cases both positive and negative, 

Maddy: [00:00:41] as well as whether it is a viable long term investment. 

Sophie: [00:00:45] But first, Maddy, 

Sophie: [00:00:47] I've got a joke for you. All right, hear me. 

Sophie: [00:00:50] So there's this new cryptocurrency called Decibel, right? Okay. And you just yell into your microphone to get money. 

Sophie: [00:00:56] Yeah. OK. Like, how good would that be? 

Sophie: [00:01:00] And you know what it is, but it's a sound investment. 

Sophie: [00:01:04] I love it. I love it. Well, Don, so glad I can make you laugh. It's so great. Well, before we get 

Maddy: [00:01:10] into today's episode, let's hear from a YIGC community member.

Sophie: [00:01:14] Show me the money, honey. My name is 

Community Member: [00:01:16] L. I'm 22 years old and I work as an accountant, roughly earning about four thousand two hundred a month give or take. Each week, I put in about 30 dollars into raised with a moderate risk portfolio. I also buy random shares. I bought maybe two shares internal about $500 each share just what I'm feeling in the moment. I don't really have any sort of game plan with that. Just the regular investment of $30 each month old F45 stocks when they went public and looking to get some more Australian holdings. Total value of my portfolio. I don't really check it too often, but I think it's above somewhere above 1.2 at the moment. I've only started investing since the middle of the year, and it's been great listening to the podcast because it's inspired me to get on to all these sort of opportunities. 

Maddy: [00:02:09] So great to hear from our wider community Facebook members. If you want to get involved, make sure you join our Facebook group at Surf. 

Sophie: [00:02:19] YIGC Investing Podcast Discussion Group Just before we jump into the episode today, we want you to define one term for you. 

Sophie: [00:02:27] What's that? 

Sophie: [00:02:28] And that is the metaverse. We talk about the metaverse a little bit and all it is, even though it's very hard 

Sophie: [00:02:34] to get your head around, 

Sophie: [00:02:36] is a digital reality that combines aspects of our social media, online gaming, augmented reality and crypto currencies. So it's like a totally new digital universe today. 

Maddy: [00:02:49] We are so excited to welcome back to the show. Millie Rowett If you missed last week's episode, I would highly recommend going back to check it out where we broke down the basics of blockchain technology and cryptocurrency, as well as lend a little bit about how bitcoin is created and what causes the price to be so volatile. On this week's show, Millie software engineer in the Bitcoin team at Square, a name you may recognise after their recent acquisition of Afterpay, is back to help us try and understand what cryptocurrency could actually be used for in the future and whether or not it is a viable long term investment. 

Millie Rowett: [00:03:25] Welcome, Millie. Hi, guys. It's nice that you invited me back. I'm so happy to be here. 

Sophie: [00:03:31] You made the comment. 

Sophie: [00:03:32] So, Millie, we're going to start off with a game this morning to really test you, and we're going to list off a bunch of coins and you've got to guess whether they're real or fake. Let me tell you this not any coin names that haven't been taken out there. I've realised after a little giggle. So first one poker dot, 

Millie Rowett: [00:03:50] that's a real coin. She knows 

Maddy: [00:03:52] this stuff. Next line at Covid coin. True or false? 

Millie Rowett: [00:03:56] Or I feel like someone's had to have made that coin. 

Sophie: [00:04:00] False. Oh, really got you know, I I don't have much faith in people. 

Millie Rowett: [00:04:07] I feel like I should have more faith in the next one. 

Sophie: [00:04:09] SushiSwap. 

Millie Rowett: [00:04:11] Yes, that's the real one to it.

Maddy: [00:04:12] And Cat Coin. 

Millie Rowett: [00:04:14] I do not know this one, but I do know there is Dogecoin and Shiba Coin and baby doge. So someone's got to make the cat coin. 

Sophie: [00:04:24] Yeah, you're right. 

Sophie: [00:04:25] I'm sorry, Einstein Coin. 

Sophie: [00:04:28] You suppose that is false, but fun fact. Switzerland actually put Einstein on this smallest coin ever. Get gold coin, and it's a really hilarious photo with him and his tongue out. 

Sophie: [00:04:41] Check it out.

Maddy: [00:04:42] Is that just an excuse to get that fun fact in that 

Sophie: [00:04:45] and turtle coin both is so hilarious. That one's true. It's true. I want to buy some total coin. I'm sure it's very valuable. So yeah, 

Sophie: [00:04:58] the final one. Gold. 

Sophie: [00:05:00] Coin, true, Charlie. Yeah, yeah, I like someone, I think I like it, it's funny. Yeah, you like that too. Well done to whoever created Gold Coin. So really, 

Maddy: [00:05:14] last week we touched on the concept of decentralisation, and today we want to build on it a little bit further because understanding decentralisation helps us to understand some of the use cases for cryptocurrency. So a good place to start is explaining, I guess, how the current monetary system works. Not not the cryptocurrency system. So what is the traditional sort of centralised system for money that we have at the moment? 

Millie Rowett: [00:05:41] Sure. So and I'll try to give like a short description, and I'm no expert. But you know, currently and you know, a lot of this is actually hidden away from us, you know, by a bank or, you know, by the app that use of the website. But all money, all government issued money that's moved around is actually recorded by your bank and can take days to actually clear and settle. It's overseen by a lot of entities who know exactly what you do with your money. And God forbid, you try to move your money overseas and you end up giving 30 percent of that transaction to the people who moved it for you. So most of us go through life without really thinking about this. You know, we just move our money from place to place. But imagine, you know, you need to take out five thousand dollars from your bank in a day, you know, whatever you need to pay for and you have to ring and ask them permission to do that. Or if you want to use your money for gambling or you know, weed or, you know, other unsavoury things, God, God forbid. You know, this is the equivalent of having to ask your parents for money to buy like sugary treats, right? And if we think about a bit more like macro of think about a bit more globally like you might interest rates, you know, who are they set by? We trust the Reserve Bank knows what's best for us. But we also trust them in the GFC. And what did they do? They went and bailed out a bunch of bankers by printing a lot of money and evaluating cash savings. So monetary economic policy policies all decided by, you know, mostly white old white dudes behind closed doors of parliament. And these processes and institutions have not evolved much in the last thousand years. So I get a bit passionate when I talk about it. But you know the difference. You know, decentralisation and centralisation is the difference between freedom and control over your own money and not, you know, Australia. We're pretty lucky that most of this doesn't affect us too much day to day. But you think about Myanmar or North Korea. Like, what is economic freedom mean to those people? 

Sophie: [00:07:40] Hmm, that's such a good point. I mean, every time I think about centralisation, I tend to think of like some institution or organisation that does have that element of control. And then when we swap to the other side, which is decentralisation, which will jump into now, it's like it kind of omits that actor that we're kind of used to, i.e. for us, for me personally, the bank I'm used to the bank, you know, looking after my money. I don't know where my money would be if I didn't 

Sophie: [00:08:06] have a bank like. 

Millie Rowett: [00:08:08] And the idea is like, you're trading, you know, security for control and power over your money. And it's a 

Sophie: [00:08:15] hard concept to kind of get your head around that we wouldn't have that kind of control, but potentially it's something in the future. So jumping onto the other side, which is decentralisation, what you know in your most layman's terms definition, what is decentralisation in the monetary system mean? 

Millie Rowett: [00:08:32] Sure. So decentralisation, I think maybe it's it's useful to to bring it into a context with kind of a counter example to decentralisation and try to explain some of the problems that that crypto is trying to solve with decentralisation, especially in finance, because the decentralisation of like a lot of things. But. So you might remember early in this year there was like the GameStop drama where, you know, a bunch of people on Reddit, you know, by doing some quite, you know, intelligent analysis of of the share realised that a bunch of hedge fund managers were shorting the GameStop stock. And if they bought it in bulk, it would drive up the price and forces Wall Street hedge fund managers to have to buy back at a higher price, which would, you know, really piss him off one, but also potentially financially cripple them if they could get enough people in. And they used like platforms like Robinhood, which is a US app that lets you invest in fractional shares like a dollar worth of shares. But Robinhood actually pulled the stock off their platform, and it was kind of like almost like a form of censorship, like they were getting allegedly maximum pressure. Those same hedge fund managers who invested in Robinhood, as well as the fact that they just couldn't afford to keep selling that stock because so many people were buying it. This is not possible in a decentralised investing platform, for example, because it is not possible to change the rules really knowing what no one person or one. Entity has that power to remove assets from platform without wide consensus from the users. It's almost like a true democratic system. You know, every decision or change that's made to the protocol to the rules is usually voted on by either a governing body, which is usually, you know, the people actually working on the programme or people with a large amount of that token invested in that platform. So every decision is transparent. There's no backroom deals, is out in the open and usually everyone can have their input on it. 

Maddy: [00:10:34] I guess it's just like the transfer of control and decision making from a centralised entity who has that power that you're talking about so of to the network of people. And I guess it like you and I, it just makes it, I guess, more fair and less. We don't need that trust on that, on the government or on the bank. It spreads the trust.

Millie Rowett: [00:10:54] Exactly. That's the really good way for 

Sophie: [00:10:56] decentralisation is kind of this base that we want to understand when we talk about the use cases for cryptocurrency. Let's jump into maybe some of the the positive use cases for crypto. One that we read about a lot and we hear about a lot is that cryptocurrencies has the ability to bank the unbanked. Firstly, what does that mean? And then secondly, how does crypto facilitate that?

Millie Rowett: [00:11:19] Sure. So in a literal sense, you know, some places are around the world. It is actually incredibly hard to get access to a bank account. You know, you literally cash under your mattress kind of places, which can be very, very scary and very unsafe. So to have control over your own finances, you know, to not get taken advantage of by these financial institutions that hold a lot of power when you do bank with them. The term goes just beyond not having a bank account, right? Because, you know, even if you do, you might live in a place where your government is overthrown and some of you don't have access to their bank account. Your or your cash is now worthless because of hyperinflation. Or, you know, all these other forces affecting your government issued currency that you have no control over. Again, it's that control piece. So, you know, crypto and specifically like bitcoin here is kind of it's like an opt out of that system. It's an alternative to the traditional system. And when I think about like economic empowerment and access to financial power, I think of, you know, shares investing super yield investment properties. It's all these things that you know, we might take for granted is quite a higher socioeconomic country, but all the time it costs a lot of upfront capital and education to get started with these things. Crypto wallets, you know, they don't charge you monthly fees. You don't need permission to make one. You don't need to be a citizen or have specific papers. You even need to know, you know, how to write your name. You don't need to have all these things to hold or transfer crypto, and you can think about, you know, your cash sitting in your bank account right now. It's actually losing value because the average rate of inflation is way more than the visible interest rate we're getting in savings accounts right now. So you might not be able to afford a house, but you know, you can buy, you know, crypto, you can buy a piece of digital art in NFT or a virtual house in, you know, like these metaverse, these these like blockchain based worlds, right? 

Maddy: [00:13:20] You never hear the word metaverse again and not just 

Sophie: [00:13:23] lost, because because of Mark Zuckerberg, he's ruined this area. I would love

Maddy: [00:13:31] to hear your thoughts on El Salvador because that is one great example of a country that has adopted bitcoin as its legal tender. 

Millie Rowett: [00:13:39] So El Salvador is a really interesting example of a place that it's national currency was actually the U.S. dollar, and it's a millennial kind of president, I would say, like quite progressive in the party's thinking and decided like, Hey, we're sick of not having control over what the US does with our currency that we use day to day. There was like kind of a grassroots movement in this very small place in El Salvador that was on tape where people just started using bitcoin for, you know, marketplaces and cafes and restaurants. They started using it like really on their mobile phones, really like naturally. And it kind of grew and spread, and everyone got really interested in this place is like, Hey, actually, this is an alternative to what we've been doing. And in El Salvador, like remittance payments are really big. So people sending money back to their families from the US and, you know, Western Union and transfer wise, take a huge cut of those payments. Not to mention you have to drive or walk or cycle or whatever you could access to hours to get to a facility that lets you do that. So this is new technology that helps improve our lives, like why wouldn't we use it as well as the country? And the president decided, Well, I want to get ahead of the game here and start using this currency because now we are running. He thinks it's going to go up and it will actually improve the economic standing of his country. 

Maddy: [00:15:05] We had a bit of a laugh last week about how one of the first crypto currency, I think maybe bitcoin transactions was on a pizza and how overpriced that would have been in today's today's day, knowing crazy how much the value of bitcoin has gone up. But I guess that's one thing that confuses me a little bit about places like El Salvador using bitcoin because the price is so volatile and also like, it's so one bitcoin has such a high value. So how does it sort of work in reality? 

Millie Rowett: [00:15:35] So it is quite an interesting, I guess, thought experiment or discussion that people have in real time as we speak now is like, Hey, if bitcoin is so valuable, why would you spend it on a coffee shop? 

Sophie: [00:15:48] Or, you know, like

Millie Rowett: [00:15:49] the usual like white paper that Satoshi Nakamoto wrote, describe bitcoin as like a peer to peer cash system, like a payment system. So like, there's an argument that bitcoin is only ever meant to be used as like an alternative like, you know, monetary network like to actually pay for goods and services. It's kind of evolved to this Gold 2.0 narrative where it's like, never use your bitcoin, never sell your bitcoin, only hold nothing else. 

Sophie: [00:16:23] And this is the 

Millie Rowett: [00:16:28] time horizon has completely blown out. It's the same as, you know, you passive investing in ETF, who like the idea is to hold it over a very long period of time. There's a quite a tension between, you know, the people of it say, now this needs to be used. That's what it was meant to be used as its people like, I guess, like this kind of idea of like the rich getting richer by holding. You can afford to hold this asset over a long period of time and get richer. 

Sophie: [00:16:58] But I guess people that say the future value of it think that at some point it will settle. It's just right now, it's in this very volatile phase, but where we could speak about this all day. So maybe we should move on to some of the other positive use cases. 

Sophie: [00:17:13] There are a lot. There are, there are a lot. 

Sophie: [00:17:16] The second we wanted to touch on was about, I guess, the transparency as we spoke about the blockchain technology last week. And we want to know what are your thoughts on, you know, whether things like the blockchain technology can solve issues like money laundering? If everyone does have access to what's happening on the general ledger or on the report, that's that's recording all the transactions. 

Millie Rowett: [00:17:39] Yeah, I guess my take on this is people always do bad things with money, whether that be crypto or cash. I guess the good thing about the blockchain is that it is open and available for everyone to view and track. So there's that transparency argument. I mean, seriously, you can go to Blockchain.com Site Explorer and have a look right now at all the bitcoin transactions happening. 

Sophie: [00:18:03] Blockchain, you know, if I kind of want to check that out, I

Sophie: [00:18:06] was going to ask this because every time someone says it's available to everyone, I'm like, Yeah, but where? Where can I say it goes? 

Maddy: [00:18:12] Blockchain.com forward 

Sophie: [00:18:13] slash explorer

Millie Rowett: [00:18:16] Yeah. Yeah, I mean, there's so many websites that do is, you know, mempool that space. There's Blockstream. This is blowing 

Sophie: [00:18:23] my mind right now. Yeah, it's really cool.

Millie Rowett: [00:18:26] I mean, it just looks like a bunch of numbers, but you can actually see, like if you have a bitcoin wallet, you can type in your address and it shows you all the transactions that occurred in and out of your wallet. Like that forever. 

Maddy: [00:18:37] I wish I kind of said like Millie bought a pizza, but it's just no, it's not details 

Sophie: [00:18:44] I don't want. 

Millie Rowett: [00:18:45] Like, Oh, my transaction history, like 

Sophie: [00:18:47] on the internet. 

Millie Rowett: [00:18:52] I was trying to think of something embarrassing that I ask that I would 

Maddy: [00:18:54] say, if you bought margaritas. 

Sophie: [00:18:57] Well, that 

Sophie: [00:18:58] would be not that. That wouldn't be that strange. So if if it is all on the internet and we can see it, but it's just numbers, then how do we actually even know if stuff like money laundering is occurring? 

Millie Rowett: [00:19:09] I guess the companies that specialise in this in finding out that information, I guess they called blockchain. Forensic companies like Chainalysis is one to detect that it's pretty much it's it's really cool. Like, I'd love to sit beside them and work it out because there was I don't know if he saw, like early this year. One of the big gas pipelines in the U.S., Colonial got held to ransom, essentially by a bunch of hackers who demanded bitcoin. And they got it. You know, they kind of had to give it demand. Otherwise, like everyone in the US, would be in the cold over the winter. So they gave and they gave the bitcoin who was like, you know, a few million dollars. But this shady Russian hacking group and what actually ended up happening was that the. Seised, a lot of the bitcoin that they sent because they were able to track the movement of those funds from wallet to wallet until they had to cash out in a way. So essentially like a soon when you're in the bitcoin ecosystem, it's easy, relatively easy to stay anonymous or pseudonymous. But as soon as you want to translate that bitcoin into government currency, you've got to use an institution. Somewhere is called on rails and off rails. So as soon as you do that, like, it is much easier to track your IP to get. Maybe you know your location. Lots of other data about you that these digital security teams are really, really good at finding. So if I was a criminal, I probably wouldn't use a system that is public by default cash. 

Maddy: [00:20:47] I don't take cash 

Millie Rowett: [00:20:48] crimes still account for like one trillion dollars or something ridiculous worth of risk. Dollars crypto is about like 50 billion. It is way, way, way back with small-SUV. And if people people are going to be awful, but it's a lot harder to be awful on the blockchain by.

Maddy: [00:21:10] Molly, you work at Square, and they have recently announced that they are building a bitcoin mining system, which is insane, but I'm really keen to hear because I feel like I'm reading every other day how companies are starting to use this technology more and more. What are some of the real sort of benefits to this technology for businesses and how they implementing it into their businesses? 

Millie Rowett: [00:21:36] How much time do we have? There is just there's so much going on, so. So you write this every day there are like a bunch of small players. There's always start-ups looking to disrupt these, these companies who have just like cornered the market on a particular thing. So, you know, there's this one company called Winding Tree, which is like a decentralised travel aggregator. So it's like an alternative to Expedia or Booking.com. You know, they they they put up the price a lot, and they have such a big chunk of the market that you don't really have another choice. So this is like kind of brand new, like using one of their tokens called so you'd be able to book hotels and stuff with like really, really minimal fees. You might not know this, but like even the Australian government, like a couple of years ago, put like high school students at high schools on the blockchain so that only you would be able to view your scores like on the internet. I think that's just the coolest thing you ever 

Sophie: [00:22:35] done that we've ever done yet is those who like, 

Millie Rowett: [00:22:40] you know, the big players looking to discover like what that new era of technology can do for them, like Facebook. Mark Zuckerberg and the Metaverse, which is the decentralised social media, is like your life. But in the digital realm, you know, AK like Ready Player One is kind of, well, you know, Amazon, Apple and Google look kind of like, I'd say, like lagging behind a little bit, but like, I wouldn't obviously count them out. Payment networks I know, like PayPal is just like looking at like decentralised ways. They can move their money around the globe because you can utilise existing blockchains like Ripple or Stellar, which, you know, kind of alternatives to like Ethereum. And you can also like send bitcoin around the world really easily. Like, Twitter just opened up lightning tips, which is like a way to like, give you a favourite Twitter celebrities like a bit of bitcoin. But without without having to integrate like a bank or PayPal, anything like that, you can just instantly send you like bitcoin from your wallet.

Sophie: [00:23:44] One thing that Mario and I have really taken away from some of the chats that we've had with investors is like looking at how some of the big, big companies out there, like adopt this technology and use it to make their companies better in whichever way. And I think that's a really cool thing to be looking at as an investor to be like, OK, I'm investing in Apple or, you know, whatever other big company that I mean, like, how are they using this technology and how are they changing so that they're up to date with the trends? 

Millie Rowett: [00:24:08] To be honest, like if you think of like the the FAANG stocks like Facebook, Apple, Google, a lot of them, apart from Facebook, doesn't they don't seem to be looking into this with gusto at the moment. Mark Zuckerberg is probably the person who's made a lot of noise about like what we call Web three, which is like the next evolution of the web. Whereas, you know, web one was all about like static information on page Web two is like, you know, users uploading their own information, you know, social media pictures kind of like that. Two way interaction with three is all about, well, what if we take away the centralised entity from the web or those products like Facebook and just have decentralised services for everyone to use and be involved in, you know, using tokens as kind of this native currency? So Facebook's really big into that Twitter. You know, Jack Dorsey is all about this. He wants to decentralise Twitter like yesterday. There's something for every side project that they're really into. But a lot of the other, the other big players like I haven't seen. Really do anything with this yet, but behind closed doors, they could they could be up to anything, 

Sophie: [00:25:20] even like one of the examples that I was reading online that I thought was so cool was like DHL, which is like obviously a postal services company, and they're working with some of the big companies at the moment, like Accenture, which is a consulting company to work out systems where they can trace pharmaceuticals using the blockchain systems so that it makes sure that it gets from, you know, the drug company to the right consumer to avoid things like drug tampering or ending up in the wrong people's hands. And I just think that's such a cool use case for this new technology. It doesn't have to be exactly like, Oh, we've got these new coins are using, it's just using that technology to better the company in some way or the other. 

Sophie: [00:25:54] Yeah. 

Maddy: [00:25:55] So this is all sounding very positive. I am keen to hear because I know there are some sort of downsides or things to consider when thinking about this technology. One, and we did touch on this a little bit earlier in the episode. It's about making the rich richer. 

Millie Rowett: [00:26:14] Yeah, and I'll try to take off my my bitcoin hat here and try to think 

Sophie: [00:26:19] I have a website on the side. 

Sophie: [00:26:21] I've been beside this all the time and, you know, go like, 

Sophie: [00:26:25] get a bit of balance. 

Maddy: [00:26:26] I I'm conscious you're like your bitcoin expert and we're asking you to talk about downsides. But you know, 

Sophie: [00:26:31] no, I 

Maddy: [00:26:32] know your weight that says I have a job interview. 

Sophie: [00:26:34] Realistic? Yeah, yeah. I worked, and I know there are bad 

Millie Rowett: [00:26:41] things and I try to be realistic about it, not not to bullish all of the time. And especially, you know, for this question, I'm cynical about all the people I follow on Twitter. I like the podcast. On the podcast I listen to are all about like, how can I get rich off bitcoin? And there's not a lot of conversation about like, well, what are the, you know, human benefits that we're actually seeing here? So, you know, there's an argument about how all these early crypto investors like a little bit gatekeeper that around the market the same way, like Wall Street kind of gatekeepers, you know that this investment market. So I would argue that like against all these like crypto millionaires, we see popping up like for every, you know, kind of 13 year old kid who buys five Lamborghinis. You know, there is like the foundation that crypto is built on is all about like open source software decentralisation, you know, personal financial freedom. You know, all these trustless, permissionless systems, you know, kind of lends itself to, you know, a system being open to any want of any class in the world. So, you know, there are people who are going to take their profits and they're going to be kind of insufferable with them. But you actually see a lot of a lot of these people who got rich in the early, early years actually giving back to the community by, you know, either becoming VC firms, investing in crypto start-ups or some of the open source protocols, you know, doing podcasts or streams, discord servers, articles, books, actually trying to bring people along for the ride rather than taking the profits and run. And if I would argue that's actually way more accessible than some of the best information or even the people like, how easy is it to get dinner with Warren Buffet as opposed to like, you know, Nick Carter, Alex Gladstein, who are on Twitter like the DMs are open, you can talk to them really easily. And apparently they're really nice guys. I'm too nervous to actually say hi, but 

Sophie: [00:28:48] if I might one day hey, with the one 

Sophie: [00:28:53] argument that I've heard about making the rich richer is that to actually mine the bitcoins, as we spoke about last week, it uses a lot of energy and the people that are actually mining them need to be able to pay for that energy. And I'm saying this with, I know nothing about this. So is that like? Is that a legitimate argument or is that something that's, you know, anyone can actually access the the mining technology and can do this for themselves? 

Millie Rowett: [00:29:21] You're spot on. So for you, it's really expensive to get up and running with a mining rig because of the energy requirements that are used to secure the blockchain like by design. It's meant to be energy intensive because that's how the new, especially bitcoin. That's how it gets its securities like you expend all this energy. Therefore, it must be legitimate because you use this much money, as much energy to secure it. So it is not super accessible for people like you and me to get into like, you know, at home mining. And unless like unless you've got a really cool house and you need like a supercharged heater in the back of your room somewhere because you know you don't want to turn any other lights in the house on because you 

Sophie: [00:30:04] see all your energy's going to the bitcoin mining. 

Millie Rowett: [00:30:07] And that is like one of the criticisms of bitcoin at the moment is like how accessible is mining and is part of one of the reasons. Square and Jack Dorsey, let's build an accessible mining rig, but I guess the answers to that is that you can join a mining pool where like you can give as much energy as you can to a selection of people to mine bitcoin and you get like a very small chunk of the profit. You know, my wife is doing it the other way so that the computer on for a couple of days, she got like 

Sophie: [00:30:37] 20 cents or something like that. 

Millie Rowett: [00:30:39] So it is not super profitable, but you can imagine it is a way to take give back to the blockchain, to bitcoin in a way and maybe make a small profit if you have, like, the right configuration set up. 

Maddy: [00:30:52] And what are people talking about about the impact of this energy consumption on the environment? Because so often I read an article recently for Fashion Journal and we found that bitcoin currently consumes 0.5 five percent of global energy production, which like, if you think about all the other things going on in the world like that, is huge. So I know that a lot of people are critiquing it, sort of saying, look, it's not sustainable because it's got such bad impact on the environment. 

Millie Rowett: [00:31:21] Yeah, this is such a common narrative that you'll hear it in crypto is that it uses a lot of energy and it's true like it does like how it gets its security, which is what we just spoke about before. It's part of the design. And you know, you probably see other headlines like, you know, boiling the oceans or, you know, bitcoin uses as much energy as Switzerland. And you know, this is kind of is where a lot of the negative feelings towards crypto come from, especially like, you know, we saw Elon Musk this year kind of do this backflip where they were accepting bitcoin for Tesla. But then they're like, Oh, no, Tesla is like all that renewable energy. So we can't do that anymore. And I mean, like the bitcoin community is is so aware of this. And you know, I want to say like it is made up a lot of people like you and me. A lot of these people are really environmentally conscious and who want to use renewable energy for mining companies like Square. Think coming up a lot, even companies like Square investing in renewable mining research like how can we be more efficient about mining? How can we move these to places where there is stranded energy? Like where there are these places, you know, hydro plants, volcanoes, you know, ocean currents. Like, where are these places where no one's going to be able to use this energy? But we can put bitcoin mining rigs there and create value from nothing of value from energy, basically. So it's not where we want it to be. But there is actually a study recently done that about fifty six percent of bitcoin mining is actually renewable energy, which makes it one of the most greenest industries in the world, which is not something you really hear about. And you also don't hear about how Christmas lights every year use way more energy than bitcoin. 

Sophie: [00:33:06] So it's it's all about perspective. 

Maddy: [00:33:11] I'm happy for you to talk about the positives of bitcoin, but don't put Christmas down. 

Sophie: [00:33:16] That's where I draw the line. Found your trigger button. 

Sophie: [00:33:20] I think actually, I was reading yesterday that Byron Bay is actually getting a new renewable bitcoin mine in Australia is not leading the way, I wouldn't say, but there's a lot of renewable mines coming up one in Tasmania, there's a hydropower one. 

Millie Rowett: [00:33:38] There is I was reading about that too. 

Sophie: [00:33:40] And I think in my mind, and this is totally just my perspective, but when I think about it, it's like it's this new kind of thing that's coming through, and a lot of young people are leading the charge with it. So because we all have such a focus, it's more common that we have a focus on the environment. It's like, how can we change it and how can we manipulate it so that it can be good for the environment as well? 

Millie Rowett: [00:34:01] Yeah. And then you're totally right. There's I saw a tweet that linked to that Byron Bay article someone who did not like bitcoin and who wrote as if Byron Bay was an insufferable. 

Sophie: [00:34:14] Yeah. And not first and 

Sophie: [00:34:17] probably going to be using bitcoin themselves in about 10. 

Sophie: [00:34:19] I know. OK. I think that 

Maddy: [00:34:22] brings us beautifully to the next part of our episode, which is our watch list. Each episode we have been asking our guests to add a stock company, news, trend or industry to our watch lists. Anything that takes your fancy and the purpose of this really is to get us thinking outside the box and broaden our horizons in the investing space. Of course, they're not financial advisors and is just for educational purposes only, but mainly what are you bringing to the watch list today? 

Millie Rowett: [00:34:50] So this is going to be really nerdy, but I attended my first festival in the Metaverse on Friday 

Sophie: [00:34:57] in a on an act called Decentraland. I'm not kidding. 

Millie Rowett: [00:35:02] Oh, I saw Paris Hilton was the dead mouse like Alice in Wonderland. Yeah, I'm serious. It was the concept. You all like 

Sophie: [00:35:11] a little Sega. 

Millie Rowett: [00:35:12] Yes. Are you a little? Avatars and you walk around. I was with my friend and I got a couple of P IP tokens which are like proof of attendance tokens, which essentially like imagine like the ticket stub like that you would collect, you know, when you go to your concerts and stuff, it's an NFT. So it's kind of like semi unique. It was so it was so trippy. And I'm not saying like, you know, what did you do? I I got up on stage and I was like dancing 

Sophie: [00:35:50] around it, cause there's, I guess, if were in lockdown, just go to a festival in the middle. 

Millie Rowett: [00:35:58] Oh, absolutely. And like, this is like, this is the thing that you can do like, you know, get to go to Decentraland dot com or whatever it is. You can make an avatar right now like connect your theory and wallet and you can just like, hang out. It's kind of become like Second Life if you ever played that as a kid. So, yeah, I'm not saying like, you know, these tokens or whatever will be worth anything, but oh, you should invest in it. But it's like you're blowing my mind. 

Sophie: [00:36:25] Yeah, you got to try 

Millie Rowett: [00:36:26] it because it's it's it's so proto. You predict what this will be like in the future. But this is the start of the digital, you know, digital universe. Like, what is your life? You got your physical life and you've got your digital life? How do those things overlap? 

Maddy: [00:36:44] So, yeah, I'll tell you what I'm imagining. I'm thinking in my head. It's like Club Penguin. Is it like Club Penguin? 

Sophie: [00:36:51] Yes. Yes, it is. When they dance. This is what kids are going to be on in the future. 

Maddy: [00:36:57] Forget Club Penguin to get in. I mean, restroom pages, it's like space like these things don't need to be replaced, but I'm very intrigued. So let's please, let's do it. 

Sophie: [00:37:07] So I also don't just say kids like I feel like it's going to be all of us. We'll be on it next week. 

Millie Rowett: [00:37:14] Imagine, imagine like The Sims, but like all your furniture and stuff like follows you from game to game because it's like it's on the blockchain. So it's it's your you own them, they belong to you, and no one else can quite literally love it. 

Sophie: [00:37:29] I wonder if we could have a podcast on the Midwest that would work hosting a podcast. Millie, we'll have to chat after.

Sophie: [00:37:36] This shows how to set that up. We digress. 

Sophie: [00:37:41] So final question for you today and for the listeners as well, I guess. What is your general consensus for the future use case of cryptocurrency? Or, you know, if you if you want because we know you're a bit of a bitcoin advocate, bitcoin more specifically, 

Millie Rowett: [00:37:56] like I personally believe that, you know, crypto and like bitcoin, blockchain will become so entrenched and normalised in our life that the majority of people won't even know that you are using it or understand will need to understand how it works. It'll just be like, Do you know what happens when you swipe a credit card right now? Like, No, no, no, it's OK. So it just works like that'll kind of be how it'll plugs together under the hood or like the internet, right? Like when you go to website, do you know what happens? Do that light thing? No one really does. So like, I believe that will further just move like into this digital life using this technology and all this becomes so normalised. I do believe that bitcoin will become like one of the most important financial tools of the next 50 years. It'll be interesting to see what happens when all the bitcoin is mined, like how that changes the monetary value of that asset. Yeah, I just know that like if you get in, you get it now is kind of like, well, like, what can I do with bitcoin in the meantime? And I honestly believe in this digital versus physical life, you can be, you know, I'm really in the real life. I'm like, you know, hundred sixty four centimetres, I'm pretty sure, but like in the Midwest, I'm like a basketball player 

Sophie: [00:39:19] and I'm like, Oh, 

Millie Rowett: [00:39:21] know, I've got like a cat tail or something like, and that's like that. I have like a different life online than I do in real life, so I think that'll be interesting to see as well. 

Maddy: [00:39:31] Very, very cool. Well, safe to say our minds 

Sophie: [00:39:34] are blown and I'm going to have to say we're going to have to 

Maddy: [00:39:39] walk away and really digest 

Sophie: [00:39:41] discussing this. But I think because this guy even real stuff up, I'm going to stop. Thank you so much. 

Maddy: [00:39:52] Really, it has been incredibly interesting and a lot of fun at chatting to you. So we really appreciate your time over two episodes as well.

Millie Rowett: [00:40:00] No, that's fine. Any time, I'm sorry that your mind's a blur, and I just, 

Sophie: [00:40:05] you know, welcome to the future, I guess. Thank you. But to be here, as we 

Millie Rowett: [00:40:12] now know, is really lovely. Thank you for having me.

Sophie: [00:40:15] OK? My phone number one. But number two, you know how on the watch list we say like it's to get us thinking outside the box and broaden our horizons 

Sophie: [00:40:22] like this is arises totally. The horizons broadened like anything from now. Oh yeah, I'm sure at ATF on that. No. And yeah, we 

Sophie: [00:40:36] see any of you on Decentraland is the real

Maddy: [00:40:38] question. I think we should set aside an afternoon jump on it and maybe like post about our experience on Instagram. 

Sophie: [00:40:47] That's a good idea. I like that idea. But as always, if you want any further information, we put a lot of stuff on our Instagram at YIGC podcast, 

Maddy: [00:40:57] and there's also some great chat going on at the moment in our Facebook group via YIGC Investing Podcast Discussion Group. Make sure you jump into the community there. Ask your questions, see what people are talking about. It is actually such a great investing resource 

Sophie: [00:41:12] and like and subscribe and leave a review if you're enjoying it because it helps more people reach us just 

Maddy: [00:41:18] like you. Thank you so much. 

Sophie: [00:41:20] Goodbye.