🟩 Alpha Drop

Welcome back to another edition of Bitcoin Insights. This week, we’ve got a special ‘Alpha Drop’ from the digital nomad himself Luke Mikic!

In this article, Luke provides a deep dive on three critical different forms of sovereignty and how to leverage them to become a digital renaissance man!

Many Bitcoiners often make the false assumption that they’re fully self-sovereign, but what does that actually mean? What types of “sovereignty” are we actually referring to?

In reality, there are different forms of sovereignty:

1. Financial Sovereignty

2. Geographical Sovereignty

3. Entrepreneurial Sovereignty

Bitcoiners are fortunate enough to be financially self-sovereign simply by hodling BTC, but this still ignores the other two thirds required to be a fully self sovereign renaissance man.

The reason behind the emergence of these different forms of sovereignty is certain key megatrends that have recently began their parabolic upside move.

These trends are reshaping the way we interact, do business, and ultimately perceive the world. So if you don’t have a firm understanding of what these trends are, you’re unlikely to be able to effectively capitalize on the them.

Therefore, today we’re doing a deep dive into these different forms of sovereignty to help illuminate you on their primary drivers and how to to best incorporate them into your life.

⌛️ Estimated Read Time: 0.8 Blocks (~7 Mins)

Trend #1: Financial Sovereignty

The first exponential trend to explore is the large population of individuals seeking financial sovereignty.

By analyzing any historical chart, Bitcoiners would all agree that bitcoin’s price is growing at an exponential pace. What many Bitcoiners may not agree upon however, is the pace of Bitcoin adoption.

The first question is how to actually measure bitcoin adoption? Some common potential pitfalls include:

• Do we analyze the number of Bitcoin wallets with a certain number of on chain $ value?

• How do we incorporate/adjust for those who have Bitcoin exposure through the ETF’s and Bitcoin Miners?

• How to account for the older coins that are presumed lost by Satoshi?

Before we explore three different adoption estimations we need to make one thing clear… Bitcoin has different adoption curves depending upon what function you’re anticipating Bitcoin will likely fulfill.

For example, do you believe Bitcoin will be a direct competitor to gold (i.e. a store of value), or do you believe the technology will one day also fulfill the function of a global medium of exchange?

Now that that’s out of the way, lets take a quick look at our three different adoption curve estimates.

Estimate #1:

For our first estimation, lets defer to the excellent analysis of Jesse Myers who estimated the percentage of the world has self custodied more than half of their net worth into Bitcoin.

This estimate uses the data of what can best be described as a Bitcoin maximalist. The statistics suggests that less than 1% of the world has adopted Bitcoin today.

Estimate #2:

When analyzing on-chain data, we need to understand that blockchain data is incredibly messy and thus can often give conflicting dtat depending purely on how certain data is labeled.

As such, I’ve used the number of Bitcoin addresses above 0, a rather crude metric in an attempt to remain approximately accurate.

Once divided by the global population of ~8bn we end up with a figure of 0.6% (also below the 1% threshold in our first estimate above).

Estimate #3:

In our third and final estimate we included individuals who signed up to exchanges, but haven’t yet decided to self custody their Bitcoin holdings.

Analyzing exchange balances represent a similar limitation to on-chain data i.e. there may be multiple smaller wallets that are all controlled by one large whale, thus skewing the bitcoin adoption estimates.

When analyzing those who signed up for an exchange to buy bitcoin/crypto, Crypto.com found there to be ~580 million total global users. The data showed 70% of these people had bought Bitcoin at some point in time, implying ~406 million Bitcoin users.

This represents a 5% global adoption rate for Bitcoin.

Irrespective of which of the above three estimates you believe, I think we can alla agree we remain in the very early innings of global Bitcoin adoption.

Based on the widely known S-curve Adoption chart (below), should Bitcoin continue its relentless adoption growth higher, we are likely still in the “innovators” or “early adopters” phases of the broader adoption trend.

Trend #2: Geographical Sovereignty

The second exponential trend we’re exploring today is the group of individuals seeking geographical sovereignty.

The number of digital nomads has skyrocketed from ~5 million in 2018, to more than 35 million in 2023 (a 7x increase). This is astonishing when compared to the trend of remote work which itself took over a decade to reach 4.8 million nomads.

Since 2019, this trend has been increasing by 51.8% per annum, representing an increase of over 6 million nomads every single year.

An inflection point was clearly reached in the 2018-2020 timeframe, which resulted in adoption growing exponential. To put this into perspective, if digital nomads constituted a country, they would rank as the 41st largest country by population globally.

From this growth alone, it appears clear that Balaji Srinavason’s concept of a network state has already come to life; however it’s not the only exponential trend radically impacting the way we' conceptualize the role of governments in the digital age.

Trend #3: Entrepreneurial Sovereignty

The third exponential trend may be more difficult to spot than the first two we discussed, but it is arguably the most important.

This trend is characterized as those individuals embracing digital and online Entrepreneurial Sovereignty.

Globally, numerous people are beginning to realize that our educational system was developed for the industrial age, and designed to promote career specialization and firm loyalty i.e. trust in the process by working as a cog in a broader ‘industrial machine’.

This educational system trained a certain set of individuals (many of whom are now retiring) for their jobs in the industrial age, but leaves the latest population cohorts terribly ill equipped to thrive in the digital age. 

People are beginning to realize this, and are essentially quitting the traditional ‘’9-5’’ deciding to rather to utilize technology to realize productivity efficiencies and start their own businesses as entrepreneurs.

This is clearly exhibited in the early 2000’s as global internet adoption hit its parabolic growth curve (perhaps similar growth is imminent for Bitcoin’s adoption in the next cycle?).

This self employment movement is happening everywhere in the western world, but the above charts is still unable to capture the gravity of this new online, decentralized movement.

The reason is that many of these reported metrics do not include many of these new digital entrepreneurs. However I think I have a proxy to solve for this, namely the trend of new YouTube channels being created.

The number of YouTube channels doubled in the last 12 months, growing from 50 million to 114 million in 2024, reflecting an exponential trend in and of itself.

This trend is particularly interesting because I believe it reflects what I believe to be one of the largest problems in todays society, namely a loss of trust in traditional (typically centralized) systems.

This is seems to be corroborated by the steady decline in views for “mainstream” media.

The rise of Joe Rogan (and his ability to garner substantially more views than a traditional mainstream media platform such as CNN) is another exemplification of this trend. Individuals appear more likely trust a face/persona than a company.

From streaming on twitch, to creating a blog, or even an online educational course, digital entrepreneurs are capitalizing on the exponential reach the internet provides to the individual.

Key Takeaways

As we’ve explored, there are three exponential emerging trends emerging today, all of which dovetail along the mutual theme of distrust by individuals.

Not only are these trends unlikely to slow down, I believe they’re likely to continue their exponential rise, and in order to correctly leverage them, we must first understand their underlying catalysts and growth drivers.

1. Individuals are seeking financial sovereignty because they don’t trust their government (in particular the government’s willingness to debase their citizens currency)

2. Individuals are seeking geographical sovereignty because they don’t trust their government to promote fairness and wealth equality.

3. Individuals are seeking entrepreneurial sovereignty because they don’t trust their government to create a well functioning job market with fair pay standards.

In order to become a “digital renaissance man”, I would recommend employing all three of the above forms of sovereignty. To do so, all you have to do is:

Step 1: Hold Bitcoin (financial sovereignty);

Step 2: Spend and save in Bitcoin (geographical sovereignty); and

Step 3: Earn in Bitcoin (entrepreneurial sovereignty).

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