WBD531 Audio Transcription
Can Bitcoin Become Legal Tender in America? With Aaron Daniel
Release date: Monday 25th July
Note: the following is a transcription of my interview with Aaron Daniel. I have reviewed the transcription but if you find any mistakes, please feel free to email me. You can listen to the original recording here.
Aaron Daniel is an Appellate attorney and author of The Bitcoin Brief, a newsletter analysing Bitcoin’s effect on law and society. In this interview, we discuss the legal arguments around making Bitcoin US legal tender, and whether it would actually confer any meaningful benefits.
“We all want freedom, that’s why Bitcoin exists, is to be apolitical freedom money separate from the state; and when you start to then advocate for the state to come and be involved in your freedom money it’s, I hate the phrase slippery slope, but it starts to be a slippery slope.”
— Aaron Daniel
Interview Transcription
Peter McCormack: Welcome to the show.
Aaron Daniel: Thanks, Peter, thanks for having me.
Peter McCormack: You've brought receipts?
Aaron Daniel: Yeah, just some demonstratives. I also brought a couple of gifts.
Peter McCormack: Oh, wow!
Aaron Daniel: So, here is your very own pocket Constitution.
Peter McCormack: Oh my God!
Aaron Daniel: And, I could only get two, so you and Jeremy, Danny, have got to fight for that one. Maybe it can be the official What Bitcoin Did pocket Constitution.
Danny Knowles: Presumably, you're given one when you're born here, so you probably have one, Jeremy?
Aaron Daniel: That's right. I actually left mine at the office, so I'm going to use that.
Peter McCormack: This is really fucking cool!
Aaron Daniel: Yeah, it's got everything in there; it's got the Declaration of Independence, it's got some State Bill of Rights in there.
Peter McCormack: The entire framework of the United States legislation is in this little book.
Aaron Daniel: That's right. It's funny because, you're going to think I'm a really big nerd, but I sent it with my son, my 6-year-old son, for show-and-tell on Memorial Day! It was like, "Bring something that's patriotic", or whatever, and I don't have any little flags or toy soldiers, or anything like that.
Danny Knowles: A gun.
Aaron Daniel: We don't have one of those, ATF, if you're listening, I don't have any of those.
Peter McCormack: Straight Outta Compton on vinyl?
Aaron Daniel: Right, so I sent him with the pocket Constitution, because this is what our soldiers died fighting for, the ideas in this book. He was laughing, because then I had a treatise from law school that explains all of it, and it's 1,000-plus pages and it's five times as wide and he's like, "Wait a second. Everything in this little book is the Constitution, then what's all the extra words over there?" I was like, "Well, that's what everybody's fighting over".
Peter McCormack: I'll tell you something really interesting, is that back when you're at school and you're a kid, and you're trying to figure out what you want to be or what you do in life, at certain points in your education, I don't know if it's the same in the US, but we have options. So, when you're about 12, you have a couple of options. One might be choosing between, say, geography and history, or one of them and maybe an additional language; you just get these little options.
Aaron Daniel: Right, electives, yeah.
Peter McCormack: Yeah. Then you do your GCSEs and then you get a couple more options. You can do double science, triple science, whatever. A-Levels, you get to pick four subjects. I picked economics, surprisingly; I did economics, classical civilisation and geography. And then, when you do your degree, you pick one subject.
But one of the really interesting things is, it's this journey you have to go on. You have to pick these things, so you just pick something you might be interested in. I only found, when I became an adult, that I started to realise the things I wanted to learn now. And, yeah, if I could pick something now, I would love to go and study American History, I'm absolutely fascinated by it. It's one of the reasons I wanted to make this show with you, is that I want to understand more about the Bill of Rights and the Constitution. I've got so much interest in the history of the people and the debates they had to establish what the United States was and is now, and I know very little about it.
As I ask you, I might ask some dumb questions, or ask in some really dumb ways, but I'm really interested in it, because people do care. I mean, we have the Magna Carta.
Aaron Daniel: Yeah, which was a foundational document for our Constitution as well.
Peter McCormack: But we don't refer to it. We don't have protests and say, "This is against what's in the Magna Carta". Nobody even knows what the fuck's in it; some people do. Apparently, there's a right to have guns in it, or something. Anyway, I don't really know. So, I am really interested in it because, just so people know, we're going to be talking about Bitcoin as legal tender and how that fits into this. So, a little education from you today, please, sir!
Aaron Daniel: Well, I'll set the record straight, I'm not a professor, I'm not a constitutional law scholar, I'm a practising appellate attorney.
Peter McCormack: What does that mean?
Aaron Daniel: So appellate attorneys basically, in layman terms, we don't go to trial. Occasionally I will show up at trial if we know there's going to be an appeal at some point. But we operate in the reviewing courts, the higher courts, and we argue that a judgement on order should be overturned or upheld. That's a lot of briefing, a lot of writing and a little bit of argumentation. And when we argue, it's not to one judge, it's usually to a panel of three; there can be up to nine in the US Supreme Court. So, that's what I do, and my firm represents regular, everyday clients, but also big corporations.
Appellate attorneys are kind of the last of the generalist attorneys. We have to know a little bit about a lot of subjects. So, one day I'll be working on contract law; the next day, I'll be working on trusts and estates. We do everything from bankruptcy and constitutional law, so we really do cover the waterfront.
Peter McCormack: A bit like a GP has to know a little bit about everything?
Aaron Daniel: Exactly. And so, I've started writing on Bitcoin and legal issues relating to Bitcoin, and I want to be clear, I'm standing on the shoulders of giants and those who have come before me. Some of my friends, Justin Wales, wrote the Law Review article on Bitcoin is Speech in 2019. So, I'm standing on their shoulders, but what I'm hoping to bring is a little bit of a different perspective, that appellate perspective, having seen a lot of different areas of the law. And we deal with novel issues in the law, and everything in Bitcoin is novel when it comes to the law.
So, I'm hoping I can bring a little bit from here, a little bit from there, and find the right heuristics and the right analogies to make the correct arguments.
Peter McCormack: And you're a lawyer who discovered Bitcoin, and this is a side hobby, how you can support Bitcoin on the legal side? This is you carving an area out for yourself?
Aaron Daniel: Yeah, so a little bit about my backstory, I guess, my Bitcoin journey. I came into it as a regular investor during the pandemic, but then I quickly understood the value proposition of Bitcoin. And then it grabbed a hold of me and I fell down the rabbit hole, and there were two experiences I had, I think, that really primed me to understand Bitcoin's value as that apolitical censorship-, seizureship-resistant money.
So, the first was a personal experience and the second was in my career as an attorney. When I was 9, my family lived in Liberia, West Africa.
Peter McCormack: Oh, wow! What was that like?
Aaron Daniel: It was crazy, yeah, I'll just put it that way. It was during the ceasefire in their civil war. We thought it was more than a ceasefire, we thought it had been an armistice, but it turned out it was a ceasefire and hostilities resumed. My father was a theology professor, seminarian, for the Methodist Church; my mother was a teacher and she taught therapeutic art at the local school, kids who'd experienced a lot of trauma through the civil war, and she was helping them through that.
Peter McCormack: Amazing.
Aaron Daniel: Yeah. And so, we were there around 1996 and everything was just devastated. The entire infrastructure, the political system was devastated. There was a six-president power-sharing agreement between all the warlords at the time, and so obviously the economy was cratered. And Liberia had its own currency, the Liberian dollar, because Liberia's very interesting in that it's not a French colony, even though it's surrounded by Ivory Coast and Senegal, and some of these other French Colonies that are on the common French, what is it? CFA franc.
So, they had their own currency, but it had cratered, obviously. So, I had the experience as a kid of walking around with a fanny pack of Liberian dollars, whenever I wanted to go to the convenience store to buy something simple. So, I experienced that hyperinflation first-hand, basically. The other part of it too was that, that's what you get when you have a money issued by a state. If the state fails, then your money fails. Then, not only do you have to rebuild your country physically, rebuild your populace emotionally and overcome the scars of war, but now you also are destitute as a country. So, that was the experience of living there.
Look, we're Americans, we were there from abroad and we were lucky; my dad got paid in USD. Somehow there was some banking affiliate that was able to pay USD cash, so we also did have US dollars that, everybody of course wanted US dollars at the time. But we had a little stockpile of cash, because that's how my dad would get paid. And so, when hostilities resumed, we had to evacuate.
Peter McCormack: Do you remember that?
Aaron Daniel: Oh yeah, absolutely. I mean, I was 9, I remember all the --
Peter McCormack: Was it chaotic?
Aaron Daniel: It was extraordinarily chaotic, because it was one warlord, Charles Taylor, who then became the President, and was deposed and tried for war crimes. He came in from the country with tanks and everything in the middle of the night. We were walked out -- we lived on a compound, big thick walls, barbed wire, guards that we trusted, with some of the other missionaries and also local pastors, but we had to make it to the embassy to get out; because again, we were lucky. We won the cosmic lottery and were born into the country with the reserve country and the strongest military in the world at that time, that could project its military power and send marines to send out their expats.
Peter McCormack: And were you smuggled to an airport and onto a plane?
Aaron Daniel: Yeah, so we had to make a run for it without any -- I mean, there were three marines in the country, or something, so we had to make a run for it without any protection. And not at gunpoint, at the point of a rocket-propelled grenade, my family was forced out of a car and everything looted and taken from us. So, all the cash that my family had on hand, clothes, the family cat.
Peter McCormack: They took the cat?
Aaron Daniel: They took the cat.
Peter McCormack: The fuckers.
Aaron Daniel: Yeah, took the cat. So, we had that experience of being refugees with nothing but the clothes on our back.
Peter McCormack: So, you arrive at the airport; you're allowed back in the car, you arrive back at the airport?
Aaron Daniel: Yes, so we -- well, no, the car's gone.
Peter McCormack: Oh, shit, they took the car?
Aaron Daniel: The car's gone, lucky that we got out ourselves. The car's gone, walked to the embassy, hang out there for a few days. Eventually, marine helicopters come and take a couple of rounds of Americans out.
Peter McCormack: That's one hell of an experience for a 9-year-old.
Aaron Daniel: It was, it was quite the experience. But again, I look back on it now and I look at everything that's happened in the world since and before and again, I won the cosmic lottery; we were able to get out. The Liberians that we worked with and became friends with and played with, they weren't that lucky. They had to stay and survive and then rebuild their country.
Peter McCormack: Wow, so what an experience. How did that shape you?
Aaron Daniel: I went on, I wanted to do international studies in college and go work for an NGO and try and save the world. Instead, I went to law school! But yeah, so that experience really primed me to understand the value, as a westerner who has the reserve currency in my pocket, and who enjoys the rule of law and safety, to understand the rest of the world doesn't have that, most of the world doesn't have that. Any technology that allows you to escape with your life savings is something that we should fight for and promote.
Peter McCormack: Yeah, because there's a war now in Europe.
Aaron Daniel: We're seeing it play out in Europe.
Peter McCormack: There are not a lot of examples, but there are examples of people who explain that they've fled Ukraine with their private keys, with their Bitcoin, and we know how that's important, we know what importance it is for human rights for people who are in desperate situations. So, I guess if you are working on the legislative side of this, you have come full circle.
Aaron Daniel: Right. I suppose so, yeah.
Peter McCormack: So, you discovered Bitcoin in the pandemic, you start listening to the podcast, and now you're on one!
Aaron Daniel: Yeah, that's right. Your podcast, Saifedean's podcast.
Peter McCormack: Who the fuck?!
Aaron Daniel: So, that was an early experience. Then I had a recent experience in my career, not as dramatic, but just as important to the client. I had a client who owned gold Krugerrands, which I guess are South African gold coins, and her father gave them to her and she kept them in a safety deposit box, which she was the sole accountholder of. Her husband, who was not an accountholder, was hit with a judgement. Some business dealings went bad or something, and he owed money and he was hit for a judgement, and so the creditor was trying to collect.
So, they attached her box and said, "You're married to him, we need to see what's in the box to satisfy the judgement". His name was on the approved access list for the box, but was not an accountholder. Under Florida law, if the wife is an accountholder and the husband's not, you don't get to then attach the wife's accounts to satisfy the husband's judgements, unless they're joint accounts, but this was not a joint account.
What happened was, the judge did not appreciate the distinction of having access to the box versus being an accountholder and kind of flipped the assumptions around, and made our client prove that the husband didn't put the coins into the box. There was testimony from her brother that they put in a certain amount. The judge disregarded the brother's testimony, found it incredible, and so said, "Yeah, the coins can be used to satisfy the husband's judgement. Take the wife's coins that were gifted to her by her late father". We appealed and lost on appeal as well, and that was really obviously frustrating for the client.
Peter McCormack: Well, it's devastating.
Aaron Daniel: Yeah, and not only is it valuable property --
Peter McCormack: But it's a gift from her father.
Aaron Daniel: It was a gift from her father, and I think she ended up doing something where she just paid the value of it, or something, to keep them, but not right. So, this client had essentially her gold, which was secured in a safety deposit box with a custodian, taken under colour of law essentially. So that primed me to realise, well if you have some property that now is not in a custodian's care, that is a bearer asset, that cannot be attached, cannot be taken, then you're in a lot better position than that client was.
Peter McCormack: So really, the fixed supply as a hedge against -- well, the fixed supply which prevents against currency debasement, and then the strong property rights of self-custody, both stood out to you based on your experience as a child and your career. That's fascinating.
Aaron Daniel: Yeah, and it's one of those things where it's frustrating that you have to have these lived experiences to understand the value as a westerner. You have, what was that, concerned.tech letter, where the technologists said, "There's no value to it", and then Gladstein and Zell got together and said, "What are you talking about? Here's 20 human rights activists and refugees who said it saved their lives. How is that not valuable?"
Peter McCormack: But those people are people I don't find credible, because they're the types of people who've been posting and writing FUD against Bitcoin for a long time. They've been told over and over again they're wrong, they've been given case studies and examples, and they choose to ignore it. They're people who come from a place of privilege who don't understand the different kinds of economic challenges that people face in other parts of the world.
I mean, one of the guys, I can't remember his name, he lives up in Berkeley in San Francisco, he lives a particularly privileged life, and he clearly hasn't spent the time to understand what it's like for somebody living in Argentina or Sri Lanka now, or any of these jurisdictions that are suffering from either high inflation, or even China right now, where we've had people protesting outside banks, because they can't get their money; or, he's failed to look at what's happened in Cyprus where the banks essentially --
Aaron Daniel: The bail in, yeah.
Peter McCormack: The bail in, yeah, they took their money. So, they're either wilfully ignorant, or they are privileged, or I don't know what it is, there's a list of things. But they're clearly missing that empathetic part of the brain that helps you understand that not everyone gets to live the same experience you have. I mean, I actually think the US has fairly strong property rights compared to some parts of the world.
Aaron Daniel: It does.
Peter McCormack: And, I also think the US has a fairly stable currency compared to other parts of the world, but you have to see these other parts of the world, you have to understand what other people have gone through. And for you to want to ban something that is actually a lifeboat and a tool, that helps people in very difficult circumstances, honestly I think they're some of the most despicable people alive and I challenge them, just sit down with somebody like Alex Gladstein, listen to these stories, get out of your own bubble, stop trying to legislate against other people, get out of your own bubble and understand what these people are going through. If you're still against Bitcoin after you've heard these arguments, then honestly, I don't understand where you're coming from.
Aaron Daniel: I think you're right, I think that's what it comes down to, in my opinion. Some folks are maliciously spreading lies, and others are just ignorant, because they just don't have to see it, and they don't see it.
Peter McCormack: Well, they're selfish. I think some of these people are fundamentally selfish. If you come from a point of privilege and you want to create controls over people who don't have that privilege, which makes their life harder and offers them less freedom, I think you're selfish. Fuck these people.
All right, well listen, I want to find out a little bit. Start with explaining the difference between the Bill of Rights and the Constitution, or how they work together. Act like I'm some Redcoat who's run off with his tea, who's come back and said, "Do you know what; what can we learn from you? What happened after we sailed back to England?"
Aaron Daniel: All right, so I think what I'd like to try and do is challenge your perceptions of the Constitution. Maybe you already have these perceptions and understand this to be the way to view the Constitution, but I don't think most people do right now.
Peter McCormack: Shall I give you my two simple views of the Constitution?
Aaron Daniel: Sure, please do.
Peter McCormack: My very first simple view is that I'm jealous we don't have a constitution in the UK. Someone's going to comment on YouTube, "We've got the Magna Carta". We don't have something which people refer to. We don't have politicians standing up in Parliament saying, "But in the Constitution [or] this is unconstitutional", we don't have the press saying, "This is unconstitutional", we don't have lawyers saying, "This is unconstitutional". So, I'm jealous that we don't have something there that we refer to, that is a framework for the kinds of freedoms that we want within our country.
The other simple view I have is, it seems to be hard to change. It feels like some bits need to be updated, we're a few hundred years since the Constitution was written and established.
Aaron Daniel: That's a valid viewpoint, and a lot of Americans share that viewpoint, absolutely. And depending on how you interpret the Constitution, yes, that is a valid viewpoint. Now again, there's certain ways of looking at the Constitution that give you more flexibility with the words, and that way of interpreting the Constitution has fallen out of vogue in the last probably 40 years, in favour of strict textualism and original intent, "What did it mean at the founding? Thus, we can't have anything different now".
I think people misunderstand what originalism really is. Originalism is, the text is fixed, the meaning was fixed at the founding. But that doesn't mean that that meaning can't apply to new technologies and new societal situations. We just have to understand what those words conveyed at the time, and then apply that meaning forward to new technologies. You get examples like, Justice Gorsuch, one of the new justices, wrote a book, and then there were some excerpts in a magazine going through some examples like, "Cruel and unusual punishment", the Eighth Amendment. Obviously, lasers didn't exist at the time, but if you were going to blast somebody with a laser, that would be cruel and unusual. You can adapt with the new technologies.
Speech, we'll come to this perhaps later in the talk; speech can encompass --
Peter McCormack: It can be code.
Aaron Daniel: It can be code, that's right. It can be something on the internet that the Founders never even dreamed of. But going back to challenging your view, there's two points. One is, the Constitution, leaving apart the Bill of Rights for now, the Constitution sets the framework for everything that the federal government can do; meaning, if it's not in that document, the federal government doesn't have the power to do it. So, it is powers that the people conferred onto the federal government.
The first question should always be, when a government takes any action, "How are you able to do that? Show me in the Constitution, government, where it says you have the power to do that?" So, that's the first way to view it. It's a list of permissions that the people have given the government to check against tyranny, to make sure the government's very constrained in what it can do. It's very much like cryptography. That's the analogy I like to use with cryptography now is, cryptography gives you the ability to grant permissions to other people and protect your privacy, and thus constrain tyranny from the government, or from Big Tech, or whoever is spying on you at this moment. So, the Constitution's like that; it's a list of permissions.
The Bill of Rights is not the source of your human rights. The Bill of Rights is again another list of rights that the Founders found important, but also a description of the ways in which the government is allowed to act vis-à-vis these rights, which are unalienable, inherent, fundamental. So, there was a debate, and this will get into the difference between the Bill of Rights and the Constitution, and a little bit of the history; there were two groups that were fighting over the Constitution once it had been hammered out in the convention. You had the Federalists, who were strong, central government, who approved of the Constitution as it was; and you had the anti-Federalists, who wanted to keep things mostly the way they were, with the states being the primary governments and what we had going on was a league of nations type thing with the states, no real strong overseeing government.
One of the very valid anti-Federalist arguments against the Constitution is, "There is no Bill of Rights in here". Virginia had passed a Bill of Rights before the Declaration of Independence. Thomas Jefferson used it to draft the Declaration, and Massachusetts passed one in 1780. So, this was not an unknown phenomenon to list out the rights that people have. The counterargument to that, which I also find very compelling, and we're seeing the ramifications play out today, the Federalists said, "Yes, but if we list out a bunch of rights, then that's going to be construed as the entire universe of rights that people have, and that's just not the case. We cannot possibly list all the freedoms that people have, so we don't want to constrain ourselves that way through a document".
James Madison, who really in my view was the Father of the Constitution, he kind of mediated between these two sides. He wrote some of the federalist papers and was in favour of the Constitution. He had come to the conclusion that the previous document, the articles in the Federation, was just inadequate, and really pushed to get a new Constitution. But he also started out with the belief that you can't enumerate these rights, otherwise we will lock ourselves into this list of rights forever.
He came around because eventually, they passed the Ninth Amendment and the Tenth Amendment, which the Ninth Amendment says, "The enumeration of these rights shall not be construed as limiting the rights that people retain", essentially. The Tenth Amendment was similar, but as to the states, "The powers not given to the federal government and not prohibited to the states remain with the states and the people".
So, they put these amendments in to clarify, "This is not the universe of your fundamental rights, this is not the source of your inalienable and your human rights". And so, that was how the anti-Federalists ultimately came onboard with the Constitution and agreed to ratify it amongst the state conventions, is this Bill of Rights was included.
Peter McCormack: What came first, the Bill of Rights or the Constitution?
Aaron Daniel: The Constitution, because the Constitution was actually passed, and so there was a brief period of time where the Bill of Rights was not included, as the Bill of Rights is a set of amendments. So, all ten of the first amendments were passed as one package as the Bill of Rights a few years afterwards.
Peter McCormack: Okay, right. So, in terms of the work you do now, when do you refer to the Constitution and when do you refer to the Bill of Rights?
Aaron Daniel: So, if you're doing criminal law, which I do not do a whole lot of, you're referring almost exclusively to the Bill of Rights. You're also referring to certain sections of the Constitution that guarantee the right to a jury trial, and things like that, which are not part of the Bill of Rights; they're in the main bulk of the Constitution. If you're talking about anything related to -- if you're out of the criminal context and then you're talking about litigating against the government, or litigating what the government can and can't do in terms of legislation, that's usually going to be the main bulk, the original Constitution, but not necessarily! To give you a lawyer answer, "It depends"!
Peter McCormack: It depends on the scenario?
Aaron Daniel: Yeah.
Peter McCormack: Okay, so sometimes you refer to one, sometimes the both, sometimes the other, and it's all case-dependant.
Aaron Daniel: That's right.
Peter McCormack: And, is it that a lot of the interpretation of the Constitution comes down to the precedents that have been set with specific litigation?
Aaron Daniel: Yeah, that's correct. So, you have this body of common law precedent that builds up over time and locks in one interpretation or another, and then you have big, epochal changes in that, like we've just seen with Roe vs Wade being overturned. But there are other examples in history too, where are these big, epochal changes.
Peter McCormack: But the big, epochal change that we've just seen now seems a very political change, but has it always been that way?
Aaron Daniel: I'm a little cynical. I'm of the belief it's always been.
Peter McCormack: It's always been political?
Aaron Daniel: Yeah. I think our view in the States of the Supreme Court as the ultimate arbiter of legal truth that stands above the political fray, is almost something that came about in the civil rights era, the 1960s, the 1970s. And, maybe it existed in the past before, but there's always been gamesmanship, there's always been politics involved.
I mean, I'll give you a good example that's relevant to money and Bitcoin. The biggest case of the 20th century, if you just go by press coverage, was actually in the 1930s, and it had to do with the federal government's attack on gold. You don't learn about this case in law school and you don't learn about it in American History.
Peter McCormack: Is that the Executive Order 6102?
Aaron Daniel: So, it was related to that whole package that FDR was essentially -- that whole policy he was pursuing. The federal government passed laws saying, "Any contract that has a gold clause in it", which was a clause that said, "If you owe me X amount of dollars, I want it repaid and I have the option to get repaid in the gold equivalent of whatever it was at the time", and it was an inflation hedge, and these were clauses that existed since -- they always existed, but they really came into being after the Civil War, when you had this big fight over paper money, the Civil War, the union government, the federal government printed greenbacks to fund the war and then they were declared legal tender.
States like California, who had a lot of gold because of the Gold Rush, and had a very strong gold-based economy, the merchants all got together and lobbied the government and were able to put these clauses in that said, "We're accepting gold, and we're not going to be bound to accept paper money. If it says gold, that's what it is, that I shall be paid in gold", and then they passed legislation that said, "Yes, if two parties agree to be paid in a type of money, the repayment has to be in that type of money. We're not going to call the judgement satisfied if you use greenbacks. It's got to be in the money that it was contracted for".
So, these gold clauses existed for a long time. And then it came to a head when FDR was confiscating everyone's gold and trying to push through his economic reforms. So, the federal government had gold clauses in their bonds, and also there were these private ones, and so the government passed a law just saying, "Those are invalid. Gold clauses are invalid. You've got to pay up in paper money, you've got to accept paper money in discharge". So, all the creditors took a haircut. All the debtors, of course, were very happy.
But these cases were really, really big, everyone was talking about them and it was very rancorous. And this was also at the time when the Supreme Court had been thumbing its nose at the Presidency, and just striking down all of FDR's new deal plans. And it was very close to this time when he started being very aggressive in response, and threatened to increase the number of justices on the court, the court-packing scheme, and all this.
But what happened with these specific gold clause cases is, he had a speech written for radio address ready for when the gold clauses would have been upheld, when they thought maybe the Supreme Court was going to uphold the gold clauses, and rule against the President and Congress. So, he had this speech drafted and it leaked, and it basically said, "I'm going to ignore the Supreme Court, and we're moving forward with our legislation". That has been seen by some scholars as this point where there was a ton of political pressure against the Supreme Court, and the Supreme Court bent to that pressure and ruled in favour of the President and the Administration, and invalidated the gold clauses.
Peter McCormack: Do you think that was also because it was the time of economic pressure?
Aaron Daniel: For sure.
Peter McCormack: A desperate situation.
Aaron Daniel: Yeah, but it just goes to show you that in the face of strong political fighting, because you can read a lot of Law Review articles that discuss the actual reasoning of these cases, and they're a little strained.
Peter McCormack: But the Constitution doesn't refer to money, right, but the Bill of Rights does?
Aaron Daniel: We can get into this too. Going back to, the federal government can only do what it's granted the power to do, you wouldn't know that the federal government doesn't have the express power to print fiat money and declare legal tender. That's not a power that was granted to the federal government, and that was a conscious decision by the Founders.
Peter McCormack: Right, and we know that because it was discussed, debated?
Aaron Daniel: Yes, exactly. So, going back to James Madison, he took really detailed shorthand notes of the debates at the constitutional convention. And the question was, "Do we give the federal government that power; do we not give the federal government that power to print money and declare legal tender?" The Founders didn't agree on everything, but they did pretty much all universally agree that fiat paper sucked, and they all hated it! Some of the language that's recorded is just very strong, like, "Evils of paper money [and] we're going to crush paper money with this Constitution".
So, they really wanted to eliminate fiat and legal tender laws, because there was a history in the colonial era of states just printing money and state money hyperinflating, with all the economic ills that go along with that. Not every state; some states were pretty disciplined, but Rhode Island and Massachusetts were pretty bad about hyperinflating.
Peter McCormack: Right, okay. So, they knew there was a risk, and that was the point, wasn't it; they were aware of the risks?
Aaron Daniel: They were aware of the risks, very well aware of it, and the previous document, the Articles of Confederation, also didn't constrain that type of printing, so the states continued to print their own money. So, they consciously decided not to grant that power to the federal government.
Subsequent to that however, we had the legal tender cases, post-Civil War, where that power was kind of inferred through all the monetary clauses and then through another clause called The Necessary and Proper Clause, which was like a catch-all clause. It was supposed to be interpreted narrowly, but it was interpreted very broadly. And again, a time of -- this was post-Civil War, economy was trying to reintegrate the states, and there was all this union money that had been printed and the Supreme Court needed to say, "Yes, that's lawful money", and the federal government had the power to declare that legal tender, but that's not in the Constitution.
So, that's an area where monetary reality and economic reality trumps what's in the actual Constitution. So, the federal government can basically coin money, specie, gold and silver; they can coin money, they can borrow money, they can tax, but legal tender is not a power that the federal government was granted.
Peter McCormack: At the time!
Aaron Daniel: At the time!
Peter McCormack: But here we are with a very unusual situation. Okay, so what is the legal tender status of the dollar right now? Is it legal tender, as set by the federal government, or do states have the option to create legal tender at the moment? Explain that whole piece.
Aaron Daniel: So, yes, the US dollar is now official legal tender, and it's what it says on all of your banknotes, your bills. The States, if you go to Article 1 Section 10, of the Constitution, it has a list of -- I also have it printed here, so it's a little bit more…
Peter McCormack: Oh, fantastic.
Aaron Daniel: There's a list of prohibitions on a list of things the states can't do.
Peter McCormack: "No state shall enter into any treaty, alliance or confederation; grant letters or marque and reprisal; coin money; emit bills of credit; make any thing but gold and silver coin a tender in payment of debts". That's the important bit.
Aaron Daniel: That's the important bit.
Peter McCormack: Okay, explain that then.
Aaron Daniel: So, this is going back to the Founders really wanting to prevent paper money, and the states were the chief offenders when it came to paper money. So, they wanted to stop, they wanted to prevent the states from having any power to essentially engage in an inflationary monetary policy. To do that, they put this provision into the Constitution that says, "You can't make any thing", which is very broad, "but silver and gold coin a tender in payment".
Peter McCormack: But that's for the states?
Aaron Daniel: For the states.
Peter McCormack: That's why we don't have a New York dollar or a California dollar?
Aaron Daniel: Exactly. And you can understand why that would be beneficial to have a uniform economy.
Peter McCormack: Of course.
Aaron Daniel: Anyway, the states were always allowed to have gold and silver as tender, and going back to California, that's what people used for a long time.
Peter McCormack: So, is gold and silver legal tender in every state now?
Aaron Daniel: Not every state, I don't think.
Peter McCormack: But it is in some?
Aaron Daniel: I think Wyoming it is, it might still be in California, but I'm pretty sure Wyoming, it is.
Peter McCormack: So, Wyoming, if you want to, you can use gold coin to pay for things.
Aaron Daniel: I think so, yes.
Peter McCormack: And, what additional status does that grant that coin as money, being legal tender?
Aaron Daniel: Right, and this is where I think a lot of bitcoiners get confused. Legal tender is actually really kind of a simple concept. It does not confer tax-exempt status on transactions used with that money, which is a common misconception. All it is is, it's money that must be accepted by a creditor in discharge of a debt.
Peter McCormack: Okay, so it must be accepted. So therefore, in Wyoming, you must accept it.
Aaron Daniel: Right.
Peter McCormack: And when you say, "In discharge of a debt"?
Aaron Daniel: Pre-existing debt. So, that is to distinguish it from spot transactions, like I'm going to go --
Peter McCormack: Into a gas station.
Aaron Daniel: Yeah. That would be a spot transaction where it does not have to be accepted.
Peter McCormack: Right. Give me an example of a debt settlement where it has to be accepted.
Aaron Daniel: I mean, paying your mortgage.
Peter McCormack: Okay, so if I get a mortgage with, I don't know, Chase in Wyoming, if I want to pay that mortgage in gold, they have to accept it?
Aaron Daniel: Yeah.
Peter McCormack: That's fucking cool!
Aaron Daniel: Again, I'm not an expert on Wyoming's laws, but I think I saw that Wyoming is one of the only states that has a provision for gold as legal tender.
Peter McCormack: I might call up Tyler Lindholm and say --
Aaron Daniel: That's exactly who you should talk to actually!
Peter McCormack: -- "Are you paying your mortgage in gold coin, Tyler? Let me know".
Aaron Daniel: Right, because that's what in El Salvador with Bitcoin now as legal tender, that was some of the trepidation and anxiety from the financial sector, it's like, "Oh, crap, how do we now accept this crazy internet money for people who want to pay their mortgages", and stuff like that. So, that's what legal tender is. Then, going back to El Salvador, staying on that, you've got this "forced tender" concept where, even in spot transactions, someone has to accept it.
Peter McCormack: Yeah, so that's a different scenario?
Aaron Daniel: That's a different scenario, and those did exist in the colonies and were enforced, and that was also part of the reason the Founders didn't like legal tender laws, the compulsory aspects of them. But for the most part, when we talk about a legal tender law, we just mean "satisfies the discharge of a debt".
Peter McCormack: Right, okay. So, when you start thinking about Bitcoin and you've referred earlier in the interview, you said when the Constitution was established that obviously technology and things change over time, so there's a chance you could interpret this that, as it says here, "Make any thing but gold and silver coin a tender in payment of debts", I think you're potentially making the argument that, if Bitcoin had have existed, it may have been considered here as something that could be?
Aaron Daniel: Right, yes, that's the argument I made. I wrote a series of articles for my newsletter, going through -- basically what happened was, there's this huge push for Bitcoin to be adopted as legal tender, and everybody's clambering for that, and even at the state level here in the States, and nobody's talking about Article 1, Section 10, not even opponents are really raising it. So I was like, "Why? Are we just ignoring this purposely? Let's address this". Nobody had made any arguments one way or the other, so I said, "Well, I'll just make all the arguments".
So, I made an argument based on an originalist interpretation of this section, that Bitcoin should be considered essentially a gold or silver coin, and that the Founders would have approved of Bitcoin, based on its similarities with those commodity monies.
Peter McCormack: In that there's no central party that controls it, there's a scarce aspect --
Aaron Daniel: Scarcity, unforgeably costly, all those aspects of Bitcoin that we prize were apparent in gold and silver, and obviously Bitcoin elevates that with a global monetary network. I also made the counterargument, the strict textualist argument, that this is a very specific clause, "You shall not make any thing", that's a very broad term, "any thing but gold and silver coin", and that's a specific term. So, you've got a prohibition that's very broad, "can't make any thing legal tender".
If you apply that to new technologies, because it's a broad term, broad original understanding, that would eliminate Bitcoin, because it doesn't fall under the exception, which is very specific, of a silver or gold coin. I presented that counterargument as well. Then I have a follow-up policy argument that I don't think that this is good policy, even if it is Constitutional, to adopt Bitcoin as state legal tender. So, we can walk through all those if you want.
Peter McCormack: Yeah, please do.
Aaron Daniel: So, the argument for how Bitcoin could be considered legal tender under this clause is going back to what we were talking about with the Founders and their intent of eliminating inflationary monetary policies. Based on their experience, the colonial experience and the debates, and their writings after the debates and during the debates, we know that they basically had three objectives by limiting the states to gold and silver coin.
They wanted to eliminate that inflationary monetary policy, they wanted to stop currency and trade wars amongst the states, because what some states were doing, like Rhode Island, was they were printing a ton of money, and then Massachusetts had to accept it, and they were spending it in Massachusetts before the prices would rise. So then, they were exporting their inflation to the other states, and then there was tit-for-tat. It was like a state-level Cantillon effect.
Peter McCormack: That's like the Monopoly Board argument. Did you listen to my recent interview with Preston Pysh?
Aaron Daniel: No, I didn't.
Peter McCormack: So, he was trying to explain inflation, and he was saying there were two games of Monopoly that are happening at the same time, but there's one new rule in that you can buy properties from the other board. So, you can own property on the other board. So, what might happen is that the players on one table might collude and say, "You know what, when we pass Go, we're not going to give you $200, we're going to give you $600", and obviously your wealth increases and you've got more money than the other game.
So then, you could look at the other board and say, "We're going to start buying some of that property". And because things are becoming scarcer, the people around that table are going, "What the fuck's going on here? They're acquiring our property and we're feeling poorer". So, they might collude and say, "Do you know what? When we pass Go, we'll grant ourselves $1,000", and they start buying back. Then you just have this tit-for-tat.
Aaron Daniel: That's exactly what played out amongst the colonies, and that's exactly what the Founders wanted to stop, by preventing the states from being in control of the money supply.
Peter McCormack: That makes sense.
Aaron Daniel: That was the second reason.
Peter McCormack: Which you can't do with gold and silver.
Aaron Daniel: Right, you can't print more gold and silver.
Peter McCormack: Yeah, so that's what they were trying to prevent?
Aaron Daniel: Yeah. Then the third thing that the Founders were trying to prevent was foreign entanglements, pissing off foreign countries, who want to do business in the states, and now they've got to transact in 50 different -- well, at the time it was 13 different currencies, and keeping foreign affairs within the realm of the federal government.
So, if you look at those purposes, gold and silver were the best money to solve those problems, because like we were saying, you can't dig more gold out of the ground much faster, certainly not then. So, you had this concept of hard commodity monies; that's what gold and silver were, that's the original understanding of this. That's the only thing that fit that description, that solved all these ills at the time.
You couldn't use tobacco, because tobacco's not unforgeably costly. You can grow a lot more of it, then it depletes. You use it, it's perishable. And this is what states did. They had commodity monies that were not gold and silver. They had tobacco notes. They actually had notes that were good for a bale of tobacco back at the warehouse, before independence. This is how they got around not having specie, because they're on the other side of the world and nobody wanted to send their money over there, so they had to get creative. So, commodity monies were what the colonists were using and what the early Americans were using, and gold and silver were the hardest commodity monies. That's the original understanding.
Now, we have technological developments, we have synthetic commodity monies. This is what George Selgin describes Bitcoin as, and that is Bitcoin is inscribing this hard money monetary policy. It is the hardest money we have now. It's right on par with gold, inflation-level-wise, and it will decrease past gold very shortly and have the lowest inflation rate. So, if you look also at Satoshi's writings --
Peter McCormack: His Federalist papers.
Aaron Daniel: That's his Federalist papers, that's right, some of the early Bitcoin Talk forums. He describes it with analogies to gold; that post about, "Imagine a colourless, grey metal that was hard to produce, but people wanted it because you could send it wherever you wanted it to go", and some of the early forerunners to gold, like Szabo's Bit Gold, they're all referring to gold. This is Satoshi describing the mining process and analogising it to gold. So, now we have digital gold, we have Bitcoin and it's just an extension of this commodity money concept that was the original meaning here in Article 1, Section 10.
Peter McCormack: So, the interesting part of this is that, even if the states can make gold and silver legal tender, because of technology and the way money works now, and it is essentially digital, it's kind of painful, kind of annoying, if a bank accepts gold, and they have to take custody of it and they have to sell it. It's just a painful thing, it's kind of annoying. I can see why they wouldn't. But actually, they are a check and balance against the money printing; they reduce the power of the federal government.
But Bitcoin's a different scenario. Because it's still digital and the way exchanges work, if a bank was to accept it, like they have to in El Salvador, there's an instant liquid market where they can come out of it and then hold the dollar. So, if it was to be made legal tender, that would essentially achieve what I think the Founding Fathers would have wanted to, which is reduce the impact, or the inflationary pressure, that comes from printed money?
Aaron Daniel: Absolutely, yeah.
Peter McCormack: So, the argument for it to be included here is quite strong?
Aaron Daniel: It is. I think it's fairly strong, until you get to a strict textual analysis.
Peter McCormack: "Any thing".
Aaron Daniel: "Any thing". So, the textualists say, original intent is fixed meaning to new technology, sure, but only when you have a broad language that's capable of encompassing that new technology. And so, if you apply that here, like going back to what I was saying, "any thing" is the prohibition; that's the broad language. So, you apply "any thing" to any new technology money that comes along, because it's broad.
Again, going back to commodity monies in the colonies, there were tons of different commodity monies and tons of different monetary devices, so they knew that gold and silver wasn't the only thing, and that there would probably be some new way, a different commodity, new paper bills that come about, some new technology or scheme that would come about as money. So, that's the argument there, if you're looking at "any thing" as being broad language that encompasses anything subsequent to the founding.
Peter McCormack: But the interesting part of this for me is that, one of the things I romanticise about the Founding Fathers, which I know once you get into it, you learn about the different flaws, the different characters, what they would argue about, etc; but for me, it felt like there was this general integrity that existed to restrict the power of the federal government to avoid tyranny, because you experienced that as people under our British King. Was he even referred to as the British King back then, or referred to as the English King?
Aaron Daniel: I think you were still British, yeah, I think it was British, the British Empire.
Peter McCormack: Yeah, the British Empire. But ever since then, there's been obvious scope creep of what the federal government does, and there seems to be a lack of integrity since for those politicians, not all, but a lot of politicians not to carry out their duties with the same integrity of protecting their constituents from an overreaching government. And for me, it would feel like any interpretation of this, when it's to be debated and discussed, the starting point should be, "Should we interpret this in a way, or are we interpreting this in a way, which does reduce that power? Are we able to achieve what the Founding Fathers wanted to achieve with this?"
So, you can be literal and prevent Bitcoin, or you can be more pragmatic and understand that the introduction of Bitcoin into this does further what the Founding Fathers wanted to achieve.
Aaron Daniel: You're exactly right that there's a risk when you're talking about strict textualism that you become hyper-literal --
Peter McCormack: And tyrannical.
Aaron Daniel: Yes. And in fact, if you look at the definitions, the contemporary definitions of gold at the founding, yes, it was a metallic substance, but it also was defined as just money. So, the meaning of gold in this clause, they were just referring to money, and we know hard commodity money, but anything that's money. So, you can find contemporary textual examples that do support a broader interpretation of gold and silver, and even broader interpretations of coin, right, because that's another limiting word there, that it's got to be a gold and silver "coin".
Coin was used like we use coin today, very broadly, you know, "I'm going to coin a phrase, I'm going to coin paper money", is how they used it. Benjamin Franklin talked about "coining land" in a landbank, almost tokenising assets, like we think about today with digital assets.
Peter McCormack: And this is quite interesting, because this helps me understand a little bit more now around the debate regarding the Second Amendment, which has been debated a lot recently with the very tragic cases. I don't have a copy of the Second Amendment in front of me, but it discusses --
Aaron Daniel: Well you do, but I'm not going to --
Peter McCormack: Well, yeah, but it's a well-armed militia. And obviously, those who interpret it literal will say, "Well, these aren't militias now", but those who interpret it, I forget the language you used, but they would say, "It allows for any person to hold a weapon".
Aaron Daniel: Right, and then the Second Amendment too, some of the debate is over a well-regulated militia is kind of a prefatory clause, and then you get into, is this really defining the rest of it, or is this just an introductory clause? Yes, a well-regulated militia is important, the right to keep and bear arms, shall not be infringed. It's almost like they're two separate thoughts. At least, that's what the Supreme Court has said; they're two separate --
Peter McCormack: Is there a comma?!
Aaron Daniel: There is, there is a comma.
Peter McCormack: There is a comma, so they are two separate thoughts. But I can see that's how then the interpretation comes. Okay, back to the work that you're doing, this is at a time now where we are seeing debates from state to state regarding Bitcoin. Some states are very pro-Bitcoin, Texas is pretty pro-Bitcoin, Wyoming is pretty pro-Bitcoin, even here in Florida, it's fairly pro-Bitcoin. And then we're seeing states which have a slightly different approach. Maybe New York, you would say, is a little bit more cynical regarding Bitcoin.
This is the cool thing about living in a republic, is that you get to vote with your feet. States compete, and you can go where the laws are that you prefer, which is great. But therefore, there are people proposing, in certain states, that Bitcoin becomes legal tender. I see Dennis Porter talking about this relentlessly.
Aaron Daniel: Right, yeah, Arizona had a proposal that was just straight-up Bitcoin as legal tender. The definition of Bitcoin was very simplistic and probably wouldn't work, but yeah!
Peter McCormack: But that is a proposed bill. What is the actual process that has to go through to be ratified, say, in Arizona?
Aaron Daniel: Right, so if Arizona were to pass that bill, the legislature would pass it and then the governor would sign it into law. It would just be the law of the land until someone challenged it, and the way that would come up in that instance is somebody would try to discharge their debt with Bitcoin, and the creditor would refuse to accept. Then the debtor would have to sue, and then you'd go on from there, all the way up. It would be in state court at first, and you would have arguments that it violates Article 1, Section 10, all the way up to wherever.
Peter McCormack: And when it ends at the Supreme Court, then you have the precedent that sets it. Interesting. So, are you doing this work to help guide people, or why are you doing this?
Aaron Daniel: Exactly, that is the question, why am I doing this? Again, it is to help people and to help guide the policy, to help people think about things a little more critically, and to put these arguments out there so that these arguments exist, so if there is ever a court case, it's like open-sourcing these arguments. I want people to join in and provide some counterarguments and poke holes, and let's really vet this, because good policy should come out of that open discussion, hopefully before we get to a big case where we're arguing over constitutionality.
The Arizona bill is not going to get -- that was just kind of a political stunt. That's not really going anywhere.
Peter McCormack: That's a hack. That's a, "Bitcoiners, follow me".
Aaron Daniel: It is a hack, it's the Bitcoin hack.
Peter McCormack: Yeah. We know it exists, because we get approached by nearly every single one who wants to come on the show, they're going to get followers. But fine, in some ways maybe that's the way it should be. If that hack exists and it works, it's because it's the will of the people to want it.
Aaron Daniel: So, I want to go in and say, "I've made this argument that I think is pretty strong, that the original intent of this section should include Bitcoin". I personally don't like the idea of legal tender!
Peter McCormack: Yeah, that was like my final -- we were going to start with this, then me and Danny agreed this should be the final question, because we met up last night, went out for tacos at a Mexican and a couple of beers, and you said, "I don't think Bitcoin should be legal tender".
Aaron Daniel: Right, and so this is because going back to that definition of legal tender, that only applies to pre-existing debts. But what it's doing is, it's impairing those debts, it's impairing that private contract between two consenting individuals. That freedom of contract has been eliminated, because now as the creditor, I have to accept Bitcoin, and that's not what I agreed to.
Peter McCormack: And legal tender always has to retrospectively apply. You couldn't have it for all contracts post --
Aaron Daniel: You could put that proviso in the law, I mean sure.
Peter McCormack: But you still don't think it should be legal tender?
Aaron Daniel: I would be more in favour of something like that, where it said, "We're going to apply this prospectively", but the other thing that legal tender laws do is, they favour one money over the others, and it eliminates that kind of free, economic process that happens when you have new commodities, new goods that come onto the market, and that natural monetisation process. We're all bitcoiners, but I think we want the best money to win, and right now that's Bitcoin, but it might not always be Bitcoin.
Peter McCormack: And is there another risk that if Bitcoin did become legal tender, it would be an argument for shitcoin A, shitcoin B to be legal tender?
Aaron Daniel: Oh, yeah, that's definitely a risk. But I think the more important thing to consider… Yeah, that's a risk. But again it comes back to, we all want freedom, that's why Bitcoin exists, to be apolitical, freedom money, separate from the state. And then, when you start to advocate for the state to come and be involved in your freedom money, I hate the phrase "slippery slope", but it starts to be a slippery slope, because first it starts as legal tender, and then it moves to compulsory tender: everyone has to accept it for all transactions.
Peter McCormack: Which was one of the big criticisms with El Salvador.
Aaron Daniel: That's right. And then it moves to, well, if everyone's got to accept it, then maybe the government should just start fixing the price, which never works with any money, and especially it won't work with Bitcoin, but cause a lot of headaches for everyone. So, that's the danger. And again, if we're supposed to be separating the state from money, just like the Founders wanted to do, it's to keep the state out of the money, to keep our freedoms and our liberties intact, and that's what Satoshi wanted to do, and that was the cypherpunk movement, was to keep our liberties intact by granting the government limited permissions where possible.
So, I find it a little hypercritical of some bitcoiners who are actively -- look, if they're in Bitcoin for their bags, right, and they know that states accepting it as legal tender is going to increase the price and they're going to profit, that's fine, you do you. But then don't say you're in it for freedom and for human rights, because those things are starting to be in conflict.
Peter McCormack: Or, maybe they didn't understand it to the extent that you've explained it just now.
Aaron Daniel: Well, maybe!
Peter McCormack: Okay, let's go back 24 hours, if somebody said to me, "Arizona, Texas, Wyoming are all going to make Bitcoin legal tender", I'm not thinking about my bags, I'm thinking, "Wow, that gives us extra regulatory protection, because it's now legal tender, it advances the opportunity for more people to consider and own Bitcoin, to escape the fiat system. To me, it in some ways feels like it provides more freedoms". It's only by having this hour-plus I've had with you now that I now understand it actually reduces your freedom.
Aaron Daniel: And you're correct that it absolutely would bring those beneficial aspects of shining a light on Bitcoin and getting everyone aware of it.
Peter McCormack: But it reduces your freedom.
Aaron Daniel: It does, it's going to reduce your freedoms. Look, some people are going to say, "Well, it's inevitable, governments are going to do this anyway", and yeah, they probably will, but let's not invite the government in now when we still have time to strengthen Bitcoin against attacks, be they governmental or otherwise. The other thing is, there are alternative policies that achieve those same beneficial results.
Peter McCormack: That was going to be my next question, "What legal protections would you like to see?"
Aaron Daniel: You're starting to see them, right. Gillibrand and Lummis' crypto digital asset law, which is going to provide tax exemption on transactions under $600; that's great. I think that's what a lot of people want.
Peter McCormack: Which rises with inflation, which is a really smart clause.
Aaron Daniel: It is, it's a really smart clause, and I hope it stays in. I would be in favour of a larger initial transaction limit, but $600 is great. I just hope it doesn't get batted down when it comes to the backdoor and fights with Treasury, and everyone else.
Peter McCormack: But that's a federal bill?
Aaron Daniel: Yeah, that's a federal bill, it's not something states can do. I'd like to see Bitcoin clauses like the gold clauses we were talking about in contracts, and then I'd like to see states passing bills that say, "Any money you want, that you contract for, that's what the judgement has to be satisfied in", because otherwise you get a situation where we contract in Bitcoin, there's no USD denomination whatsoever in our contract, 1 Bitcoin is 1 Bitcoin. And then, we get into a dispute, you win a judgement against me, because I didn't pay you the Bitcoin, but because USD is legal tender, the government says, "Well, 1 Bitcoin is equal to $19,000, so here's your $19,000", but you don't want the $19,000, you want the Bitcoin.
So, unless you have those laws that are saying, "We're going to respect freedom of contract and whatever monies are chosen by the consenting parties", you can put all the clauses you want in your contract. But if you have to enforce them, they're not going to be enforced the way you want. So, that's something the states can do, and that is a general purpose law that would encompass altcoins, would encompass anything, would encompass tobacco notes maybe!
Peter McCormack: Is there a group of Bitcoin-interested lawyers who are actively getting together and discussing these things? Do you have a cohort that you are working with on these discussions, because I think, like I said, I think some people pushing towards having legal tender perhaps don't understand the implications of it; a bit like you have the Bitcoin Policy Institute working on educating within Congress hopefully, do you have a cohort where you're out there actually trying to help people who are pushing for changes to legislation?
Aaron Daniel: So, it's interesting talking about a cohort of Bitcoin lawyers. Look, there's tons of digital asset lawyers who are very smart and very good at what they do.
Peter McCormack: Well, they're going to be busy helping with the SEC.
Aaron Daniel: Exactly. And there are groups of those that are more in the DAO space, and there are DAOs of lawyers who get together. But it's not Bitcoin-focused. There aren't too many lawyers who are Bitcoin-focused.
Peter McCormack: But there might be some who are interested, like yourself. I'm just thinking, if that cohort existed, then you could be having those discussions, debates about the implications of some of the things people are doing, then you could help educate via my show, or via a Twitter Space, or when Dennis Porter is pushing something.
Aaron Daniel: What I'm actively exploring now is putting together a kind of Amicus programme, or a judicial education programme, and I've been in talks with some policy groups. Nothing's settled yet, so I'm not going to say anything about it. But this is what I'm exploring doing, and educating the policymakers and those who are advocating for policy, but also the judiciary; because the groups like the Bitcoin Policy Institute and Bitcoin Today Coalition, they're focused on talking to lawmakers and talking to the agency enforcement arms, but they're not talking to the judiciary yet.
So what you've got is, you've got the lawmakers who are going to make the law are being educated on Bitcoin; you've got the agencies who are going to enforce the laws being educated on Bitcoin; but then, the judiciary who's going to review that enforcement are not being educated on Bitcoin. So, I kind of like to think of those three, that's the three separations of powers: Congress, the agencies around the executive, and the judiciary.
It's kind of like Bitcoin. Lawmakers are kind of like the devs; they write the code, they write the law. Then the miners, they're like the agencies; they run the code, they enforce the protocol. But then you've also got validator nodes, who check the work of the enforcement prong and that's the judiciary, and we haven't had much outreach to the judiciary yet.
So, that's what I'm exploring doing, is helping either through appearing in cases on behalf of interested policy groups to file Amicus briefs. Coin Center does this work and they're super-smart guys over there, and they've been doing it a hell of a lot longer than I have. But they're a large tent and they're not focused expressly on Bitcoin. So, to get a group together that would be interested in doing that, that's one of the things I'm exploring now.
Peter McCormack: That's quite interesting, that separation of powers within Bitcoin that you've identified and how that works. I think I've heard that before; maybe I have.
Aaron Daniel: I'm sure I'm not the first person to mention that, I'm sure.
Peter McCormack: Yeah, but it's quite interesting and it's quite interesting the rules of consensus are a bit like the Constitution. It's almost like Satoshi --
Aaron Daniel: It's almost like it's intentional, right?!
Peter McCormack: It's almost like he looked upon the separation of powers and the Constitution, and that's part of the framework he used to build Bitcoin. That's fascinating. Is there anything in this I've not asked you about that we've missed?
Aaron Daniel: I mean, I could go on all day. I don't know what else you want to talk about. So, one of the other things I'm exploring is, you were talking about some states being anti, or hostile to Bitcoin. New York passed their moratorium on proof of work, which hasn't been signed by the Governor yet. So, I wrote another article on that, and how the moratorium would be a violation of the First Amendment, freedom of speech. So, I'm exploring a test case related to that.
Peter McCormack: I think we're going to save that for another show.
Aaron Daniel: I think that's okay! There's a lot to talk about there.
Peter McCormack: We did discuss that before. So, we had it here and we're like, look, we always want our shows to be between an hour and an hour and a half, that's the sweet spot. We're like, "If we're running about 45 minutes, then we'll go into that", but we've got to come back to Miami soon, and I think that would make for a second fascinating show.
Aaron Daniel: Yeah, and maybe I'll have a lot more concrete to discuss about that on the next show.
Peter McCormack: So, some people listening won't know you, won't have heard of you, but might be interested in getting in touch, want to talk to you, engage with you. How do they find you?
Aaron Daniel: You can find all of my articles on bitcoinbrief.io, that's my newsletter. I've also published a couple of articles in Bitcoin Magazine, you can just search for Aaron Daniel on Bitcoin Magazine. Shoot me an email at aaron@bitcoinbrief.io and then my Twitter is @wadaniel. You can also just search me on the Florida bar website, call my office.
Peter McCormack: Well, we'll shove that all in the show notes. Look, I'm really glad we got to do this, it was fascinating.
Aaron Daniel: Yeah, thank you for having me on. This has been a great discussion.
Peter McCormack: What were we stopped by? Was it, we were stopped by a hurricane before or a tornado?
Aaron Daniel: Yeah, it was a tropical storm. I was going to meet you in Nashville, and the first storm of the season blew through, and I was telling Danny, one of my friends' neighbourhoods was completely flooded. His house was okay, but it was a little dicey there. We've been okay thus far, hurricane season hasn't kicked up too bad yet.
Peter McCormack: Well, I'm glad we got to do this, and we will do it again, because we've already realised we've got to come back to Miami pretty soon.
Aaron Daniel: Always got to come back to Miami!
Peter McCormack: Always got to come back to Miami. But yeah, look, really appreciate you coming on, man. This was fascinating, really interesting to hear, and anything we can do to help you, you stay in touch, and good luck with this, man.
Aaron Daniel: I appreciate it, thanks.
Peter McCormack: I think people are going to want to talk to you.
Aaron Daniel: Yeah, I welcome all criticism and discussion. Please seek me out.
Peter McCormack: All right, man, well listen, good luck with this.
Aaron Daniel: Thanks, appreciate it.
