FFS103 - Sooly Kobayashi

[00:00:00]

Intro

Sooly: My experience I noticed like one thing that's been working in Africa with business owners, just from a mining perspective is mining is legal.

Just explore, how much electricity do they have? How much electricity do they consume? the cost of electricity. Convince them to put a miner to transform a cost center into a profit center in their business. the adoption, it's. is accelerating from my view for the small to medium business owners, um, in Africa and the Middle East. Um, uh,

no one heard of ordinals in Africa. But the impact of the ordinance and the transaction fees. They know of that.

They don't want to dive into the intricacies of lightning Opening channels, et cetera. No. they heard that Bitcoin has a, they can transfer money for cheap, they can wait 10 minutes or like 15 minutes or whatever for, to get their $101,000 or, or 10 K or 20 K.

They want that and they hear it's, it's been the most secure network to transact on for them. They don't care about the, the speed, as long as it's cheap and secure. But with the ordinals, it only made that more difficult.

[00:01:00] [00:02:00]

Introducing Sooly Kobayashi

Luke: Sooly Kobayashi, welcome to the Freedom Footprint Show. Thanks for joining us.

Sooly: Thanks for having me, Luke, Knut.

Knut: Yeah. Nice to see you, Sooly. could you start by giving our listeners a little introduction through to yourself? Give us, give us the TLDR on Sooly Kobayashi, please.

Sooly: [00:03:00] sure. SuSoolyLebanese born and raised. lived through the Lebanese public corruption before all the inflation and Lebanon getting into the mainstream media. Uh, worked into international NGOs, uh, United Nations humanitarian development programs in Lebanon, uh, working with ministries, working with cash programs, etc.

I've always been an IT geek since seven, uh, when I disassembled the first PC. And then, uh, yeah, 2014, I moved to Europe, to the corporate world, where it happens just moving. I hear about something called Bitcoin. Didn't really, Look into it. That's my, my 10 year anniversary memorial, uh, since 2014.

and then, um, yeah, I started traveling to Africa, uh, Southwest Africa and the Middle East for the last decades, every six weeks for three weeks. and Just before the [00:04:00] inflation that hit Angola in 2016, I had started to dabble into the TradFi kind of trading traditional finance just as a hobby. 2016, I am in Angola, the, there's all this inflationary syndrome that the country is going through from capital controls to prices to, uh, price controls, to the banks, not transferring money, um, outside the country, et cetera.

And then, yeah, that's, just wanted to, to, to share that because for me, as a Lebanese, I saw that in 2016 and as soon as it started 2019 in Lebanon, uh, I saw a lot of similarities. Now, um, through my Bitcoin story, just 2017, I told you 1,016, I started like stratify, um, Bitcoin, uh, um. It happened that I picked up Bitcoin on my, investing, trading radar, just like any other asset.

I didn't know what it was, just traded it just like that. other [00:05:00] funds and oil and metals, et cetera, had no cloud bought custody. and back then I was like, I was proud that, yeah, I started, uh, I own some Bitcoin on a trading app. I thought it was like mine anyway, in the first place. and then 2019 is where I really started to realize that this is very time consuming.

I was lucky that I, unfortunately, the only thing I lost was time and time preference. and I only realized the, the, the importance of time preference in 2019, where it was affecting really my life, uh, family, friends, work, because I was doing this on the side. And, You have to follow the news, um, Asia, Europe, uh, the States, uh, having two or three screens, uh, on and like trying to understand graphs and astronomy, um, so it was quite a thing.

And then I noticed that everything [00:06:00] followed Bitcoin, uh, for a reason or another. So that triggered my curiosity, and frankly, I, I go through these annual self reflections, uh, where I had to change something in my life. Uh, everything was okay except sleep and like quality, uh, relationships. I was like, you know what, uh, I'm going to convert all these top 30, 40 crypto to Bitcoin.

I did that, 2019, just at the beginning, even though I started dabbling because like I always followed Buffet's, uh, advice on like, always buy when there's blood on the street. Uh, I understood back then that Bitcoin was, uh, an asset that had some legitimacy, uh, even back then, and then converted to Bitcoin 2019.

And I started entering the rabbit hole, uh, 2019. I meet a great guy, Bitcoiner and a friend, Marco from Lebanon, who's the founder of the biggest, Bitcoin community in Lebanon, education community. [00:07:00] And we started, I remember like, Like for weeks debating about like, you know, he's a maxi, he was a maxi, I wasn't one then.

Um, a money maximist, let's sound money maximist, let's keep it, uh, let's clarify it now, it's 2024, we need to, we need to clarify, I guess. Um, and then I realized like, wow, this is really something. And I started converting all my other trad5 holdings to Bitcoin. Um, 2020, unfortunately, it was unfortunate for the COVID, uh, syndrome and impact on the world, but, uh, being home without traveling, made me discover that there was something called Clubhouse, which was like the early generation of Twitter spaces.

I got educated by Max Hillebrand in a toxic way that I really loved it, man. I loved it. I loved every single hour, like it was like, it was like, I was so thirsty for learning and, um, started organizing sessions on [00:08:00] Clubhouse for, to educate Bitcoin and Arabic 2020 weekly with Marco, that's. took off. And then, uh, back then I didn't know that, uh, Swan was, uh, on one of the clubs and they saw that I was organizing these sessions in Arabic every, every week.

And they reached out and asked me how it's going. And like, if I'm interested in like, to do something further and back then, really, like even now, I don't, I, um, I work in a, in a family business, um, and I don't have time to do any real operational work, but I was like, I was so frustrated back then, you know, like you just like swallow the toxic orange pill where you see the, you're, you're, I think toxicity levels decreases over time and you keep, at least for me, uh, um, uh, a switch.

Where you can switch it on. Uh, this is how I do it. I think like you can be a maxi gentleman, uh, without using the toxicity left, right and center. [00:09:00] And then I was like, uh, what are you doing in the Middle East and Africa? Since you're asking, because like I, I know the market quite well. I know the, who are the players, the exchanges, the applications, and I know what's happening.

And I was like, I ranted and vented and vomited it all on a call. And the guy was like, uh, maybe I think you should talk to Corey. I was like, okay, and taught me that you create your own reality, uh, in the sense where that's years ago, fast forward today, I do Bitcoin consulting, business consulting, uh, for, Bitcoin companies wanting to work in the Middle East and Africa, but most of my work is to onboard non Bitcoin companies onto Bitcoin through, um, acquiring Bitcoin, custodying Bitcoin, um, mining, point of sale, um, a la carte menu, kind of, if [00:10:00] someone needs it, just because like during, through my work, which is, um, a fiat job nowadays, the, we're entering the, we're, we're diversifying into a Bitcoin, uh, business unit as well.

That's all that I'm handling, but it exposes me to a lot of manufacturers, supply chain distributions, business owners. And yeah, it's been really mind blowing how you tell me like, what's the TLDR? It's just like how it all started. And Bitcoin just gives you, um, I mean, first off, you just want to do something a Bitcoin and, um, By the way, I did give a talk on the, one of the European meetups, the Antwerp Belgium meetups about how to find a job and to create your opportunities in Bitcoin.

Like everyone wants to work on Bitcoin. Everyone wants to go on the website to look for jobs and Bitcoin companies. The best way, frankly, is to create your own. Um, because we're, we're not too [00:11:00] many and we need each other. Um, and one thing that the TLDR of this thing is that basically every company would need someone who believes in a goal and an area, if you have an area of spec, uh, specialty of expertise, really just go do your homework and not start knocking on doors.

If one doesn't work, the other will. That's it. Sorry for the longer TLDR.

Knut: no, this is very interesting. There's a lot to unpack there. First of all, I'm curious what brought you to Angola in the first place. It's not a country that you just happened to end up in, I guess. Like, what brought you there?

Sooly: my fiat job is, I'm going to try not to talk myself much about this topic. It's just like Angola, uh, and the surrounding countries, Sub Saharan Africa is, um, is one of the operations we have, um, in my fiat job and, um, it's all [00:12:00] supply chain based. Um, so yeah, this is, this is why. Um, like I'm based in Europe where the head offices are in Europe, but, uh, the arms of the business are in Africa and the Middle East.

Knut: Okay, we won't dox you any further. Uh, I mean, that could mean literally anything from oil of Yulee to Barbie dolls to whatever. I don't know. Uh, so, uh, So let's not go there. Um,

Bitcoin and Islamic Finance

Knut: another thing that interests me, like the, the little I know about, uh, Islamic banking or, or like Arab banking is that, uh, I think it's taking interest, interest is sort of a sin in Islam.

Isn't that the case? And it's, it's forbidden to, to, uh, give out loans and, uh, require interest payments. How does that work?

Sooly: so it's three parts or like, let's say four parts for first, Halal money in Islam is like avoiding Reba or interest. Like you mentioned, second is, [00:13:00] um, this money to have an ethical business practice. Third is transparency and fairness. Transparency fourth and fairness, uh, sorry, transparency third and fairness fourth.

So if you notice, like, if you, if you draw similarities with Bitcoin, if like from the creation of Bitcoin, from the code, the code is written in a fair way. The proof of work mining is done in a democratic, fair way, especially with the difficulty adjustment. Um, and the ethical business practices today, we know the illicit practices on fiat compared to Bitcoin, how it is and why Bitcoin prevents those illicit practices from, uh, from happening.

Knut: So, so would you say Bitcoin is halal money?

Sooly: Yes, I say this, even though, disclaimer, I'm not a sheikh, even though we have a sheikh in the space called Muawiyah Tucker. You need to definitely, I don't know if you spoke with him. Uh, he's He is an official sheikh a teaching Sharia, et cetera. [00:14:00] That's something else. Yeah. This is, this is, there's a, there are, there are a couple.

There's also, uh, also, um, another, uh, bitcoin in this place called, uh, Muslim Bitcoin, who's also, uh, advocating a lot. And they both, both been, uh, writing papers, blogging, blogging about this. and there are even like, uh, I did some just by diving into the rabbit hole. Because, you know, when, when you just discover Bitcoin, you start asking questions, obvious questions, at least for me, like, why is the logo orange?

Um, is it halal? Is anyone like, uh, has any sheikh or like any priest or any rabbi spoke about Bitcoin before? What did they do? Et cetera. And there are, um, there are a couple of, um, None, um, uh, let's say a couple of sheikhs and Islam, I think in Saudi Arabia and in Bahrain who have done lectures on YouTube about Bitcoin being halal in Arabic.

And one of them has written a paper that I can share with you after the pod. Um, yeah, it's, [00:15:00] it's quite interesting. I think today there's a lot. Uh, happening when it comes to, I mean, if you go to Dubai, you can see like from the airport, you see the, the, the crypto shitcoin area ads, um, welcoming you at the airport, uh, the highways.

If you go on Twitter spaces, you see how Saudi Arabia, despite the non legislation is like booming when it comes to trading, et cetera, just because today they're using it as a property. Uh, not as, so today it's kind of, uh, unspoken halal property that everyone is using to trade regardless to huddle or to trade, like really, um, short term.

Um, but you don't find any, anyone talking about money. And, uh, I know for a fact that I don't want to mention someone if they don't want to be mentioned, but I know for a fact that the mainstream media in the Arab world is refusing to talk about [00:16:00] Bitcoin, comparing it to, like, talking about sound money on mainstream media.

They are able, they are ready to speak about Bitcoin, the tech property, but don't bring up the sound money. yeah, there's, uh, proven, proven, uh, incidents or events where, um, people who went on TV shows who were able and more, more than capable to talk about the subject, they were requested not to speak about the sound money aspect of it.

100%.

Knut: that problem is sort of everywhere. I know they're for like, uh, this week when we reached a new all time high and stuff, the Bitcoin was mentioned in Sweden as well on, um, public service media. And, uh, of course they, they never talk about the, the sound money aspect. That's, that's just, it's mentioned like Bitcoin is a cryptocurrency, like implying that there are more, and this is purely speculative is something they say over and over again, never [00:17:00] realizing that everything is purely speculative, uh, since value is subjective, right?

So, so you never hear these, um, Other takes, you only hear it from the perspective of a statist Keynesian mindset, I guess.

[00:18:00]

Luke: Hey, so maybe you can take us through a little bit about your experience with the general MEA Middle East Africa, um, kind of adoption there, because I know that that's one thing that you're heavily involved in here. Maybe, maybe a quick question. Sort of a combination for some, some background, like, like, what's your, what's been your experience with, with, uh, Bitcoin in, in these regions that you're working with?

Sooly: From a grassroots project, there's a lot happening. Um, and there are, evolution and challenges at the grassroots level. And we can dive into that. Uh, from a institutional level, there's a lot of evolution. Um, and from a regulatory point of view, there is, unfortunately, not much evolution except, um, in some of the, like, Dubai like cities, uh, we're talking about Bahrain, we're talking about Dubai, [00:19:00] um, in particular Abu Dhabi and the UAE.

And you have the religious perspective as well. now it depends if you're talking about the Middle East or Africa, that's about the, from the religious perspectives, mainly the Middle East, but for Africa in particular, man, the evolution happening there and the progress is mind blowing. Um, I mean, we met in Lugano, Knut, and compared to the African conferences, um, the, the conference I attended in September was in Ghana.

The amount of energy people want to work on, on, on Bitcoin, the amount of developers working on Bitcoin, the, the initiatives of like. Coding, like incentivizing people to code on Bitcoin and to create like on ramps, off ramps is mind blowing. Um, so I would start with Africa. Africa is I think that the leading, leading continent in adoption, but also development.[00:20:00]

Um, and this comes from a simple idea is that if Bitcoin is stopped for any reason, In Europe, from a legislation point of view, I'm talking because it cannot be stopped. We all know that, uh, or in the West, nothing will change for the Westerners, but if, uh, Bitcoin is like, let's just, from a legislation point of view, try to be stopped in Africa.

The Africans won't allow it to stop. Um, today they need Bitcoin more than anything else. They, I mean, there's today also the, the split between some are like, uh, complete hodling and some are like with the medium of exchange. And Africa is needs Bitcoin as a medium of exchange, uh, more than a store of value.

Of course, store of value helps you in a highly inflationary environment. But if, for example, like Angola or Sierra Leone or South Africa, 70 percent of the market [00:21:00] is informal markets, which means, um, you have most of the trade, commercial trade, the food and non food. It's happening on the streets, on tables, on the ground, like the mamas and papas are just like putting their shampoos next to their oils and cereals, etc.

And you go buy from there. This is what 70 percent of the population does. And you have public markets everywhere. Now, the governments want these traders or these ladies to register their VAT or their tax registration. And they want them to start invoicing customers. Some have, believe it or not, those ladies that might be selling something on a table might own multiple shops in the back, and they have a lot of money, and they can afford going through the registration process, but this is the minority of those, um, traders on the streets.

What I'm trying to say here is, like, as a medium of exchange, these [00:22:00] These traders, these commercial business women and mainly ladies in Africa, they cannot register for taxes just because they live in the slums and every time there is rain, they will be changing their house every season. This is how informal the African continent still is, even though you go as a tourist and you go, you see the nice places, et cetera.

But Africa has so much potential and they need Bitcoin. And this is why M Pesa exponentially grew there. This is why you see all these innovations on Bitcoin using mobile phones in Africa, because this is really the core need for Africa today. So from an adoption today, it's It's very, um, it's very young.

Um, I wouldn't say premature to try anything at this stage. I think there's a lot of innovation and development happening. Like if you see a [00:23:00] Cassie in South Africa, or if you see, um, a Bitcoin Dua in Ghana or a Bitcoin Dada in Kenya. They're doing great work. Uh, each of them is trying to educate and trying to, to work around, like to create a circular economy where, where, where they're working and they are progressing, but without the support, of the rest of the Bitcoiners around the world, this is not really gonna take off, I think.

Um, and this is another story, but yeah, this is for, for Africa from an adoption point of view. yeah, I don't know if you want to learn more about, uh, the Middle East, we can, but I think Africa is the most interesting developing, um, location for, for Bitcoin adoption nowadays.

Knut: Yeah, yeah, and, uh, uh, Africans really have the chance to leapfrog everyone else here by, by, by being faster on the ball. It's, and it's a, it's beautiful because it's, uh, Uh, well, for lack of a better word, revenge for [00:24:00] 50 years of failed politics trying to solve their problems. Um, so, um, uh, yeah, a lot of exciting stuff happening there.

And, and these, uh, miners, Providing electricity to places that otherwise wouldn't have any chance of getting on any type of grid, I find that extremely fascinating too, and as you say, it's going fast, and I think we've just seen, like, the snowball start to roll down the hill, and it's only gonna get bigger, and it's gonna

Mining in Africa

Sooly: Absolutely. Um, talking about miners, uh, when you, when you see what, uh, gridless is doing in Kenya and Africa is amazing, but it's unfortunate there's a divide between West Africa and East Africa from a regulatory maturity in my opinion, or wisdom. Uh, for example, Angola. who has 97 percent of [00:25:00] Angolan energy is hydro.

More than 65 percent of the Angolan energy produced from hydro is in excess abundance, so no one is, uh, absorbing it. And they banned proof of work in December 2023. So, this is just an example. of a country that had one of the cheapest electricity on the globe in abundance, where it can serve the rural and the urban areas because in Africa, even the urban areas need some development, et cetera.

What you're saying is that is indeed fascinating for the governments who really, understood the benefits from it. But, uh, some other countries with greater, unique value proposition or advantage to start mining. are just like shooting, shooting their, their selves in the foot, unfortunately.

Knut: Malawi, uh, same, uh Latitude as Angola. [00:26:00] there's a facility there, I know. Uh, a couple of our friends were there visiting, uh, and they started up something. So, things are happening all over the place, it seems.

Sooly: Yes, Bhutan, Bhutan is, is growing big time as well. Like Ethiopia, uh, Ethiopia is also, I mean, Hashlabs, the guys are doing great, great work in, in Ethiopia as well. Um, I mean, everyone is scouting, right? Everyone is scouting for countries with cheap electricity, but the many, few, or many are scouting for, for cheap electricity and few are scouting for cheap.

properties, real estates with like, uh, really like a waterfall or some green energy kind of, innovation they can build on to, to mine and really develop the area where they will be based

Knut: Yeah, fascinating continent. It's a land of opportunity. Uh, always has been in a way, but especially like in times like these when, when there's a whole new industry to be explored here. Um, [00:27:00] fascinating.

Sooly: percent. Um, like for me, um, the, um, My experience, like when I go, I started like orange Bitcoin left, right and center like all of us. And then I noticed like one thing that's been working in Africa with manufacturers, um, or business owners, just from a mining perspective is mining is legal.

Just explore, um, the, the homework of like, to know how much electricity do they have? How much electricity do they consume? How much, the cost of electricity. And just, Convince them to put a miner to transform a cost center into a profit center in their business. One miner becomes two and two becomes five and five becomes ten.

And then I was like, Oh, I need to buy more Bitcoin because I don't have space for miners in my business. yeah, this is, I think the, it's unfortunate. Like the, the adoption, it's. is accelerating from my view for the small to medium business owners, um, in Africa and the Middle East. Um, [00:28:00] uh, but not for the individual.

I'm talking from a mining perspective.

Bitcoin in the Middle East

Knut: Fascinating you should mention Bahrain there before. I spent some time there, but my family used to live there, and I used to semi live there, or I was on and off. I was working on boats at the time, and so I was like out for six weeks, and then I spent like four weeks in Bahrain maybe, and then two weeks in Sweden or something.

So, and it's a fascinating place. From what I know, they recently converted from an emirate to a kingdom, I think. Uh, so, so, um, what do you know about the regulations and stuff there? It's, it's a bit more liberal than Saudi Arabia. I know that much. It may be not as liberal as, as Dubai, but, uh, somewhere in between.

what, what's going on?

Sooly: Uh, from a liberal point of view or liberalism, uh, is something,

Knut: liberty point of view.

Sooly: listen, uh, I once heard like [00:29:00] one saying, like, if you don't have a gay parade on the street of a country, that means you don't have liberty. Um, and, uh, at the same time, uh, liberty, uh, sphere of speech, et cetera. Now We're going to talk about what's happening in the region.

Today. Um, there is a competition between Dubai or the UAE and United Kingdom of Saudi Arabia. Okay. So Kingdom Saudi Arabia decided, uh, last year to have this vision that they want to be the leading city in the Middle East. Um, like one of their regions, uh, one of their areas in the, in Saudi. Um, they want to convert it into really like a mind blowing futuristic kind of city.

Um, and of course, before that vision, you had Dubai in the Middle East that had a similar kind of view. And today you have a competition between both. Um,

Luke: Neom, right?

Sooly: yes, correct. Correct. Neon is one of the, yeah, is, is, is DCT that got the marketing [00:30:00] and the, the spotlights about how things are, um, expected to be, et cetera, like you have.

Like, I don't know, like flying cars and like schools and hospitals, like above each other on a horizontal line in the desert, like really mind blowing from an architecture point of view. But let's see about that with like all like the budget was about like 60 billion or something

Knut: It's a very fiat y project though. It's like central planning all over the place, right?

Sooly: a hundred percent, like, okay. So, um, I don't think the, the Middle East or Africa is getting away from central planning. Any time soon. Okay. Unfortunately, uh, from a freedom footprint point of view, I think things are getting better in some areas that have witnessed already some, um, uh, oppression over the years.

However, There are other areas like Lebanon, Syria, Palestine, Egypt with Sudan. [00:31:00] Things are getting worse and worse. And you have the oil rich countries like Bahrain, Qatar, Saudi Arabia, the UAE that are really working on the regulatory point of view that to actuate and open to absorb basically the international, uh, investment, um, when it comes to Bitcoin.

Bahrain is one of the leading ones, I think, after the UAE. So you have Dubai first, Abu Dhabi second, Bahrain maybe third, but despite all the, what you read on the media, that even Dubai, let's talk only about Dubai just because for you to understand what I'm talking about, today you have Bitcoin companies who've been, who went and opened offices in Dubai a year ago, recruited, uh, opened bank accounts with a lot of like, um, headache doing it, and they still didn't get their license.

And it's been like 360 days since they applied. Now today in Dubai, and we're talking about the most open city slash, um, [00:32:00] country in, in the world that should be really absorbed, be open minded about, about Bitcoin and absorbing the, the businesses and individuals. Today, if you are a business, and I spoke with compliance departments and banks trying to convince them of like Bitcoin, et cetera.

You have, you might read that a bank is really Bitcoin friendly. You go, uh, they tell you, yes, it's crypto friendly or Bitcoin friendly. You open a bank account as a business. I'm talking at the moment, you're going to receive a transaction, from, um, A buying or selling Bitcoin. Let's say you have sister companies in Africa and you want to just transfer because like doing your own treasury management.

you go through, um, a very long, difficult process. now apparently there are some new banks that are trying to make it easier for you, from a banking perspective. From a licensing perspective, Today depends what you want to do. Um, and it applies also the same in Bahrain. today you have, and you can notice from the [00:33:00] couple of exchanges in the region, you have a couple of exchanges that are, you don't have Bitcoin only exchanges for a fact, unfortunately, not yet.

but the exchanges you have, uh, have only few as a few, like couple of crypto and only Bitcoin. Um, if you want to. Uh, open a business today in the Middle East, um, you need to really find, uh, because you have, uh, it depends on your business model that you have different licenses. and if you read just the law, it's, it's really crazy how they've, they're, they're trying to regulate everything from wallets to exchanges.

To if you're minting or not, if you're holding custody or not, if you, if you are just a normal startup, you're not holding custody. If let's say you're creating a Bitcoin app, right, where you can integrate with other applications, um, you can't open a normal bank account. You need to go through a specific directory.

a process. So it's still good, better than other areas where [00:34:00] they really don't allow you to do anything, to be fair. Um, we're still early because when you talk to banks, they don't have a clue still about what we're talking about. Um, but yeah, I had the same conversation with Portuguese banks, uh, of companies operating in Angola, trying to move their liquidity through Bitcoin, with a Portuguese bank that they have in Angola and Portugal.

And the Portuguese bank didn't. like new or at least they didn't tell me that they acted really idiots not understanding what, uh, what's the Portuguese, crypto legislation. So I went on online on chatgpt for like three hours meeting with the CFO of a company and the compliance department in Lisbon, Portugal, copy pasting their own legislation, telling you, like telling them, listen, guys.

Your country has some legislation about cryptocurrency and you can apply that. And they started asking about like, how can you trace Bitcoin transactions? Like things are, and, and, and I was like, even, um, having a [00:35:00] conversation with your friend, Jeff Booth, Knut, asking him like, are they stupid or are they playing dumb?

And he was like, I think they're playing dumb just because

Knut: a bit of both I think.

Sooly: but when you're talking about with like people, uh, that are not boomers who've been in this space and who have read few things, you imagine there's a minimum. Um, I think today that the world don't, I mean, as much as they have the ETF and they're happy with the ETF and the banks are gonna, are marketing Bitcoin as a good thing.

I'm, uh, more on the conservative, pessimistic side from a legislation point of view. Um, I'm Over time, long term, as much as I'm hugely, um, uh, bullish on Bitcoin, I am, uh, I'm a sole money maximalist, uh, but I'm very pessimistic about the future, unfortunately, when it comes to real legislations, et cetera, [00:36:00] and seeing the CBDCs happening.

Abu Dhabi, for example, is working on a CBDC to go hand in hand with the Chinese CBDC in specific, for example. And Abu Dhabi has the central bank of the UAE. And you keep thinking about all these things, like how, like, okay, we're happy with the price going up great, but like

Knut: There is another perspective though, and that is that these regulations are, are forcing people to actually adopt a Bitcoin standard and do business on Bitcoin without involving banks or governments or anything like that, because a business on a Bitcoin standard doesn't have to be a Anything.

You don't have to do any paperwork. It can be a Telegram group or a Nostr chat, you know? So, uh, uh, So, it is unstoppable in that sense. If you, if you, if you really use it, the way you can. And there are tools like Wasabi, for instance, and CoinJoints and stuff. You can, you can be completely private, and you can be completely independent.

And that, uh, At the end of the day, that's the [00:37:00] point of the whole thing, because it can't be permissionless if it needs permission from people, like, either it is permissionless or not, and, uh, it can't really compete with any other currency or, or asset. If it isn't, it needs to be outside of the law. It needs to be independent from what any human being, regardless if it's an emir, a king, or a president, or a, you know, a prime minister.

Bitcoin needs to not give a fuck about that. Like, and, uh, and that's, that's a feature, not a bug. So, so I think what they're, what, what they're really achieving with all of this, especially when the threatening with CBDCs and stuff is that they're pushing everyone with a brain out away from. The legacy systems and on to this new standard.

and I, uh, I take the, the more optimistic view. We have, you know, these, [00:38:00] uh, Riverside here, or Zoom calls or video conferencing, we have social media, including Nostr, which is sort of unstoppable, uh, and we have Bitcoin, which is very much unstoppable. Um, so we're unstoppable. They, they can't stop this from happening.

And sure, they can make martyrs out of this or that bitcoiner. They can imprison this or that guy, but on the whole, uh, there will be a segment of the world population that just don't have to care about this. laws and regulations. Just as, um, I guess the, the, uh, central bankers and, uh, quote unquote diplomats of the world don't have to care about laws and regulations right now.

Like the, the so called elites, which is just basically the most successful thieves. Uh, but we're, we're creating a new global class of citizenry here that doesn't have to care about Um, what [00:39:00] about laws the way, um, you know, legacy people do?

Difficulties with Bitcoin Adoption

Sooly: a hundred percent, a hundred percent. But I think my frustration comes from stems from, um, the lack of the effort. I mean, there, there are a lot of efforts. Don't get me wrong. Just like. There's a lot of development happening. Like, yeah, we need to develop this, wallet 2. 0. We need to develop this, uh, solution, uh, second, third layer, etc.

It's all good for Bitcoin. But when it comes to Middle East and Africa. When I talk about Middle East and Africa, I'm not talking about the rich countries like Nigeria, the, or I'm talking about Dubai or Saudi Arabia. I'm talking about really the poor countries that really need Bitcoin as Bitcoin. today, in order to, use Bitcoin or to feel To build resilience for the people because we understand Bitcoin, but like it took you thousands of hours or hundreds of hours to be where you are today, but the [00:40:00] normal business owner convincing him today with, um, with Bitcoin, it got much more difficult with the ordinals.

Uh, that's one thing. Um, second thing, um, we need to, like, in order to, like what you said about like, um, Bitcoin doesn't care, doesn't, doesn't give a fuck by design. if those individuals can't spend their Bitcoin to buy their needs, they really, they don't really need to see the benefits from it other than store of value.

Remittances, yes. To receive it from their diaspora from outside their continent where they have billions, millions and billions. Yes. Okay. But today it's very crucial to really accelerate a circular economy for these areas. And I think there are a couple of initiatives happening around the world that would only help that.

Once you have a circular economy, um, I'm not talking about the on ramps we have, like [00:41:00] Bitrefill. I'm talking about really the, like normal businesses. Yeah. To really accept, uh, Bitcoin for, from anything to anything really, that would help and they would, that would help feel the communities that they can adopt Bitcoin and to use it without going through the fiat on ramp until we get that, we still rely on the continent, still rely on the region, still rely on the banks, even like today you have unbanked people in Africa, but some share, uh, M Pesa account.

Some share a SIM card today. In Africa, just because they can't handle the fees, et cetera. So, self sovereignty, they need to feel like they can survive. They can thrive from medical services to foods, to travel using Bitcoin. if they don't know about Bitrefill or any other, uh, option, that's, that's also, um, a problem until today.

Knut: Yeah. So, um, that's like, we have to keep [00:42:00] pushing the mantra, accept Bitcoin for your goods and services. That's, that's the most crucial thing. if you do, then you help people. Then you help this thing happen, regardless of where you're from or where you happen to be in the world.

[00:43:00]

Spam Affecting Adoption

Luke: So you mentioned that, you mentioned the, the ordinals thing being a barrier to adoption for businesses, like they see that and it makes it more difficult. Can you explain that a little bit?

Sooly: I mean, uh, they don't, like, no one heard of ordinals in Africa. I mean, at least the people who I see and work with. but the impact of the ordinance and the transaction fees. They know of that. And, um, of course now that it got better than before, because like the, with the hype a couple of [00:44:00] months back, it was just ridiculous.

Yes. It was an opportunity to onboard them on Lightning and to explain what Lightning is, et cetera. But frankly speaking, When you're talking to a business owner who's like in his 40s or something, his 20s or something, but when you're talking for someone in his 60s, just explaining something very simple, you don't want to, you want to keep it simple.

They don't want to dive into the intricacies of lightning and if they need privacy for liquid or not. And they're like, Opening channels, et cetera. No. So they, they heard that Bitcoin has a, they can transfer money for cheap, they can wait 10 minutes or like 15 minutes or whatever for, to get their $101,000 or, or 10 K or 20 K.

They want that and they hear it's, it's been the most secure network to transact on for them. They don't care about the, the speed, as long as it's cheap and secure. They don't wanna trust a third party. Great. But with the ordinals, it only made that more difficult. [00:45:00] Now, yes, maybe history and block size war taught us that it only accelerates the development of layer 2s, layer 3s, to make things better, blah, blah, blah, yes, yes, yes, and all the above.

But frankly speaking, on the ground, we still, we're still not there yet.

Knut: Well, the ordinalist problem seems to be solving itself now if you have a look at the mempool, because like, if I switch to the data, you know, visualization here on mempool. space, it's not at all as bad as it was like a month ago. So there, they might be finally running out of money, this.

Luke: That's just for any given block, though. I mean, like, and I empathize with your point here, Sooly, that like, what I've seen as being the biggest problem is that it's contributed to create basically a minimum price right now. I mean, the ordinals are adding just enough demand that the mempool isn't clearing.

At, at all. Like it, like it used to say six months ago or, or a year ago or [00:46:00] something like that. And, and there can be an argument that maybe that's a good thing, right? But, uh, the, the, the thing is, uh, the, the combination of that Binance comes in and does, uh, a batch of consolidation transactions that's going to fill up 20 blocks and then, and then you have these, these spiky fe it still happens.

That, that there's a, a big. Spike, and it's all from some kind of, uh, inscription mint or something like that. And so those spike for a while, and so those, those Binance transactions don't get dealt with. It takes, it takes longer, right? And, and I mean, I think the, uh, the thing that, uh, I, I appreciate you saying is that there is an effect on the ground, right?

The, the problem solving itself, okay, I, I, I can kind of see that to some extent. It's certainly not as bad as it as it was three months ago, for example, but higher fees are higher fees, and it prevents users from transacting, actually transacting money like a monetary [00:47:00] transaction at the at the fee rate that they could if here, I'll, I'll, I'll Um, maybe try to be a little more succinct about this.

There's no such thing as waiting for a couple of days for fees to go down anymore. It's just that fees sort of have this floor, and you put a transaction in, you have to do it above that floor, or you have no idea. How long it's going to transact from. So that floor used to be one sat per vbyte. Now it's something in the realm of 12.

It was 20, uh, a month ago or something. Right. So, so it's just raised the floor. It's raised the ability for someone to, to transact. Right. So yeah. What, what do you think about that? Is it that, is that really having an effect?

Sooly: I mean, three months ago, it was an issue. And people just like, especially like, you have a lot of crypto bros trying to enter the market, especially after the [00:48:00] finance shake last year. There's a lot of opportunities in Africa. And they keep, for me, it's like Bitcoin in a way or marketing Bitcoin over other shitcoins.

I mean, of course, going through the The basics, uh, but when it comes from a transaction point of view and the fees point of view, that was an issue. Now it's no longer the issue. and education is key. At the same time, the more you educate the better, um, the more chance you have to educate, the more time you have to educate depends who you're talking to.

If you're talking to a family office, with a board, you need to pick the youngest age group. If you're talking to, um, a um, a barber. In Africa, uh, who's in his sixties is going to be just tough. You need to download, download, unfortunately, a lightning wallet and transact, uh, on, uh, what if Satoshi to convince them and then orange them this way.

Uh, so things change. Uh, there isn't, yes, it affected the, the, the education. [00:49:00] Um, just like, you know, when you were orange billing. For a long time, using the same techniques, you don't have to worry about the fees, and from one day to another, fees are up. You need to change the whole, I mean, for me it's a bit, I'm a bit OCD, I'm a perfectionist in the sense where Yes, of course you can pitch for the lightning.

But lightning has its weaknesses as well. I don't like to pitch something, um, that I'm not 100 percent sure of. I'm 100 percent sure of Bitcoin today. Am I 100 percent sure of lightning in a controlled environment? Yes, I am. Um, like I know people who and I even encouraged and did some some presentations where they had different offices across different countries.

They have different nodes and they can transact their own channels, um, in a self sovereign way. But this is not your typical. business owner today. And if we're going to drive adoption, I think there's a lot of, [00:50:00] I mean, despite the development on L2s and L3s, and it's fantastic. L1 is still the way to go, in my opinion, for Africa when it comes to, I'm not talking medium of exchange, just to teach about

Knut: A bit, a bit of a historical perspective here, though, from, from, uh, like, having lived through the segwit, um, the, the fork wars back in 2017. So there was a period, like, before the fork, but also after, like, during 2018, where no one thought the mempool would ever clear again. But it did. Like, it took months and months, but then it cleared up again.

And, uh, and, uh, same, same thing in, uh, uh, when was that? Like, 2021? We had high fees for a while, like, the fir I think this is the, like, the first Ordinal type, if it's even that, but then it cleared again, and now we're having this spike, and it's going down [00:51:00] again, and we can think that it's never gonna clear again, but we don't really know that.

We'll have to wait and see, I guess.

Sooly: Bitcoin doesn't care. We don't. you don't, the funny part is like, really, this is like the whole, we're entering the ordinance topic, just like in Africa or the Middle East, it's a, it's a region that needs really sound money for the characteristics of sound money. And Ordnance is just another fiat centralized VC way of doing things.

Uh, it would be, yeah, creating hype and demand and adoption and blah, blah, blah, getting people back or like someone really trying, liking, like the mind blowing thing is just like today you have NFT artists claiming to be Bitcoin maxis because they believe in Bitcoin network to be the strongest network on earth.

It's like, What am I doing here?

Luke: Yeah, we saw some real Bitcoin art [00:52:00] at Bitcoin Atlantis, uh, Fractal Encrypt, uh, tons of other artists, but Fractal's piece was the centerpiece of this art gallery. Absolutely mind blowing stuff, just mind blowing, and that's some real art right there.

Knut: And not, not, not clogging the chain at all. It's like even that Fractal works so hard on his art, so he doesn't have time to do any on chain transactions, so he's even offloading

Sooly: I have practiced work at home. I love his work, man. Yeah. Um, uh, I, I wasn't able to make it for Atlantis this year, but I only saw amazing reviews guys. Well done.

Knut: We had, we had such a wonderful time, and yeah, we're releasing a lot of episodes from that right now. This will of course be released after that, so it doesn't matter to this show.

Sooly Kobayashi's Bitcoin Consulting

Knut: Anyway, Sooly, uh, tell us a bit about your, uh, uh, your current thing, like, uh, the consulting you do. Um, you, you consult Bitcoin businesses, you said, and like [00:53:00] individuals as well?

Sooly: Yes. Correct. So, uh, what I do from, um, from the Bitcoin space, um, I'm always on the hunt to try to do my homework to see if there's any opportunity for a Bitcoin only company, to find opportunities for Bitcoin only companies. And the market in Africa or the Middle East. So what I do is like I assess the market, and knock on their doors, uh, proposing a strategy to work on.

so yeah, I did that with Swan. Uh, I did that with Jam3, even though Jam3 and, um, Their perspectives like, okay, but like, you know, for example, Dubai doesn't need Gen 3. They have enough money for Gen 3, but this is exactly the point. Like the whole region needs Gen 3 and we will see more of Gen 3, I'm sure, uh, this year in Africa.

so this is what I do for the Bitcoin companies. Um, now even like I expanded [00:54:00] into, um, like there's a lot of services that some of the Bitcoin companies, they don't have Pleasants in the Middle East. I need to, run some, um, uh, some assessments, uh, some vetting for partners, uh, et cetera. So I did that.

But the core is really onboarding individuals and businesses, um, high net worth individuals in specific or business owners that are That can be just a barber or like really nonprofits, Bitcoin organizations like Bitcoin Dada in Kenya and Ghana, uh, just to see how can Bitcoin help them grow. Because at the end of the day, I strongly believe that, um, like all of us, like helping each other and helping Bitcoin entities thrive, we will all benefit from it.

Um, so yeah, what I do is like, it all starts with a, I call it the Nakamoto approach where it's like, I divided the. It's just a normal, um, thinking where it's, you do the assessment, you have your [00:55:00] white paper, and after the white paper, you do, basically, the first step is a discovery call, getting to know the client, etc.

And then we do a preliminary deep dive of like the white, white paper preparation where we go, um, we do a SWOT analysis of the strategy, the vision of the person, et cetera. Um, and then I write like a clear proposal to serve the, the entity or the organization. And by the way, I like, it's varies between, uh, all sectors, agriculture, manufacturing and services.

Um, as well, you have like great, um, business owners who've been building, uh, or using Bitcoin in different ways. And for me, orange billing has been so Interesting is in the sense where not convincing people to buy Bitcoin, just convincing people to, to really optimize their operations. Bitcoin brings you marketing today.

Bitcoin brings you a point of sale and less accounting heads in your [00:56:00] accounting department for less reconciliations during the day to do. There's a lot of things and energy and mining. So, frankly, Bitcoin is so easy to defend because it's so strong and amazing. So, um, and then, um. There's a session called the protocol alignment, where there's a roadmap of what needs to be done milestones wise based on the business or the high network individuals.

And then there are checkpoints in between. And then there's a block confirmation. I call it in the, in the process, the block confirmation is like the strategy implementation, and there's a difficulty adjustment. At the end where there is always a check. So there's a timeline of a roadmap of different sessions.

I try to, I call it Nakamoto approach. It's very transparent. This way it made me consistent with all the clients and to make sure that everything goes well. And it's very transparent, very methodical and it works. So yeah, this is what I do. And, um, Unfortunately, I haven't finalized the website yet because sometimes I have a too low time of a preference.

[00:57:00] My time preference is too low sometimes. Um, but yeah, um, I'll be launching this website very soon. And just because I need, didn't need the website before, but now that with all the hype and everyone wants more Bitcoin, it just makes more sense.

Knut: So, so where can people find you online if they can't find you on the website?

Sooly: Uh, Sooly Kobayashi on Twitter, on LinkedIn. And yeah, that's me on all platforms. Sooly Kobayashi.

Knut: And if they want your services, they can shoot you a DM, I guess.

Sooly: Always open. Thank you.

Luke: Sooly, this has been fantastic. Thank you so much for joining us.

Sooly: Likewise. Thanks, guys.

Knut: Yeah. Take care. Good luck with everything.

Luke: This has been the Freedom Footprint show. Like, subscribe and brush your teeth. Thanks for listening.