A Cover Letter to Ray Dalio

In this epic piece, Robert Breedlove takes a massive dive into Bitcoin, and presents one of the most solid cases for Bitcoin that’s out there.

That said, it’s not always easy to get the very busy (and skeptical) Ray Dalio’s of the world to sit down for a few hours, so I hope this cover letter can encourage him to have an open mind, and give Bitcoin a few hours of his time. ROI on those few hours could be bigger than any return he’s witnessed in his highly illustrious and successful career.

Bitcoin is most definitely not an “easy get”. Most ultra-bullish Bitcoiners only become that way due to a deep understanding of the history and properties of money-as-we-know-it, the technology behind Bitcoin, macro, micro and behavioural economics, as well as the dynamics of start-up companies and technologies in bootstrapping themselves and realising network effects. Less technical people observe the IQ density of the space, through its industry leaders and broader development community, which allows for a high level of believability-weighted decision making. I believe you have one of the best grasps of these concepts in the world, so I ask that you humour me for a few minutes to allow me to demonstrate just how much Bitcoin aligns with your personal views and fundamentals. This journey isn’t quick — the most dedicated Bitcoiners have put in thousands of hours of research and knowledge development, as well as many hundreds of days “in the saddle” with exposure to the whims of the Bitcoin Rollercoaster. I hope that by the end of this letter you will at least consider revisiting the topic of Bitcoin with a bit more depth.

Bitcoin has been likened by some to be reflective of a startup organisation; currently heading into its Series B fund raise. Bitcoin is a well-oiled “un-organization” with founders but no CEOs, many volunteers but no employees, where the best ideas are developed and implemented by consensus regardless of who proposed the idea, and provably non-diluting equity available to anyone who is willing to trade their energy for it. This is all baked into the code, and it is radically transparent for anyone wishing to participate in the ecosystem. So transparent, that an individual can verify anything they need to about the Bitcoin network by simply running some software on a very basic computer setup in the order of $200 and with the most basic of internet connections. It may likely be one of the best real-life examples of an Idea Meritocracy at play — the cultural paradigm that you originated at Bridgewater.

Idea Meritocracies are microcosms of what a “truly free” market should be. There aren’t many, if any, examples of free markets in the wild; except of course, Bitcoin. The competition in the Bitcoin space is merciless, where the best products having a shelf-life of months before being made redundant by superior products. Most industry leading service providers will find themselves competing with a free product not long after establishing themselves. As at date of writing, the Bitcoin space even meets several criteria of the “theoretical” perfectly competitive market. Bitcoin’s nature as an open-source, public, encrypted, distributed ledger means that the blockchain guarantees radical transparency, property rights and homogeneity of product, at zero or near-zero transaction and storage cost. The factors of production (labour, equipment, and capital) are mobile to the extent that only a communication link and a power source is required to participate in the ecosystem. Developing on top of Bitcoin requires no permission, and if entrepreneurs have a good enough idea, securing start-up capital is not a difficult barrier to entry to overcome. Information asymmetry, low number of market participants, and externalities from use of non-renewable energy to mine will all be resolved in time, most likely by the end of this decade. The critical thing to note is, although there are relatively few people who own the majority of Bitcoin now, once Bitcoin is spent in the future during the redistribution phase, it is spent forever — there are no reprints. If you want your Bitcoin balance to stay the same or increase, you must be creating value for someone. There is no free lunch with Bitcoin.

A central tenet of your school of thought is open-mindedness, and I encourage you to suspend disbelief and allow yourself to be immersed in high quality Bitcoin content; whether through attending a Bitcoin-only conference, books, podcasts, or even attending your local casual Bitcoin meetup. When meeting Bitcoiners in the real world, you are guaranteed to witness more IQ packed into one small place than you have ever witnessed in your life. Bitcoin was created and fostered by the most radically open-minded, and the development of its technology over time was only possible through radical open-mindedness in the developer community, and of the wider user community once improvements were thoroughly scrutinised and ready to be implemented.

I’m sure that a lot of these arguments have hit home — after all, you personally coined the majority of the arguments I used to present The Case for Bitcoin. It is daunting and confusing to step into such a revolutionary realm, but you will find that if you are willing to radically open your mind, your fundamentals are 100% aligned with Bitcoin’s.

Bitcoin Evangelist. BEng MEngSc MBA