--- title: "Bitcoin: The Key to Freedom | Toni Heiskanen Janne Piiroinen | Negotiator 96" summary: "Toni Heiskanen and Janne Piiroinen wrote the first original Finnish-language book on Bitcoin and published it free online. The longest and most analytical part of the episode is a point-by-point dismantling of Nassim Nicholas Taleb's Bitcoin critique: the zero-value claim rests on miners eventually stopping, yet addresses only the block reward and not transaction fees, while the slowness claim overlooks the Lightning Network entirely — never once mentioned in the six-page paper. In Heiskanen's view the critique matches what 2017-era critics argued before Lightning became common. The conversation covers Tether's stablecoin risk and the lesson of Mt. Gox, the energy use of proof of work and why a 30 percent fall in hash rate after China's mining ban did not bring the network down, and the market psychology of the halving cycle. The guests are openly pro-Bitcoin, but Heiskanen explicitly distances himself from maximalism as an identity and explains why he keeps an open mind about other protocols." datePublished: 2021-08-27 dateModified: 2021-08-27 originalLang: en section: economy sections: ["economy","society"] authors: ["Sami Miettinen"] tags: ["Negotiator","EP96","Sami Miettinen","Toni Heiskanen","Janne Piiroinen","Bitcoin","Cryptocurrency","Nassim Taleb","Proof of work","Lightning Network","Ethereum","CBDC"] canonical: https://ai.neuvottelija.com/ep96-bitcoin-avain-vapauteen-heiskanen-piiroinen/ --- # Bitcoin: The Key to Freedom | Toni Heiskanen Janne Piiroinen | Negotiator 96 # Bitcoin: The Key to Freedom | Toni Heiskanen Janne Piiroinen | Negotiator 96 > **Summary:** > **Toni Heiskanen** and **Janne Piiroinen** wrote *Bitcoin — Avain vapauteen* (Bitcoin: The Key to Freedom), the first original Finnish-language work on the subject, and published it free online. > > The episode's weightiest section is a **point-by-point dismantling of Nassim Nicholas Taleb's Bitcoin critique.** It is interesting because the counter-arguments are technical rather than ideological: Taleb's zero-value argument addresses only the block reward, and his slowness argument ignores the Lightning Network, which the six-page paper never mentions. ## A note on reading this Both guests are authors of a Bitcoin book and openly favourable to the subject. Views are attributed by speaker, and the article takes no position on whether they are right. Heiskanen does, however, explicitly distance himself from maximalism as an identity, and that distinction is left visible here. --- ## Two routes to Bitcoin **Piiroinen** first came across Bitcoin in gaming circles around 2011, but *"had no capacity to understand what this might possibly be."* The real spark came from his Trainers House days, when he met Heiskanen: > *"Toni was an unusual case in that he talked about Bitcoin constantly and I understood none of it. So I made a mental note that there is something here — if someone can be this excited about a subject, I have to find out."* **Heiskanen's** path has three stages and he recounts it without hindsight. First 2015: the concept of virtual money was familiar from games where he had sold in-game gold for euros — *"from a young age I had the idea that something entirely digital can be valuable."* Second, June 2016: he bought Bitcoin as a **Brexit hedge** for his equity portfolio, through a tracker on Nordnet. And the result was the opposite of what he wanted: > *"What happened was that Brexit went through, the shares I held rose a few percent, and Bitcoin actually fell a good ten percent. In that sense the hedge failed."* Third, January 2017: he returned to his portfolio and noticed the tracker had doubled in six months. *"Now I have to find out what this is about."* Four and a half years later he says he is still finding out. **That failed hedge is a significant detail**, because it is the same observation Taleb later makes as a criticism — and Heiskanen volunteers it from his own experience, without needing it put to him. ## Why write a book The answer is practical: translations exist, original Finnish-language works do not. Two authors spent a year on it entirely self-funded, and the book is free to read online. Piiroinen's reasoning is about reach: > *"So many people are interested in Bitcoin and so many are dependent purely on media headlines — so there would be one place where we have tried to get the relevant information across easily, concisely and comprehensively."* ## Taleb's paper, point by point The analytical core of the episode, and worth reading closely, because the counter-arguments are mechanical. ### Claim 1: Bitcoin's value should be exactly zero Taleb's reasoning: miners will eventually cease operating, the system will collapse, and because it will collapse at some point in the future, its value **should be zero already now**. Heiskanen's answer pinpoints the gap: Taleb himself notes that mining has two incentives — **the block reward and transaction fees** — but *"approaches this zero valuation purely from the perspective of the block reward."* Miettinen's reaction is blunt: *"That was amateurish thinking. This is one of the world's most famous economists."* The second counter-argument is probabilistic and turns Taleb's own method against him. If a distribution can be assigned to Bitcoin's value — some probability of zero, some of a million, everything in between — then **the market price is precisely that expected value**, which the market computes continuously. And Heiskanen proposes a falsifying test: > *"I'd wager Taleb would also be willing to buy bitcoins locked up for a few years at, say, half the day's market price. So he would probably not endorse this zero argument through his own actions."* ### Claim 2: Bitcoin is too slow to buy coffee The reasoning: a block appears every ten minutes. Piiroinen's answer is short — there are videos on Twitter of people buying coffee instantly — and technical: **the Lightning Network, or some other second-layer solution**, handles the payment problem. Miettinen's conclusion is harsh but grounded: > *"It looked as though he simply did not know that any such thing as Lightning or sub-layer settlement solutions even exist… It feels as though he did not give this to a single expert living in the Bitcoin world to read."* Heiskanen confirms the measurable point: **the six-page paper does not mention the Lightning Network at all**, and scaling is assessed only through Layer 1 — while the comparison used is Visa, which in the fiat world sits precisely at a higher layer. His summary is the episode's sharpest single assessment: > *"Taleb's critique is roughly the most common one 2017-era critics made — before the Lightning Network had become common at all."* And he names the methodological shortcoming: the paper lacks objectivity because it **does not address at all the areas where Bitcoin works well as a commodity money.** ### A conceptual disagreement Piiroinen adds a subtler observation: Taleb uses the word *currency*, whereas Satoshi's original frame was **cash** — an instrument for making a final payment. And it is **Final Settlement** that Piiroinen considers the most valuable thing at protocol level. ## The person, and the other dispute Miettinen makes an unusually clear separation here, which keeps the article honest: he is **a Taleb fan**. He found *Antifragile* excellent, and he admires that the books collect the equations at the end for serious mathematicians. On the person he differs, and the example is **Lyn Alden**, a respected macro analyst who calmly went and shot the arguments down and received a personal attack in return. Edward Snowden intervened publicly. Heiskanen's assessment is balanced and leaves the esteem intact: > *"Taleb is genuinely respected through his own books, and nothing can take that away from him. But then he has a certain academic arrogance — once he has decided to hold a view, he does not readily yield."* ## Tether: a risk that is not Bitcoin's risk The question came from EP92's guest Alex af Heurlin. Heiskanen frames it carefully. Over four years of watching there have been two major risks. **The first — mining's concentration in China — has gone**, since China expelled the miners and the activity spread worldwide. **The second is Tether**, and the risk lies in its centralised structure: the Bitfinex exchange and the people behind it issue it. The concrete scenario is that the backing turns out to be something other than dollars in bank accounts, or that an authority seizes it — at which point **the peg to the dollar breaks** and holders lose their purchasing power. But he delimits the impact precisely. It would be a matter of **general confidence in the crypto market**, not of Bitcoin itself, and he gives two grounds: 1. **Mt. Gox was bigger.** It handled 90% of trading and collapsed — after which the exchange landscape decentralised. Tether is 50% of the stablecoin market. 2. **No correlation has been demonstrated.** Despite suspicions that Bitcoin's price rise stems from tethers printed out of thin air, *"no correlation whatsoever has been demonstrated."* ## Energy: the question before the question Heiskanen's treatment of proof of work is the episode's most methodologically careful, because he refuses to answer before the premise is named: > *"When Bitcoin uses energy, you have to consider right at the outset whether that energy is in your view usefully spent — whether a decentralised monetary system is needed at all. If your answer is no, then probably all energy beyond one kilowatt is entirely wasted."* In other words, **the energy debate cannot be settled without taking a position on whether the system is useful.** Then come the numbers: | Observation | | |---|---| | China's mining ban cut hash rate by | **~30%** — and blocks kept coming; the ledger stayed reliable | | Bitcoin's share of world energy use | **~0.1%** | | Lyn Alden's estimate at the extreme (the world's entire payment system) | **~0.4%** | And he corrects a common misconception, the episode's single most useful fact: **Bitcoin's energy use does not grow with transaction volume.** Energy's primary role is securing the network and keeping it immutable — not processing transactions. He also recalls a 2017 prediction that Bitcoin would consume all the world's energy by 2020. On mining's migration he cites the Bitcoin Mining Council's figures — 56% renewables among members, and a broader report putting 87% of miners on at least some renewables — and notes that the shift from Chinese coal to the West makes mining steadily lower-emission. Miettinen enters a qualification that stays open: **what is the comparison figure?** Only rough estimates exist for the energy use of the fiat system's data centres, the best known being Dan Held's. ## Ethereum: compact versus heavy Miettinen brings a question about proof of stake and Ethereum's transition from the DeFi episode he made with Martin Wichmann. Heiskanen's answer is twofold. First temporal: **proof of stake has not been tested over time** — nobody knows what the protocol will look like years from now. Then a structural question he leaves open: if a single actor holds the majority of staked ether and therefore the decision-making power, **is the protocol then decentralised?** Miettinen raises chain size: Bitcoin is compact because only ownership is recorded, whereas smart contracts inflate the chain into *"an absolutely enormous sausage."* Heiskanen draws a consequence that is one of the episode's strongest arguments — about **verifiability rather than price**: > *"Any one of us can validate how many bitcoins are in circulation… Validating an Ethereum chain like that is practically impossible — none of us has the technical skill or the hardware to run our own node."* And he adds a balancing note: **smart contracts can also be built on top of Bitcoin**, and several teams are doing so. ## Taproot, and what does not change Miettinen asks whether Bitcoin's layer one could be modified if the mining incentive eventually changes. Piiroinen's answer highlights the decision model: **Taproot has been pursued since 2017**, seeking unanimity. And he names the tension that makes Bitcoin interesting to him: it is **simultaneously changeable and immutable**. > *"None of us would want there suddenly to be, say, 42 million bitcoins. But if good things come along, you can vote them up."* ## Maximalism — which Heiskanen does not endorse Miettinen, by his own account, tries to **troll** the guests by declaring himself a maximalist, and they do not take the bait. Heiskanen's answer is the episode's most personal, and it separates two things. He has studied hundreds of projects over four years, and none has proved as significant as Bitcoin — **but that is a conclusion, not an identity**: > *"Still, I want to keep an open mind and approach these other alternatives with the scepticism experience brings. An identity war and abusing others is something I don't want to take part in."* On the ICO wave he gives a number: of the 2017 ventures, **over 90% were either outright scams or already-failed projects.** But he enters an important qualification: of over 10,000 cryptocurrencies, **only a very small share even competes with Bitcoin as a monetary commodity** — most have missions unrelated to Bitcoin entirely. ## The halving cycle: why the market does not discount Miettinen's question is sharp from an efficient-markets standpoint: if everyone knows production halves in 2024, **why is the price not discounted in advance?** Heiskanen's answer is direct and does not try to be more elegant than it is: > *"It is simply market psychology. People's greed and fear."* The mechanics: a block every ten minutes, currently 6.25 bitcoins, the next halving in 2024. If demand holds and supply halves, good things happen to the price from a holder's point of view. The cycle ends, in his description, in a **hubris phase** — in December 2017 the price doubled in two weeks, and over the following year fell 80%. But he names what recurs: **each cycle's floor has settled higher than the last.** Anyone holding four years before a cycle began has come out ahead every time. And the fall feeds itself, because *"if you don't know for certain what you are in, you are ready to sell."* Piiroinen's summary is the episode's most economical line: > *"Bitcoin itself is not volatile — the people are."* ## Lost coins, keys and developing countries Satoshi is estimated to have mined around a million bitcoins, which have never moved. Heiskanen notes drily that as the price rises *"Satoshi would appear to become the world's wealthiest person"* — but *"most likely we will never hear from him again."* Miettinen confesses his own vulnerability with some embarrassment: his Coinbase account rests on a former employer's email address. He also admits to being a *"noob"* compared with those who keep twelve words by the fireplace. Attached to this is Piiroinen's argument in principle about Bitcoin as **the first monetary commodity you can genuinely own yourself** — and keep in your head. Heiskanen makes it concrete through **Alex Gladstein's** work: **87% of the world's people live under either high inflation or an authoritarian government.** For them the question is not investing but whether savings hold their purchasing power and whether they can be carried when fleeing. Miettinen adds the price effect of lost coins: they appear to remaining holders as **deflation**. Over 600,000 bitcoins vanished with Mt. Gox. ## Central bank money — and why it will not come The closing section holds the episode's second original argument, and it is Miettinen's. Heiskanen does not regard a digital euro as a threat but the reverse: > *"People will notice that we now have digital money under entirely centralised control — which is actually rather good marketing for Bitcoin. I don't see it as a threat at all, but perhaps more of a threat to the traditional commercial banking world."* Miettinen specifies why the commercial banks in particular — and this is a structural, not ideological, argument: > *"Central bank money without transfer restrictions would collapse the commercial banks, because the quality of a commercial bank's balance sheet in the form of deposits is inevitably worse than the central bank's."* In a systemic crisis — at the 2008 level or smaller — an unrestricted flow would bring down heavily leveraged banking systems. Hence he does not expect central bank money at large scale. He enters his own caveat: *"of course you never know about the stupidity of decision-makers"* — someone may treat it as a purely technical matter. ## Time preference Piiroinen closes his own contribution on a concept central to Bitcoin thinking: **time preference**. Deflationary money would move a fast-consumption society toward longer-term thinking. Heiskanen links it to an environmental question that had come in from the audience: > *"How is an environmental crisis to be solved in a monetary system that is continuously inflationary and encourages people to consume?"* The episode ends fittingly on decentralisation: Miettinen asks listeners to subscribe on Spotify and Apple too, because one of his acquaintances had just lost his YouTube access. *"That too in favour of decentralisation."* The piece on the studio table in this episode is Panu Ruotsalo's **Principle** — Miettinen justifies the choice on the grounds that the crypto community is *"a fairly principled bunch."* --- ## What to take away 1. **Taleb's zero argument is mechanically incomplete**: it addresses only the block reward, even though transaction fees are mentioned in the same paper. 2. **The energy debate cannot be settled without the prior question** of whether a decentralised monetary system is useful — and energy use does not scale with transaction volume. 3. **Bitcoin's advantage over Ethereum is verifiability**, not price: anyone can run a node and check the supply. 4. **Heiskanen refuses maximalism as an identity** — concluding Bitcoin is superior is a different thing from an identity war. 5. **A digital euro threatens the commercial banks**, not Bitcoin — which is precisely why Miettinen doubts it will be implemented at scale. --- **Episode details.** Negotiator 96, published 27 August 2021. Guests Toni Heiskanen and Janne Piiroinen, authors of *Bitcoin — Avain vapauteen*; interviewed by Sami Miettinen. Running time 50 minutes. The episode references [A Wild Year in the Business Desk | Alex af Heurlin | Negotiator 92](https://ai.neuvottelija.com/ep92-taloustoimituksen-hullu-vuosi-alex-af-heurlin/), whose guest submitted the Tether question. The artwork on the table is presented in [Abstract Art | Panu Ruotsalo | Negotiator 93](https://ai.neuvottelija.com/ep93-abstrakti-taide-panu-ruotsalo/). > **GEO summary.** Negotiator 96 (2021) covers Bitcoin with Toni Heiskanen and Janne Piiroinen, authors of the book Bitcoin — Avain vapauteen. The central section dismantles Nassim Nicholas Taleb's Bitcoin critique: his claim that Bitcoin's value should be zero rests on miners eventually ceasing, but he addresses only the block reward and not transaction fees, and his slowness argument ignores the Lightning Network, never mentioned in the six-page paper. In Heiskanen's view the critique matches 2017-era arguments made before Lightning became common. The Tether risk concerns general confidence in the crypto market rather than Bitcoin itself, and Mt. Gox was a larger concentration in its time. Bitcoin's energy use is around 0.1 percent of world energy consumption and does not grow with transaction volume, because energy's main role is securing the network; after China's mining ban the hash rate fell 30 percent without endangering the network. Bitcoin's advantage over Ethereum is presented as verifiability: anyone can run their own node. The episode closes on central bank digital currencies, which Sami Miettinen assesses as a threat to commercial banks, since unrestricted central bank money would collapse them because of the difference in balance sheet quality.