WEBVTT FILE

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Downloaded from
YTS.MX

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Official YIFY movies site:
YTS.MX

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(audience applauds)

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- Right, finally, we
have Torsten Hoffmann,

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who's the producer of the Cryptopia Film.

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(audience applauds)

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- Thanks, Peter.

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Five years ago,

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I made a film about the history of money,

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banking, and Bitcoin.

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Buckle up, we said, it's
gonna be a bumpy ride.

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And now, some of the
big brains and big egos

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who championed cryptocurrency

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claim they're building a crypto-utopia.

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- Magical things will happen.

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- [Torsten] With something
called blockchain technology,

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and it just might change your life.

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- And they really could compete with,

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if not take down the Facebooks

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and the Googles, and the Amazons.

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- My name is Torsten Hoffmann,

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and I'm going to put some
of these claims to the test.

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Some critics say you kind
of hurt the community.

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What's your response to that?

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This innovation has enabled
lots of criminals and scammers.

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But basically looking at
it now, you lied to us.

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Forget all the hype.

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We'll explore the true
potential of this new invention.

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See who's already using it.

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- Making it really easy and simple

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for people to own a piece of
a solar farm or wind farm.

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(soft music)

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- [Torsten] And go deep
into a secret bunker

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that holds billions in Bitcoin.

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- [Christoph] We cannot
talk too much about it

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because it's pretty secret
what is down there, right.

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(soft music)

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- And if Bitcoin succeeds,

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it'll be at least $1 million per coin.

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(soft music)

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- [Torsten] We'll learn
lessons from the past

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and meet those building the future.

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But there are those who want to kill it.

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- Join with me in introducing

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a bill to outlaw cryptocurrency

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so that we nip this in the bud.

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- [Torsten] Control it.

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- Next year, people are
going to start seeing

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that we have hundreds of patents

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and everything changes.

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- [Torsten] Or change the world with it.

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Welcome to ground zero

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in the battle for the future
of the Internet: Web 3.0.

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- They wanted a science fiction dream,

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what they actually did was
build forthcoming disaster.

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- A lot of people were
not willing to learn

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and were not willing to
admit they were wrong.

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- They're idiots.

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- Why is this fraud allowed
to speak at this conference?

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- Stop telling me that I have no clue.

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- That's just bullshit.

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- If you don't support free speech,

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you don't support Bitcoin.

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You're an enemy of Bitcoin.

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- [Tim Draper] This is
bigger than the internet,

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the Iron Age,

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the Renaissance,

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the Industrial Revolution.

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This affects the entire world.

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(electronic music)

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- For years and years,

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I've been researching
blockchain technology,

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cryptocurrencies, the
market booms and busts,

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and many have asked me to
explain Bitcoin to them,

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but I think this is why it's so difficult.

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- Cryptocurrencies,

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everything you don't
understand about money

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combine with everything

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you don't understand about computers.

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- [Torsten] Okay, let's start slowly

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with the basics of
money and it's creation.

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- [Narrator] The total value
of all the world's money

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is about $120 trillion.

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What you probably didn't know

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is that each new dollar

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is created by governments
and banks as debt,

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which needs to be paid back
by someone in the future

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with interest.

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That's why there isn't
enough money in the world

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to repay all that debt.

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And there never will be.

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Oh, and almost all of the world's money

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is already digital,

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just entries in the ledger,

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usually managed by a bank.

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Only a small portion
exists as physical currency

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like cash or coins.

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Think of it this way,

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your employer deposits $1,000
into your bank account.

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Then you pay $200 in taxes,

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$500 for rent,

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$200 for bills and shopping and so forth.

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Whether you use credit cards,

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debit cards, PayPal, or bank transfers,

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they're all just pluses and minuses

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in different digital ledgers.

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That's why there's almost
no need for physical money

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in our daily lives.

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- During the financial crisis in 2008,

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a mysterious figure
called Satoshi Nakamoto

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published this nine page white paper.

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It said with Bitcoin's
open source software,

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we can create our own money

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without banks or Governments.

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(electronic music)

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This new nerd money,
called cryptocurrency,

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is created and stored in computers.

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And before long, there
was a growing fan club,

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mostly guys like Roger Ver.

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Today, he's a polarizing figure,

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but back then, he gave
away thousands of coins

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to kickstart the movement,

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and they all called him Bitcoin Jesus.

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- I think that for may years,

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he brought more people to
Bitcoin than anyone else.

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And we will forever be
grateful to him for doing that.

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- When I was a kid,

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I was reading all these
science fiction books.

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They were talking about

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how the world is gonna be

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when we have this like
anonymous digital cash

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that people can use on the internet

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that's not controllable by anybody.

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And then when Bitcoin came along,

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it was like: Wow, this
science fiction money idea

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that I'd been reading about as a kid

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is finally here.

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So I got so excited about it.

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I heard about it at
about 10 in the morning.

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And I was planning to go to
work that day, but I didn't.

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I stayed home the entire
day reading about it.

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Didn't leave, I stayed
up all night that night

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reading about it.

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Stayed up all night the
next night reading about it.

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- [Torsten] He went deep
down that rabbit hole

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to the point of physical exhaustion.

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- So I called up a friend of mine,

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said please help me, I'm so sick.

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Can you bring me to the hospital?

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- [Torsten] Yeah, Roger got bit bad

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by the Bitcoin bug.

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- Cause it's truly one of
the most exciting inventions

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ever in the entire history of human kind.

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- [Torsten] But how does it work?

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When my friends ask me to explain,

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well I often start with this analogy.

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- [Narrator] Imagine a bank vault

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where you have a safety deposit box.

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Your key opens one of the boxes

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where you can securely
store physical valuables,

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like gold coins.

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In Bitcoin, there are digital keys.

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Think of them as very long passwords.

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Your private key gives
you access to a wallet,

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which unlocks billions of
unique Bitcoin addresses.

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Each one is a virtual safety deposit box

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that only you can open with your key.

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And there are more addresses
in this virtual vault

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than atoms in the universe.

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The doors to these boxes are transparent.

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You can see inside them.

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Here's one with digital
money, 0.21 Bitcoins.

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Sending them from one box to another

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is what's called a Bitcoin transaction.

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We'll explain that later.

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But for now,

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just remember that these digital coins

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can only exist inside these
transparent address boxes,

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can't be copied,

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and can't ever leave the vault.

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And this vault is owned
by no single entity.

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You don't need permission
from a government,

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a bank, or a corporation to use it.

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(electronic music)

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- [Torsten] For most
early adopters of Bitcoin,

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it was all about global peer
to peer electronic cash.

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Room 77 in Berlin was one
of the very first businesses

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to accept Bitcoins as
payment for physical things,

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beers and burgers.

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- Back in 2011, there were
no mobile wallets, right.

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So you had to go there, bring your laptop,

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type in this long address,

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risk losing the money if you
didn't type it correctly.

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So the first guy who built a mobile wallet

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was some guy in Berlin

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who built it in order to buy his beer

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with his phone instead of his computer.

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(speaking in foreign language)

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- [Narrator] Credit cards
are an old technology,

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and actually pretty complex.

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And you payment details are
shared with many middlemen.

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Each of these parties are also
taking a cut of the action,

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which is built into the price
of nearly everything you buy.

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If you purchase something internationally,

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double the number of
middlemen and triple the fees.

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Credit cards handle almost $20 trillion

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of transactions per year.

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(upbeat music)

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- [Torsten] Early Bitcoin
adopters, like Room 77,

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avoided paying credit card fees.

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But Joerg's real beef was with the bankers

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who collect them.

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(upbeat music)

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- [Torsten] Collapsing economies, murder,

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I didn't sign up for this.

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Let me get a drink.

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Well, actually, I need
to buy my German crew

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some Gluwein

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and explain why they won't get paid

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until after Christmas.

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You see, transferring
money from Australia,

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where I live,

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to Germany can take several days,

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and it will cost $30 plus exchange fees

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just for updating numbers
in digital ledgers.

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After all, it's just moving data.

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I can send a picture or video

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to anyone on the planet
almost instantly, for free.

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We live in the age of the Internet,

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but the banks won't send the data

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after 5:00 p.m., or on a weekend?

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That doesn't make any sense.

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So what if those slow
and expensive middlemen

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with their multiple ledgers

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could be replaced with a giant database

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synchronised over the Internet?

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That's the big idea behind Bitcoin.

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And it's run by a
decentralised global network

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of powerful mining computers
and regular laptops.

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Here's how it works.

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When I pay my cameraman,

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what's really happening
is that I use my key

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to open my wallet,

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and then instruct the network

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to send Bitcoins to his address.

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Most Bitcoin apps use QR codes

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to identify and address.

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You scan it,

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then swipe to use your key,

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and approve the transaction.

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- [Narrator] This information is shared

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throughout the global
network within seconds.

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Every 10 minutes or so,

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one miner using a
tremendous amount of energy

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beats all the others in a contest

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to solve a very difficult math problem.

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That miner is authorised

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to arrange the most recent transactions

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into a structured block,

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and is rewarded in Bitcoins for this work.

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All the data contained inside each block

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is represented by a check sum.

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The miner now adds the new block

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00:11:54.028 --> 00:11:55.533
to the previous one.

265
00:11:55.557 --> 00:11:56.997
That's why it's called the blockchain.

266
00:11:57.021 --> 00:11:59.709
Now the ledger will be updated globally.

267
00:11:59.733 --> 00:12:02.456
The check sums of the previous block

268
00:12:02.480 --> 00:12:04.274
match the beginning of the new one,

269
00:12:04.298 --> 00:12:06.550
which are baked together forever.

270
00:12:06.574 --> 00:12:09.531
It's impossible to tanker
with the data inside the block

271
00:12:09.555 --> 00:12:11.527
without changing the check sums

272
00:12:11.551 --> 00:12:13.046
and breaking the chain.

273
00:12:13.070 --> 00:12:15.485
(soft music)

274
00:12:18.654 --> 00:12:20.879
- [Torsten] This immutability
is the first rule of Bitcoin.

275
00:12:20.903 --> 00:12:23.425
It means one one can ever change

276
00:12:23.449 --> 00:12:25.553
what was once recorded in the blockchain,

277
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or spend the same coin twice.

278
00:12:27.108 --> 00:12:29.193
That's also called censorship resistance,

279
00:12:29.217 --> 00:12:33.102
and it's critical to Bitcoin
being used as real money.

280
00:12:38.184 --> 00:12:39.699
Awarded winning journalist Laura Shin

281
00:12:39.723 --> 00:12:42.096
tells me a story about women
bloggers in Afghanistan

282
00:12:42.120 --> 00:12:44.034
being paid in Bitcoin.

283
00:12:44.058 --> 00:12:46.971
- One of the women had an abusive husband,

284
00:12:46.995 --> 00:12:48.219
and saved up here Bitcoins

285
00:12:48.243 --> 00:12:51.399
and eventually was able to divorce him

286
00:12:51.423 --> 00:12:53.964
because she was able to control her money

287
00:12:53.988 --> 00:12:55.770
when she earned the Bitcoins.

288
00:12:55.794 --> 00:12:58.160
- [Torsten] In my first
film, the early adopters

289
00:12:58.184 --> 00:13:00.787
said that this kind of
financial freedom for everyone

290
00:13:00.811 --> 00:13:02.236
was just around the corner.

291
00:13:02.260 --> 00:13:07.255
- The world's most populous
network is adopting Bitcoin,

292
00:13:07.375 --> 00:13:08.239
that's the Internet.

293
00:13:08.263 --> 00:13:12.046
The world's largest economy
is adopting Bitcoin.

294
00:13:12.070 --> 00:13:13.385
That's the internet.

295
00:13:13.409 --> 00:13:15.083
We have transcended borders.

296
00:13:15.107 --> 00:13:17.265
- It's totally failed as electronic cash.

297
00:13:17.289 --> 00:13:20.188
- [Torsten] David Gerard
says it has unbanked

298
00:13:20.212 --> 00:13:22.995
the banked more than it
has banked the unbanked.

299
00:13:23.019 --> 00:13:25.297
He's an outspoken critic
of this technology.

300
00:13:25.321 --> 00:13:28.296
- It's not very good as a payment system.

301
00:13:28.320 --> 00:13:30.787
There a small payment in this case

302
00:13:30.811 --> 00:13:33.435
if you want to trade in things

303
00:13:33.459 --> 00:13:34.950
the Government doesn't
want you to trade in.

304
00:13:34.974 --> 00:13:37.091
- [Torsten] That's David's polite way

305
00:13:37.115 --> 00:13:38.687
of saying illegal stuff.

306
00:13:38.711 --> 00:13:40.847
- In 2011, most of my partner colleagues

307
00:13:40.847 --> 00:13:41.996
- In 2011, most of my partner colleagues
(soft music)

308
00:13:41.996 --> 00:13:42.020
(soft music)

309
00:13:42.020 --> 00:13:43.209
were saying three things.
(soft music)

310
00:13:43.209 --> 00:13:44.110
were saying three things.

311
00:13:44.134 --> 00:13:45.385
It was either drugs,
pornography, or arm sales.

312
00:13:53.199 --> 00:13:54.793
- [Torsten] The Silk
Road was a black market

313
00:13:54.817 --> 00:13:55.802
on the dark web

314
00:13:55.826 --> 00:13:57.237
where the buyers and sellers used Bitcoins

315
00:13:57.261 --> 00:13:59.764
to fly under the radar of the authorities.

316
00:13:59.788 --> 00:14:02.355
It had one million users

317
00:14:02.379 --> 00:14:05.334
until the FBI showed up and shut it down.

318
00:14:05.358 --> 00:14:07.999
They caught this guy for running it,

319
00:14:08.023 --> 00:14:10.247
and confiscated the coins held in escrow

320
00:14:10.271 --> 00:14:11.867
by snatching his computer.

321
00:14:11.891 --> 00:14:14.723
And then they locked him away for life.

322
00:14:14.747 --> 00:14:16.951
Seems like a pretty straight forward case

323
00:14:16.975 --> 00:14:19.209
of law enforcement doing their job,

324
00:14:19.233 --> 00:14:21.789
but in crypto, not
everybody sees it that way.

325
00:14:21.813 --> 00:14:24.364
(soft music)

326
00:14:24.388 --> 00:14:25.952
- People have an absolute right

327
00:14:25.976 --> 00:14:27.830
to put whatever they
want in their own bodies

328
00:14:27.854 --> 00:14:29.818
because their bodies belong to them.

329
00:14:29.842 --> 00:14:31.217
That makes Ross Ulbricht

330
00:14:31.241 --> 00:14:32.945
and the users of the Silk Road heroes,

331
00:14:32.969 --> 00:14:34.892
not criminal law breakers in a bad sense.

332
00:14:34.915 --> 00:14:37.461
They are criminal law
breakers in a good sense

333
00:14:37.485 --> 00:14:39.872
the same way that Harriet
Tubman or Rosa Parks,

334
00:14:39.896 --> 00:14:41.477
or you know, Thomas Jefferson,

335
00:14:41.501 --> 00:14:42.971
or George Washington were.

336
00:14:42.995 --> 00:14:47.001
- [Torsten] No doubt
cryptocurrencies can be a tool

337
00:14:47.025 --> 00:14:48.394
for criminal activity.

338
00:14:48.418 --> 00:14:49.948
But so are dollar bills

339
00:14:49.972 --> 00:14:51.157
or the banking system.

340
00:14:51.181 --> 00:14:55.744
And let's not forget the
blockchain is a public ledger.

341
00:14:55.768 --> 00:14:57.850
- It's actually been quite useful

342
00:14:57.874 --> 00:14:59.305
for uncovering crimes.

343
00:14:59.329 --> 00:15:01.969
A former federal prosecutor
named Kathryn Haun,

344
00:15:01.993 --> 00:15:04.034
she was the one who discovered

345
00:15:04.058 --> 00:15:06.296
that there were a couple
federal agents that

346
00:15:07.694 --> 00:15:10.757
were pilfering the Bitcoins
that the Government had obtained

347
00:15:10.781 --> 00:15:11.697
from the Silk Road case

348
00:15:11.721 --> 00:15:12.925
for their own gain.

349
00:15:12.949 --> 00:15:14.963
And what was interesting

350
00:15:14.987 --> 00:15:16.939
was she got a tip that there might be one,

351
00:15:16.963 --> 00:15:19.553
one agent that was doing this.

352
00:15:19.577 --> 00:15:21.916
But from looking at the movements

353
00:15:21.940 --> 00:15:22.945
on the blockchain itself,

354
00:15:22.969 --> 00:15:24.607
she realised that there were two people.

355
00:15:24.631 --> 00:15:27.560
- [Torsten] The prosecutor could see

356
00:15:27.584 --> 00:15:29.104
those Bitcoins being moved.

357
00:15:29.128 --> 00:15:31.798
And when the dirty cops tried
to sell them for dollars,

358
00:15:31.822 --> 00:15:34.025
they got busted.

359
00:15:34.049 --> 00:15:36.464
(soft music)

360
00:15:40.042 --> 00:15:42.565
But what makes Bitcoins worth stealing?

361
00:15:42.589 --> 00:15:44.341
Why do they have value at all?

362
00:15:45.596 --> 00:15:47.135
- [Narrator] Let's go back
to where Bitcoins are stored

363
00:15:47.159 --> 00:15:50.202
in transparent digital deposit boxes,

364
00:15:50.226 --> 00:15:52.146
protected by strong cryptography.

365
00:15:52.170 --> 00:15:55.642
They can never be copied
or leave the vault

366
00:15:55.665 --> 00:15:57.293
because any transaction of any Bitcoin,

367
00:15:57.317 --> 00:16:00.697
down to a 100 millionth fraction

368
00:16:00.721 --> 00:16:03.854
is recorded in the
blockchain for eternity.

369
00:16:03.878 --> 00:16:05.632
This synchronised global ledger

370
00:16:05.656 --> 00:16:07.621
is shared among thousands
of computers worldwide.

371
00:16:07.645 --> 00:16:10.818
That's why it can't be
compromised or altered.

372
00:16:10.842 --> 00:16:12.058
Think about that.

373
00:16:12.082 --> 00:16:15.443
We can make an infinite number
of perfect digital copies

374
00:16:15.467 --> 00:16:17.498
of a movie, a song, any file,

375
00:16:17.522 --> 00:16:19.507
but for the first time in history,

376
00:16:19.531 --> 00:16:21.676
this distributed record keeping

377
00:16:21.700 --> 00:16:24.533
allows us to have a
truly unique and fungible

378
00:16:24.557 --> 00:16:27.296
digital object that is also scarce.

379
00:16:27.320 --> 00:16:30.256
If you could count all
of these virtual coins,

380
00:16:30.280 --> 00:16:33.347
you'd find about 18 million of them today.

381
00:16:33.371 --> 00:16:35.672
The mining reward is the only way

382
00:16:35.696 --> 00:16:37.013
new coins are created.

383
00:16:37.037 --> 00:16:39.399
(soft music)

384
00:16:39.423 --> 00:16:40.613
In the first years of Bitcoin,

385
00:16:40.637 --> 00:16:44.040
miners competed for 50
Bitcoins every 10 minutes.

386
00:16:44.065 --> 00:16:46.593
Then their reward for
processing transactions

387
00:16:46.617 --> 00:16:48.886
dropped to 25 Bitcoins,

388
00:16:48.910 --> 00:16:50.756
then 12.5,

389
00:16:50.780 --> 00:16:53.559
and then half again and
again every four years.

390
00:16:53.583 --> 00:16:57.120
It's good old fashioned supply and demand.

391
00:16:57.144 --> 00:17:00.018
If investors or users of Bitcoin

392
00:17:00.042 --> 00:17:02.410
create a higher demand than
this decreasing supply,

393
00:17:02.434 --> 00:17:04.136
the price will go up.

394
00:17:04.160 --> 00:17:07.770
When the cap of 21 million is reached,

395
00:17:07.794 --> 00:17:09.950
the protocol stops the network
from creating any more.

396
00:17:09.973 --> 00:17:13.654
It's the opposite of our
traditional money supply,

397
00:17:13.678 --> 00:17:16.056
which keeps growing and growing.

398
00:17:16.079 --> 00:17:18.493
(soft music)

399
00:17:23.888 --> 00:17:25.872
- Hmm, and unlimited amount of dollars

400
00:17:25.896 --> 00:17:28.205
versus a very limited supply of Bitcoins.

401
00:17:28.230 --> 00:17:29.792
You do the math!

402
00:17:29.816 --> 00:17:32.845
If you use Euros or dollars,

403
00:17:32.869 --> 00:17:34.983
you might not care about a
little inflation per year.

404
00:17:35.007 --> 00:17:36.672
But if your currency isn't stable,

405
00:17:36.696 --> 00:17:38.809
you might be a trillionaire on paper,

406
00:17:38.833 --> 00:17:40.218
and be dead broke.

407
00:17:40.242 --> 00:17:43.655
(slow suspenseful music)

408
00:17:45.057 --> 00:17:46.192
- I grew up in Patagonia

409
00:17:46.216 --> 00:17:47.500
in the southern part of Argentina.

410
00:17:47.524 --> 00:17:49.078
My parents are sheep ranchers there.

411
00:17:49.102 --> 00:17:52.216
And I remember growing up in my childhood,

412
00:17:52.240 --> 00:17:54.266
I saw my parents loose
everything three times.

413
00:17:54.290 --> 00:17:56.935
First because of a huge devaluation,

414
00:17:56.959 --> 00:17:58.634
then because of hyperinflation,

415
00:17:58.658 --> 00:18:01.265
and the last time because the
Government confiscated all

416
00:18:01.289 --> 00:18:03.824
our bank deposits.

417
00:18:03.848 --> 00:18:05.293
I think that today,

418
00:18:05.317 --> 00:18:08.290
there are billions of people,

419
00:18:08.314 --> 00:18:09.458
at least four billion people

420
00:18:09.482 --> 00:18:11.197
who would be a lot better off

421
00:18:11.221 --> 00:18:12.917
by having access to a form of money

422
00:18:12.941 --> 00:18:17.016
that is non-political and more democratic.

423
00:18:17.040 --> 00:18:22.035
(soft music)
(muffled speech)

424
00:18:24.427 --> 00:18:25.552
- We think of finance.

425
00:18:25.576 --> 00:18:26.442
We think of banking.

426
00:18:26.466 --> 00:18:27.750
We think of money.

427
00:18:27.774 --> 00:18:30.355
In terms of the experience and perspective

428
00:18:30.379 --> 00:18:32.982
of Western European or
developed nation person,

429
00:18:33.006 --> 00:18:37.710
and that is really just a
billion and a half people

430
00:18:37.734 --> 00:18:40.987
who have a very privileged financial life.

431
00:18:41.011 --> 00:18:42.705
What about the other six billion?

432
00:18:42.729 --> 00:18:45.179
Every single country that is free

433
00:18:45.203 --> 00:18:50.088
has essentially a legal
status for cryptocurrencies

434
00:18:50.112 --> 00:18:52.036
that is very open and permissive.

435
00:18:52.060 --> 00:18:54.263
And every single country that is unfree

436
00:18:54.287 --> 00:18:58.710
has restrictive or banned
cryptocurrency status.

437
00:18:58.734 --> 00:19:01.149
(soft music)

438
00:19:16.685 --> 00:19:18.210
- This is the Berlin Wall,

439
00:19:18.234 --> 00:19:19.498
still a powerful symbol

440
00:19:19.522 --> 00:19:22.871
of a Government trying
to control its citizens.

441
00:19:22.895 --> 00:19:26.519
But this is what happens when people

442
00:19:26.543 --> 00:19:28.605
want to be free.

443
00:19:28.629 --> 00:19:32.149
The very first open crypto-war
is playing out in Venezuela

444
00:19:32.173 --> 00:19:35.512
where the local currency
loses value every hour

445
00:19:35.536 --> 00:19:37.191
due to hyperinflation.

446
00:19:37.215 --> 00:19:38.419
- A lot of people in Venezuela

447
00:19:38.443 --> 00:19:39.788
are trying to mine cryptocurrencies.

448
00:19:39.812 --> 00:19:43.464
And the government views
this as a threat obviously

449
00:19:43.488 --> 00:19:46.861
because they're trying to
keep the Bolivar propped up.

450
00:19:46.885 --> 00:19:48.769
The government actually
provided electricity

451
00:19:48.793 --> 00:19:49.602
to a lot of people,

452
00:19:49.626 --> 00:19:52.387
and if they perceive that
your electricity usage

453
00:19:52.411 --> 00:19:53.664
has gone up,

454
00:19:53.688 --> 00:19:56.751
they will come and check if
you have mining equipment

455
00:19:56.775 --> 00:19:58.709
in your house, and they will confiscate it

456
00:19:58.733 --> 00:20:00.587
if they find it.

457
00:20:00.611 --> 00:20:02.385
- [Torsten] And that brings
us to the big question,

458
00:20:02.409 --> 00:20:04.333
can Governments or banks ban Bitcoin?

459
00:20:04.357 --> 00:20:06.718
- So the title is "Jamie Dimon,

460
00:20:06.742 --> 00:20:09.219
"Here's why you're wrong about Bitcoin".

461
00:20:09.243 --> 00:20:10.919
- [Torsten] Dimon runs JP Morgan Chase,

462
00:20:10.943 --> 00:20:13.215
one of the largest banks in the world

463
00:20:13.239 --> 00:20:15.892
that moves $6 trillion every single day.

464
00:20:15.916 --> 00:20:17.011
- Oh, you said of Bitcoin

465
00:20:17.035 --> 00:20:18.666
eventually it will be closed.

466
00:20:18.690 --> 00:20:21.336
And then I said to
anyone who knows anything

467
00:20:21.360 --> 00:20:24.111
about the technology, this is an
incredibly absurd statement.

468
00:20:24.135 --> 00:20:27.610
I even said it was a little bit hilarious

469
00:20:27.634 --> 00:20:29.688
because I find it kind of funny

470
00:20:29.712 --> 00:20:32.186
the idea that you thought
you could close Bitcoin.

471
00:20:32.210 --> 00:20:34.865
But you'd have to shut down the Internet,

472
00:20:34.889 --> 00:20:36.726
which also doesn't make sense.

473
00:20:36.750 --> 00:20:39.179
I could understand if you
wanted Bitcoin shut down,

474
00:20:39.203 --> 00:20:40.657
or hoped it was a fraud.

475
00:20:40.681 --> 00:20:41.537
I mean if I were you,

476
00:20:41.561 --> 00:20:43.414
and if I really understood the disruption

477
00:20:43.438 --> 00:20:45.562
that crypto assets could
bring to financial services,

478
00:20:45.586 --> 00:20:47.041
I'd be very scared.

479
00:20:47.065 --> 00:20:48.579
- And I think whatever Jamie Dimon

480
00:20:48.603 --> 00:20:49.642
says or thinks about Bitcoin

481
00:20:49.666 --> 00:20:53.000
is as relevant as whatever
the Postmaster General

482
00:20:53.024 --> 00:20:55.235
thought or said about email:

483
00:20:55.259 --> 00:20:56.912
Who cares?

484
00:20:56.936 --> 00:20:59.505
- Then I wrote sincerely, Laura Shin.

485
00:21:01.021 --> 00:21:02.196
- [Torsten] But some politicians

486
00:21:02.220 --> 00:21:04.935
still think they can stop
open source software.

487
00:21:04.959 --> 00:21:08.100
- I look for colleagues to join with me

488
00:21:08.124 --> 00:21:12.832
in introducing a bill to
outlaw cryptocurrency purchases

489
00:21:12.856 --> 00:21:16.532
by Americans so that
we nip this in the bud

490
00:21:16.556 --> 00:21:21.551
in part because an awful lot
of our international power

491
00:21:21.612 --> 00:21:24.403
comes from the fact that the dollar

492
00:21:24.427 --> 00:21:26.937
is the standard unit of
international finance

493
00:21:26.961 --> 00:21:30.663
and transactions clearing
through the New York Fed

494
00:21:30.687 --> 00:21:34.294
is critical for major oil
and other transactions.

495
00:21:34.318 --> 00:21:37.131
And it is the announced purpose

496
00:21:37.155 --> 00:21:38.829
of the supporters of cryptocurrency

497
00:21:38.853 --> 00:21:41.403
to take that power away from us.

498
00:21:41.427 --> 00:21:45.256
- Cryptocurrency represents a
litmus test for Governments.

499
00:21:45.280 --> 00:21:50.186
It reveals how much your
Government believes in,

500
00:21:50.210 --> 00:21:54.749
in the fundamental
freedoms and Human Rights

501
00:21:54.773 --> 00:21:58.859
because if they don't
trust their own citizens

502
00:21:58.883 --> 00:22:01.047
to have control over their own money,

503
00:22:01.071 --> 00:22:01.907
that says a lot about the government

504
00:22:01.931 --> 00:22:04.391
and says very little about cryptocurrency.

505
00:22:04.415 --> 00:22:07.980
- [Torsten] You see, the
reason why some Governments

506
00:22:08.004 --> 00:22:10.267
and most banks are
threatened by this technology

507
00:22:10.291 --> 00:22:13.264
is simple, your private
key and your wallet

508
00:22:13.288 --> 00:22:15.042
can replace your bank account.

509
00:22:15.066 --> 00:22:17.111
The network is run by software

510
00:22:17.135 --> 00:22:19.618
and its currency is made and maintained

511
00:22:19.642 --> 00:22:21.726
by computing power and electricity.

512
00:22:21.750 --> 00:22:22.964
It can't be manipulated

513
00:22:22.988 --> 00:22:25.702
by central bankers, Wall Street lobbyists

514
00:22:25.726 --> 00:22:27.021
or politicians.

515
00:22:27.045 --> 00:22:29.801
But with new freedom
comes new responsibility.

516
00:22:29.825 --> 00:22:34.006
- Simple rule, if you control
the keys, it's your Bitcoin.

517
00:22:34.030 --> 00:22:37.222
If you don't control the
keys, it's not your Bitcoin.

518
00:22:37.246 --> 00:22:38.859
Your keys, your Bitcoin.

519
00:22:38.883 --> 00:22:41.313
Not your keys, not your Bitcoin.

520
00:22:41.337 --> 00:22:42.337
Your keys, your Bitcoin.

521
00:22:43.395 --> 00:22:45.358
Not your keys, not your Bitcoin.

522
00:22:45.382 --> 00:22:47.490
- [Torsten] Got that?

523
00:22:47.514 --> 00:22:48.679
If you lose your key,

524
00:22:48.703 --> 00:22:50.770
you will never be able to
access your coins again.

525
00:22:50.794 --> 00:22:52.945
And if someone hacks your computer

526
00:22:52.969 --> 00:22:54.489
where you store those passwords,

527
00:22:54.513 --> 00:22:56.803
your coins will be stolen in a second.

528
00:22:56.827 --> 00:22:59.368
And remember how Wences's family

529
00:22:59.392 --> 00:23:01.673
had their money stolen
by their own government?

530
00:23:01.697 --> 00:23:04.873
Well, maybe that's why
he built the Fort Knox

531
00:23:04.897 --> 00:23:06.435
of Bitcoin security, Xapo.

532
00:23:06.459 --> 00:23:08.909
- Most of our seven million customers

533
00:23:08.933 --> 00:23:10.307
are in emerging markets.

534
00:23:10.331 --> 00:23:14.103
In countries where there is
problems with the currency,

535
00:23:14.127 --> 00:23:16.511
we have explosions in
activity like Venezuela

536
00:23:16.535 --> 00:23:18.079
right now or Turkey.

537
00:23:18.103 --> 00:23:20.097
And we develop this system of vault

538
00:23:20.121 --> 00:23:22.735
where we have five private keys

539
00:23:22.759 --> 00:23:24.873
for each one of our Bitcoin addresses.

540
00:23:24.897 --> 00:23:26.924
We keep those private keys

541
00:23:26.948 --> 00:23:30.467
in an offline server that
has never been online,

542
00:23:30.491 --> 00:23:31.347
will never be online.

543
00:23:31.371 --> 00:23:32.495
It's inside the vault.

544
00:23:32.519 --> 00:23:34.693
The vault is inside a bunker,

545
00:23:34.717 --> 00:23:36.022
usually deep underground.

546
00:23:36.046 --> 00:23:37.430
Our main one is in Switzerland

547
00:23:37.454 --> 00:23:40.082
in a decommissioned military bunker.

548
00:23:40.106 --> 00:23:42.905
- [Torsten] I just had
to see it for myself

549
00:23:42.929 --> 00:23:44.994
even though it took months for
us to get cleared for a tour.

550
00:23:45.018 --> 00:23:47.432
(soft music)

551
00:24:00.381 --> 00:24:02.016
We were met by Christoph Oschwald,

552
00:24:02.040 --> 00:24:04.663
a former military commander
who runs the place,

553
00:24:04.687 --> 00:24:06.661
and a representative from Xapo.

554
00:24:06.685 --> 00:24:09.278
Christoph said the guards
would rather shoot us

555
00:24:09.302 --> 00:24:10.682
than show us around.

556
00:24:10.706 --> 00:24:14.253
I hope he was kidding.

557
00:24:14.277 --> 00:24:17.214
- They need to bring in the material

558
00:24:17.238 --> 00:24:20.041
to the other side of the personal lock.

559
00:24:20.065 --> 00:24:23.653
- [Torsten] First up, one
more check of our IDs,

560
00:24:23.677 --> 00:24:26.551
a pat down for weapons or
any other monkey business,

561
00:24:26.575 --> 00:24:28.895
and gear inspection.

562
00:24:28.919 --> 00:24:32.298
Even the boss was searched.

563
00:24:32.322 --> 00:24:36.349
It took nearly an hour to
get my team through security,

564
00:24:36.373 --> 00:24:38.009
but it was worth it.

565
00:24:38.033 --> 00:24:40.817
No other film crew has
been allowed access.

566
00:24:40.841 --> 00:24:44.333
- We are the largest custodian
of Bitcoin in the world

567
00:24:44.357 --> 00:24:46.571
because a lot of the
largest holders in the world

568
00:24:46.595 --> 00:24:48.676
use us for security.

569
00:24:48.700 --> 00:24:50.200
- [Torsten] Rumour has it

570
00:24:50.224 --> 00:24:52.509
that 10% of all Bitcoins are stored here

571
00:24:52.533 --> 00:24:54.930
and in their four other secret locations.

572
00:24:54.954 --> 00:24:58.029
(soft music)

573
00:24:58.053 --> 00:25:00.774
- Unfortunately, I can't
confirm any of those numbers.

574
00:25:02.089 --> 00:25:03.144
- From the mountain,

575
00:25:03.168 --> 00:25:07.110
we are getting a lot of benefits, right?

576
00:25:07.134 --> 00:25:08.400
Earthquake proof,

577
00:25:08.424 --> 00:25:10.102
flooding proof,

578
00:25:10.126 --> 00:25:12.325
but on the other side,

579
00:25:12.349 --> 00:25:14.433
you're facing a lot of additional costs.

580
00:25:14.457 --> 00:25:17.540
- [Torsten] Like maintaining
seven independent

581
00:25:17.564 --> 00:25:19.155
backup power supplies.

582
00:25:23.478 --> 00:25:25.422
The labyrinth of tunnels
deep into the mountain

583
00:25:25.446 --> 00:25:28.075
is interrupted by nuclear grade doors.

584
00:25:28.099 --> 00:25:30.514
(soft music)

585
00:25:38.643 --> 00:25:39.818
It's a level of security

586
00:25:39.842 --> 00:25:42.575
applied to all of the data
Christoph protects here,

587
00:25:42.599 --> 00:25:43.599
not just for Xapo.

588
00:25:45.216 --> 00:25:47.116
- We cannot talk too much about it

589
00:25:47.140 --> 00:25:49.977
because it's pretty
secret what is down there.

590
00:25:50.001 --> 00:25:51.826
- Are we allowed to film there?

591
00:25:51.850 --> 00:25:52.850
- No.

592
00:25:53.812 --> 00:25:56.691
- [Torsten] There were
doors that remained shut

593
00:25:56.715 --> 00:25:58.790
and security measures we
weren't allowed to see.

594
00:25:58.814 --> 00:26:02.094
- And some of those
checks may be biometric

595
00:26:02.118 --> 00:26:04.625
including the eye and
the finger print scan

596
00:26:04.649 --> 00:26:07.680
and the fingerprint scanner

597
00:26:07.704 --> 00:26:09.568
also makes sure that you are alive

598
00:26:09.592 --> 00:26:11.156
so that you didn't cut someone's finger

599
00:26:11.180 --> 00:26:13.374
and you're just using it to open the gate.

600
00:26:13.398 --> 00:26:14.466
- So you must have a pulse.

601
00:26:14.490 --> 00:26:16.905
(soft music)

602
00:26:23.188 --> 00:26:25.186
- Don't touch the racks.

603
00:26:27.923 --> 00:26:29.868
- [Torsten] These aren't
Xapo's actual servers,

604
00:26:29.892 --> 00:26:32.151
but if you've ever wondered
what cryptocurrency thieves

605
00:26:32.175 --> 00:26:35.001
dream about, it's sitting
somewhere down here

606
00:26:35.025 --> 00:26:37.200
unplugged from the Internet.

607
00:26:37.224 --> 00:26:39.128
- There is absolutely no way,

608
00:26:39.152 --> 00:26:43.380
zero way to attack the data
on the cold storage site.

609
00:26:43.404 --> 00:26:45.722
- [Torsten] But here's my question,

610
00:26:45.746 --> 00:26:48.309
why do I need the cold offline servers

611
00:26:48.333 --> 00:26:49.276
to be inside a mountain?

612
00:26:49.300 --> 00:26:51.546
Why can't it be in my basement?

613
00:26:51.570 --> 00:26:52.935
- While the server is in the basement,

614
00:26:52.959 --> 00:26:55.163
it still can be stolen, right?

615
00:26:55.187 --> 00:26:58.619
So this is like money.

616
00:26:58.643 --> 00:27:00.377
It is data, yes,

617
00:27:00.401 --> 00:27:01.746
it's bits and bytes,

618
00:27:01.770 --> 00:27:03.671
but it is money at the end,

619
00:27:03.695 --> 00:27:05.232
and a lot of money.

620
00:27:05.256 --> 00:27:07.180
This is why this data centre here

621
00:27:07.204 --> 00:27:09.819
is more a bank than a data centre.

622
00:27:09.843 --> 00:27:12.125
(soft music)

623
00:27:12.149 --> 00:27:13.057
- [Torsten] Okay, let's do a quick recap.

624
00:27:13.081 --> 00:27:16.131
We now have billions of
dollars worth of data

625
00:27:16.155 --> 00:27:17.440
secured in digital banks

626
00:27:17.464 --> 00:27:19.405
deep inside secret military bunkers.

627
00:27:19.429 --> 00:27:21.406
If you don't think Bitcoin

628
00:27:21.430 --> 00:27:23.873
is already changing the
world's concept of money,

629
00:27:23.897 --> 00:27:25.596
you haven't been paying attention.

630
00:27:26.795 --> 00:27:28.279
Remember Mervyn?

631
00:27:28.303 --> 00:27:30.667
He used to be a senior
executive at Deutsche Bank.

632
00:27:30.691 --> 00:27:32.152
His colleagues once said Bitcoin

633
00:27:32.176 --> 00:27:33.714
was for law breakers and troublemakers.

634
00:27:33.738 --> 00:27:37.747
He now runs $100 million
crypto fund out of Malta.

635
00:27:39.642 --> 00:27:43.906
- Our research shows
that the crypto markets

636
00:27:43.930 --> 00:27:48.848
are gonna probably be worth
about $8.7 trillion in 2027.

637
00:27:48.872 --> 00:27:51.416
- Which is 50x from today.

638
00:27:51.440 --> 00:27:52.440
- Exactly.

639
00:27:58.313 --> 00:27:59.628
- [Torsten] Most financial analysts

640
00:27:59.652 --> 00:28:02.348
say you better stick to your
shares and bonds and dollars.

641
00:28:02.372 --> 00:28:03.947
Bitcoin is dangerous nonsense,

642
00:28:03.971 --> 00:28:06.446
far too risky as investment.

643
00:28:06.470 --> 00:28:09.308
To others, Bitcoin is an escape hatch

644
00:28:09.332 --> 00:28:11.516
that will take them away from risk,

645
00:28:11.540 --> 00:28:13.456
an insurance against financial doomsday,

646
00:28:13.480 --> 00:28:15.991
a way out of the debt crisis,

647
00:28:16.015 --> 00:28:17.370
negative interest rates,

648
00:28:17.394 --> 00:28:20.167
trade wars, and economic downturn.

649
00:28:20.191 --> 00:28:22.177
They say it's an anti-fragile asset

650
00:28:22.201 --> 00:28:25.262
uncorrelated to financial markets.

651
00:28:25.286 --> 00:28:26.701
So who's right here?

652
00:28:26.725 --> 00:28:28.729
Well, every time I turn on the television,

653
00:28:28.753 --> 00:28:30.207
it gets even more confusing.

654
00:28:30.231 --> 00:28:31.431
- Bitcoin is worth about a bit

655
00:28:32.873 --> 00:28:33.683
under $200 billion today.

656
00:28:33.707 --> 00:28:36.361
All the gold in the world
is worth eight trillion,

657
00:28:36.385 --> 00:28:38.589
and it could become the next gold.

658
00:28:38.613 --> 00:28:41.596
- In terms of cryptocurrencies, generally,

659
00:28:41.620 --> 00:28:44.842
I can say almost with certainty

660
00:28:44.866 --> 00:28:47.114
that they will come to a bad ending.

661
00:28:47.138 --> 00:28:51.076
- But if Bitcoin is out
there, and gold is out there,

662
00:28:51.100 --> 00:28:54.543
it can be a participant in
bringing down the dollar.

663
00:28:54.567 --> 00:28:56.261
- I say it's the mother of all bubbles,

664
00:28:56.285 --> 00:28:58.499
and it's also the biggest
bubble in human history.

665
00:28:58.523 --> 00:29:00.247
- Do you think this is a currency?

666
00:29:00.271 --> 00:29:01.961
A currency that's really
gonna work eventually?

667
00:29:01.985 --> 00:29:04.070
- Well, I think it is working.

668
00:29:04.094 --> 00:29:07.550
And there will be other currencies like it

669
00:29:07.574 --> 00:29:09.098
that may be even better.

670
00:29:09.122 --> 00:29:11.022
- Bitcoin is successful

671
00:29:11.046 --> 00:29:15.169
only because of its
potential for circumvention,

672
00:29:15.193 --> 00:29:17.658
lack of oversight.

673
00:29:17.682 --> 00:29:20.040
So it seems to me it ought to be outlawed.

674
00:29:20.064 --> 00:29:23.175
It doesn't serve any
social useful function.

675
00:29:23.199 --> 00:29:26.011
- [Torsten] This film
isn't investment advice,

676
00:29:26.035 --> 00:29:27.958
but it strikes me that
most of these TV shows

677
00:29:27.982 --> 00:29:29.769
just want to stir controversy.

678
00:29:29.793 --> 00:29:32.453
They don't understand what's going on,

679
00:29:32.477 --> 00:29:34.413
but they know that filling airtime

680
00:29:34.437 --> 00:29:35.931
with a controversial topic

681
00:29:35.955 --> 00:29:37.336
will get them higher ratings.

682
00:29:37.360 --> 00:29:39.264
So how about the general public?

683
00:29:39.288 --> 00:29:41.955
In America, the younger generation

684
00:29:41.979 --> 00:29:44.135
already starts to trust
this new asset class

685
00:29:44.159 --> 00:29:46.141
and Wences says Bitcoin

686
00:29:46.165 --> 00:29:48.189
may reach a million dollars per coin.

687
00:29:48.213 --> 00:29:52.924
- I would say the
biggest financial mistake

688
00:29:52.948 --> 00:29:53.983
you can make right now

689
00:29:54.007 --> 00:29:55.931
is to own an amount of Bitcoin

690
00:29:55.955 --> 00:29:57.280
that you cannot afford to lose

691
00:29:57.304 --> 00:29:59.518
because it's super risky
and you may lose it.

692
00:29:59.542 --> 00:30:01.606
The second biggest financial
mistake you can make

693
00:30:01.630 --> 00:30:03.114
is not to own any.

694
00:30:03.138 --> 00:30:08.133
Because you put 1% of
your net worth in Bitcoin.

695
00:30:08.394 --> 00:30:12.234
Most people can afford to
lose 1% of their net worth.

696
00:30:12.258 --> 00:30:13.484
And if I am right,

697
00:30:13.508 --> 00:30:15.791
it's gonna be more than
100% of your net worth,

698
00:30:15.815 --> 00:30:17.363
so with a non-material exposure,

699
00:30:17.387 --> 00:30:19.098
you change your life.

700
00:30:19.122 --> 00:30:21.845
Now what you would spend
on a romantic weekend

701
00:30:21.869 --> 00:30:22.745
with your wife,

702
00:30:22.769 --> 00:30:25.531
say sorry, we're not gonna
do that this weekend.

703
00:30:25.555 --> 00:30:27.066
I'm gonna just buy Bitcoin.

704
00:30:27.090 --> 00:30:28.420
Consider it spent.

705
00:30:28.444 --> 00:30:30.698
It disappears, and check in seven years.

706
00:30:30.722 --> 00:30:34.752
I either give you bad advice,
and cost you a weekend,

707
00:30:34.776 --> 00:30:37.170
or I want a grandkid called Wencito.

708
00:30:37.194 --> 00:30:39.275
(laughs)

709
00:30:40.141 --> 00:30:43.044
- But what you fail to
mention is that the currency,

710
00:30:43.068 --> 00:30:44.283
the micro transaction.

711
00:30:44.307 --> 00:30:46.385
- All of that is irrelevant, right?

712
00:30:46.409 --> 00:30:49.697
Meaning all of the cryptocurrencies

713
00:30:49.721 --> 00:30:50.716
are way too volatile

714
00:30:50.740 --> 00:30:52.330
for anyone to take them seriously.

715
00:30:52.354 --> 00:30:55.472
- Hold on, let's go back
to where we started.

716
00:30:55.496 --> 00:30:57.780
Bitcoin was created as peer
to peer electronic cash.

717
00:30:57.804 --> 00:30:59.408
That was the killer app,

718
00:30:59.432 --> 00:31:01.104
a payment directly from you to me,

719
00:31:01.128 --> 00:31:03.276
from me to the coffee shop.

720
00:31:03.300 --> 00:31:06.851
- I have bought a bag of coffee

721
00:31:06.875 --> 00:31:09.952
for two Bitcoin in 2012,

722
00:31:09.976 --> 00:31:14.971
which today costs me
$12,000 in today's money.

723
00:31:15.176 --> 00:31:17.786
That is a deflationary effect.

724
00:31:17.810 --> 00:31:22.385
As long as Bitcoin keeps doing
sudden increases in prices,

725
00:31:22.409 --> 00:31:25.779
that's gonna stop retail
use in it's tracks.

726
00:31:25.803 --> 00:31:29.068
- With Bitcoin, you can
send $1 or $1 million

727
00:31:29.092 --> 00:31:31.006
worth of value anywhere in the world.

728
00:31:31.030 --> 00:31:32.212
You can do it for free.

729
00:31:32.236 --> 00:31:34.283
- [Torsten] But basically,
looking at it now,

730
00:31:34.307 --> 00:31:35.559
you lied to us.

731
00:31:35.583 --> 00:31:38.029
Yeah, that's what they
all used to tell me,

732
00:31:38.053 --> 00:31:42.215
cheap, easy, fast, global, unstoppable.

733
00:31:42.239 --> 00:31:45.052
I'm not done with you, pal.

734
00:31:45.076 --> 00:31:46.763
But I need to explain what happened here.

735
00:31:46.787 --> 00:31:50.178
Every block contains about
one megabyte of data,

736
00:31:50.202 --> 00:31:53.006
much smaller than a photo
you post on Instagram.

737
00:31:53.030 --> 00:31:57.010
That means only a limited
number of transactions

738
00:31:57.034 --> 00:31:58.818
can fit into each block.

739
00:31:58.842 --> 00:32:00.581
If you want your payment to jump the line,

740
00:32:00.605 --> 00:32:02.773
you can choose to pay a premium fee

741
00:32:02.797 --> 00:32:04.537
or sit and wait.

742
00:32:04.561 --> 00:32:06.865
At one point, the blocks became so full

743
00:32:06.889 --> 00:32:09.800
that the transaction time
went to several hundred hours.

744
00:32:09.824 --> 00:32:12.342
That's days!

745
00:32:12.366 --> 00:32:15.097
And it was more expensive than
international wire services.

746
00:32:15.121 --> 00:32:18.569
It got so bad that a Bitcoin conference

747
00:32:18.593 --> 00:32:20.667
wouldn't take payment in Bitcoins!

748
00:32:20.691 --> 00:32:23.503
And he's the guy who promised
me moving money fast and for free.

749
00:32:23.527 --> 00:32:26.767
What went wrong?

750
00:32:26.791 --> 00:32:29.957
- That's a direct intentional result

751
00:32:29.981 --> 00:32:31.496
of Bitcoin Core's policies

752
00:32:31.520 --> 00:32:33.414
of intentionally making it slow,

753
00:32:33.438 --> 00:32:34.951
expensive and unreliable.

754
00:32:34.975 --> 00:32:36.974
- [Torsten] And Roger blames this guy

755
00:32:37.876 --> 00:32:40.718
for Bitcoin not becoming a
mainstream global currency.

756
00:32:40.742 --> 00:32:44.458
- There are no shortage
of conspiracy theories.

757
00:32:44.482 --> 00:32:45.482
-

758
00:32:46.415 --> 00:32:48.907
- Blockstream was founded in 2014.

759
00:32:48.931 --> 00:32:52.634
The original co-founders are
a lot of core developers.

760
00:32:52.658 --> 00:32:54.053
- [Torsten] Those are the software coders

761
00:32:54.077 --> 00:32:56.514
who continue building Bitcoin
after Satoshi vanished.

762
00:32:56.538 --> 00:33:00.008
Roger thinks those guys sabotaged
the scaling of the network

763
00:33:00.032 --> 00:33:03.339
so Blockstream could promote
its own software solutions.

764
00:33:03.363 --> 00:33:05.218
Sampson says come on,

765
00:33:05.242 --> 00:33:07.965
the blockchain is already 200
Gigabytes large and growing.

766
00:33:07.989 --> 00:33:10.250
- Every transaction made

767
00:33:10.274 --> 00:33:12.914
has to go out to the whole network.

768
00:33:12.938 --> 00:33:15.874
And every block that contains
that transaction that is mined

769
00:33:15.898 --> 00:33:18.189
has also to go out to the whole network.

770
00:33:18.213 --> 00:33:20.358
And it has to be stored for eternity.

771
00:33:20.382 --> 00:33:22.244
- [Torsten] The argument,

772
00:33:22.268 --> 00:33:24.901
more independent miners will
continue running Bitcoin

773
00:33:24.925 --> 00:33:27.085
and ensure decentralisation

774
00:33:27.109 --> 00:33:29.415
if the blockchain is kept small.

775
00:33:29.439 --> 00:33:31.647
In his view, this decentralisation

776
00:33:31.671 --> 00:33:33.446
is what makes Bitcoin valuable,

777
00:33:33.470 --> 00:33:35.299
a store of value!

778
00:33:35.323 --> 00:33:38.229
- So holding Bitcoin is also a use case.

779
00:33:38.253 --> 00:33:39.857
- And that store money hypothesis,

780
00:33:39.881 --> 00:33:41.076
I cannot get my head around.

781
00:33:41.100 --> 00:33:42.098
It's the most,

782
00:33:42.122 --> 00:33:45.302
like, nutty thing I've ever heard.

783
00:33:45.326 --> 00:33:47.669
- One philosophy could
be described as Bitcoin

784
00:33:47.693 --> 00:33:50.077
as digital gold, and the other philosophy

785
00:33:50.101 --> 00:33:52.225
could be described as
Bitcoin as digital cash.

786
00:33:52.249 --> 00:33:53.795
- [Torsten] The other team said

787
00:33:53.819 --> 00:33:55.827
you guys have it the wrong way around.

788
00:33:55.851 --> 00:33:58.578
First, Bitcoin needs to
be usable as a currency,

789
00:33:58.602 --> 00:34:00.686
a medium of exchange.

790
00:34:00.710 --> 00:34:02.469
Then, maybe, it will become stable

791
00:34:02.493 --> 00:34:04.113
and a store of value.

792
00:34:04.137 --> 00:34:06.520
(soft music)

793
00:34:06.544 --> 00:34:09.516
The solution is easy, just
increase the size of the blocks

794
00:34:09.541 --> 00:34:11.585
from one to two, four, eight megabytes

795
00:34:11.609 --> 00:34:13.444
so that more transactions fit into them.

796
00:34:13.467 --> 00:34:15.572
This will lower the fees,

797
00:34:15.597 --> 00:34:18.840
and people will start using
Bitcoin as cash again.

798
00:34:18.864 --> 00:34:21.235
- The original title of
the Bitcoin white paper

799
00:34:21.260 --> 00:34:23.135
is Bitcoin, an electronic peer to peer

800
00:34:23.159 --> 00:34:25.451
electronic cash system.

801
00:34:25.475 --> 00:34:27.130
- [Torsten] But you know,
Satoshi's white paper

802
00:34:27.154 --> 00:34:28.299
isn't the Bible.

803
00:34:28.322 --> 00:34:29.188
It's not a religion.

804
00:34:29.213 --> 00:34:31.266
Stuff changes, we evolve,

805
00:34:31.290 --> 00:34:32.784
we might find out new things.

806
00:34:32.808 --> 00:34:36.289
So why this fixation on that white paper

807
00:34:36.313 --> 00:34:39.417
created 10 years ago.

808
00:34:39.440 --> 00:34:40.626
- There isn't any fixation.

809
00:34:40.650 --> 00:34:42.866
It's not the version of Bitcoin
that I got involved with,

810
00:34:42.889 --> 00:34:44.166
and it's not the version of Bitcoin

811
00:34:44.190 --> 00:34:46.141
that I want to support.

812
00:34:46.165 --> 00:34:47.489
- [Torsten] So Roger joined forces

813
00:34:47.513 --> 00:34:49.474
with a controversial online
gambling billionaire, Bitmain,

814
00:34:49.498 --> 00:34:52.643
a Chinese crypto mining
company and this guy.

815
00:34:52.668 --> 00:34:57.663
- I'll do whatever the
fuck I want with my money.

816
00:34:57.817 --> 00:34:59.348
- [Torsten] Okay?!

817
00:34:59.372 --> 00:35:01.635
Anyway, they forced a software fork,

818
00:35:01.659 --> 00:35:03.746
which is a split into
two separate blockchains.

819
00:35:03.770 --> 00:35:06.717
Every holder of Bitcoin now also owned

820
00:35:06.741 --> 00:35:08.487
the same amount of Bitcoin cash.

821
00:35:08.511 --> 00:35:12.424
- Roger had nothing to do with
the creation of Bitcoin cash.

822
00:35:12.448 --> 00:35:13.347
Roger didn't know about it

823
00:35:13.371 --> 00:35:15.206
until a few weeks before
it actually happened.

824
00:35:15.230 --> 00:35:17.419
- [Torsten] But still, Bitcoin Jesus

825
00:35:17.443 --> 00:35:19.000
had become Bitcoin Judas.

826
00:35:19.024 --> 00:35:21.896
- Every revolution is followed
by the counter-revolution,

827
00:35:21.920 --> 00:35:25.404
which is usually a purge of
the original revolutionaries.

828
00:35:25.428 --> 00:35:29.745
- People are very
passionate about Bitcoin.

829
00:35:29.769 --> 00:35:34.722
And that's why they show a lot of emotion.

830
00:35:34.746 --> 00:35:36.021
- When you're part of a tribe,

831
00:35:36.045 --> 00:35:37.949
you get very religious about your tribe,

832
00:35:37.973 --> 00:35:39.923
making the other tribe almost your enemy.

833
00:35:39.947 --> 00:35:43.332
- It's very hard to debate Roger

834
00:35:43.356 --> 00:35:46.392
because a lot of what he's
saying is just his opinions

835
00:35:46.416 --> 00:35:47.739
and his emotions.

836
00:35:47.763 --> 00:35:49.882
You cannot debate someone's emotions.

837
00:35:49.906 --> 00:35:53.443
- And then they basically
diverted entire Bitcoin project

838
00:35:53.467 --> 00:35:56.670
into something that wasn't
usable as peer to peer cash.

839
00:35:56.694 --> 00:35:58.219
- When he gave his talk,

840
00:35:58.243 --> 00:36:01.465
I kinda knew that that
whole debate slash panel,

841
00:36:01.489 --> 00:36:03.214
I kind of expected it to go off the rails,

842
00:36:03.238 --> 00:36:04.842
but I didn't expect killing babies.

843
00:36:04.866 --> 00:36:05.990
- So that means more babies

844
00:36:06.014 --> 00:36:09.148
are dying in countries around the world

845
00:36:09.172 --> 00:36:11.385
because they have less economic freedom.

846
00:36:11.409 --> 00:36:13.453
More people are starving to death

847
00:36:13.477 --> 00:36:15.264
because they have less economic freedom.

848
00:36:15.288 --> 00:36:18.378
People are literally
dying because of this.

849
00:36:18.402 --> 00:36:19.259
I'm not exaggerating.

850
00:36:19.283 --> 00:36:20.773
This is a life and death matter.

851
00:36:20.797 --> 00:36:23.764
- [Torsten] And remember
that list of promises

852
00:36:23.788 --> 00:36:25.432
that early Bitcoiners championed?

853
00:36:25.456 --> 00:36:29.654
Cheap, easy, fast, unstoppable.

854
00:36:29.678 --> 00:36:31.328
I forgot one.

855
00:36:31.352 --> 00:36:33.204
- If you don't support free speech,

856
00:36:33.228 --> 00:36:34.332
you don't support Bitcoin.

857
00:36:34.356 --> 00:36:35.561
You're an enemy of Bitcoin.

858
00:36:35.585 --> 00:36:38.159
- [Torsten] Censorship
shall not be abided.

859
00:36:38.183 --> 00:36:39.767
- In fact, I myself

860
00:36:39.791 --> 00:36:41.775
have tried posting just a direct quote

861
00:36:41.799 --> 00:36:43.044
from Satoshi Nakamoto,

862
00:36:43.068 --> 00:36:44.123
the creator of Bitcoin.

863
00:36:44.147 --> 00:36:46.738
- I think Roger complains a
lot about censorship on Reddit,

864
00:36:46.762 --> 00:36:51.246
but Reddit is just one of many platforms.

865
00:36:51.270 --> 00:36:53.016
- Word for word quote from Satoshi,

866
00:36:53.040 --> 00:36:55.341
without any additional
commentary from myself at all,

867
00:36:55.365 --> 00:36:57.929
and I've had that post deleted.

868
00:36:57.953 --> 00:36:59.697
- Even though I may not
agree with a lot of things

869
00:36:59.721 --> 00:37:00.966
that Roger Ver is doing now,

870
00:37:00.990 --> 00:37:02.352
I do sympathise with him

871
00:37:02.376 --> 00:37:04.520
and his frustration with being censored.

872
00:37:04.544 --> 00:37:06.880
- They're literally censoring the words

873
00:37:06.904 --> 00:37:08.428
of the creator of Bitcoin.

874
00:37:08.452 --> 00:37:09.577
- Ultimately, it's just a forum

875
00:37:09.601 --> 00:37:11.156
that these guys set up

876
00:37:11.180 --> 00:37:12.534
to talk about Bitcoin,

877
00:37:12.558 --> 00:37:14.346
and they can do whatever
they want with it, right?

878
00:37:14.370 --> 00:37:17.030
- [Torsten] When I first
started covering this space,

879
00:37:17.054 --> 00:37:18.838
everyone was united in their struggle

880
00:37:18.862 --> 00:37:20.456
against the establishment.

881
00:37:20.480 --> 00:37:22.134
Now the industry has grown so much

882
00:37:22.158 --> 00:37:24.083
that they are competing parties,

883
00:37:24.107 --> 00:37:26.244
propaganda machines, conspiracy theories.

884
00:37:26.268 --> 00:37:28.338
Looks a lot like politics.

885
00:37:28.362 --> 00:37:30.949
- The biggest fight within
the Bitcoin ecosystem

886
00:37:30.973 --> 00:37:32.055
is over at the moment

887
00:37:32.079 --> 00:37:34.044
is who has the right to the name Bitcoin?

888
00:37:34.068 --> 00:37:35.311
But at the end of the day,

889
00:37:35.335 --> 00:37:37.439
I think the version of Bitcoin described

890
00:37:37.463 --> 00:37:38.562
in the Bitcoin white paper

891
00:37:38.586 --> 00:37:41.354
has the strongest claim
to the name Bitcoin

892
00:37:41.378 --> 00:37:42.571
than anything else.

893
00:37:42.595 --> 00:37:44.352
And that's Bitcoin Cash.

894
00:37:44.376 --> 00:37:45.825
- [Torsten] Roger owns Bitcoin.com

895
00:37:46.844 --> 00:37:48.278
and he has every intention
of bringing Bitcoin Cash

896
00:37:48.302 --> 00:37:49.627
to the masses,

897
00:37:49.651 --> 00:37:51.151
even if it means that some people

898
00:37:51.175 --> 00:37:52.524
coming to his website

899
00:37:52.548 --> 00:37:54.050
think that they're buying Bitcoin

900
00:37:54.074 --> 00:37:55.938
but they're getting Bitcoin Cash.

901
00:37:57.253 --> 00:38:00.064
- I think it's fraudulent to
say that in causing people

902
00:38:00.088 --> 00:38:03.328
to buy Bitcoin Cash when they
actually want to buy Bitcoin.

903
00:38:21.629 --> 00:38:23.054
- [Torsten] So Bitcoin core fans

904
00:38:23.078 --> 00:38:25.631
say Roger is hijacking the brand name,

905
00:38:25.655 --> 00:38:28.468
and Bitcoin Cash supports
claim that Blockstream

906
00:38:28.492 --> 00:38:31.096
is hijacking Bitcoin's development.

907
00:38:31.120 --> 00:38:32.583
- I mean yeah, it is
a conflict of interest

908
00:38:32.607 --> 00:38:36.360
because they're developing
this open source protocol

909
00:38:36.384 --> 00:38:39.662
in a way where their
company can benefit from it.

910
00:38:39.686 --> 00:38:41.345
- Everything we're doing is open source,

911
00:38:41.369 --> 00:38:45.831
so it's not like there's
some secrecy or anything.

912
00:38:45.855 --> 00:38:48.069
You can see all the code that's committed,

913
00:38:48.093 --> 00:38:49.806
and it does go through
this vetting process.

914
00:38:49.830 --> 00:38:51.746
- They have had influence.

915
00:38:51.770 --> 00:38:54.859
I wouldn't say it's not true.

916
00:38:54.883 --> 00:38:58.638
But I don't think they
have enough influence

917
00:38:58.662 --> 00:39:01.285
to actually corrupt Bitcoin.

918
00:39:01.309 --> 00:39:03.243
- We no longer have anyone
maintaining the project

919
00:39:03.267 --> 00:39:04.352
just because we don't want

920
00:39:04.376 --> 00:39:06.927
that potential conflict of interest.

921
00:39:06.951 --> 00:39:09.692
- But in a way, now they've
won the battle anyways.

922
00:39:09.716 --> 00:39:12.278
- [Torsten] So who won
Bitcoin's first war?

923
00:39:12.302 --> 00:39:14.939
Well, both parties got their way.

924
00:39:14.963 --> 00:39:18.260
After the split, the market
valued Bitcoins much higher.

925
00:39:18.284 --> 00:39:22.845
And Bitcoin Cash transaction
fees were much lower.

926
00:39:22.869 --> 00:39:25.843
- The benefit of the scaling
debate or civil war was

927
00:39:25.867 --> 00:39:27.919
Bitcoin was battle tested.

928
00:39:27.943 --> 00:39:29.477
Like a lot of companies

929
00:39:29.501 --> 00:39:30.776
and a lot of powerful people

930
00:39:30.800 --> 00:39:35.351
tried very hard to try to
change Bitcoin, and they failed.

931
00:39:35.375 --> 00:39:38.485
- This thing that
Satoshi Nakamoto launched

932
00:39:38.509 --> 00:39:42.301
is much more resilient
than anyone even hoped.

933
00:39:48.252 --> 00:39:49.587
- I know, I know, you want to find out

934
00:39:49.611 --> 00:39:51.075
what any of this has to do

935
00:39:51.099 --> 00:39:53.893
with this new crytopia,
a revolutionary internet.

936
00:39:53.917 --> 00:39:54.773
We'll get there, I promise.

937
00:39:54.797 --> 00:39:58.221
But first, we need to go from
Bitcoins original blockchain

938
00:39:58.245 --> 00:40:00.083
to hundreds of blockchains.

939
00:40:02.458 --> 00:40:05.247
Back in 2011, when Charlie
Lee was a Google engineer,

940
00:40:05.271 --> 00:40:07.489
he wanted a faster and lighter version

941
00:40:07.513 --> 00:40:09.149
of Satoshi's cryptocurrency,

942
00:40:09.173 --> 00:40:11.213
and was one of the first to experiment

943
00:40:11.237 --> 00:40:13.369
with the open source software.

944
00:40:13.393 --> 00:40:15.910
- The actual coding in terms
of the code differences

945
00:40:15.934 --> 00:40:17.849
became Bitcoin and Litecoin

946
00:40:17.873 --> 00:40:19.078
was actually pretty trivial.

947
00:40:19.102 --> 00:40:21.183
- And what does that mean in time?

948
00:40:21.207 --> 00:40:25.877
- I would say like four,
four or five hours.

949
00:40:25.901 --> 00:40:27.962
- Litecoin was positioned as silver

950
00:40:27.986 --> 00:40:29.757
to Bitcoin's gold.

951
00:40:29.781 --> 00:40:32.458
And it's network value grew
to billions of dollars.

952
00:40:32.482 --> 00:40:35.681
Some critics say: Well, you
sold at the highest point,

953
00:40:35.705 --> 00:40:37.369
and you kind of hurt the community.

954
00:40:37.393 --> 00:40:38.688
What's your response to that?

955
00:40:38.712 --> 00:40:41.145
- When I sold, no one knew
it was at the highest point.

956
00:40:41.169 --> 00:40:42.664
I didn't know it was gonna
be the highest point.

957
00:40:42.688 --> 00:40:44.098
Everyone thought it was
gonna keep going up.

958
00:40:44.122 --> 00:40:47.067
In hindsight, it was good timing,

959
00:40:47.091 --> 00:40:48.655
selling it at that high.

960
00:40:48.679 --> 00:40:51.332
But I'm still focused
full-time on Litecoin adoption,

961
00:40:51.356 --> 00:40:54.392
and working on Litecoin,
Litecoin development.

962
00:40:54.416 --> 00:40:56.626
So it's not like I sold it and just quit.

963
00:40:56.650 --> 00:40:59.846
Nobody gets to kind of dictate

964
00:40:59.870 --> 00:41:03.258
how Bitcoin improves or grows.

965
00:41:03.282 --> 00:41:08.109
Whereas with Litecoin, I
have a strong influence

966
00:41:08.133 --> 00:41:10.026
on the growth of Litecoin,

967
00:41:10.050 --> 00:41:11.211
which is good and bad.

968
00:41:11.235 --> 00:41:15.461
It's kinda like difference
between the benevolent dictator

969
00:41:15.485 --> 00:41:18.424
versus a democracy.

970
00:41:18.448 --> 00:41:20.899
The benevolent dictator is more efficient,

971
00:41:20.923 --> 00:41:22.694
but you have to assume

972
00:41:22.718 --> 00:41:24.466
that the benevolent
dictator stays benevolent.

973
00:41:24.490 --> 00:41:25.870
- Let's put a pin in that.

974
00:41:25.894 --> 00:41:29.015
Litecoin was one of the first
alternative cryptocurrencies,

975
00:41:29.039 --> 00:41:30.748
or alt-coins.

976
00:41:30.772 --> 00:41:33.877
Some of the early adopters,
like Charlie, made fortunes.

977
00:41:33.901 --> 00:41:36.090
Soon, there were hundreds of coins

978
00:41:36.114 --> 00:41:39.771
made by cryptographers,
copycats, and con-men.

979
00:41:39.795 --> 00:41:41.615
There's a coin for bloggers,

980
00:41:41.639 --> 00:41:43.426
a currency for online gamers,

981
00:41:43.450 --> 00:41:46.270
one with anonymity,
and even one for banks.

982
00:41:46.294 --> 00:41:50.100
But can this invention unleash
something even more powerful

983
00:41:50.124 --> 00:41:52.114
than digital currencies?

984
00:41:52.138 --> 00:41:54.469
(dog barks)

985
00:41:56.194 --> 00:41:59.471
Back in 2014, I met the
kid who knew how to do it.

986
00:41:59.495 --> 00:42:01.815
- Hi, I'm Vitalik Buterin,

987
00:42:01.839 --> 00:42:03.793
co-founder of Bitcoin Magazine,

988
00:42:03.817 --> 00:42:04.626
founder of Ethereum,

989
00:42:04.650 --> 00:42:07.291
and just general Bitcoin and
crypto currency advocate.

990
00:42:07.315 --> 00:42:09.212
- [Torsten] Just 19 years old,

991
00:42:09.236 --> 00:42:12.391
Vitalik was on a mission
to make money programmable.

992
00:42:16.854 --> 00:42:18.496
- Vitalik is a very very smart guy.

993
00:42:18.520 --> 00:42:21.984
The thing about Vitalik is
he was pushed away of Bitcoin

994
00:42:22.008 --> 00:42:25.661
because he had gone to to
Bitcoin Core developers

995
00:42:25.685 --> 00:42:28.418
and tried to build
Ethereum on top of Bitcoin.

996
00:42:28.442 --> 00:42:31.217
- [Torsten] And they basically
said nope, not interested.

997
00:42:31.241 --> 00:42:34.093
So he built a separate
blockchain called Ethereum,

998
00:42:34.117 --> 00:42:36.840
with its own currency called Ether.

999
00:42:36.864 --> 00:42:40.379
- A comparison might be
Bitcoin is like a spreadsheet,

1000
00:42:40.403 --> 00:42:43.664
and Ethereum is like a
spreadsheet with macros.

1001
00:42:43.688 --> 00:42:46.999
- [Torsten] Using our
analogy, Ethereum allows you

1002
00:42:47.023 --> 00:42:49.627
to store cryptocurrency and computer code

1003
00:42:49.651 --> 00:42:51.242
in the same secure box.

1004
00:42:53.487 --> 00:42:54.739
Here's how a smart contract might work.

1005
00:42:54.763 --> 00:42:57.619
Let's say I bet Charlie

1006
00:42:57.643 --> 00:43:00.636
that a Litecoin will be worth $200

1007
00:43:00.660 --> 00:43:02.588
on January 1st of next year.

1008
00:43:02.612 --> 00:43:04.862
We each put an ether into a box

1009
00:43:04.886 --> 00:43:06.440
along with a smart contract,

1010
00:43:06.464 --> 00:43:08.778
a simple programme that
automatically checks

1011
00:43:08.802 --> 00:43:10.186
the price of Litecoins

1012
00:43:10.210 --> 00:43:11.805
on that future date.

1013
00:43:11.829 --> 00:43:13.823
If I'm right, the money goes to me.

1014
00:43:13.847 --> 00:43:14.683
If I'm wrong,

1015
00:43:14.707 --> 00:43:15.818
it's sent to Charlie.

1016
00:43:20.230 --> 00:43:22.716
- A smart contract is
neither smart nor a contract.

1017
00:43:22.740 --> 00:43:24.256
It's a dumb program.

1018
00:43:24.280 --> 00:43:27.774
And once you understand that
all it is a dumb program,

1019
00:43:27.798 --> 00:43:29.579
that clarifies a lot of stuff.

1020
00:43:29.603 --> 00:43:32.642
And the word contract there
is in the meaning of finance.

1021
00:43:32.666 --> 00:43:35.603
- [Narrator] Most financial arrangements

1022
00:43:35.627 --> 00:43:37.823
are pretty simple and clear cut.

1023
00:43:37.847 --> 00:43:39.537
A bet with Charlie,

1024
00:43:39.561 --> 00:43:40.467
your home loan,

1025
00:43:40.491 --> 00:43:41.597
and insurance policy,

1026
00:43:41.621 --> 00:43:44.653
just two parties and some
form of exchange of value

1027
00:43:44.677 --> 00:43:47.170
based on a set of rules called a contract.

1028
00:43:47.194 --> 00:43:49.646
The same is true for
global financial markets.

1029
00:43:49.670 --> 00:43:52.643
Think bonds, futures, derivatives,

1030
00:43:52.667 --> 00:43:54.612
credit default swaps.

1031
00:43:54.636 --> 00:43:56.330
They're all just contracts,

1032
00:43:56.354 --> 00:43:58.715
and the world economy runs
on them using middlemen

1033
00:43:58.739 --> 00:44:00.881
who all charge high fees.

1034
00:44:00.905 --> 00:44:04.165
Proponents say that if
we used smart contracts,

1035
00:44:04.189 --> 00:44:06.010
we could tell the bankers,

1036
00:44:06.034 --> 00:44:09.577
lawyers, escrow agents, and
Wall Street finance guys

1037
00:44:09.601 --> 00:44:10.875
to take a hike.

1038
00:44:10.899 --> 00:44:13.862
- A soda machine is a smart
contract machine, right.

1039
00:44:13.886 --> 00:44:16.022
You stick in a dollar, you get a soda.

1040
00:44:16.046 --> 00:44:17.828
It's very, very simple.

1041
00:44:17.852 --> 00:44:19.472
The soda machine does take statistics,

1042
00:44:19.496 --> 00:44:22.104
and it has to make sure
that you can't scam it

1043
00:44:22.128 --> 00:44:23.623
by stealing the soda,

1044
00:44:23.647 --> 00:44:25.970
but Ethereum and the people

1045
00:44:25.994 --> 00:44:27.463
that are trying to decentralise this

1046
00:44:27.487 --> 00:44:30.566
will tell you that that transaction,

1047
00:44:30.590 --> 00:44:33.027
that smart contract between
you and the soda machine

1048
00:44:33.051 --> 00:44:36.948
is so critical that it needs
to be globally processed

1049
00:44:36.972 --> 00:44:41.147
and saved at 100,000
decentralised computers

1050
00:44:41.171 --> 00:44:43.433
because it is so sensitive.

1051
00:44:43.457 --> 00:44:46.986
And in reality, 99% of
all of these contracts,

1052
00:44:47.010 --> 00:44:50.795
they don't need this kind
of censorship resistance.

1053
00:44:50.819 --> 00:44:51.804
- [Torsten] You know, in two years time

1054
00:44:51.828 --> 00:44:53.063
when people will see this film,

1055
00:44:53.087 --> 00:44:53.896
or in four years time,

1056
00:44:53.920 --> 00:44:56.710
I think will be an
interesting historic moment.

1057
00:44:56.734 --> 00:44:58.975
- What we're doing is we're saying,

1058
00:44:58.999 --> 00:44:59.808
we have this Ethereum network,

1059
00:44:59.832 --> 00:45:02.290
inside the Ethereum network
there's this asset called Ether,

1060
00:45:02.314 --> 00:45:04.632
and we're actually going
to be selling Ether.

1061
00:45:04.656 --> 00:45:05.512
We're going to be selling Ether

1062
00:45:05.536 --> 00:45:07.529
at a rate of 1,000 to 2,000
Ether for one Bitcoin.

1063
00:45:07.553 --> 00:45:10.106
And that's how we're
gonna raise all the money.

1064
00:45:10.130 --> 00:45:11.475
- [Torsten] It worked.

1065
00:45:11.499 --> 00:45:13.084
Vitalik figured out a way
to fun the Ethereum project.

1066
00:45:13.108 --> 00:45:15.784
And it made his investors very rich.

1067
00:45:15.808 --> 00:45:18.807
(soft music)

1068
00:45:18.831 --> 00:45:20.587
This new model for
fundraising soon had a name,

1069
00:45:20.611 --> 00:45:24.821
and initial coin offering, or ICO.

1070
00:45:24.845 --> 00:45:27.878
- IPOs and ICOs sound similar,

1071
00:45:27.902 --> 00:45:30.056
but they have, they're nothing similar.

1072
00:45:30.080 --> 00:45:31.285
The only thing similar about them

1073
00:45:31.309 --> 00:45:33.500
is they both help you raise money.

1074
00:45:34.741 --> 00:45:37.649
IPOs, you don't do until
you have a company,

1075
00:45:37.673 --> 00:45:38.777
until you have revenue,

1076
00:45:38.801 --> 00:45:40.036
until you have users,

1077
00:45:40.060 --> 00:45:42.883
until you can actually prove
to the public investors

1078
00:45:42.907 --> 00:45:44.142
that this is a valuable company

1079
00:45:44.166 --> 00:45:45.231
that's worth investing in,

1080
00:45:45.255 --> 00:45:47.079
and it's worth buying their stock.

1081
00:45:47.103 --> 00:45:50.167
ICOs, it's pre-product.

1082
00:45:50.191 --> 00:45:52.684
You have maybe a couple
of people on the team.

1083
00:45:52.708 --> 00:45:54.192
It's just a white paper.

1084
00:45:54.216 --> 00:45:56.083
And so people are just buying into,

1085
00:45:56.107 --> 00:45:59.412
trust into faith that this
is something that will exist.

1086
00:45:59.436 --> 00:46:02.026
- [Torsten] And this is the
guy who opened the floodgates.

1087
00:46:02.050 --> 00:46:05.161
He crated a standard called ERC-20,

1088
00:46:05.185 --> 00:46:08.705
enabling you or me or
anyone to create an ICO.

1089
00:46:10.270 --> 00:46:11.505
- So on the one hand,

1090
00:46:11.529 --> 00:46:12.445
you have these smart contracts,

1091
00:46:12.469 --> 00:46:14.176
these little programmes
that can talk to each other,

1092
00:46:14.200 --> 00:46:17.489
but you have to define how
do they talk to each other.

1093
00:46:17.513 --> 00:46:19.751
And because everybody now
agrees to that same standard.

1094
00:46:19.775 --> 00:46:22.614
- [Torsten] Smart contracts can interact

1095
00:46:22.638 --> 00:46:24.107
within the entire Ethereum network

1096
00:46:24.131 --> 00:46:27.967
and the ERC-20 standard
allow the creation of tokens.

1097
00:46:27.991 --> 00:46:31.595
- The goal here is like, ultimately,

1098
00:46:31.619 --> 00:46:32.634
I'd like to see eight year olds

1099
00:46:32.658 --> 00:46:34.048
building their own financial systems.

1100
00:46:34.072 --> 00:46:37.276
- [Torsten] Yeah, but what if
some of these eight year olds

1101
00:46:37.300 --> 00:46:39.081
are also scammers?

1102
00:46:39.105 --> 00:46:42.396
- So let's say I'm trying to do a ICO,

1103
00:46:42.420 --> 00:46:44.843
and I create a smart contract

1104
00:46:44.867 --> 00:46:47.525
where I create a million coins,

1105
00:46:47.549 --> 00:46:51.316
and one of the transactions is that if you

1106
00:46:51.340 --> 00:46:55.764
send me $100, I will send
you that many worth of coins.

1107
00:46:55.788 --> 00:46:58.433
- [Torsten] It was a mad gold rush.

1108
00:46:58.457 --> 00:47:00.416
- People realised wow, if,

1109
00:47:00.440 --> 00:47:03.053
if I can just pull up,
pull together a project

1110
00:47:03.077 --> 00:47:04.305
and a white paper, I can raise money.

1111
00:47:04.329 --> 00:47:06.197
- Like a lot of money.

1112
00:47:06.221 --> 00:47:08.636
(soft music)

1113
00:47:23.736 --> 00:47:25.956
Some people hawking new
coins didn't actually exist.

1114
00:47:25.980 --> 00:47:29.007
This handsome chap is the graphic designer

1115
00:47:29.031 --> 00:47:30.715
of a Bulgarian ICO.

1116
00:47:30.739 --> 00:47:33.530
Actually, they just posted
a photo of Ryan Gosling.

1117
00:47:33.554 --> 00:47:36.679
Another project raised millions in Ether,

1118
00:47:36.703 --> 00:47:38.158
and then vanished,

1119
00:47:38.182 --> 00:47:40.935
leaving investors with this website.

1120
00:47:40.959 --> 00:47:43.352
Look closer, that's nice.

1121
00:47:43.376 --> 00:47:46.110
Most of the scam coins were built

1122
00:47:46.134 --> 00:47:47.505
on Vitalik's smart
contract platform Ethereum

1123
00:47:47.529 --> 00:47:50.604
using Fabian's token standard.

1124
00:47:50.628 --> 00:47:54.617
This innovation has enabled a
lot of criminals and scammers.

1125
00:47:54.641 --> 00:47:59.636
- So I would say the amount of scams

1126
00:47:59.920 --> 00:48:02.973
in that system are rather low.

1127
00:48:02.997 --> 00:48:04.991
It sometimes looks bigger than it is.

1128
00:48:05.015 --> 00:48:08.058
I would assume that the actual scams,

1129
00:48:08.082 --> 00:48:11.555
purposeful scams, in that system

1130
00:48:11.579 --> 00:48:13.433
maybe were like two or three percent.

1131
00:48:13.457 --> 00:48:17.744
I would say actually
most ICOs were not scams.

1132
00:48:17.768 --> 00:48:21.125
- I would say about two to
five percent of the thousands of ICOs

1133
00:48:21.149 --> 00:48:22.856
that are happening are actually legit.

1134
00:48:22.880 --> 00:48:24.673
- [Torsten] And the rest is?

1135
00:48:24.697 --> 00:48:27.170
- Pretty scammy, or just not gonna work.

1136
00:48:27.194 --> 00:48:31.969
- Can you define for
me what a shitcoin is?

1137
00:48:31.993 --> 00:48:33.465
(laughs)

1138
00:48:33.489 --> 00:48:37.552
- I think it's just a
derogatory term people use

1139
00:48:37.576 --> 00:48:40.509
on coins that they don't like

1140
00:48:40.533 --> 00:48:42.421
for Bitcoin maximalists,

1141
00:48:42.445 --> 00:48:44.871
people who only care about Bitcoin,

1142
00:48:44.895 --> 00:48:46.454
everything else is a shitcoin.

1143
00:48:46.478 --> 00:48:48.158
In my point of view,

1144
00:48:48.182 --> 00:48:52.873
I think a coin that is kind
of a scam is a shitcoin.

1145
00:48:52.897 --> 00:48:56.211
So people create coins
just to get rich from it,

1146
00:48:56.235 --> 00:48:58.997
print a lot of tokens out of thin air,

1147
00:48:59.021 --> 00:49:00.096
trying to pump the price up

1148
00:49:00.120 --> 00:49:02.034
and make a lot of money from it.

1149
00:49:02.058 --> 00:49:03.625
And it's not really
providing a lot of value

1150
00:49:03.649 --> 00:49:06.450
to the world.

1151
00:49:06.474 --> 00:49:08.348
- [Torsten] No value for the world,

1152
00:49:08.372 --> 00:49:10.412
but they did add value for their creators.

1153
00:49:10.436 --> 00:49:12.937
If you can print billions
of tokens out of thin air

1154
00:49:12.961 --> 00:49:15.712
like a central bank,
well, that's why this guy

1155
00:49:15.736 --> 00:49:18.702
was one of the wealthiest men
on earth for a brief moment.

1156
00:49:18.726 --> 00:49:21.435
Here's how that happened.

1157
00:49:21.459 --> 00:49:23.782
- [Narrator] There will only
every be 21 million Bitcoins,

1158
00:49:23.806 --> 00:49:26.320
and it's inventor had to earn them

1159
00:49:26.344 --> 00:49:27.958
by mining with his computers

1160
00:49:27.982 --> 00:49:29.536
just like everyone else.

1161
00:49:29.560 --> 00:49:30.925
There are more Litecoins,

1162
00:49:30.949 --> 00:49:33.195
and even more Ether in circulation.

1163
00:49:33.219 --> 00:49:36.092
Vitalik kept some portion to
fund the development team.

1164
00:49:36.116 --> 00:49:38.312
And then there's Ripple.

1165
00:49:38.336 --> 00:49:41.494
They created 100 billion XRP

1166
00:49:41.518 --> 00:49:44.191
but kept 80% for themselves
and their clients.

1167
00:49:44.215 --> 00:49:47.534
And the other 20%, they gave
as a bonus to the founders.

1168
00:49:47.558 --> 00:49:50.560
That's how you get to be one
of the richest men on earth.

1169
00:49:50.584 --> 00:49:53.945
- [Torsten] Okay, maybe I
was a bit too harsh on ICOs

1170
00:49:53.969 --> 00:49:57.306
democratising start up
finance can be a good thing.

1171
00:49:57.330 --> 00:50:00.429
There were many legit
companies raising capital too.

1172
00:50:00.453 --> 00:50:02.883
Over the years, I've met many founders

1173
00:50:02.907 --> 00:50:05.281
who have real offices with real people

1174
00:50:05.305 --> 00:50:07.076
trying to solve real problems.

1175
00:50:08.574 --> 00:50:10.079
But to Bitcoin maximalists,

1176
00:50:10.103 --> 00:50:13.352
Bitcoin is the be all end
all of cryptocurrency.

1177
00:50:13.376 --> 00:50:16.610
Other blockchains, ICOs, smart contracts,

1178
00:50:16.634 --> 00:50:19.014
that's all a waste of time.

1179
00:50:22.832 --> 00:50:26.380
- There is no such thing as blockchains,

1180
00:50:26.404 --> 00:50:29.257
that revolutionise the healthcare industry,

1181
00:50:29.281 --> 00:50:31.106
and the automotive production...

1182
00:50:31.130 --> 00:50:33.152
- Of course there is.

1183
00:50:33.176 --> 00:50:34.103
- Huh?

1184
00:50:34.127 --> 00:50:34.936
- Of course there is.

1185
00:50:34.960 --> 00:50:36.155
What you're saying is a
maximalist point of view.

1186
00:50:36.179 --> 00:50:39.285
You are speaking about
from a perspective of,

1187
00:50:39.309 --> 00:50:41.532
of a cult or a sect.

1188
00:50:41.556 --> 00:50:46.439
My problem is that you
are hijacking a movement

1189
00:50:46.463 --> 00:50:48.880
of a technology that is far greater

1190
00:50:48.904 --> 00:50:51.055
and has far more potential

1191
00:50:51.079 --> 00:50:53.712
than just these individuals.

1192
00:50:53.736 --> 00:50:55.061
- There's all of these different things

1193
00:50:55.085 --> 00:50:56.347
that you could use blockchain for, right.

1194
00:50:56.371 --> 00:50:57.838
And so people have,

1195
00:50:57.862 --> 00:50:59.713
they're almost like different ecosystems.

1196
00:50:59.737 --> 00:51:02.937
And then what you see is almost
like an evolutionary process

1197
00:51:02.961 --> 00:51:05.207
right, where the blockchains fork

1198
00:51:05.231 --> 00:51:06.999
and they have the same ancestries,

1199
00:51:07.023 --> 00:51:08.474
but they adapt to different environments

1200
00:51:08.498 --> 00:51:12.324
and we see this like every
increasing level of diversity

1201
00:51:12.348 --> 00:51:13.668
in number of blockchains.

1202
00:51:13.692 --> 00:51:16.010
So I think the idea that
here's like one blockchain,

1203
00:51:16.034 --> 00:51:16.843
gonna be one blockchain

1204
00:51:16.867 --> 00:51:18.656
and it's gonna be fit for everything,

1205
00:51:18.680 --> 00:51:23.675
it's almost like disregarding
the nature of evolution.

1206
00:51:24.029 --> 00:51:27.448
- Meanwhile, the big corporations

1207
00:51:27.472 --> 00:51:28.846
have been studying cryptocurrency.

1208
00:51:28.870 --> 00:51:31.754
And they think that
Bitcoin's underlying database

1209
00:51:31.778 --> 00:51:33.073
is where the magic is.

1210
00:51:33.097 --> 00:51:34.508
The motto in the boardrooms,

1211
00:51:36.953 --> 00:51:38.761
Blockchain, not Bitcoin!

1212
00:51:42.911 --> 00:51:44.181
Back in Germany, my friend Oliver

1213
00:51:44.205 --> 00:51:46.559
keeps tabs on the men in suits.

1214
00:51:46.583 --> 00:51:48.085
He used to be one of them.

1215
00:51:52.827 --> 00:51:54.787
- [Torsten] BMW is looking
at using the blockchain

1216
00:52:04.664 --> 00:52:06.889
for their future fleet of electric cars

1217
00:52:06.913 --> 00:52:08.816
to interact with public transport.

1218
00:52:08.840 --> 00:52:11.754
Lufthansa wants to see if the blockchain

1219
00:52:11.778 --> 00:52:13.362
can better track parts and maintenance.

1220
00:52:13.386 --> 00:52:16.449
And Deutsche Telekom is
using smart contracts

1221
00:52:16.473 --> 00:52:17.838
to negotiate tariffs

1222
00:52:17.862 --> 00:52:19.964
for roaming costs with other telecoms.

1223
00:52:19.988 --> 00:52:22.402
(soft music)

1224
00:52:26.603 --> 00:52:28.526
if we can store trade certificates
and shipping documents

1225
00:52:28.550 --> 00:52:30.246
on the blockchain,

1226
00:52:30.270 --> 00:52:33.153
you can check to see where
those organic avocados

1227
00:52:33.177 --> 00:52:34.963
really came from, who grew them,

1228
00:52:34.987 --> 00:52:36.629
who packed them,

1229
00:52:36.653 --> 00:52:37.702
and who shipped them.

1230
00:52:38.701 --> 00:52:40.335
Besides, the Internet of things

1231
00:52:40.359 --> 00:52:42.546
needs a ledger of all those things.

1232
00:52:42.570 --> 00:52:44.931
Well, that's the idea

1233
00:52:44.955 --> 00:52:47.059
behind private centralised blockchains,

1234
00:52:47.083 --> 00:52:49.586
maintained and controlled by corporations.

1235
00:52:49.610 --> 00:52:51.804
A famous example, the
Walmart supply chain trial,

1236
00:52:51.828 --> 00:52:53.770
which they're working with IBM.

1237
00:52:53.794 --> 00:52:56.090
That's a completely centralised.

1238
00:52:56.114 --> 00:52:59.526
They use a blockchain
derived product Hyperledger,

1239
00:52:59.550 --> 00:53:01.467
but all the nodes reside on the IBM cloud,

1240
00:53:01.491 --> 00:53:04.022
and they're all administered by Walmart,

1241
00:53:04.046 --> 00:53:06.258
and the supplier is used
because Walmart told them to.

1242
00:53:06.282 --> 00:53:08.476
It's a centralised database system!

1243
00:53:08.500 --> 00:53:10.253
But they marketed it Blockchain.

1244
00:53:10.277 --> 00:53:11.782
So that means one,

1245
00:53:11.806 --> 00:53:14.035
they wouldn't have got a
New York Times headline

1246
00:53:14.059 --> 00:53:15.777
if they just said database.

1247
00:53:15.801 --> 00:53:17.458
- [Torsten] You might wonder

1248
00:53:17.482 --> 00:53:18.807
what's the point of a blockchain

1249
00:53:18.831 --> 00:53:20.174
if it's controlled by a company?

1250
00:53:20.198 --> 00:53:22.314
Well, I compare it to the open Internet

1251
00:53:22.338 --> 00:53:24.211
versus company owned Intranets.

1252
00:53:24.235 --> 00:53:26.263
They both exist.

1253
00:53:26.287 --> 00:53:29.653
Meanwhile, Facebook
announced a cryptocurrency

1254
00:53:29.677 --> 00:53:31.553
for their two billion users.

1255
00:53:31.577 --> 00:53:34.062
Such a system might be more efficient

1256
00:53:34.086 --> 00:53:35.480
than a public blockchain,

1257
00:53:35.504 --> 00:53:37.019
but there's a downside.

1258
00:53:37.043 --> 00:53:37.977
Some Governments banned it within weeks.

1259
00:53:38.001 --> 00:53:42.034
(group chatter)

1260
00:53:42.058 --> 00:53:43.682
- Right now, the ways, pieces of paper,

1261
00:53:43.706 --> 00:53:45.920
that's being shifted around,
that doesn't make any sense.

1262
00:53:45.944 --> 00:53:47.608
That infrastructure needs to be replaced.

1263
00:53:47.632 --> 00:53:49.107
- [Torsten] Why occupy Wall Street

1264
00:53:49.131 --> 00:53:51.366
when we can build a new one
on the blockchain instead?

1265
00:53:51.390 --> 00:53:53.584
In the future of decentralised finance,

1266
00:53:53.608 --> 00:53:56.839
stock certificate, corporate bonds,

1267
00:53:56.863 --> 00:53:59.296
insurance policies, property deeds,

1268
00:53:59.320 --> 00:54:01.825
mortgages, all can be
turned into crypto tokens

1269
00:54:01.849 --> 00:54:03.795
and made tradable 24/7.

1270
00:54:03.819 --> 00:54:06.733
(electronic music)

1271
00:54:14.728 --> 00:54:17.808
(electronic buzzing)

1272
00:54:25.784 --> 00:54:28.247
- What's much more exciting
than tokenized securities

1273
00:54:28.271 --> 00:54:30.515
of traditional businesses
where it's just equity

1274
00:54:30.539 --> 00:54:31.455
that you pass around

1275
00:54:31.479 --> 00:54:33.982
is totally novel digital securities

1276
00:54:34.006 --> 00:54:36.120
that you couldn't do before, right.

1277
00:54:36.144 --> 00:54:38.294
Novel use cases where you
could kick back cash flow

1278
00:54:38.318 --> 00:54:39.825
on a continual basis.

1279
00:54:39.849 --> 00:54:41.804
I think some examples of this

1280
00:54:41.828 --> 00:54:42.952
that we're seeing now are MakerDao,

1281
00:54:42.976 --> 00:54:45.992
Binance which has Binance Coin,

1282
00:54:46.016 --> 00:54:49.137
that's actually much
bigger of an opportunity

1283
00:54:49.161 --> 00:54:50.950
because it represents
something totally new.

1284
00:54:50.974 --> 00:54:53.388
(soft music)

1285
00:54:56.783 --> 00:54:58.086
- My name is Dr. Jemma Green,

1286
00:54:58.110 --> 00:55:01.621
and I'm a co-founder and the
chairman of PowerLedger.

1287
00:55:01.645 --> 00:55:03.792
And we use the blockchain

1288
00:55:03.816 --> 00:55:05.391
to enable electricity trading,

1289
00:55:05.415 --> 00:55:09.386
energy asset financing,
and carbon markets.

1290
00:55:09.410 --> 00:55:11.224
- [Torsten] This award
winning Australian company

1291
00:55:11.248 --> 00:55:13.317
wants to take us to a
carbon-free economy faster.

1292
00:55:13.341 --> 00:55:15.664
Jemma has identified a problem.

1293
00:55:15.688 --> 00:55:19.186
- Apartment buildings, often
the buildings are tenanted.

1294
00:55:19.210 --> 00:55:21.180
An it means that if there is solar panels,

1295
00:55:21.204 --> 00:55:24.271
the owner of the apartment
isn't really incentivize

1296
00:55:24.295 --> 00:55:25.880
to put in solar panels or batteries

1297
00:55:25.904 --> 00:55:27.368
because the tenant benefits.

1298
00:55:27.392 --> 00:55:28.927
But using our platform,

1299
00:55:28.951 --> 00:55:30.745
the tenant will pay their electricity bill

1300
00:55:30.769 --> 00:55:32.323
to the body corporate.

1301
00:55:32.347 --> 00:55:33.323
- [Torsten] Using PowerLedger,

1302
00:55:33.347 --> 00:55:35.627
the tenant pays the owner,
not the power company

1303
00:55:35.651 --> 00:55:37.618
for their electricity.

1304
00:55:37.642 --> 00:55:38.909
And if the tenant isn't at home,

1305
00:55:38.933 --> 00:55:40.994
the unused energy will
be sold to a neighbour,

1306
00:55:41.018 --> 00:55:42.927
lowering their power bill

1307
00:55:42.951 --> 00:55:45.600
and making a profit for the owner.

1308
00:55:45.624 --> 00:55:47.563
- So it actually crates the mechanism

1309
00:55:47.587 --> 00:55:50.321
to justify investing the
capital in the first place.

1310
00:55:50.345 --> 00:55:52.517
- This system could speed up investment

1311
00:55:52.541 --> 00:55:54.117
in sustainable energy projects

1312
00:55:54.141 --> 00:55:56.921
by making it easy to own a
piece of a solar or wind farm.

1313
00:55:56.945 --> 00:55:59.359
(soft music)

1314
00:56:01.918 --> 00:56:03.382
Why do I need a blockchain for this?

1315
00:56:03.406 --> 00:56:07.098
Can't I invest in a solar farm
without this new fancy tech?

1316
00:56:07.122 --> 00:56:09.065
- The blockchain acts as
a kind of asset register

1317
00:56:09.089 --> 00:56:11.065
and income register,

1318
00:56:11.089 --> 00:56:12.570
and in tokenizing the asset,

1319
00:56:12.594 --> 00:56:15.081
it becomes tradable on an exchange.

1320
00:56:15.105 --> 00:56:17.608
You might own two or three solar panels

1321
00:56:17.632 --> 00:56:20.371
of a thousand, you know, in a solar farm,

1322
00:56:20.395 --> 00:56:23.198
and you would receive the
income associated with that

1323
00:56:23.222 --> 00:56:24.993
amount of ownership.

1324
00:56:25.017 --> 00:56:25.981
(soft music)

1325
00:56:26.005 --> 00:56:28.527
- Now bankers don't very
much like being cut out

1326
00:56:28.551 --> 00:56:29.796
of the cashflow loop,

1327
00:56:29.820 --> 00:56:31.094
so they took another look

1328
00:56:31.118 --> 00:56:33.457
at Mr. Nakamoto's curious
little white paper.

1329
00:56:33.481 --> 00:56:35.970
And they've recently been spending

1330
00:56:35.994 --> 00:56:38.874
a billion dollars a year
in blockchain research.

1331
00:56:39.931 --> 00:56:41.313
Isn't it ironic,

1332
00:56:41.337 --> 00:56:43.312
Satoshi's anti-bank invention

1333
00:56:43.336 --> 00:56:44.671
is now being used by the banks

1334
00:56:44.695 --> 00:56:45.870
to move money faster.

1335
00:56:45.894 --> 00:56:47.597
And by big business to
track supply chains.

1336
00:56:47.621 --> 00:56:50.535
(electronic music)

1337
00:57:04.552 --> 00:57:05.483
Cryptocurrencies, digital tokens,

1338
00:57:05.507 --> 00:57:07.908
public blockchains, private blockchains,

1339
00:57:07.932 --> 00:57:09.217
where is the killer app?

1340
00:57:09.241 --> 00:57:11.702
Well, adoption of new technology

1341
00:57:11.726 --> 00:57:14.062
often follows old trends.

1342
00:57:14.086 --> 00:57:16.219
- My name is Marc Ventresca.

1343
00:57:16.243 --> 00:57:18.397
I'm here at Oxford, the
University of Oxford

1344
00:57:18.421 --> 00:57:19.616
on the faculty.

1345
00:57:19.640 --> 00:57:21.474
I'm an economics sociologist by training,

1346
00:57:21.498 --> 00:57:23.665
interested in how large-scale
infrastructure changes.

1347
00:57:23.689 --> 00:57:26.231
- So great so see you after nine years.

1348
00:57:26.255 --> 00:57:27.719
- [Marc] I know.

1349
00:57:27.743 --> 00:57:29.766
- [Torsten] Marc teaches a class

1350
00:57:29.790 --> 00:57:31.153
on innovation and system building.

1351
00:57:31.177 --> 00:57:33.164
He tells me what must align

1352
00:57:33.188 --> 00:57:35.194
for a new technology to become fruitful.

1353
00:57:35.218 --> 00:57:39.327
- All technologies start
out as interesting ideas.

1354
00:57:39.351 --> 00:57:41.845
Some of them begin to
develop into innovations

1355
00:57:41.869 --> 00:57:44.063
and we know that arc from
invention to innovation

1356
00:57:44.087 --> 00:57:46.148
takes a lot of time, takes a lot of work.

1357
00:57:46.172 --> 00:57:48.297
Some of those innovations

1358
00:57:48.321 --> 00:57:49.801
eventually become commercially viable.

1359
00:57:49.825 --> 00:57:53.275
- [Torsten] Case in point, the automobile.

1360
00:57:53.299 --> 00:57:54.461
In the early days,

1361
00:57:54.485 --> 00:57:56.037
cars looked like a pretty lousy idea,

1362
00:57:56.061 --> 00:57:58.434
and poorly executed.

1363
00:58:00.386 --> 00:58:02.070
- Early on, there were electric cars,

1364
00:58:02.094 --> 00:58:03.598
there were battery operated cars.

1365
00:58:03.622 --> 00:58:06.564
The combustion engine was
a relative late comer.

1366
00:58:06.588 --> 00:58:09.626
- [Torsten] It took Henry
Ford's mass production

1367
00:58:09.650 --> 00:58:11.264
to create the standards,

1368
00:58:11.288 --> 00:58:12.434
what a car looked like,

1369
00:58:12.458 --> 00:58:14.091
what parts it needed,

1370
00:58:14.115 --> 00:58:15.178
how it operated.

1371
00:58:15.202 --> 00:58:17.090
That's when complementary assets

1372
00:58:17.114 --> 00:58:19.379
and infrastructure emerged.

1373
00:58:19.403 --> 00:58:22.292
- So you have a paved
roads and petrol stations.

1374
00:58:22.316 --> 00:58:26.036
Then you have secondary things
like motels and restaurants,

1375
00:58:26.060 --> 00:58:28.265
and places to eat while you're
on the highway and buy food.

1376
00:58:28.289 --> 00:58:30.665
Then you have interesting questions

1377
00:58:30.689 --> 00:58:32.070
like what side of the
road should we drive on.

1378
00:58:32.094 --> 00:58:34.970
- [Torsten] An entire
ecosystem had been built,

1379
00:58:34.994 --> 00:58:37.755
but it wasn't a smooth
transition by any means.

1380
00:58:39.320 --> 00:58:41.694
- The imagery here is there
are maybe a couple of hundred,

1381
00:58:41.718 --> 00:58:42.733
three or four hundred companies

1382
00:58:42.757 --> 00:58:44.231
that tried to get into this space.

1383
00:58:44.255 --> 00:58:45.360
But they're not car companies.

1384
00:58:45.384 --> 00:58:46.756
They're bicycle manufacturers

1385
00:58:46.780 --> 00:58:48.192
or steam engine manufacturers.

1386
00:58:48.216 --> 00:58:50.912
At some point, in this account,

1387
00:58:50.936 --> 00:58:53.032
all that period of ferment settles

1388
00:58:53.056 --> 00:58:54.361
around a dominant design,

1389
00:58:54.385 --> 00:58:55.620
and then you have what,

1390
00:58:55.644 --> 00:58:57.617
again, what innovation
economist would call a shakeout.

1391
00:58:57.641 --> 00:59:00.433
They would say you go from
300 or 400 producers,

1392
00:59:00.457 --> 00:59:05.280
all of them vying to
shape this emerging space,

1393
00:59:05.304 --> 00:59:06.929
this emerging thing called the automobile.

1394
00:59:06.953 --> 00:59:09.128
You may then drop to
20 or 30 manufacturers.

1395
00:59:09.152 --> 00:59:11.766
And then you may drop to five or six.

1396
00:59:11.790 --> 00:59:14.071
(soft music)

1397
00:59:14.095 --> 00:59:14.904
- [Torsten] It took 50 years

1398
00:59:14.928 --> 00:59:16.709
for cars to go from curious invention

1399
00:59:16.733 --> 00:59:19.336
to finally tuned, mass market product.

1400
00:59:19.360 --> 00:59:22.050
50 years to change the
world as we knew it.

1401
00:59:24.475 --> 00:59:26.389
♪ Bitcoin is Gold theme song ♪

1402
00:59:26.413 --> 00:59:27.581
- [GPS] Your destination is on the left.

1403
00:59:27.605 --> 00:59:32.013
- [Torsten] But our story
isn't about cars or roads.

1404
00:59:32.037 --> 00:59:33.921
I want to learn about dominate designs

1405
00:59:33.945 --> 00:59:35.427
of digital technology.

1406
00:59:36.293 --> 00:59:38.248
That's why I came to the
Computer History Museum

1407
00:59:38.272 --> 00:59:40.505
in the heart of Silicon Valley.

1408
00:59:40.529 --> 00:59:43.267
- So you're looking at
the console for SAGE,

1409
00:59:43.291 --> 00:59:45.674
which was probably the
first computer network.

1410
00:59:45.674 --> 00:59:46.581
which was probably the
first computer network.
- [Torsten] The US military
and some American universities

1411
00:59:46.581 --> 00:59:46.605
- [Torsten] The US military
and some American universities

1412
00:59:46.605 --> 00:59:47.955
There were 23 centres around North America
- [Torsten] The US military
and some American universities

1413
00:59:47.955 --> 00:59:50.235
There were 23 centres around North America

1414
00:59:50.259 --> 00:59:51.929
to warn against Soviet bombers.

1415
00:59:51.953 --> 00:59:54.386
And they were waiting for World War III.

1416
00:59:57.757 --> 01:00:00.802
asked this guy to create
a new kind of network

1417
01:00:00.826 --> 01:00:03.037
to connect their separate networks.

1418
01:00:03.061 --> 01:00:05.281
- And this young girl

1419
01:00:05.305 --> 01:00:08.017
got up and she had a bunch of questions,

1420
01:00:08.041 --> 01:00:09.935
but her first one was

1421
01:00:09.959 --> 01:00:12.353
how did I manage to
convince all the governments

1422
01:00:12.377 --> 01:00:14.101
of the world to let us build the Internet.

1423
01:00:14.125 --> 01:00:16.719
And I said well, except
for the handful of us

1424
01:00:16.743 --> 01:00:18.036
that were actually
working on the Internet,

1425
01:00:18.060 --> 01:00:21.214
nobody else really thought
it was a very good idea,

1426
01:00:21.238 --> 01:00:22.731
and they didn't think it
was gonna lead anywhere.

1427
01:00:22.755 --> 01:00:25.684
And you know, we pretty
much had free running room.

1428
01:00:25.708 --> 01:00:29.306
- [Torsten] Yes, that's the
man who co-invented TCP/IP

1429
01:00:29.330 --> 01:00:30.695
about 50 years ago.

1430
01:00:30.719 --> 01:00:32.593
That's their original academic paper.

1431
01:00:32.617 --> 01:00:35.150
You can think of TCP as the
backbone of the Internet.

1432
01:00:35.174 --> 01:00:38.018
But back then, there were
many competing technologies.

1433
01:00:38.042 --> 01:00:41.397
- There was a very big
battle over the protocols.

1434
01:00:41.421 --> 01:00:43.978
TCP/IP didn't just win by default.

1435
01:00:44.002 --> 01:00:48.507
It won through attrition
by basically being better,

1436
01:00:48.531 --> 01:00:50.529
simpler, easier to deploy

1437
01:00:50.553 --> 01:00:52.151
than all of the other proposals.

1438
01:00:52.175 --> 01:00:52.983
- [Torsten] More scalable.

1439
01:00:53.007 --> 01:00:53.932
- And more scalable.

1440
01:00:53.956 --> 01:00:55.670
And it had a lot of competition

1441
01:00:55.694 --> 01:00:59.640
from phone companies that
tried to make the Internet

1442
01:00:59.664 --> 01:01:03.709
a closed, metered, controlled system.

1443
01:01:03.733 --> 01:01:06.029
They tried to do what people

1444
01:01:06.053 --> 01:01:07.660
are trying to do today with blockchains,

1445
01:01:07.684 --> 01:01:09.930
which is take the open
decentralised network

1446
01:01:09.954 --> 01:01:13.399
and turn it into this sterile,
closed corporate system

1447
01:01:13.423 --> 01:01:16.128
where they can charge by the
minute and be in control.

1448
01:01:16.152 --> 01:01:17.916
- [Torsten] The Internet's
ultimate victory

1449
01:01:17.940 --> 01:01:20.096
has a dirty little secret.

1450
01:01:20.120 --> 01:01:22.202
The men in charge of promoting it

1451
01:01:22.226 --> 01:01:24.249
were employees of the military

1452
01:01:24.273 --> 01:01:27.947
with the muscle and the cash
to beat the competition.

1453
01:01:27.971 --> 01:01:29.316
- And then there's email.

1454
01:01:29.340 --> 01:01:30.149
- Email?

1455
01:01:30.173 --> 01:01:31.544
I heard that's really neat.

1456
01:01:31.568 --> 01:01:32.444
- [Torsten] Email was perhaps

1457
01:01:32.468 --> 01:01:34.071
the Internet's first killer app.

1458
01:01:34.095 --> 01:01:34.904
Then in the early 90s,

1459
01:01:34.928 --> 01:01:36.306
Tim Berners-Lee introduced
the World Wide Web

1460
01:01:36.330 --> 01:01:39.277
as a 20 page proposal.

1461
01:01:39.301 --> 01:01:42.011
Soon, there were browsers
that made it more accessible

1462
01:01:42.035 --> 01:01:44.889
and user-friendly for the general public.

1463
01:01:44.913 --> 01:01:47.757
(electronic music)

1464
01:01:47.781 --> 01:01:49.136
- I think that the Internet

1465
01:01:49.160 --> 01:01:51.402
is going to be one of the major forces

1466
01:01:51.426 --> 01:01:54.522
for reducing the role of Government.

1467
01:01:54.546 --> 01:01:56.838
The one thing that's missing,

1468
01:01:56.862 --> 01:01:58.523
but that will soon be developed,

1469
01:01:58.547 --> 01:02:00.954
is a reliable e-cash.

1470
01:02:00.978 --> 01:02:02.792
- [Torsten] Still, few
understood the potential

1471
01:02:02.816 --> 01:02:04.201
of this new tech.

1472
01:02:04.225 --> 01:02:06.609
- From people who thought it would just be

1473
01:02:06.633 --> 01:02:08.587
the world's greatest library,

1474
01:02:08.611 --> 01:02:11.410
to some of the early cypherpunks,

1475
01:02:11.434 --> 01:02:14.285
who are the direct forefathers of crypto,

1476
01:02:14.309 --> 01:02:17.792
and certainly blockchain-type ideas,

1477
01:02:17.816 --> 01:02:19.985
who thought much as today,

1478
01:02:20.009 --> 01:02:22.165
that it would create kind of a Commons

1479
01:02:22.189 --> 01:02:24.950
that was outside of the direct control

1480
01:02:24.974 --> 01:02:26.605
and normal laws of Governments.

1481
01:02:26.629 --> 01:02:29.286
- [Torsten] That's ironic
because the US Government

1482
01:02:29.310 --> 01:02:30.612
funded it in the first place.

1483
01:02:30.636 --> 01:02:33.062
The spiritual forefathers of crypto

1484
01:02:33.086 --> 01:02:34.341
who built the early Internet

1485
01:02:34.365 --> 01:02:36.239
thought it was a new technology

1486
01:02:36.263 --> 01:02:37.641
for global freedom of expression

1487
01:02:37.665 --> 01:02:40.695
and a blank canvas upon which
they could build their dreams.

1488
01:02:40.719 --> 01:02:42.670
Boy, that sounds familiar!

1489
01:02:42.694 --> 01:02:44.561
And the media?

1490
01:02:44.585 --> 01:02:45.511
They didn't quite know

1491
01:02:45.535 --> 01:02:47.378
what to make of this new thing either.

1492
01:02:47.402 --> 01:02:49.376
But sure enough, they found juicy stories

1493
01:02:49.400 --> 01:02:50.739
about the dark side of it.

1494
01:02:50.763 --> 01:02:53.568
- Which was the Internet
is full of criminals,

1495
01:02:53.592 --> 01:02:55.840
and paedophiles, and pornographers.

1496
01:02:55.864 --> 01:02:59.414
And it's too dangerous to
use your credit card on it.

1497
01:02:59.438 --> 01:03:01.039
It's full of scams.

1498
01:03:01.063 --> 01:03:03.202
We're seeing the exact same story now.

1499
01:03:03.226 --> 01:03:05.680
- We envision technology
as if it were autonomous,

1500
01:03:05.704 --> 01:03:10.581
as if it were simply outside
of human and social experience.

1501
01:03:10.605 --> 01:03:13.152
But we see our technologies

1502
01:03:13.176 --> 01:03:15.214
that become shaped by
commercial interests,

1503
01:03:15.238 --> 01:03:17.195
by political an regulatory infrastructure,

1504
01:03:17.219 --> 01:03:21.452
by actors who are acting
for many reasons, right?

1505
01:03:21.476 --> 01:03:22.912
- Where do you want me?

1506
01:03:22.936 --> 01:03:23.988
- [Torsten] Remember Bob?

1507
01:03:24.012 --> 01:03:26.289
The big telecoms wanted his thoughts

1508
01:03:26.313 --> 01:03:28.035
on a little idea they were kicking around.

1509
01:03:28.059 --> 01:03:29.875
- They had a meeting

1510
01:03:29.899 --> 01:03:31.104
where they trying to figure out

1511
01:03:31.128 --> 01:03:32.183
how they could buy the Internet.

1512
01:03:32.207 --> 01:03:33.033
If they couldn't kill it,

1513
01:03:33.057 --> 01:03:34.241
well why not own it?

1514
01:03:34.265 --> 01:03:35.669
- I got asked that myself

1515
01:03:35.693 --> 01:03:37.809
by an executive at a
large information company.

1516
01:03:37.833 --> 01:03:42.159
It was probably in 1990 if
they could buy the Internet.

1517
01:03:42.183 --> 01:03:43.472
(scoffs)

1518
01:03:43.496 --> 01:03:44.910
- I remember asking them

1519
01:03:44.934 --> 01:03:46.023
well, why don't you buy the world economy,

1520
01:03:46.047 --> 01:03:47.413
then you can own everything.

1521
01:03:47.437 --> 01:03:49.079
Why don't you buy the weather,

1522
01:03:49.103 --> 01:03:50.818
then you can control that too.

1523
01:03:50.842 --> 01:03:53.237
- [Torsten] As the Internet's
momentum and hype grew,

1524
01:03:53.261 --> 01:03:55.335
investors threw money at entrepreneurs

1525
01:03:55.359 --> 01:03:57.041
and shady characters.

1526
01:03:57.065 --> 01:03:59.480
(soft music)

1527
01:04:05.034 --> 01:04:06.346
- The joke in the Dotcom era

1528
01:04:06.370 --> 01:04:09.615
was that you put a dotcom
behind your company

1529
01:04:09.639 --> 01:04:11.853
even if it had nothing
to do with the Internet.

1530
01:04:11.877 --> 01:04:14.611
And the venture capitalist
just throw money at you.

1531
01:04:14.635 --> 01:04:16.982
- [Torsten] It took a few
decades and hype cycles,

1532
01:04:17.006 --> 01:04:19.504
but the wild Internet was
eventually domesticated,

1533
01:04:19.528 --> 01:04:22.343
co-opted by trillion dollar companies

1534
01:04:22.367 --> 01:04:25.191
and then fundamentally
transformed how we shop,

1535
01:04:25.215 --> 01:04:27.322
work, and communicate.

1536
01:04:27.346 --> 01:04:29.760
(soft music)

1537
01:04:33.056 --> 01:04:35.487
Speaker's Corner in London's Hyde Park.

1538
01:04:36.573 --> 01:04:39.321
For 150 years, this has
been a safe place to stand

1539
01:04:39.345 --> 01:04:42.343
on a soapbox to sell your ideas,

1540
01:04:42.367 --> 01:04:43.495
preach the Gospel,

1541
01:04:43.519 --> 01:04:47.147
badmouth the king, or promote communism.

1542
01:04:47.171 --> 01:04:49.366
Today, with the World Wide Web,

1543
01:04:49.390 --> 01:04:52.283
we can stand on giant, digital soapboxes

1544
01:04:52.307 --> 01:04:54.720
using Facebook, Twitter, YouTube.

1545
01:04:54.744 --> 01:04:56.053
We can share our ideas,

1546
01:04:56.077 --> 01:04:59.628
or start a fight, with
anyone on the planet.

1547
01:05:02.107 --> 01:05:04.854
- Well, almost anyone.

1548
01:05:04.878 --> 01:05:07.548
Of 65 countries studied,

1549
01:05:07.572 --> 01:05:09.236
China has the least free Internet,

1550
01:05:09.260 --> 01:05:11.117
worse than Iran, Cuba or Syria.

1551
01:05:11.141 --> 01:05:14.576
A police force of more
than two million cybercops

1552
01:05:14.600 --> 01:05:16.758
and the world's most sophisticated

1553
01:05:16.782 --> 01:05:18.437
Artificial Intelligence system

1554
01:05:18.461 --> 01:05:20.737
keep China's web content
clean and users in check.

1555
01:05:20.761 --> 01:05:24.021
So sorry to break it to you,

1556
01:05:24.045 --> 01:05:25.929
but there's no longer a World Wide Web.

1557
01:05:25.953 --> 01:05:27.667
Welcome to the Splinternet.

1558
01:05:27.691 --> 01:05:29.192
No, it's not just in China.

1559
01:05:29.216 --> 01:05:32.152
- [Narrator] In Russia,
Wikipedia is illegal.

1560
01:05:32.176 --> 01:05:34.443
Facebook is outlawed in Bangladesh.

1561
01:05:34.467 --> 01:05:36.297
There's no WhatsApp in Dubai.

1562
01:05:36.321 --> 01:05:38.446
Twitter was banned in Turkey

1563
01:05:38.470 --> 01:05:40.709
after news about Government
corruption spread.

1564
01:05:40.733 --> 01:05:42.782
And Saudi Arabia shut down

1565
01:05:42.806 --> 01:05:44.351
the region's largest news services,

1566
01:05:44.375 --> 01:05:45.767
Al Jazeera and the BBC.

1567
01:05:45.791 --> 01:05:49.066
Meanwhile, in India, the
entire web was turned off

1568
01:05:49.090 --> 01:05:50.587
100 times last year.

1569
01:05:50.611 --> 01:05:52.742
(soft music)

1570
01:05:52.766 --> 01:05:53.575
- [Torsten] To be fair,

1571
01:05:53.599 --> 01:05:55.889
some of the censorship is to
prevent terrorist recruitment,

1572
01:05:55.913 --> 01:05:58.455
or to stop violent mobs
from hurting people.

1573
01:05:58.479 --> 01:06:01.254
But I think Government's
control over the Internet

1574
01:06:01.278 --> 01:06:03.287
has gone just a little too far...

1575
01:06:03.311 --> 01:06:06.988
- Hello, I'm from the
Australian Government.

1576
01:06:07.012 --> 01:06:08.806
Do you have something to hide?

1577
01:06:08.830 --> 01:06:10.718
We've taken the UK's fascist spying law

1578
01:06:10.742 --> 01:06:12.902
and made it even more fascist.

1579
01:06:12.926 --> 01:06:14.311
To test this shit fuckery,

1580
01:06:14.335 --> 01:06:15.144
we chose Australia,

1581
01:06:15.168 --> 01:06:17.448
the weakest of the Five Eyes alliance,

1582
01:06:17.472 --> 01:06:19.286
thanks to our lack of a Bill of Rights.

1583
01:06:19.310 --> 01:06:20.844
So international data requests

1584
01:06:20.868 --> 01:06:22.303
will now be funnelled through us,

1585
01:06:22.327 --> 01:06:23.871
compromising not just Aussies,

1586
01:06:23.895 --> 01:06:25.629
but all of you fuckers too.

1587
01:06:25.653 --> 01:06:26.962
You're welcome!

1588
01:06:26.986 --> 01:06:29.401
(soft music)

1589
01:06:31.018 --> 01:06:32.063
- Hold on,

1590
01:06:32.087 --> 01:06:33.770
Satoshi turned money into code,

1591
01:06:33.794 --> 01:06:36.419
code is just letters and numbers,

1592
01:06:36.443 --> 01:06:37.760
which is speech, right?

1593
01:06:37.784 --> 01:06:39.635
So money, now is speech,

1594
01:06:39.659 --> 01:06:42.033
which is a pretty powerful
idea if you think about it.

1595
01:06:42.057 --> 01:06:44.880
But if Bitcoin is this uncontrollable,

1596
01:06:44.904 --> 01:06:47.767
uncensorable technology.
Can the blockchain

1597
01:06:47.791 --> 01:06:49.490
also enable global free speech?

1598
01:06:49.514 --> 01:06:51.034
(soft music)

1599
01:06:51.058 --> 01:06:52.694
- [Narrator] In some
places, it already does.

1600
01:06:52.718 --> 01:06:55.877
One Chinese student tried
to report a sexual assault,

1601
01:06:55.901 --> 01:06:57.927
and was silenced by her college.

1602
01:06:57.951 --> 01:06:59.909
But she knew that she can attach a message

1603
01:06:59.933 --> 01:07:01.995
into the metadata of an
Ethereum transaction.

1604
01:07:02.019 --> 01:07:04.230
So she spent 15 cents

1605
01:07:04.254 --> 01:07:06.624
and now her letter outlining her story

1606
01:07:06.648 --> 01:07:08.136
and the threats she received

1607
01:07:08.160 --> 01:07:10.123
is on the public Ethereum blockchain

1608
01:07:10.147 --> 01:07:12.642
where it will remain unchangeable forever.

1609
01:07:12.666 --> 01:07:15.081
(soft music)

1610
01:07:20.379 --> 01:07:21.663
- [Torsten] The early cryptopioneers

1611
01:07:21.687 --> 01:07:23.212
wanted to democratised money.

1612
01:07:23.236 --> 01:07:24.592
Finance 2.0, if you will.

1613
01:07:24.616 --> 01:07:27.328
But now, the believers in the blockchains

1614
01:07:27.352 --> 01:07:29.332
have their eyes on a bigger prize:

1615
01:07:29.356 --> 01:07:31.708
They want to decentralise everything.

1616
01:07:31.732 --> 01:07:33.610
Web 3.0.

1617
01:07:33.634 --> 01:07:36.049
Facebook without the propaganda.

1618
01:07:36.073 --> 01:07:37.918
Twitter without the terms of service.

1619
01:07:37.942 --> 01:07:39.640
Reddit without the censorship.

1620
01:07:39.664 --> 01:07:42.055
Online identity without the hacks.

1621
01:07:42.079 --> 01:07:44.817
Internet browsing without
tracking software.

1622
01:07:44.841 --> 01:07:47.514
Websites without the advertising.

1623
01:07:50.379 --> 01:07:53.105
- We pay with either attention or privacy.

1624
01:07:53.129 --> 01:07:56.777
So we either have
advertising thrown at us,

1625
01:07:56.801 --> 01:07:58.207
our attention is monetized,

1626
01:07:58.231 --> 01:08:01.732
or we pay with micro
violations of our privacy.

1627
01:08:01.756 --> 01:08:03.791
- [Torsten] And that is
why the internet today

1628
01:08:03.815 --> 01:08:05.714
is the ultimate surveillance economy.

1629
01:08:05.738 --> 01:08:08.075
One privacy tool is the Brave browser.

1630
01:08:08.099 --> 01:08:10.384
It doesn't store data

1631
01:08:10.408 --> 01:08:12.622
and pays users and content publishers

1632
01:08:12.646 --> 01:08:14.666
in their basic attention tokens.

1633
01:08:14.690 --> 01:08:17.603
(electronic music)

1634
01:08:19.578 --> 01:08:22.013
- What most people in the crypto space

1635
01:08:22.037 --> 01:08:24.245
are probably most excited about

1636
01:08:24.269 --> 01:08:27.292
is this notion that we can create

1637
01:08:27.317 --> 01:08:29.961
these kinds of user-owned
decentralised networks.

1638
01:08:29.986 --> 01:08:33.361
You can, for instance, offer file storage

1639
01:08:33.385 --> 01:08:34.701
in the way that an Amazon does,

1640
01:08:34.725 --> 01:08:37.957
or that you could offer search,

1641
01:08:37.981 --> 01:08:38.996
you know, the way Google does,

1642
01:08:39.020 --> 01:08:40.774
but do it in a peer-to-peer fashion

1643
01:08:40.799 --> 01:08:45.769
without this behemoth at
the centre extracting rents.

1644
01:08:45.792 --> 01:08:47.407
And do it in a way where all the people

1645
01:08:47.431 --> 01:08:48.583
that are users of it can benefit.

1646
01:08:48.607 --> 01:08:51.804
- Blockstack is the next
evolution in computing.

1647
01:08:51.827 --> 01:08:55.024
We've seen three main
eras of computing before.

1648
01:08:55.049 --> 01:08:58.520
We had mainframes that
were these large computers

1649
01:08:59.460 --> 01:09:00.270
that everyone depended on.

1650
01:09:00.294 --> 01:09:03.147
Then we got desktops where
users were in control,

1651
01:09:03.171 --> 01:09:05.290
and they owned their own computers,

1652
01:09:05.314 --> 01:09:07.077
and their data and information.

1653
01:09:07.102 --> 01:09:09.126
And then we saw cloud computing

1654
01:09:09.149 --> 01:09:11.456
where we're dependent
on these large companies

1655
01:09:11.479 --> 01:09:12.818
running services for us.

1656
01:09:12.843 --> 01:09:14.613
And we're about to embark

1657
01:09:14.638 --> 01:09:16.844
on this major shift in computing

1658
01:09:16.869 --> 01:09:18.946
called decentralised computing

1659
01:09:18.969 --> 01:09:21.754
where users are getting back in control.

1660
01:09:21.778 --> 01:09:24.193
(soft music)

1661
01:09:25.103 --> 01:09:28.826
- And they really could
some day compete with,

1662
01:09:28.850 --> 01:09:32.112
if not take down some
of the big tech giants,

1663
01:09:32.137 --> 01:09:33.892
like the Facebooks and the
Googles and the Amazons

1664
01:09:33.916 --> 01:09:35.256
that we know.

1665
01:09:35.281 --> 01:09:36.475
(electronic music)

1666
01:09:36.499 --> 01:09:37.627
- [Torsten] That's a tall, tall order.

1667
01:09:37.651 --> 01:09:38.916
- It is, it is, but I
mean who would've thought

1668
01:09:38.941 --> 01:09:41.503
at the beginning of the Internet

1669
01:09:41.527 --> 01:09:43.351
that Wikipedia would beat out Encarta.

1670
01:09:43.375 --> 01:09:45.323
- [Torsten] These Web3
promises sound good,

1671
01:09:45.346 --> 01:09:48.386
but my professional
network is on LinkedIn.

1672
01:09:48.410 --> 01:09:50.501
My personal photos are on Instagram.

1673
01:09:50.524 --> 01:09:52.272
If I deleted my accounts,

1674
01:09:52.296 --> 01:09:53.640
I'd lose everything!

1675
01:09:53.665 --> 01:09:55.849
These services aren't just walled gardens,

1676
01:09:55.873 --> 01:09:57.627
they are digital prisons.

1677
01:09:57.651 --> 01:09:59.735
- Data is locked up in several companies.

1678
01:09:59.759 --> 01:10:02.452
And we don't own it.

1679
01:10:02.476 --> 01:10:03.671
The companies own it.

1680
01:10:03.695 --> 01:10:05.250
But they use the data

1681
01:10:05.273 --> 01:10:07.427
to mine it, to advertise to us,

1682
01:10:07.451 --> 01:10:08.259
to sell us things,

1683
01:10:08.282 --> 01:10:09.282
to manipulate us,

1684
01:10:10.285 --> 01:10:11.513
to change our behaviour,

1685
01:10:11.537 --> 01:10:13.291
and Ocean Protocol is the answer

1686
01:10:13.315 --> 01:10:14.750
to freeing up the data

1687
01:10:14.773 --> 01:10:16.755
and giving the power back to individuals.

1688
01:10:16.780 --> 01:10:18.548
- [Torsten] So how do you plan to do that?

1689
01:10:18.572 --> 01:10:21.593
- It's essentially an operating system

1690
01:10:21.617 --> 01:10:22.902
on top of Ethereum

1691
01:10:22.925 --> 01:10:26.478
that allows for people to share data,

1692
01:10:26.502 --> 01:10:29.680
storage, algorithms,

1693
01:10:29.704 --> 01:10:33.692
and computation in a way
that preserves privacy.

1694
01:10:33.716 --> 01:10:35.689
- [Torsten] It's too early to tell

1695
01:10:35.713 --> 01:10:37.246
whether projects like these can succeed.

1696
01:10:37.270 --> 01:10:40.378
But I do like the ideal of
digital property rights.

1697
01:10:40.402 --> 01:10:42.662
Wouldn't it be nice if companies

1698
01:10:42.686 --> 01:10:44.260
paid us in cryptocurrency

1699
01:10:44.284 --> 01:10:45.629
when they use our data?

1700
01:10:45.653 --> 01:10:47.887
And if we control who has access to it

1701
01:10:47.911 --> 01:10:49.832
instead of our digital overlords.

1702
01:10:49.856 --> 01:10:51.903
And then there is the question

1703
01:10:51.927 --> 01:10:53.934
of our most precious information,

1704
01:10:53.959 --> 01:10:56.418
our very identity.

1705
01:10:56.442 --> 01:10:58.276
- If you take the history of mankind,

1706
01:10:58.300 --> 01:11:00.195
a lot of blood has been shed

1707
01:11:00.219 --> 01:11:01.373
getting to democracy, right?

1708
01:11:01.397 --> 01:11:04.081
The idea that every man
has a vote in the world.

1709
01:11:04.105 --> 01:11:06.129
And you know, I take it kind of personally

1710
01:11:06.153 --> 01:11:08.193
because I was born in South
Africa during apartheid,

1711
01:11:08.218 --> 01:11:11.853
you know, a child of Indian immigrants.

1712
01:11:11.877 --> 01:11:14.490
And we were not allowed to vote.

1713
01:11:14.514 --> 01:11:16.688
- [Torsten] Vinny tells me
that in the United States alone

1714
01:11:16.712 --> 01:11:20.523
there are 14,000 different paper
forms of birth certificates

1715
01:11:20.548 --> 01:11:22.358
issued by local authorities.

1716
01:11:22.382 --> 01:11:24.240
There are mistakes on them

1717
01:11:24.264 --> 01:11:26.966
and even identity theft
starting from birth.

1718
01:11:26.990 --> 01:11:29.559
- All your information
is already out there.

1719
01:11:29.583 --> 01:11:31.452
You know, there's five
hacks a day happening,

1720
01:11:31.477 --> 01:11:34.344
so how do you prove that
you are who you say you are?

1721
01:11:34.369 --> 01:11:36.784
(soft music)

1722
01:11:39.020 --> 01:11:40.654
- [Torsten] Our crypto celebrity Andreas

1723
01:11:40.678 --> 01:11:42.702
has 10 imposters on Instagram.

1724
01:11:42.726 --> 01:11:44.290
Ryan Gosling's alter ego

1725
01:11:44.314 --> 01:11:46.500
is committing financial fraud in Bulgaria.

1726
01:11:46.523 --> 01:11:47.977
And who knows what's happening

1727
01:11:48.001 --> 01:11:50.101
with your compromised information?

1728
01:11:50.125 --> 01:11:51.483
(soft music)

1729
01:11:51.507 --> 01:11:53.804
Blockchain-based services
like Civic's identity.com,

1730
01:11:53.827 --> 01:11:56.571
or Microsoft's Ion say
they can give us control

1731
01:11:56.594 --> 01:11:59.555
of our identity and protect it.

1732
01:11:59.579 --> 01:12:02.392
- Currently, we are having our reputation,

1733
01:12:02.416 --> 01:12:04.639
our history with different systems

1734
01:12:04.664 --> 01:12:06.173
and different companies,
like Facebook and Twitter.

1735
01:12:06.197 --> 01:12:09.739
With the blockchain, the
core of important information

1736
01:12:09.763 --> 01:12:11.900
sits on that trusted system

1737
01:12:11.924 --> 01:12:15.469
which we control and we
can take from wherever

1738
01:12:15.493 --> 01:12:17.118
we want to go to something else.

1739
01:12:17.142 --> 01:12:19.975
- [Torsten] Meanwhile,
Vitalik has inspired thousands

1740
01:12:19.999 --> 01:12:22.032
of software developers to build is vision

1741
01:12:22.057 --> 01:12:23.670
of decentralised finance,

1742
01:12:23.693 --> 01:12:25.759
but early in Ethereum's history,

1743
01:12:25.782 --> 01:12:26.907
something went wrong

1744
01:12:26.932 --> 01:12:28.786
with one of the first smart contracts

1745
01:12:28.809 --> 01:12:30.744
called the DAO.

1746
01:12:30.768 --> 01:12:32.262
- The DAO went like this,

1747
01:12:32.286 --> 01:12:33.608
they wanted a completely

1748
01:12:33.632 --> 01:12:35.789
"the Decentralised
Autonomous Organisation".

1749
01:12:35.813 --> 01:12:38.906
They wanted a science fiction dream

1750
01:12:38.930 --> 01:12:40.754
of an independent computer program

1751
01:12:40.778 --> 01:12:42.559
that was immune to human influence.

1752
01:12:42.583 --> 01:12:47.347
So what they actually did was
build a forthcoming disaster.

1753
01:12:47.371 --> 01:12:49.184
- [Torsten] The problem?

1754
01:12:49.209 --> 01:12:51.433
Some sloppy code left their
safety deposit box wide open,

1755
01:12:51.457 --> 01:12:54.425
and somebody just helped themselves.

1756
01:12:54.450 --> 01:12:56.657
(soft music)

1757
01:12:56.682 --> 01:12:58.887
- It allowed them to pilfer $50 million

1758
01:12:58.911 --> 01:13:01.207
from this smart contract.

1759
01:13:01.231 --> 01:13:05.949
And that's why when I
say it's not even clear

1760
01:13:05.973 --> 01:13:07.137
whether or not it was a hack, you know,

1761
01:13:07.161 --> 01:13:08.386
this smart contract
allowed them to do that.

1762
01:13:08.410 --> 01:13:11.353
You know, what happened was
the majority of the community

1763
01:13:11.377 --> 01:13:13.807
did decide to roll back the blockchain

1764
01:13:13.831 --> 01:13:16.646
and to pretend like
the DAO never happened.

1765
01:13:16.670 --> 01:13:19.162
- [Torsten] Yep, you heard that correctly.

1766
01:13:19.186 --> 01:13:21.913
The top decision makers forked Ethereum

1767
01:13:21.937 --> 01:13:23.385
into two separate networks,

1768
01:13:23.409 --> 01:13:25.193
one where the money was gone,

1769
01:13:25.217 --> 01:13:27.117
and a new one where the money

1770
01:13:27.141 --> 01:13:29.625
was restored to it's original owners

1771
01:13:29.648 --> 01:13:31.550
breaking the first rule of cryptocurrency,

1772
01:13:31.575 --> 01:13:34.200
never alter the blockchain.

1773
01:13:34.224 --> 01:13:36.348
(soft music)

1774
01:13:36.371 --> 01:13:38.626
- Immutability last only as long

1775
01:13:38.650 --> 01:13:40.608
as the big boys haven't lost money.

1776
01:13:40.632 --> 01:13:42.791
- [Torsten] Just like Bitcoin,

1777
01:13:42.816 --> 01:13:44.385
Ethereum also experienced
scaling problems.

1778
01:13:44.409 --> 01:13:47.568
When a decentralised app
called Crypto Kitties,

1779
01:13:47.592 --> 01:13:49.587
I'm not kidding, went viral,

1780
01:13:49.611 --> 01:13:53.791
and the kitties bred like
rabbits in it's blockchain,

1781
01:13:53.815 --> 01:13:55.840
the system ground to a halt.

1782
01:13:55.864 --> 01:13:58.210
The network is now being upgraded.

1783
01:13:58.235 --> 01:14:00.144
But there are many competitors

1784
01:14:00.168 --> 01:14:02.010
who claim that their
blockchains are faster,

1785
01:14:02.034 --> 01:14:04.133
fairer, and more scalable.

1786
01:14:04.157 --> 01:14:07.505
The next shakeout will sure
be interesting to watch.

1787
01:14:07.529 --> 01:14:10.984
- It's never easy to admit that,

1788
01:14:11.008 --> 01:14:12.206
that you've been fooled.

1789
01:14:15.193 --> 01:14:16.375
Maybe I've been fooled.

1790
01:14:21.937 --> 01:14:22.937
Maybe?

1791
01:14:23.985 --> 01:14:24.880
- [Torsten] The crypto community

1792
01:14:24.905 --> 01:14:26.628
doesn't agree on much of anything,

1793
01:14:26.652 --> 01:14:28.773
except when it comes to this guy.

1794
01:14:28.797 --> 01:14:31.393
- Hello, my name is Dr. Craig Wright.

1795
01:14:31.416 --> 01:14:34.142
I'm the chief scientist of nChain Limited.

1796
01:14:34.166 --> 01:14:35.998
- On the balance of the evidence,

1797
01:14:36.022 --> 01:14:39.480
Craig Wright almost certainly
is not Satoshi Nakamoto.

1798
01:14:39.504 --> 01:14:41.835
- The proofs that he gave
were not real proofs.

1799
01:14:41.860 --> 01:14:43.811
In the end, he either chickened out

1800
01:14:43.835 --> 01:14:45.269
or didn't actually have the proof.

1801
01:14:45.293 --> 01:14:48.559
- Craig Wright obviously
seems to be a scammer.

1802
01:14:51.627 --> 01:14:54.770
- I'm happy to say that
Craig Wright is a fraud.

1803
01:14:54.794 --> 01:14:56.874
- I know he's controversial.

1804
01:14:56.898 --> 01:14:59.545
No one really changes the world

1805
01:14:59.568 --> 01:15:02.835
without being bold, without
disrupting peoples' ideas,

1806
01:15:02.859 --> 01:15:05.627
an without drawing a little
controversy around the way.

1807
01:15:05.651 --> 01:15:06.827
(soft music)

1808
01:15:06.852 --> 01:15:08.226
- [Torsten] But the majority of industry

1809
01:15:08.250 --> 01:15:09.537
says Craig is crazy or a conman.

1810
01:15:09.561 --> 01:15:13.641
- So Craig, kindly join us on stage.

1811
01:15:13.665 --> 01:15:15.169
- [Torsten] And that
giving him screen time

1812
01:15:15.193 --> 01:15:16.713
is irresponsible.

1813
01:15:16.737 --> 01:15:17.545
(soft music)

1814
01:15:17.568 --> 01:15:18.487
- And I'll say this quite frankly

1815
01:15:18.511 --> 01:15:21.780
because I've got more
money than your country.

1816
01:15:23.775 --> 01:15:24.969
- [Torsten] But I was in the area

1817
01:15:24.993 --> 01:15:26.723
and just couldn't resist.

1818
01:15:26.746 --> 01:15:28.579
(soft music)

1819
01:15:28.603 --> 01:15:30.407
(doorbell rings)

1820
01:15:30.431 --> 01:15:32.846
(soft music)

1821
01:15:34.124 --> 01:15:35.599
A few quick facts,

1822
01:15:35.623 --> 01:15:36.489
Craig is the person

1823
01:15:36.513 --> 01:15:39.157
who claimed to be Satoshi
Nakamoto on the BBC.

1824
01:15:39.182 --> 01:15:42.156
But his cryptographic
proof didn't check out,

1825
01:15:42.180 --> 01:15:45.034
and since then, many just
see him as an imposter.

1826
01:15:45.058 --> 01:15:47.262
- I'm the guy with a law degree

1827
01:15:47.286 --> 01:15:50.993
that used to work for federal police

1828
01:15:51.017 --> 01:15:52.980
and military intelligence.

1829
01:15:53.004 --> 01:15:55.879
(electronic music)

1830
01:15:55.903 --> 01:15:57.807
- You would actually be
the perfect super villain

1831
01:15:57.831 --> 01:15:59.094
for us because everybody

1832
01:15:59.119 --> 01:16:01.195
kind of doesn't believe you, hates you.

1833
01:16:01.219 --> 01:16:03.318
What do you say to your critics?

1834
01:16:03.342 --> 01:16:05.693
- Do I start with a muahuahua?

1835
01:16:05.718 --> 01:16:09.405
Many people are hated early on

1836
01:16:09.429 --> 01:16:10.744
because they're not understood.

1837
01:16:10.768 --> 01:16:12.332
If it doesn't have a use,

1838
01:16:12.356 --> 01:16:13.771
it shouldn't have a value.

1839
01:16:13.795 --> 01:16:16.418
Right now, practically
everything is a Ponzi.

1840
01:16:16.442 --> 01:16:17.996
I don't particularly like Ethereum.

1841
01:16:18.020 --> 01:16:19.525
It's a dead end.

1842
01:16:19.549 --> 01:16:21.059
They can say whatever
they want about ERC-20

1843
01:16:21.084 --> 01:16:24.499
except practically
everything they're doing

1844
01:16:24.523 --> 01:16:26.717
that they want to solve,
I solved years ago.

1845
01:16:26.741 --> 01:16:31.736
Decentralisation was never
the point of Bitcoin, ever.

1846
01:16:32.096 --> 01:16:33.501
I was called a fool then,

1847
01:16:33.525 --> 01:16:35.057
and I'll be called a fool again.

1848
01:16:35.081 --> 01:16:37.693
And every single time I'll be right.

1849
01:16:37.718 --> 01:16:41.800
I picked up "Mastering
Bitcoin" the other day,

1850
01:16:41.825 --> 01:16:43.651
and I opened page one.

1851
01:16:43.675 --> 01:16:45.679
And I went this is wrong.

1852
01:16:45.702 --> 01:16:50.094
Silkroad was the worst thing
to ever happen to Bitcoin.

1853
01:16:50.119 --> 01:16:52.263
- You seem to think that nobody else

1854
01:16:52.287 --> 01:16:54.440
has anything interesting to say.

1855
01:16:54.464 --> 01:16:56.288
You've already solved the
problems many years ago.

1856
01:16:56.312 --> 01:16:58.844
That's kind of the vibe
that I'm getting here.

1857
01:16:58.869 --> 01:16:59.888
- Fairly much, yes.

1858
01:16:59.912 --> 01:17:01.850
- [Torsten] Okay.

1859
01:17:02.905 --> 01:17:04.831
Turns out, Craig's playbook is patents.

1860
01:17:04.855 --> 01:17:07.184
Some say he's a patent troll.

1861
01:17:07.208 --> 01:17:09.545
- Well, I've got a bucket list bit

1862
01:17:09.568 --> 01:17:11.407
which is to beat Edison, which

1863
01:17:11.432 --> 01:17:14.160
as silly as it sounds

1864
01:17:14.184 --> 01:17:15.936
came from a Simpsons episode.

1865
01:17:15.960 --> 01:17:17.727
To beat Mr. Edison,

1866
01:17:17.751 --> 01:17:20.573
I need to get 1,085 (patents).

1867
01:17:20.597 --> 01:17:22.512
And right at the moment,

1868
01:17:22.536 --> 01:17:25.476
I'm on white paper 1,074.

1869
01:17:26.742 --> 01:17:27.835
- [Torsten] For each white paper,

1870
01:17:27.860 --> 01:17:29.659
he claims to file about 1.1 patents.

1871
01:17:30.768 --> 01:17:34.657
- The first 163 will
be very shortly public.

1872
01:17:34.681 --> 01:17:37.517
Next year, people are gonna start seeing

1873
01:17:37.541 --> 01:17:38.975
that we have hundreds of patents,

1874
01:17:38.999 --> 01:17:41.043
and everything changes.

1875
01:17:41.067 --> 01:17:43.553
We file PCT and keep them
secret as long as we can.

1876
01:17:43.577 --> 01:17:46.538
- There's a huge
philosophical disagreement

1877
01:17:46.562 --> 01:17:47.862
between myself and Craig.

1878
01:17:47.887 --> 01:17:50.833
So I think patents

1879
01:17:50.857 --> 01:17:52.398
are Government granted monopoly.

1880
01:17:52.423 --> 01:17:54.700
- [Torsten] The big brains and big egos

1881
01:17:54.724 --> 01:17:56.118
who broke away from Bitcoin

1882
01:17:56.142 --> 01:17:58.096
couldn't hash out their differences.

1883
01:17:58.120 --> 01:17:59.969
So there was another split.

1884
01:17:59.994 --> 01:18:03.475
Craig's new coin also claims
to be the 'real' Bitcoin.

1885
01:18:03.499 --> 01:18:06.439
And he wants to enable blocks
a million times larger,

1886
01:18:06.463 --> 01:18:08.761
updating and storing this giant blockchain

1887
01:18:08.785 --> 01:18:11.261
will be impossible for normal computers.

1888
01:18:11.285 --> 01:18:13.184
I just can't figure this guy out.

1889
01:18:13.208 --> 01:18:16.236
Is he a genius, a madman, a fraud?

1890
01:18:16.260 --> 01:18:17.996
Maybe all three?

1891
01:18:18.020 --> 01:18:20.541
- And a lot of the things he says are very,

1892
01:18:20.565 --> 01:18:23.065
are just wrong technically.

1893
01:18:23.089 --> 01:18:25.148
- However, I did calculate

1894
01:18:25.173 --> 01:18:27.906
that nChain spent tens
of millions of dollars

1895
01:18:27.930 --> 01:18:29.903
to develop and file these patents.

1896
01:18:29.927 --> 01:18:32.089
And some have been granted.

1897
01:18:32.112 --> 01:18:35.778
What's the point of having
a war chest full of IP

1898
01:18:35.802 --> 01:18:37.727
if they aren't going to enforce it?

1899
01:18:37.751 --> 01:18:39.298
So basically what I'm looking at

1900
01:18:39.322 --> 01:18:42.831
is stuff that nobody's ever
really seen in the community.

1901
01:18:42.855 --> 01:18:43.664
- [Craig] That's correct.

1902
01:18:43.688 --> 01:18:44.496
Yes.

1903
01:18:44.521 --> 01:18:46.074
- As soon as the price of Bitcoin

1904
01:18:46.098 --> 01:18:47.564
and the cryptocurrencies went higher,

1905
01:18:47.588 --> 01:18:49.677
what did most people do?

1906
01:18:49.701 --> 01:18:51.772
All they did was start adopting

1907
01:18:51.796 --> 01:18:54.090
all the worst behaviours of bankers,

1908
01:18:54.114 --> 01:18:55.340
scamming the market,

1909
01:18:55.364 --> 01:18:58.010
centralising wealth in a few hands.

1910
01:18:58.034 --> 01:19:01.195
- [Torsten] Hmm, I think
that's called human nature.

1911
01:19:01.219 --> 01:19:03.508
- So everyone wants to change the world

1912
01:19:03.532 --> 01:19:06.080
simply because they're not
in the position of power.

1913
01:19:06.103 --> 01:19:08.406
As soon as they get into that position,

1914
01:19:08.430 --> 01:19:09.719
they do exactly the same thing.

1915
01:19:09.743 --> 01:19:12.232
- [Torsten] So guys like you
will build a better future

1916
01:19:12.255 --> 01:19:14.709
and we can trust you guys
better than the bankers?

1917
01:19:14.733 --> 01:19:15.758
- You don't have to trust us.

1918
01:19:15.782 --> 01:19:16.787
That's the beauty.

1919
01:19:16.811 --> 01:19:18.376
We're building a trustless,

1920
01:19:18.400 --> 01:19:20.590
decentralised system that
gives power to people.

1921
01:19:20.614 --> 01:19:23.028
(soft music)

1922
01:19:27.053 --> 01:19:29.645
- Trustless sounds like there's no trust.

1923
01:19:29.669 --> 01:19:32.731
But actually it means we
don't need to trust you.

1924
01:19:32.755 --> 01:19:35.568
I think the better word
should be trust-free..

1925
01:19:35.593 --> 01:19:38.855
About one third, or maybe
half of all the cost

1926
01:19:38.879 --> 01:19:41.799
of all the transactions are
paid to establish trust

1927
01:19:41.823 --> 01:19:43.794
between trading parties.

1928
01:19:43.818 --> 01:19:46.847
Like we're paying for lawyers.

1929
01:19:46.871 --> 01:19:49.005
We're paying auditors.

1930
01:19:49.029 --> 01:19:51.692
We're paying even police, even regulators,

1931
01:19:51.716 --> 01:19:53.621
Government to build trust,

1932
01:19:53.645 --> 01:19:55.702
to ensure everything will be enforced.

1933
01:19:55.726 --> 01:19:58.656
So trust is quite expensive.

1934
01:19:58.680 --> 01:20:00.324
Blockchain is the first time

1935
01:20:00.348 --> 01:20:02.272
that we saw some technology

1936
01:20:02.296 --> 01:20:04.709
that can eliminate the cost

1937
01:20:04.733 --> 01:20:07.686
or reduce the cost of trust dramatically.

1938
01:20:07.710 --> 01:20:09.434
Magical things will happen.

1939
01:20:09.459 --> 01:20:10.903
- [Torsten] Trust may be expensive,

1940
01:20:10.927 --> 01:20:12.558
but it's also in short supply.

1941
01:20:12.582 --> 01:20:14.150
All around the globe,

1942
01:20:14.174 --> 01:20:16.365
people have been losing
faith in the media,

1943
01:20:16.389 --> 01:20:18.333
institutions, and Governments.

1944
01:20:18.357 --> 01:20:20.504
So what if this new technology

1945
01:20:20.528 --> 01:20:22.148
could fix one of society's biggest issues?

1946
01:20:22.173 --> 01:20:24.152
But the question remains:

1947
01:20:24.175 --> 01:20:25.880
What if you are cheated?

1948
01:20:25.904 --> 01:20:28.096
What if your password is stolen,

1949
01:20:28.120 --> 01:20:29.115
and the money,

1950
01:20:29.139 --> 01:20:30.164
the contracts,

1951
01:20:30.188 --> 01:20:31.949
your identity is gone?

1952
01:20:34.219 --> 01:20:36.279
If code is law,

1953
01:20:36.303 --> 01:20:40.382
who administers justice?

1954
01:20:40.406 --> 01:20:43.050
(soft music)

1955
01:20:43.075 --> 01:20:45.362
Aren't you worried that the
promise of decentralizing power

1956
01:20:45.386 --> 01:20:48.635
is kind of in jeopardy
with you and Charlie

1957
01:20:48.659 --> 01:20:50.523
and Vitalik and Craig

1958
01:20:50.548 --> 01:20:52.871
as such central figureheads?

1959
01:20:52.896 --> 01:20:54.530
- Yeah, I really wish

1960
01:20:54.554 --> 01:20:57.307
there weren't public figures or leaders.

1961
01:20:57.331 --> 01:20:58.660
I want everyone to lead themselves,

1962
01:20:58.684 --> 01:21:01.253
but sadly that's not the world we live in.

1963
01:21:01.277 --> 01:21:02.562
If you're gonna look to a leader,

1964
01:21:02.585 --> 01:21:04.106
you know, choose your leader wisely.

1965
01:21:04.130 --> 01:21:06.857
(soft music)

1966
01:21:06.880 --> 01:21:08.196
- But just how different are they

1967
01:21:08.219 --> 01:21:10.114
from our current political, financial,

1968
01:21:10.138 --> 01:21:11.303
and business leaders?

1969
01:21:11.327 --> 01:21:13.594
Are their systems really
resistant to corruption,

1970
01:21:13.618 --> 01:21:15.269
immune to manipulation,

1971
01:21:15.293 --> 01:21:16.969
and worthy of our trust?

1972
01:21:16.993 --> 01:21:17.862
(soft music)

1973
01:21:17.886 --> 01:21:21.323
Maybe that's why the best
bet is on the only project

1974
01:21:21.347 --> 01:21:22.313
without a figurehead:

1975
01:21:22.337 --> 01:21:24.898
Bitcoin doesn't care about human drama,

1976
01:21:24.922 --> 01:21:28.118
bad press, or what anyone thinks.

1977
01:21:28.142 --> 01:21:31.389
Yeah, sure, it hasn't succeeded
as a global currency yet,

1978
01:21:31.414 --> 01:21:33.026
but in the past decade,

1979
01:21:33.050 --> 01:21:36.705
it has been the world's best
performing financial asset.

1980
01:21:36.728 --> 01:21:39.594
So we're back to where we started:

1981
01:21:39.618 --> 01:21:41.428
The genius who vanished.

1982
01:21:41.452 --> 01:21:42.960
(electronic music)

1983
01:21:42.985 --> 01:21:44.818
- With Satoshi being gone from Bitcoin,

1984
01:21:44.843 --> 01:21:49.285
Bitcoin is really a very
decentralised network and currency.

1985
01:21:49.309 --> 01:21:52.406
- He was intelligent enough to know that

1986
01:21:54.128 --> 01:21:54.937
a system without a father

1987
01:21:54.960 --> 01:21:56.348
was gonna be much more robust

1988
01:21:56.371 --> 01:21:57.925
than a system with a father.

1989
01:21:57.949 --> 01:21:59.564
(electronic music)

1990
01:21:59.588 --> 01:22:01.112
- No father maybe,

1991
01:22:01.137 --> 01:22:02.472
but without leaving a will,

1992
01:22:02.496 --> 01:22:05.018
the kids are now fighting over
the meaning of his invention,

1993
01:22:05.041 --> 01:22:07.267
and the inheritance,

1994
01:22:07.291 --> 01:22:10.559
projecting their fears and
fantasies onto his legacy.

1995
01:22:10.584 --> 01:22:12.999
(soft music)

1996
01:22:14.394 --> 01:22:16.398
For some, it's money for the Internet

1997
01:22:16.422 --> 01:22:18.166
that can replace middlemen

1998
01:22:18.190 --> 01:22:19.954
and bank the unbanked.

1999
01:22:19.978 --> 01:22:22.262
And maybe a tool for illicit trade,

2000
01:22:22.286 --> 01:22:23.530
or is it digital gold?

2001
01:22:23.554 --> 01:22:25.231
A totally new asset class.

2002
01:22:25.255 --> 01:22:27.288
A bet against the bankers.

2003
01:22:27.312 --> 01:22:29.459
And insurance against inflation.

2004
01:22:29.483 --> 01:22:31.869
Protection from corrupt politicians.

2005
01:22:31.893 --> 01:22:34.332
And a weapon against the state.

2006
01:22:34.356 --> 01:22:36.813
Maybe the end of money as we know it.

2007
01:22:36.837 --> 01:22:39.800
For some entrepreneurs,
it represents a shortcut

2008
01:22:39.825 --> 01:22:41.529
to fund their dreams.

2009
01:22:41.553 --> 01:22:43.505
A platform for fairer finance.

2010
01:22:43.530 --> 01:22:45.993
Which is why incumbents fight it.

2011
01:22:46.017 --> 01:22:48.175
Some say public blockchains

2012
01:22:48.200 --> 01:22:50.386
are just slow and useless databases.

2013
01:22:50.410 --> 01:22:53.920
While big business is busy
building private blockchains

2014
01:22:53.943 --> 01:22:55.628
to boost efficiency.

2015
01:22:55.652 --> 01:22:57.816
Or maybe this decentralised technology

2016
01:22:57.840 --> 01:23:00.273
is a new protocol layer for the Internet

2017
01:23:00.298 --> 01:23:02.231
upon which we can build a better web

2018
01:23:02.255 --> 01:23:04.719
to dethrone the tech giants,

2019
01:23:04.743 --> 01:23:06.407
reclaim free speech,

2020
01:23:06.432 --> 01:23:08.386
protect online identities,

2021
01:23:08.410 --> 01:23:10.898
and facilitate free trade in
a borderless, digital economy.

2022
01:23:10.923 --> 01:23:14.109
Oh, and a tool to rebuild
trust in our societies,

2023
01:23:14.133 --> 01:23:18.346
and yes, maybe even save the planet.

2024
01:23:18.370 --> 01:23:22.299
That's a never ending
list of cryptopian ideas.

2025
01:23:22.323 --> 01:23:24.737
(soft music)

2026
01:23:25.942 --> 01:23:27.160
Isn't this a bit too much to ask

2027
01:23:27.184 --> 01:23:29.059
of a nine page document?

2028
01:23:29.083 --> 01:23:31.496
(soft music)

2029
01:23:36.550 --> 01:23:38.226
Yeah sure, the Internet and the Web

2030
01:23:38.250 --> 01:23:39.855
started out as white papers too.

2031
01:23:39.879 --> 01:23:42.925
But it took decades before
it's infrastructure was built,

2032
01:23:42.950 --> 01:23:44.697
became user friendly,

2033
01:23:44.721 --> 01:23:46.746
and ready to scale globally.

2034
01:23:46.771 --> 01:23:49.484
- We kind of domesticate
the wild potential

2035
01:23:49.508 --> 01:23:51.754
of technologies into what's familiar.

2036
01:23:51.778 --> 01:23:54.340
And we dramatically underestimate,

2037
01:23:54.364 --> 01:23:55.538
or under imagine

2038
01:23:55.562 --> 01:23:57.837
what that technology may eventually do.

2039
01:23:57.861 --> 01:23:59.145
- [Torsten] It'll be the users,

2040
01:23:59.169 --> 01:24:00.563
maybe billions of them,

2041
01:24:00.587 --> 01:24:02.764
who will adopt this technology
without even knowing

2042
01:24:02.788 --> 01:24:05.356
what a blockchain is or how it works.

2043
01:24:06.316 --> 01:24:08.594
Because here's the thing:

2044
01:24:08.619 --> 01:24:11.023
The average users don't
care about the wires

2045
01:24:11.047 --> 01:24:12.671
that move their money quicker,

2046
01:24:12.695 --> 01:24:14.130
don't know about the software

2047
01:24:14.154 --> 01:24:16.592
that moves this movie or that picture,

2048
01:24:16.616 --> 01:24:18.675
what will move them

2049
01:24:18.699 --> 01:24:22.032
are services that'll make
their days a little brighter,

2050
01:24:22.056 --> 01:24:24.088
their chores a little lighter,

2051
01:24:24.112 --> 01:24:28.243
and their lives a little richer.

2052
01:24:29.896 --> 01:24:31.200
♪ Dude's got suits ♪

2053
01:24:31.224 --> 01:24:34.642
♪ Dude's got a tie and a big smile ♪

2054
01:24:34.666 --> 01:24:37.252
♪ And he's pitching me some blockchain ♪

2055
01:24:37.276 --> 01:24:38.621
♪ Supply chains are broken ♪

2056
01:24:38.645 --> 01:24:39.815
♪ Do we need his token ♪

2057
01:24:39.839 --> 01:24:41.337
♪ There's a pain in my brain ♪

2058
01:24:41.361 --> 01:24:42.411
♪ and I'm going insane ♪

2059
01:24:42.434 --> 01:24:44.591
♪ I don't want no blockchain ♪

2060
01:24:44.615 --> 01:24:45.987
♪ That one plays chess at his desk ♪

2061
01:24:46.012 --> 01:24:47.181
♪ poses for the press ♪

2062
01:24:47.205 --> 01:24:49.169
♪ The price of his coin just tripled ♪

2063
01:24:49.193 --> 01:24:51.380
♪ I just stare into the
Ether, take a breather ♪

2064
01:24:51.404 --> 01:24:54.393
♪ 'cause I don't wanna cause a Ripple ♪

2065
01:24:54.416 --> 01:24:57.215
♪ Don't wanna cause a Ripple ♪

2066
01:24:57.239 --> 01:25:01.918
♪ I won't trust him with my money ♪

2067
01:25:01.942 --> 01:25:06.937
♪ Will never trust him with my life ♪

2068
01:25:07.123 --> 01:25:09.174
♪ Well I have been told ♪

2069
01:25:09.198 --> 01:25:12.355
♪ That my life is controlled ♪

2070
01:25:12.379 --> 01:25:15.626
♪ But Bitcoin ain't Gold ♪

2071
01:25:16.813 --> 01:25:19.228
(rock music)

2072
01:25:32.910 --> 01:25:34.237
♪ Talks Bretton Woods ♪

2073
01:25:38.267 --> 01:25:39.208
♪ That guy speaks code ♪

2074
01:25:39.232 --> 01:25:40.521
♪ Runs a full node ♪

2075
01:25:40.545 --> 01:25:41.708
♪ This is new money production ♪

2076
01:25:44.228 --> 01:25:45.317
♪ of illicit goods ♪

2077
01:25:45.341 --> 01:25:47.846
♪ This is a weapon of math destruction ♪

2078
01:25:47.870 --> 01:25:50.347
♪ This is a weapon of math destruction ♪

2079
01:25:50.371 --> 01:25:52.371
♪ This is a weapon of math destruction ♪

2080
01:25:52.396 --> 01:25:53.603
♪ That lady's quick on her feet ♪

2081
01:25:53.627 --> 01:25:55.316
♪ Lit in her a tweets ♪

2082
01:25:55.340 --> 01:25:57.143
♪ Says she takes on the haters ♪

2083
01:25:57.166 --> 01:25:58.230
♪ and nothing can break her ♪

2084
01:25:58.254 --> 01:25:59.969
♪ The Web could be much safer ♪

2085
01:25:59.994 --> 01:26:02.170
♪ And our Freedom quite greater ♪

2086
01:26:02.193 --> 01:26:06.333
♪ And it's all in this white paper ♪

2087
01:26:06.357 --> 01:26:08.125
♪ All in this white paper ♪

2088
01:26:08.148 --> 01:26:09.991
♪ I don't trust them ♪

2089
01:26:10.014 --> 01:26:12.312
♪ With my money ♪