And his newest book just came out eight weeks ago called ” The Internet of Money” which is a masterpiece to speak. Delight facilitate me accept, Andreas Antonopoulos! Good morning everyone! Let’s start with a quick canvas here. How many of you have utilized a digital currency like Bitcoin at least once? And how many of you own Bitcoin at this moment or any other digital currency? Okay, we are in a position repair that. If you like, later on, today, come find me. I would be delighted to demonstrate to you how to set up a Bitcoin wallet on your smartphone, and I will give you your first fraction of a bitcoin , not a whole Bitcoin, and demonstrate you how a transaction runs because Bitcoin and the digital currency revolution it has started is best demonstrated and experienced, then excused. It’s actually very difficult to explain Bitcoin. I’ve spent the last five years old memorizing how to explain Bitcoin.
That is my full-time task. Unfortunately, private developers prevent representing brand-new substance which I then have to explain all over again. So, for a moment, forget everything you think you know about Bitcoin. Forget everything you’ve heard about blockchain and let’s start from basics. In 2011, I heard about Bitcoin for the first time and my reaction was exactly the same as the reaction of everybody else who heard about Bitcoin the first time including its founder and that reaction was:” hah, nerd fund !” That’s probably just for gambling.
Six months later, I heard about Bitcoin again and this time, I read the white paper that propelled such systems and my background in computer science and distributed organizations allowed me to interpret behind the illusion of what I recollected Bitcoin was and It blew my intellect. In “peoples lives”, I have now had six occasions in which I have become absolutely obsessed with a structure to new technologies to the point of forgetting to eat, forgetting to sleep and expending just as much knowledge as I possibly can. My first computer when I was 10 years old, my first programming language experience, my first modem, my first access to the web the first time I use the web browser. The first time I downloaded and installed the Linux operating system and then Bitcoin. When I’ve discovered it, I invested four months ingesting as much as I could, except meat. I lost 26 pounds on the highly inadvisable food of obsession. I have not emerged from that because I continue find brand-new blankets of profundity to understand this and the reason it’s so fascinating is because it isn’t what it appears to be at first glance.
Bitcoin isn’t money. The blockchain isn’t a structure of currency. It is a platform of confidence. It’s not a company, it’s not a make, it’s not a service you sign up for. it’s not a money. Currency is just the first application. It is the concept of decentralization applied to the human communication of value. Because what is fund?( UNINTELLIGIBLE) told us it’s an illusion.
It’s imaginary. And the same reasons we don’t grasp that is because it’s so deeply embedded in our civilization. Money is one of the oldest engineerings humanity has. It predates writing. How do we know that? The very first samples of writing we have are spreadsheets. They are tallies and ledgers of indebtedness owed and fund pre-existed that writing. You might even be presumed that fund had an oral tradition Until it was required to invent a written tradition so writing was developed for it. In its own history of money who are currently spans tens of thousands of years, “theres been” maybe five major changes.
From pure barter exchange to the introduction of the first abstraction of value, shells, plumages, balls, seeds, stones, and then precious metals. And then paper money, and then plastic money, and now, system fund. Bitcoin inserts a platform on which you can run money as an application on a network without any center extents of power A system altogether decentralized like the Internet itself. It is not fund for the Internet but The Internet of Money. And what is money? Money is a language. Money is a linguistic abstraction. Money is a language that we use to communicate importance to each other. Money plainly allows us to express price and that price may have financial results but it also has other consequences.
We use money to express and establish social alliances, and relationships, and associations, and to create organization. Bitcoin is the first structure of money “thats really not” controlled by any entity, that is completely decentralized. And what that does is it introduces the very same happenings that the Internet brought to communication. If money is speech, if money is a language and you detached from all other media, and you make it pure addres, pure content, an Internet content type, a etiquette name fund over IP, it completely separates it from all of these previous the idea of people, sovereign issuers, foundations that control.
And so we go from institution-based money to network-based fund. And of course, everyone will welcome this with open arms. Not a chance. What do you think they said the first time someone was presented with a gold depository credential instead of a amber copper? They said:” Hah, that’s not fund! Go away !” What do you think happened in 1950 the first time person pictured up at a motel and presented their diners club membership card and said:” I’ll compensate with this piece of paper !”” That’s not fund. Travel away !” And now we’re on the verge of a new conversion of money. We’re on the verge of creating the first completely world-wide, wholly borderless, wholly decentralized, and fully open pattern of fund, one which allows you build applications because this fund is programmable, and you don’t need to ask anyone’s permission to open an application any more than you need to ask permission to launch an application on the Internet.
And the only requirement to have a successful application on The Internet of Money is two interested participates. That is your sell segment and you have an application. And thousands and thousands of applications will flourish. When you push innovation to the edges of the network, when you remove the requirement for dispensation, what happens? Exponential blowup in invention. The applications that could not be built on the old systems of money because they required permission because they required a significantly great market segment, because they required adoption by numerous, in order to be available at all. Now , none of those requirements exist. Anyone in the world can download an application or use even specific features telephone with text messaging and immediately acquire the same superpowers that institutions of banking have today.
And when I say anyone, that’s only scratching the surface. Because ironically enough , not only does Bitcoin and blockchain money not discern margins, it also does not distinguish people. It doesn’t matter if you’re person or persons or a refrigerator, or a self-driving automobile. Thought-out the history of fund owned of currency compelled personhood either as persons or as industry associations of persons in a corporation. Bitcoin can be owned by machines, Bitcoin can be owned by software agents, machines can pay one another and that is not just about financial activity. It’s the basis for market-based security systems. It’s the basis for creating bails of authentication between machines. It’s the basis of brand-new applications that have never been done before Bitcoin and blockchain technology federates the systems of money. Today we have systems of fund for small-minded pays, new systems of fund for large-scale payments. We have systems of fund for pays between someones, we have systems of fund for remittances between companies, we have systems of fund for payments between governments.
Does that be borne in mind of something? That’s how communication used to be before the Internet. We had systems of communication for scenes, systems of communication for notes, systems of communication for short interval and great distances and the Internet came and amalgamated all of those. What The Internet of Money does is, it creates a single network which can do a micro transaction to a giga transaction in seconds, anywhere in the world for any player without permission. But if you exactly look at the application of fund, you’re missing the stage because you can take its own language, the building blocks of this scaffold and use them to construct other languages that transmit price. Tokens, wage details, label patriotism coppers. Today there are over hundreds of thousands of digital monies applying the design motif, the recipe of Bitcoin. Most of them are junk. Some of them are not. And over the next decade, we are going to see tens of thousands and then hundreds of coppers. Some will have financial employ, some will simply be expressions of love, affiliation. They will represent items in the physical world. The title for a home, the limiting key for a automobile that can be transferred from one owned to another and five seconds later, that owner can step into the car and drive away because the car can validate the brand-new better standards of ownership.
We cannot yet dream what applications we’re going to build around this. But one of the interesting things we’re beginning to observe is that money arises out of the social construct of Homo sapiens spontaneously. It even grows in primates. You can teach monkeys money. You can teach dolphins fund. You can teach grays, parrots money. And they will learn how to exchange abstract tokens for food and then use them to build social relationships. They’ll also invent strong-arm theft, beat up the other monkey, take away its pebbles, ingest the bananas. And we see that same happen happen in children. Toddlers invent money in kindergarten, pulley-blocks and rubber bands and Pokemon cards and other little tokens, abstractions of value that they exchanged enhance social bonds, to express patriotism and friendship, to be informed about sharing. Children will be building currencies. Exclusively this time these monies will be world, unforgeable, and scalable on day one.
Few years from now, Maria will be propelling Maria coin in her kindergarten to rival against Joey coin and It won’t really matter to anyone. Until of course, Justin Bieber propels Justin Bieber copper and it happens to surpass world markets capitalization of thirty commonwealths on this planet, and “were all” publish horrified ruling editorials about how the world is going to blaze. What’s happening with this technology is astonishingly deep. And for certainly some of the companies in this room, it’s a little bit frightening. Enlisting has all along been the most innovative sector in the world because there is a carefully considered equilibrium between innovation and the conservative fiduciary tariff that exists in banking, that must exist when you hold other people’s money.
And hitherto with Bitcoin, you don’t restrict other people’s fund. In Bitcoin, I control my money. I have complete and total power over my Bitcoin. It cannot be seized, it cannot be frozen, it cannot be censored, my deals cannot be intercepted, and they cannot be stopped. And I can do so with almost complete obscurity and so can anyone 5 minutes after they download an its implementation and money has changed eternally and sketching has changed forever. The feeling that they are able to being carried out in service industries of fund, in the industries of commerce and preserve the same republican posture that has existed now for centuries ever since shopkeepers in Venice and Amsterdam started problem depository certifications and affording banking services. That is pas. That is go! You cannot operate closed organizations that have borders and expect permission to join at a rate of innovation that is controlled by the most conservative bias within your organization because now you are competing with a technology that permits exponential rise, exponential Invention at the leading edge without dispensation by anyone in the world.
And it’s not about anyone in this room Why? We represent the privileged elite. I can go on to a brokerage account open it up online and be trading on the Tokyo stock market within 12 hours in yen. That is the privilege that I have. One and a half billion people have that advantage. Six billion people can operate mainly in one currency and perhaps have certain basic banking services. Four billion people are greatly underbanked and an surprising two and a half billion people are wholly unbanked. They will leapfrog. They will never have a relationship with a bank. Every single child born today will never have a bank account. They will have a bank app. A bank app that doesn’t give them an account. A bank app that builds them a banker, an international banker in an app. They will not be permitted to open a bank account until they’re 16 years old.
By that time, I hope they will have at least six or more years of experience with digital monies. And I would like to watch them walk into a bank fork to have someone explained to them what three to five business eras represents. It is highly likely the children born today will never get a driving license because they’ll have self-driving cars But they will also never use paper money. Because by the time they get to an age where they really start using fund, there is no paper money. It will seem as anachronistic as a fax machine or horse and buggy seem to be us.
Exponential innovation on a world basis giving access to the other six billion. They have gigantic motive. And this system offerings them a solution. It’s not ready yet. It’s nascent, its complex, It’s impossible to use. For most people. In 1989, I mailed my first email. In order to do so, I had to compile a version of the Unix mail program applying a C compiler and Unix command direction knowledge. I had to set it up on the require pipeline, type out my email and that email was gave across the great Internet in an surprising three days. Exactly 20 year later, my mother repeated that experience with a swipe. Bitcoin today and all of the currencies that are built on that recipe are just at the same stage that the Internet was in 1991. Only now we have the Internet. And so the rate of exponential proliferation has already started. The innovation is growing at an astonishing proportion. I invest every single day full-time trying to keep up with Bitcoin. Just one currency, and it’s almost impossible. Do not underestimate this. Do not listen to the people who tell you that Bitcoin is just for pornographers, terrorists, drug peddler, and gamblers.
Remember that they said the exact same happening about the Internet. And when you give it to two or three billion people, they’re not interested in those happenings. They’re interested in sharing feline videos. And now we have an Internet of a billion cat videos. When you take digital currency mainstream and give it to the four billion people who have been isolated from international finance and commerce, and you give them the opportunity to control their money against the spotted governments and corrupted banks that are stealing from them, you give them the opportunity to control their future, you give them the opportunity to transact with everyone in the world. To own claim on their own property in a amply transferable digital token that is recognized everywhere. Control over finance that cannot be seized frozen or censored. They will buy food, health care, sanitation, education, shelter because that’s what we do. And they will not denied access information and communication technologies. Do not underestimate where this is going. The Internet of Money was propelled on January 3rd, 2009. It’s coming. It’s coming faster than you can imagine. It’s deeper than they are able to fathom. It’s more sophisticated than they are able to immediately understand. It takes years of study simply to understand all of the implications.
And it is a gift to the entire world. A engineering that represents the sixth greatest innovation in information and communication technologies of fund, the most ancient technology of our civilisation. Thank you. Should we do some questions? We’ve got plenty of hour for inquiries. What determines the buying power of the money? How does it stabilize and what’s required to stabilize it, so if I would buy some Bitcoins, who can manipulate the best interests of the that? Mhm, everyone.
The buying power of Bitcoin is determined in exactly the same way that the buying power of the euro, the British sterling, the Japanese yen, or the US Dollar is determined through market forces-out of furnish and request in international liquid markets that operate around the clock. One of the fundamental rights gaps is that bitcoin trading never ceases. Has been exiting continuously for seven years the network never stops. Every ten minutes Bitcoins heart trounces and operations are processed, the exchanges never open. There is no closing price for Bitcoin. It is a rolling average and in that trading a market capitalization of approximately twelve million dollars is now traded internationally. What is twelve billion dollars for a world currency? It’s a guppy, swimming in shark-infested water and every merchant, every whale goes in there and exactly kickings that toll around. So right now its own experience of living on Bitcoin which I have been doing full-time for more than three years is a roller coaster.
It’s an absolute roller coaster. I’ve seen shifts of 20 or 30 percentage in a date and yet, if you look at the longer term direction, capacity goes up, transactions go up, and volatility maintenances declining. And the charm of it is, I can’t sell that to an American. I can’t sell that to a Brit. I don’t need to sell it to an Argentinean. I don’t need to sell it to a Brazilian. I don’t need to sell it to a Venezuelan I went to a meeting and an Argentinian told me I’m not worried about volatility, our currency has volatility like this. Bitcoin has volatility like this. I’d rather be going in that direction. And you don’t need to tell them why.
Their government through people out of airliners not more than 35 years ago for differing. They already know why the separation of heads of state and money is a good mind. And so volatility is relative. Any other issue, come up. Yeah? Let’s get a microphone to you one second. Thanks, a great lecture. Plainly, it chimed a bit like one area of the copper, this is why we also read all these you are familiar with big hacks, and I don’t know, Bitfinex, you know they, I think they stole 40% of the money.
I conceive also this autonomous administration has been hacked and all these things. Can you only manifest a bit on the dark area or of those aspects that might not acquire our full trust into this evolution. Perfectly. The steering wheel was not invented until 30 years after the vehicle was inserted. Why? Because the first vehicles had two leather straps that you pulled left or right to move the car, to steer the car. They employed horse reins to steer vehicles. That’s called skeuomorphic pattern. It represents stopping a shadow of the former past in your new organisation, failing to see the new dimension and repeating the past. Here’s a money that is not centralized where your fund is your fund. Your keys, your fund. Not your keys , not your fund. So, what is the first thing we do with this new system? We build centralized institutional’s of custodial self-control that take other families fund and support it for them. Well, guess what? The entire record of banking, the entire system of regulation and oversight is based on the simple centuries-old recognizing also that when somebody else holds your fund, risks are they’re going to run away with it.
And the entire system of regulation is designed to prevent that and hitherto it still happens all the time. In hedge funds, in banks, in national currencies, all the time. And so of course, if you repeat custodial accounts, exchanges that take other people’s Bitcoin and centralize it It happens again, as bad because there are no oversight and regulations in most of these rooms. The answer is really simple. Stop centralizing the decentralized currency. Stop trying to replicate the banking past in the future of money. And the important thing to realise is that security in Bitcoin is an emergent property that exists because of the decentralization of control and power.
If I want to hack a million clients Bitcoin, And they’re regarding their keys, I have to hack a million clients. If they all give their keys to one person or an organisation, then we’ve got a honeypot. A honeypot that attracts the attention of every hacker on the planet. And notice what’s happened. Over seven years and with a market capitalization of twelve billion dollars, Bitcoin is most important cryptographic deployment in the world, the largest public key infrastructure in the world, the largest protection honeypot in the world and “its not” procure because it doesn’t get attacked.
It is secure because it generates exemption by being attacked all the time, 24 hours a day by the most sophisticated attackers this planet has. And if you in that surrounding set up a centralized custodial exchange utilizing PHP and MySQL and you park a 150 million dollar Honeypot in there, you’re inviting the sharks. Bitcoin banks get hacked, Bitcoin exchanges get hacked, Bitcoin has not been hacked and cannot be hacked because there is no point of ascendancy that you can apply pressure on. It’s completely decentralized. All right, Maybe one more question. Where does the furnish of Bitcoin come from and are you sure the market doesn’t get oversupplied? The furnish of Bitcoin is defined algorithmically based on a geometrically rejecting quantity role, means that, in the beginning every 10 hours, 50 new Bitcoin are made, so every brick, the heartbeat, 10 minutes, made 50 new Bitcoin. This Bitcoin is used as a reinforce in a game theory based protection example that ensures that every transaction is independently validated by completely anonymous performers who have to post electricity as such guarantees of the security work they’ve done and if they succeed in doing the security work confirming deals properly, they deserve as a wage based on a probabilistic return.
That reward, 50 Bitcoin every 10 times. That’s how currency is introduced into the economy. Every four years it gets cut in half. 50 to 25 in November of 2012. And this year in July, this past July, we had our second having event which was celebrated with birthday parties all parts of the world and Bitcoins reward exited from 25 to Bitcoin. As a system, it’s designed to have a monetary policy that is intentionally deflationary and simulates the issuing of precious metals. It get more and more difficult and harder to excavation gold at greater and greater and greater overhead. And Bitcoin is the same. The sentiment being that fewer and fewer is issued over day. If you follow that geometric curve, at some moment, you reach the end. In its first year 2141 Bitcoin is no longer issued. 21 million coins is the asymptotic cap. It will never reach 21 million coppers. That is part of its additional protocol, it is an unchangeable part of the protocol and it is a rule enforced by every system that participates in the Bitcoin network.
It is meant to be sound fund but it’s not the only monetary policy that exists. There are several other currencies that enforce different monetary plans. The opinion is genuinely for Bitcoin to serve as a extremely very solid reserve currency for many other things. What do you have to give to corporations here who are from non-financial institutions about how they should take tactical steps to think about experimenting with the blockchain in terms of storing price? I guess understanding that it’s not just money, understanding that it is a pulpit for trust.
Understanding that it can be used as a historical record of truths that they are able register information that it can be used to create all kinds of tokens that can be exchanged between your clients, your suppliers, your producers, that it can also be used plainly as a money for any cross-border deals import/ exportation acts, remittances based overflows, paying accompanieds and affiliates. All of the points that today are expensive, slow, and difficult become cheap, fast, and easy “if youre using” one of the following options digital currencies. But It’s still early. For now, learning about it. Here’s the one important thing you must understand. You will hear a lot about blockchain and the majority of members of what you been talking about blockchain is not The Internet of Money. It is The Intranet of Money. The Intranet is where you run FrontPage and Outlook and antiquated software in a closed little enclave of your corporate back oceans with stale content and boring apps. And in the end, it’s full of viruses anyway because you can’t keep it secure. Blockchain that is not open, that is not public, that is not borderless that is not open for invention is not what we’re talking about here.
And that’s a really important preeminence. It may be useful if you want to run a clearing home between three banks, perhaps. But it’s not The Internet of Money. Thank you. Thank you so much..